Town of Greybull, Matter of

• Decision Date: 24 February 1977
• Docket Number: No. 4650,4650
• Citation: 560 P.2d 1172
• Parties: In the Matter of the Arbitration Award-TOWN OF GREYBULL and Northern Supply Company. NORTHERN SUPPLY COMPANY, Appellant (Petitioner below), v. TOWN OF GREYBULL, Appellee (Respondent below).
• Court: Wyoming Supreme Court

Page 1172

560 P.2d 1172

In the Matter of the Arbitration Award-TOWN OF GREYBULL and Northern Supply Company.

NORTHERN SUPPLY COMPANY, Appellant (Petitioner below), v. TOWN OF GREYBULL, Appellee (Respondent below).

No. 4650.

Supreme Court of Wyoming.

Feb. 24, 1977.

Graves & Hacker, Cheyenne, for appellant.

Gray P. Hartman, Basin, for appellee.

Before McCLINTOCK, RAPER, THOMAS and ROSE, JJ., and ARMSTRONG, District Judge, Retired.

ROSE, Justice.

This matter is here upon appeal from an order of the district court confirming an arbitration award.

On May 16, 1973, the Town of Greybull entered into contracts for the supply and installation of pipe for a water line project from Shell to Greybull, Wyoming. The town elected to divide the project into two separate contracts, one with Welch Construction Company, the installation contractor, and one with Northern Supply Company, the supply contractor. The contracts called for completion of the work within 125 days, but more than 200 days were required to finish the project.

Special condition 6 of the contract with Northern provided that if liquidated damages are assessed against the installing contractor-for late installation-the supply contractor will be assessed $200 per day for every day's delay which it caused. ¹

Since the contract was not completed within the designated time limitations, the town sought to impose a penalty against Northern and negotiations ensued. In the course of these negotiations Northern requested a clarification of the days for which the town sought to exact a penalty, in response to which request the mayor directed Mr. Livingston, the town's engineer, to prepare a summary and breakdown of the days for which the engineer believed Northern should be penalized. In a letter to the mayor, with copies to Northern and Welch, Livingston concluded that a maximum of 45 days' penalty were assignable to Northern ² and he specified the days for which the penalty should be charged.

Northern disagreed and the question was submitted to arbitration under the appropriate provision of the contract. ³ The arbitrators, after hearing the evidence, decided Northern should be assessed a penalty for 31 1/2 days, some of which were not the exact same days as those identified in the Livingston letter.

The district court upheld the arbitrators and we affirm the decision of the district court.

The appellant designates three contentions for error, which it describes as follows:

'I. The Arbitrators acted in excess of their authority by awarding damages beyond the scope of the parties' stipulated submission.

'II. The arbitrators acted in excess of their authority by deviating from the contractual documents in the determination of their award.

'III. If the arbitrators did intend to limit their award to the periods submitted and to comply with the requisites of the liquidated damages provisions, then the award contains an evident miscalculation and mistake.'

In considering the issues raised by this appeal, we do so in an atmosphere created by the following statutes and rules applicable to arbitration litigation in Wyoming:

Section 1-1048.14, W.S.1957, 1975 Cum.Supp., provides in pertinent part 'When court to vacate award.-(a) Upon application of a party, the court shall vacated an award where:

'(1) The award was procured by corruption, fraud or other undue means;

'(2) There was evident partiality by an arbitrator appointed as a neutral or corruption in any of the arbitrators or misconduct prejudicing the rights of any party;

'(3) The arbitrators exceeded their powers; . . .'

Section 1-1048.15, W.S.1957, 1975 Cum.Supp., provides:

'When court to modify or correct award.-(a) Upon application made within ninety days after delivery of a copy of the award to the applicant, the court shall modify or correct the award where:

'(1) There was an evident miscalculation of figures or an evident mistake in the description of any person, thing or property referred to in the award.

'(2) The arbitrators have awarded upon a matter not submitted to them and the award may be corrected without affecting the merits of the decision upon the issues submitted; or

'(3) The award is imperfect in a matter of form, not affecting the merits of the controversy. . . .'

Arbitration is a method of voluntary settlement of disputes embedded in the public policy of Wyoming and is favored by this court. Riverton Valley Electric Ass'n v. Pacific Power & Light Co., Wyo., 391 P.2d 489.

Courts which favor the arbitration process are reluctant to disturb arbitrators' just solutions to controversies: Oil, Chemical and Atomic Workers Union v. Great Lakes Carbon Corporation, Wyo., 376 P.2d 640; William J. Burns International Detective Agency, Inc. v. New Jersey Guards Union, inc., 64 N.J.Super. 301, 165 A.2d 844; Lentine v. Fundaro, 29 N.Y.2d 382, 328 N.Y.S.2d 418, 278 N.E.2d 633.

