Maietta v. Greenfield

Scanlan, J., delivered the opinion of the Court. In this case, we are asked to consider an appeal (a) prematurely taken, (b) which proves in fact to have been unnecessary, and (c) which asks that this Court advise the court below concerning matters upon which the opposing parties are now in agreement. Such a meritless resort to the appellate process must be dismissed under Rule 835 a 2. This we do, for the reasons now stated.

Appellants, Dennis Maietta and Frank Maietta, d/b/a Maietta Trucking Co. and Maietta Trucking Contractors (hereinafter referred to as “Maietta”) are a Pennsylvania partnership. Maietta is a subcontractor working on a low rent public housing project being constructed in Hagerstown known as the Noland Gardens Project. The general contractor for the project is Security Construction Company (hereinafter referred to as “Security.”) In addition to Security, the other appellees are Urban ²⁸⁹ Development Company and Associates, owner of the land on which the project is being constructed, the Equitable Trust Company, and the Hagerstown Housing Authority. Maietta performed certain work on Noland Gardens.

A dispute arose between Maietta and Security. Maietta then filed a mechanic’s lien and thereafter filed a petition to foreclose and enforce the mechanic’s lien against all the appellees in the Circuit Court for Washington County. Security disputed the petition to enforce the lien, claiming that there was a genuine dispute between the parties as to the amount of work, labor and materials performed or furnished by Maietta. Security also alleged that Maietta had breached the contract it had with Security.

On its part, Maietta claimed that Security had breached that contract. In the court below, Security contended that the dispute between the parties was subject to arbitration. Maietta took the position that the chancellor had exclusive jurisdiction to determine all the issues and facts involved in the dispute. After hearing argument and reviewing the contract between the parties, the chancellor entered an order, dated February 1, 1972, directing the parties to proceed by arbitration.

On April 6, 1972, the chancellor filed an opinion and entered an order approving the substitution of a surety bond in the amount of $230,000.00 in place of the mechanic’s lien claimed by the appellants in the amount of $191,155.03. Maietta appealed from both orders. AN ORDER DIRECTING ARBITRATION IS NOT APPEALABLE The contract between Maietta and Security provides in paragraph 24 thereof that: “In the case of dispute in regard to any of the articles of this Contract, if arbitration is provided for in the agreement between the Owner and the Contractor, same shall apply with equal force to this Contract.” ²⁹⁰ Article 7.10.1 of the contract between the owner, Urban Development Company and Associates, and Security states, with exceptions not pertinent here, that “claims, disputes and other matters ins question arising out of, or relating to, this Contract or the breach thereof . . . , shall be decided by arbitration, in accordance with the Construction Arbitration rules of the American Arbitration Association then obtaining unless the parties mutually agree otherwise.” The agreement between the owner" and Security goes on to provide that the agreement to arbitrate shall be specifically enforceable, that the arbitration award shall be final, “and judgment may be entered upon it in accordance with applicable law in any court having jurisdiction thereof.” Ibid. In 1965, Maryland adopted the Uniform Arbitration Act, now found as Article 7 of the Code (1966 Repl.

Vol.). Article 7, § 1 provides as follows: “A written agreement to submit any existing controversy to arbitration or a provision in a written contract to submit to arbitration .any controversy thereafter arising between the parties is valid, enforceable and irrevocable, save upon such grounds as exist at law or in equity for the revocation of any contract. This article does not apply to an arbitration agreement between employers and employees or between their respective representatives unless it is expressly provided in such agreement that this article shall apply.” Article 7, Section 18 specifies those orders entered in connection with an arbitration proceeding from which an appeal may be taken. These are: (1) An order denying an application to compel arbitration made under § 2; (2) an order granting an application to stay arbitration made under § 2 (b); (3) an order confirming or denying confirmation of an award; ²⁹¹ (4) an order modifying or correcting an award; (5) an order vacating an award without directing a rehearing; or (6) a judgment or decree entered pursuant to the provisions of this article.” Paragraph 24 of the contract between Maietta and Security incorporates by reference article 7.10.1 of the agreement between Security and the owner which requires that “all claims, disputes and other matters in question arising out of, or relating to,” the contract “or the breach thereof,” are to “be decided by arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association.” Interpreting paragraph 24 of their contract to require arbitration, the chancellor directed the parties to proceed by arbitration.

We think he was correct in that, but, in any event, his order to arbitrate is a non-appealable, interlocutory order and not one of the orders from which an appeal may be taken by virtue of Article 7, Section 18, supra. In adopting the Uniform Arbitration Act and in limiting the categories of orders thereunder from which an appeal would lie, the General Assembly acted to encourage arbitration where the parties had contracted to arbitrate and limit the appeal of interlocutory orders entered prior to a final judgment of a court confirming, or denying the confirmation of, the arbitrators’ award. At the present time, at least fourteen States, including Maryland, have adopted a Uniform Arbitration Act. All these statutes are very similar in their essential provisions. 1 ²⁹² The issue of the appealability of an order directing parties to arbitrate under a contract calling for arbitration, as provided for in Article 7, Section 1, supra, is one of first impression in this Court.

Although cases on the precise point in other jurisdictions are limited, in at least two of the States which have adopted a Uniform Arbitration Act similar to that in effect in Maryland, it has been held that an order directing arbitration is an interlocutory, nonappealable order. Thus, in Roeder v. Huisk, 105 Ariz. 508 , 467 P. 2d 902 . (1970), the Arizona Supreme Court dismissed an appeal from an order of a trial court directing arbitration under a contract for the construction of a home where the contract contained an arbitration clause. The Arizona Uniform Arbitration Act sets out those orders which are appealable in connection with arbitration proceedings. 2 That provision of the Arizona statute is identical with Article 7, Section 18 of the Maryland Code.

In upholding the dismissal of the appeal in Roeder , the Supreme Court of Arizona said: “We here hold that a party can raise the issue of arbitrability or waiver of right to arbitrate by objecting to the trial court’s confirmation of the arbitration award.” Id. at 904. See also Johnson v. Village of Plymouth, 281 Minn. 232 , 161 N.W.2d 306 (1968), where an order directing arbitration was held nonappealable under identical provisions of the Minnesota Uniform Arbitration Act. The same result was reached in Laufman v. Hall-Mack Co., 215 Cal. App. 2d 87 , 29 Cal.

Rptr. 829 (1963), where it was held that an order directing arbitration under § 1294 of the California Code of Civil Procedure was not appealable. While California does not have an arbitration act precisely identical to the Maryland statute, the provision of the California statute which limits the categories of appeals in arbitration cases is very similar to Article 7, Section 18 of the Maryland Code. 3 In denying the appeal from an