On appeal from Superior Court of New Jersey, Chancery Division, General Equity Part, Passaic County.
Before Judges D'Annunzio, A.a. Rodr¡guez and Coburn.
The opinion of the court was delivered by: Coburn, J.A.D.
Argued September 17, 1997
This public-sector arbitration case is governed by the Arbitration Act, N.J.S.A. 2A:24-1 to -11 (subsequently referred to as the "Arbitration Act" or "the Act"). We are primarily concerned with an important procedural issue arising under the Act which has been discussed by the Supreme Court but not yet definitively resolved. Under the Act, the losing party must institute a summary action to vacate the arbitration award within three months of its delivery. Is a prevailing party seeking judicial confirmation of the award similarly bound? We hold that the three-month limitation for obtaining judgment applies equally to both sides.
The case resulted from a dispute between the parties respecting the defendant's decision to employ a special police officer to work regular shifts in the police department. The plaintiff, Policeman's Benevolent Association, Local 292, claimed the defendant's conduct violated its collective bargaining agreement. The defendant, Borough of North Haledon, contended that N.J.S.A. 40A:14-118 and -122 authorized the action taken to meet an emergency. A grievance was filed and was ultimately resolved in plaintiff's favor by the arbitrator. The award entitled the police officers of the Borough to receive overtime pay totaling $8,363.08.The arbitration was conducted pursuant to the New Jersey Employer-Employee Relations Act, N.J.S.A. 34:13A-1 to -29, under the supervision of the Public Employment Relations Commission ("PERC"). N.J.S.A. 34:13A-5.2 provides, in part: This commission [PERC]
shall make policy and establish rules and regulations concerning employer-employee relations in public employment relating to dispute settlement, grievance procedures and administration including enforcement of statutory provisions concerning representative elections and related matters and to implement fully all the provisions of this act.
The collective bargaining agreement contains the following provision regarding arbitration:
"If no satisfactory resolution of the grievance is reached at STEP TWO, the grievant shall have twenty (20) calendar days within which to request arbitration by the Public Employment Relations Commission by filing a request for Submission of a Panel of Arbitrators, pursuant to the rules of PERC. The decision of the Arbitrator shall be final and binding upon the parties. The expense of such arbitration shall be borne equally by the parties." [Emphasis added.]
The arbitrator's decision recites, "Since the parties were unable to resolve the grievance, it came before me for final and binding resolution pursuant to the parties' Collective Bargaining Agreement and in accordance with the rules of the Public Employment Relations Commission." [Emphasis added.] More than three months after the arbitrator delivered the award, the plaintiff brought this action in the Chancery Division seeking confirmation of the award. The complaint asserted, "The jurisdiction of this court is invoked pursuant to New Jersey's common law cause of action for confirmation of an arbitration award." The defendant filed an answer which included as an affirmative defense the assertion, "The application for confirmation is untimely pursuant to N.J.S.A. 2A:24-7." The defendant also asserted by way of affirmative defense and counterclaim that the award violated the law. The plaintiff responded with a motion to dismiss the defendant's pleadings and to confirm the award. The trial Judge did not address the merits of defendant's position under N.J.S.A. 40A:14-118 and -122. Instead, the Judge ruled, as expressly requested by plaintiff, that confirmation of the award was required because the defendant had not brought an action to vacate within the three-month period set forth in the Arbitration Act. Plaintiff maintained the same position regarding the applicability of the Act in its appellate brief. Defendant appeals. We affirm the judgment refusing to vacate the arbitration award. However, we reverse the judgment confirming that award.
We begin our analysis by observing that common-law arbitration may no longer exist in New Jersey. For the contrary position, plaintiff relies on this statement in Heffner v. Jacobson, 100 N.J. 550 (1985):
"Since the enactment of the Arbitration Act, New Jersey courts have recognized the continuing existence of common-law arbitration. That Conclusion comports with the majority view elsewhere that arbitration statutes have not abolished common-law arbitration." [Id. at 554 (citations omitted).]
However, in Perini Corp. v. Greate Bay Hotel & Casino, Inc., 129 N.J. 479 (1992), the plurality opinion treated the arbitration as arising under the Arbitration Act without any indication that the parties had so agreed. Id. at 490-91. Chief Justice Wilentz expressly addressed this issue in his Concurring opinion. He said:
"Arbitration in New Jersey is governed by statute. While our precedents have, I believe, disregarded that statute, it is time we return to it. It pronounces the correct rule." [Id. at 548.]
In In re Arbitration Between Tretina Printing, Inc. v. Fitzpatrick & Associates, Inc., 135 N.J. 349, 356-58 (1994), the Supreme Court decided to reject the plurality opinion in Perini with respect to the scope of judicial review in private-contract arbitration and adopt instead the views expressed on this point by the Chief Justice in his Concurring Perini opinion. However, it may be that in taking that course, the Court was not endorsing the Chief Justice's view that all arbitration in New ...