Mikelson v. UNITED SERVICES AUTO. ASS'N

• Decision Date: 24 March 2010
• Docket Number: No. 28332.,28332.
• Citation: 227 P.3d 559
• Parties: Mathew S. MIKELSON, Plaintiff-Appellee, v. UNITED SERVICES AUTOMOBILE ASSOCIATION, Defendant-Appellant.
• Court: Hawaii Court of Appeals

227 P.3d 559

Mathew S. MIKELSON, Plaintiff-Appellee, v. UNITED SERVICES AUTOMOBILE ASSOCIATION, Defendant-Appellant.

No. 28332.

Intermediate Court of Appeals of Hawai`i.

March 24, 2010.

Terrance M. Revere, (Motooka Yamamoto & Revere), Honolulu, on the briefs, for Defendant-Appellant.

Alan Van Etten, Tred R. Eyerly, (Damon Key Leong Kupchak Hastert), Honolulu, on the briefs, for Plaintiff-Appellee.

NAKAMURA, C.J., FOLEY and FUJISE, JJ.

Opinion of the Court by FOLEY, J.

Defendant-Appellant United Services Automobile Association (USAA) appeals from the "Order Granting Plaintiff Mathew S. Mikelson's Motion for Order Confirming Arbitration Award" (Order) filed on December 7, 2006 in the Circuit Court of the First Circuit (circuit court).¹

On appeal, USAA contends the circuit court lacked jurisdiction to decide the Motion for Order Confirming Arbitration Award (Motion to Confirm) filed on October 17, 2006 by Plaintiff-Appellee Mathew S. Mikelson (Mikelson) because the motion was moot. Mikelson contends this court lacks appellate jurisdiction to hear this appeal. We disagree with both USAA and Mikelson and affirm.

I.

This case arises out of a January 17, 1999 accident in which Mikelson, while riding his motorcycle, was struck by an automobile. Mikelson was a named insured with his father under a USAA automobile policy. Mikelson suffered bodily injury and sued USAA under the underinsured motorist benefits of the policy. The extensive background facts of the case are set forth in Mikelson v. United Services Automobile Ass'n, 107 Hawai'i 192, 111 P.3d 601 (2005) (Mikelson I), and Mikelson v. United Services Automobile Ass'n, 108 Hawai`i 358, 120 P.3d 257 (2005) (Mikelson II). In Mikelson I, the Hawai'i Supreme Court held that Mikelson was a covered person under an insurance policy issued by USAA. 107 Hawai'i at 201-206, 111 P.3d at 610-615. In Mikelson II, the Hawai'i Supreme Court denied Mikelson's request for attorney's fees for the appeal because the issue of whether Mikelson was entitled to benefits under the insurance policy had yet to be determined by arbitration. 108 Hawai'i at 361, 120 P.3d at 260.

On October 4, 2006, the Arbitrator's Final Award (Arbitration Award) was issued. The Arbitration Award, inter alia, awarded Mikelson $110,236.33 after application of a covered loss deductible. On October 17, 2006, Mikelson filed the Motion to Confirm, asking the circuit court, pursuant to Hawaii Revised Statutes (HRS) § 658A-22 (Supp.2009), to confirm the Arbitration Award. Although Mikelson did not state in his Motion to Confirm whether the Arbitration Award had been satisfied, three days later he filed a "Motion for Order that USAA `Pay Benefits' to Mikelson," to which he attached a copy of a check from USAA dated October 6, 2006 for the full amount of the award.

On October 31, 2006, USAA filed an opposition memorandum to Mikelson's Motion to Confirm. Citing to Wong v. Board of Regents, University of Hawaii, 62 Haw. 391, 616 P.2d 201 (1980), and Lathrop v. Sakatani, 111 Hawai'i 307, 141 P.3d 480 (2006), USAA argued that the circuit court lacked jurisdiction to hear the motion because the court does not have jurisdiction to hear moot issues, an issue is moot when there is no controversy, and no controversy existed in this case because the award was satisfied prior to confirmation of the award. USAA did not oppose the Motion to Confirm based on any grounds stated in HRS §§ 658A-20 (Supp.2009), 658A-23 (Supp.2009), or 658A-24 (Supp.2009).

The circuit court granted the Motion to Confirm on December 7, 2006, and USAA timely appealed.

II.

It is well established that the Hawai'i Supreme Court has "confined judicial review of arbitration awards to the strictest possible limits." Mars Constructors, Inc. v. Tropical Enters., 51 Haw. 332, 335, 460 P.2d 317, 319 (1969). This is because "of the legislative policy encouraging arbitration and thereby discouraging litigation." Gadd v. Kelley, 66 Haw. 431, 441, 667 P.2d 251, 258 (1983) (citing Mars Constructors, 51 Haw. at 336, 460 P.2d at 319). See also Mathewson v. Aloha Airlines, Inc., 82 Hawai'i 57, 69, 919 P.2d 969, 981 (1996). Thus, "review of arbitration awards by the circuit and appellate courts is limited by the provisions of the arbitration statute." Mars Constructors, 51 Haw. at 336, 460 P.2d at 319. See Kalawaia v. AIG Hawai'i Ins. Co., 90 Hawai'i 167, 173, 977 P.2d 175, 181 (1999); Bd. of Directors of AOAO of Tropicana Manor v. Jeffers, 73 Haw. 201, 205-07, 830 P.2d 503, 506-07 (1992) .