We have said that before we will upset a district court's decision upholding an arbitration award, appellant must have discharged its proof burden by showing with clear and convincing evidence that the award

'. . . was obtained by fraud, corruption, behavior beyond the bounds of natural justice, excess of authority, or a manifest mistake of fact or law appearing upon the face of the award . . ..' Riverton Valley v. Pacific Power, supra, at 391 P.2d 500, citing Waisner v. Waisner, 15 Wyo. 420, 89 P. 580, and Oil Chemical & Atomic Workers Union, Local 2-230 v. Great Lakes Carbon Corporation, Wyo., 376 P.2d 640.

FIRST AND THIRD ASSIGNMENTS OF ERROR

Appellant's first and third issues are conditioned upon its assumption that the parties had 'stipulated' that the town's claim would be restricted to the specific days assigned for penalty by the Livingston letter. Therefore, the question of whether there was in fact such a 'stipulation' by which the arbitrators and the parties are bound receives our initial attention.

In framing and arguing the first and third issues, the appellant has 'assumed a fact which is not in evidence.' We do not find the exchanges concerning the Livingston letter to structure a 'stipulation' of the parties which binds either of them in making and resisting their claims, the board in making its award, the trial court in upholding the decision of the arbitrators, or this court in affirming the trial court.

Black's Law Dictionary, Revised Fourth Edition, defines stipulate as: 'Arrange or settle definitely, as an agreement or covenant. Mennen Co. v. Krauss Co., D.C.La., 37 F.Supp. 161, 163.' (Emphasis supplied)

In the same dictionary, supra, under the heading 'stipulation,' we find the following:

'the name given to any agreement made by the attorneys engaged on opposite sides of a cause, (especially if in writing,) regulating any matter incidental to the proceedings or trial, which falls within their jurisdiction. Such, for instance 'An agreement between counsel respecting business before the court. It is not binding unless assented to by the parties or their representatives, and most stipulations are required to be in writing. Holland Banking Co. v. Continental Nat. Bank of Jackson County, Kansas City, Mo., D.C.Mo., 9 F.Supp. 988, 989.' (Emphasis supplied)

are agreements to extend the time for pleading, to take depositions, to waive objections, to admit certain facts, to continue the cause. See Lewis v. Orpheus, 15 F.Cas. (No. 8,330) 492; Southern Colonization Co. v. Howard Cole & Co., 185 Wis. 469, 201 N.W. 817, 819.' (Emphasis supplied)

Mr. Livingston, the town's engineer, testified before the arbitrators that he had written the letter and then went on to respond to further interrogation:

'Q. (By Mr. Davis (Attorney for the Town of Greybull)) Who requested it?

'A. Well, my covering letter says it was made in accordance with a request made by the Town at a meeting with representatives of Northern Supply.

'Q. Did the Town request it, if you know, or did Northern Supply request it?

'A. Northern Supply I believe wanted some sort of a determination as to what the Town felt their (sic) responsibilities were as far as the late delivery of pipe.

'Q. I see.

'A. So, the Town agreed that they (sic) would do that and asked me to make that determination.

'Q. Thank you.

'MR. DAVIS: That is all.

'MR. WILMARTH (Attorney for appellant): I might state for the record-and I apologize, Mr. Livingston was there but Mr. Davis was not-that this was a meeting held January 10th, 1975, at the Town Hall and I asked at that time for them to tell us what period of that seventy-nine days, if any, they thoght we were responsible for.

'I believe that then the Town through the Mayor-and I wish that he was still here-but turned to Mr. Livingston and at some later time asked you to do that as best you could, as I understand it, with the idea that then you would send us a copy of your determination at which time then we would respond point by point to see what could be worked out.' (Emphasis supplied)

The Livingston communication related that his engineering firm had found Northern to have been late in delivery of materials on certain specified days and was, therefore, liable for 45 days of liquidated damages. ⁴

There was no subsequent agreement between the parties prior to the arbitration proceeding to the effect that the days specified by Livingston were the only days for which the town would claim damages. At no time before the hearing did the town agree to be bound in the arbitration process by the representation contained in this letter. Northern did not move the board for an order defining the issues upon which the town relied. We find no dialogue in the agreement that the contents of the Livingston agreement that the contents of the Livingstone letter would be binding upon the parties or the arbitrators. ⁵ In our view, there was no contract, agreement, or stipulation When the time frames contemplated by the Livingston letter were before the board of arbitrators in the context of whether one of the witnesses' testimony...