ARBITRATION Review for Fraud / Powers of Arbitrator / Undue Means
Posted by BS - 26/01/11 at 10:01 amRandall v. Conley, 2010 ME 68, 2 A.3d 328, Silver, J.
The merger of two law firms went awry and resulted in arbitration. The arbitrator held that plaintiff owed the defendant money. The arbitrator issued a clarification based upon a miscalculation of the award. In a subsequent order, the arbitrator found that the plaintiff was in contempt of his earlier order and imposed sanctions.
Plaintiff moved to vacate the arbitration award on the basis that it was procured by fraud. His argument was based on the discovery of evidence which he alleged conflicted with evidence introduced at arbitration by defendant.
The Superior Court vacated the contempt order and confirmed the rest of the award. It held that the document submitted by Randall did not compel a finding of fraud and that he had not established that a different outcome would have resulted had the arbitrator seen the new evidence. The court also concluded that the clarification award appropriately corrected a computational error.
The Law Court affirmed the finding that the arbitration award was not procured by fraud. In order to prevail on this statutory ground for vacating an arbitrator’s award, the petitioner must show that the Court was compelled to vacate the award and must demonstrate the fraud by clear and convincing evidence. Because there were non-fraudulent explanations of the new evidence—for example that the critical note was added later to further clarify what had been said at the meeting—plaintiff had not established fraud by clear and convincing evidence, and the record did not therefore compel a finding that the award was procured by fraud. The Law Court also concluded that the clarification order was within the arbitrator’s power to correct a computational error and that the Superior Court acted within its discretion in refusing to hold a hearing on the motion to alter or amend.