Gepaya v. State Farm Mut. Auto. Ins. Co., 94 Hawai'i 362, 365, 14 P.3d 1043, 1046 (2000) (internal brackets and ellipsis omitted). Further, "we review the circuit court's ruling on an arbitration award de novo, but we also are mindful that the circuit court's review of arbitral awards must be extremely narrow and exceedingly deferential." Tatibouet v. Ellsworth, 99 Hawai'i 226, 233, 54 P.3d 397, 404 (2002) (internal brackets, quotation marks, and citations omitted).

United Pub. Workers, AFSCME, Local 646, AFL-CIO v. Dawson Int'l, Inc., 113 Hawai`i 127, 137-38, 149 P.3d 495, 505-06 (2006) (brackets in original omitted).

III.

A. THIS COURT HAS APPELLATE JURISDICTION OVER THIS APPEAL.

Mikelson's claim that this court lacks appellate jurisdiction to hear this case is without merit. An appeal may be taken from an "order confirming or denying confirmation of an award." HRS § 658A-28(a)(1) (Supp. 2009). USAA appeals from the Order, and, therefore, this court has jurisdiction to hear this appeal.

B. THE CIRCUIT COURT DID NOT ERR BY CONFIRMING THE ARBITRATION AWARD.

USAA contends the circuit court lacked jurisdiction over Mikelson's Motion to Confirm because the issue was moot. USAA states that "there was no reason to confirm an award that had already been paid." USAA argues that a controversy or dispute must exist in order to confirm an arbitration award and since there was no controversy, the circuit court lacked jurisdiction because courts do not decide moot cases.

"It is well-established that courts will not consume time deciding abstract propositions of law or moot cases, and have no jurisdiction to do so." Lingle v. Hawai'i Gov't Employees Ass'n, AFSCME, Local 152, AFL-CIO, 107 Hawai'i 178, 187, 111 P.3d 587, 596 (2005) (internal quotation marks, citation, and brackets omitted).

Confirmation of an arbitration award is an "expeditious procedure for reducing or converting the arbitration award to a judgment which can be enforced by judicial writ." Krystoff v. Kalama Land Co., 88 Hawai'i 209, 214, 965 P.2d 142, 147 (App.1998) (quoting State of Md. Cent. Collection Unit v. Gettes, 321 Md. 671, 584 A.2d 689, 696 (1991)).²

"HRS chapter 658A is based on the Uniform Arbitration Act (2000) (RUAA), which was approved by the National Conference of Commissioners on Uniform State Laws (NCCUSL) in 2000." United Pub. Workers, AFSCME, Local 646, AFL-CIO v. City & County of Honolulu (UPW), 119 Hawai`i 201, 210, 194 P.3d 1163, 1172 (App.2008), cert, rejected, 2009 WL 766218 (Hawai'i Feb. 13, 2009). Hawai`i has codified the RUAA as HRS Chapter 658A. UPW, 119 Hawai`i at 202, 194 P.3d at 1164.

HRS § 658A-22 provides:

§ 658A-22 Confirmation of award. After a party to an arbitration proceeding receives notice of an award, the party may make a motion to the court for an order confirming the award at which time the court shall issue a confirming order unless the award is modified or corrected pursuant to section 658A-20 or 658A-24 or is vacated pursuant to section 658A-23.

Section 22 of the RUAA provides:

SECTION 22. CONFIRMATION OF AWARD. After a party to an arbitration proceeding receives notice of an award, the party may make a motion sic to the court for an order confirming the award at which time the court shall issue a confirming order unless the award is modified or corrected pursuant to Section 20 or 24 or is vacated pursuant to Section 23.

The comments to Section 22 of the RUAA provide:

1. The language in Section 22 has been changed to be similar to that in Federal Arbitration Act Section 9 to indicate that a court has jurisdiction at the time a party files a motion to confirm an award unless the award has been changed under Section 20 or vacated, modified or corrected under Section 23 or 24. Although a losing party to an arbitration has 90 days after the arbitrator gives notice of the award to file a motion to vacate under Section 23(b) or to file a motion to modify or correct under Section 24(a), a court need not wait 90 days before taking jurisdiction if the winning party files a motion to confirm under Section 22. Otherwise the losing party would have this period of 90 days in which possibly to dissipate or otherwise dispose of assets necessary to satisfy an arbitration award. If the winning party files a motion to confirm prior to 90 days after the arbitrator gives notice of the award, the losing party can either (1) file a motion to vacate or modify at that time or (2) file a motion to vacate or modify within the 90-day statutory period.

2. The Drafting Committee considered but rejected the language in Federal Arbitration Act Section 9 that limits a motion to confirm an award to a one-year period of time. The consensus of the Drafting Committee was that the general statute of limitations in a State for the filing and execution on a judgment should apply.

Because the language of HRS § 658A-22 is virtually identical to the language of the federal arbitration statute, we may look to federal authority for guidance in the interpretation of HRS § 658A-22. Bateman Constr., Inc. v. Haitsuka Bros., Ltd., 77 Hawai`i 481, 485, 889 P.2d 58, 62 (1995).

In Ottley v. Schwartzberg, 819 F.2d 373 (2d Cir.1987), the United States Court of Appeals for the Second Circuit (Second Circuit) set forth the following facts of the case. After an arbitration award had been issued, Ottley filed a petition in the United States District Court for the Southern District of New York to confirm the...