July 19, 2007
JIMMY W. TAKTER AND CHRISTINA TAKTER, PLAINTIFFS-RESPONDENTS,
M. ALI KHAN AND MVN HOMES, INC., DEFENDANTS-APPELLANTS.
On appeal from Superior Court of New Jersey, Law Division, Mercer County, Docket No. L-3924-00.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued March 14, 2007
Before Judges Cuff, Fuentes and Baxter.
In this appeal, we consider defendants M. Ali Khan's and MVN Homes, Inc.'s challenge to an order confirming an arbitration award, and the order denying their motion for reconsideration. The dispute concerns a contract to construct a house and stable in East Windsor. The case was being tried in the Law Division before a jury, when the parties agreed to binding arbitration as a means of expediting the disposition of their claims.
The chosen arbitrator, retired Judge Peter Ciolino, entered an award on behalf of plaintiffs in the amount of $90,987.79, an amount significantly less than the sum sought by plaintiffs. Thereafter, over defendants' objections, the court granted plaintiffs' motion to confirm the award. Defendants now appeal seeking to set aside the arbitration award on the basis of fraud and corruption, and the involvement of an associate from the arbitrator's office. We affirm.
In agreeing to resolve this controversy through binding arbitration, the parties further limited the scope of the arbitration by setting strict guidelines for the presentation of evidence. Specifically, each side was limited to a fifty-page presentation; the documentary evidence was limited to those documents produced during discovery and trial exhibits; no live witnesses were to be presented to the arbitrator; the lawyers were entitled to an oral presentation limited to three hours. We now turn to the legal standards governing our review of this matter. An arbitration award may be vacated only when the reviewing court finds one of any of the following six grounds:
(1) the award was procured by corruption, fraud, or other undue means;
(2) the court finds evident partiality by an arbitrator; corruption by an arbitrator; or misconduct by an arbitrator prejudicing the rights of a party to the arbitration proceeding;
(3) an arbitrator refused to postpone the hearing upon showing of sufficient cause for postponement, refused to consider evidence material to the controversy, or otherwise conducted the hearing contrary to section 15 of this act, so as to substantially prejudice the rights of a party to the arbitration proceeding;
(4) an arbitrator exceeded the arbitrator's powers;
(5) there was no agreement to arbitrate, unless the person participated in the arbitration proceeding without raising the objection pursuant to subsection c. of section 15 of this act not later than the beginning of the arbitration hearing; or
(6) the arbitration was conducted without proper notice of the initiation of an arbitration as required in section 9 of this act so as to substantially prejudice the rights of a party to the arbitration proceeding.
We will not burden this opinion with a lengthy recitation of the evidence presented to the arbitrator. Suffice it to say that the evidence reviewed by the arbitrator was in keeping with the strict guidelines established by the parties themselves.
With the above-cited standards to guide us, we are satisfied that defendants have not established any of the statutory grounds for vacating the arbitration award.
We emphasize that an arbitrator's factual determinations are not reviewable by a court. Ukrainian Nat'l Urban Renewal Corp. v. Joseph L. Muscarelle, Inc., 151 N.J. Super. 386, 396 (App. Div.), certif. denied, 75 N.J. 529 (1977). Furthermore, a court reviewing an arbitrator's decision may not substitute its own judgment for that of the arbitrator, "regardless of the court's view of the correctness of the arbitrator's interpretation." New Jersey Transit Bus Operations, Inc. v. Amalgamated Transit Union, 187 N.J. 546, 554 (2006). Defendants have not presented any evidence of partiality, corruption or misconduct by Judge Ciolino. There has been no showing that the arbitration proceedings were conducted in a corrupt manner. In short, defendants have not met the high statutory burden established by the Legislature. Mere dissatisfaction with the outcome of an arbitration is insufficient to disturb the arbitrator's award. Finally, defendants object to the arbitrator's alleged use of an associate to assist him in performing his duties. Even if this was the case, we discern no legal grounds to question the ultimate viability of the award.
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