Nick-George Ltd. Partnership v. Ames-Ennis, Inc.

Singley, J., delivered the opinion of the Court. This case raises the question of the limitations imposed upon judicial review of an arbitrator’s award under the Maryland Uniform Arbitration Act (the Act), now Maryland Code (1974), Courts and Judicial Proceedings Article § 3-223 and § 3-224. The sections respectively set out conditions upon which an arbitrator’s award may be corrected or modified and the grounds upon which it may be vacated. Because the issues are primarily procedural, we need summarize only the relevant facts.

On 17 May 1971, Nick-George Limited Partnership (Nick-George) entered into a contract with Ames-Ennis, Inc. (Ames-Ennis) under the terms of which Ames-Ennis agreed to construct a 184-unit apartment project in Perryman, Maryland for Nick-George. The contract provided that work was to commence within 30 days and that the project was to be completed by 17 May 1972. Ames-Ennis did not commence work on 16 June 1971, and the work had not been completed by December, 1972, when Nick-George apparently defaulted in payments on the mortgage on the project, allegedly because of the delayed completion. . On 26 December 1972, Nick-George terminated its contract with Ames-Ennis, and in April, 1973, filed with American Arbitration Association, in accordance with the terms of its contract with Ames-Ennis, a demand for arbitration, and asserted a claim of $300,000.00.

No answer was filed by Ames-Ennis. Hearings were held before an arbitrator for six days during June and July, 1973. While the hearings were in progress, Nick-George increased its claim to $615,286.00. At the conclusion of the hearings, Ames-Ennis filed its counterclaim for $197,324.26.

On 18 September 1973, the arbitrator submitted his award to the parties and to American Arbitration Association. The award directed that Nick-George pay $60,855.00 to Ames-Ennis. ³⁸⁷ On 4 December 1973, Nick-George sought the aid of the Circuit Court for Harford County, where it filed a bill of complaint for equitable relief containing two “counts.” 1 Relief was sought in two forms: under the Uniform Declaratory Judgments Act, Code (1957) Art. 31A, now Code (1974), Courts and Judicial Proceedings Article §§ 3-401 through 3-415, a declaration that the award of the arbitrator be declared null and void and of no effect, largely bottomed on the contention that the award failed to resolve the controversies between the parties, and contained no explanation of the manner in which the result was arrived at. The second claim for relief was based on the Act, Code (1957) Art. 7, § 13, now Code (1974), Courts and Judicial Proceedings Article § 3-223, and sought a decree modifying the arbitrator’s award. Ames-Ennis filed a motion ne recipiatur to that part of the bill of complaint which sought declaratory relief, and an answer to that part of the bill which sought a modification of the award.

Bifurcated hearings were held, in which orders were entered granting the motion ne recipiatur and dismissing the portion of the bill which sought a modification of the award under § 3-223 of the Act. An appeal was taken to the Court of Special Appeals. We granted certiorari before the case came on for hearing in that court. We regard the result reached below as eminently correct.

The declaratory action sought to have the award vacated, an action which could have been maintained under the Act, had suit been instituted within 30 days of the delivery of the award. Section 3-224 provides: “§ 3-224. Vacating award. “(a) Petition. — (1) Except as provided in paragraph (2), a petition to vacate the award shall ³⁸⁸ be filed within 30 days after delivery of a copy of the award to the petitioner. “(2) If a petition alleges corruption, fraud, or other undue means it shall be filed within 30 days after the grounds become known or should have been known to the petitioner. “(b) Grounds. — The court shall vacate an award if: “(ll An award was procured by corruption, fraud, or other undue means; “(2) There was evident partiality by an arbitrator appointed as a neutral, corruption in any arbitrator, or misconduct prejudicing the rights of any party; “(3) The arbitrators exceeded their powers; “(4) The arbitrators refused to postpone the hearing upon sufficient cause being shown for the postponement, refused to hear evidence material to the controversy, or otherwise so conducted the hearing, contrary to the provisions of § 3-213, as to prejudice substantially the rights of a party; or “(5) There was no arbitration agreement as described in § 3-206, the issue was not adversely determined in proceedings under § 3-208, and the party did not participate in the arbitration hearing without raising the objection. “(c) When award not to be vacated. — The court shall not vacate the award or refuse to confirm the award on the ground that a court of law or equity could not or would not grant the same relief.” We recall the purple passage which appeared in the opinion written for the Court of Special Appeals by Judge (now Chief Judge) Gilbert in Security Construction Co. v. Maietta, 25 Md. App. 303, 308 , 334 A. 2d