{"id":894320,"date":"2018-05-31T10:01:02","date_gmt":"2018-05-31T16:01:02","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=894320"},"modified":"2018-05-31T10:01:02","modified_gmt":"2018-05-31T16:01:02","slug":"matter-first-impression-supreme-court-reverses-trial-court-no-evident-miscalculation-arbitration-award","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/matter-first-impression-supreme-court-reverses-trial-court-no-evident-miscalculation-arbitration-award\/","title":{"rendered":"In a Matter of First Impression, the Supreme Court Reverses Trial Court: No “Evident Miscalculation” in Arbitration Award"},"content":{"rendered":"

Katherine Kohm, Esq. | The Dispute Resolver<\/a> | May 24, 2018<\/p>\n

The Supreme Court of Mississippi in\u00a0D. W. Caldwell, Inc. v. W.G. Yates & Sons Constr. Co.<\/u>, No. 2017-CA-00116-SCT, — So.3d.– (Miss. May 10, 2018) reversed and remanded\u00a0a trial court’s modification of an arbitration award for “evident miscalculation.”\u00a0 The Supreme Court held that “evident miscalculation of figures was not apparent from face of arbitration award, and thus, modification of the award was not warranted.” The Supreme Court remanded for the trial court to confirm the award.<\/p>\n

The underlying dispute concerned a roofing subcontract for a dormitory at Auburn University.\u00a0 After the subcontractor started work, it discovered structural issues that needed to be addressed before roofing could begin.\u00a0 The general contractor\u00a0and the\u00a0subcontractor agreed that\u00a0the subcontractor would\u00a0perform the structural repairs and then complete the roofing.\u00a0 However,\u00a0subcontractor was not paid in full for both the repair change order and the original\u00a0roofing scope.\u00a0 A dispute arose and the parties arbitrated.\u00a0 The arbitrator issued a reasoned award in favor of the subcontractor. The general contractor requested clarification of this award, which the arbitrator denied, and then proceeded to Mississippi trial court on a motion to\u00a0“alter, amend, or vacate the award.” The subcontractor, for its party, moved to confirm the award.<\/p>\n

In Mississippi, like many other states, the grounds justifying an amendment\u00a0or correction to an\u00a0arbitration award are quite limited\u00a0including only: “(a) an\u00a0evident miscalculation of figures<\/u>\u00a0or an evident mistake in the description of any person, thing or property referred to in the award; (b) The arbitrators have awarded upon a matter not submitted to them and the award may be corrected without affecting the merits of the decision upon the issues submitted; or (c) The award is imperfect in a matter of form, not affecting the merits of the controversy.”\u00a0 Miss. Code. Ann. \u00a7 11-15-135.<\/p>\n

The trial court “believing that an\u00a0evident<\/span>\u00a0miscalculation<\/span>\u00a0was present as it related to the retainage amounts” denied\u00a0the subocontractor’s\u00a0motion to confirm the award\u00a0and instead allowed the general contractor to introduce new evidence and witness testimony as to the miscalculation.\u00a0\u00a0The trial court held that\u00a0there was a “facially evident miscalculation” as “the arbitrator had duplicated the labor costs for shingle installation in its award\u2013once under the original subcontract and once under the oral agreement to repair the structural damage [and] amended the award, reducing the total by $104,507.”<\/p>\n

The subcontractor appealed the trial court decision and the Mississippi Supreme Court reversed holding that “arbitrator’s award contained no\u00a0evident<\/span>miscalculations<\/span>\u00a0which would merit modification.” The Court first focused on the extreme narrowness of arbitration review, but also acknowledged that “what amounts to an evident miscalculation” had not previously been decided by this Court.\u00a0 After reviewing cases from other jurisdictions it\u00a0decided on this definition: an “evident (plain, obvious, or clearly understood) miscalculation must be apparent from nothing more than the four corners of the award and the contents of the arbitration record.” Indeed the moving party must be able to show “[w]ithout looking outside the undisputed facts or relying upon testimony from a witness in the trial court”\u00a0that “a different, but correct, calculation could be made.”\u00a0 In the instant\u00a0case, the Court examined “the thirteen-page award for any facially\u00a0evident<\/span>miscalculations<\/span>\u00a0or computational errors. In doing so, [it found] that no such errors [were] present. Looking next to the attorney-written arguments, oral arguments, and agreed-upon record evidence,\u00a0[it] likewise failed to find such errors.”\u00a0 In sum, the court “fail[ed] to find that the arbitrator erroneously duplicated costs of labor and relied on such a duplication in making his award. Nor [did the Court] ascertain that the arbitrator erred by excluding the retainage totals.”<\/p>\n

In reaching this holding, the Mississippi Supreme Court also\u00a0held that the trial court had abused its discretion by\u00a0hearing and crediting witness testimony during the\u00a0award\u00a0modification hearing.\u00a0\u00a0The trial court took additional testimony regarding the cost of the structural repairs in order to determine whether and to what extent there was an\u00a0evident<\/span>\u00a0miscalculation<\/span>\u00a0of figures in the award. The Supreme Court emphasized that “arbitration is meant to supplant litigation, not supplement it” and that the trial court’s error\u00a0“transformed . . .\u00a0the very narrow and limited purpose of its review [impermissibly]\u00a0 imbu[ing] it with the responsibility of the factfinder.”\u00a0Note that\u00a0trial court’s abuse of discretion was not the linchpin of\u00a0its evident\u00a0miscalculation\u00a0decision.<\/p>\n","protected":false},"excerpt":{"rendered":"

Katherine Kohm, Esq. | The Dispute Resolver | May 24, 2018 The Supreme Court of Mississippi in\u00a0D. W. Caldwell, Inc. v. W.G. Yates & Sons Constr. Co., No. 2017-CA-00116-SCT, — So.3d.– (Miss. May 10, 2018) reversed and remanded\u00a0a trial court’s modification of an arbitration award for “evident miscalculation.”\u00a0 The Supreme Court held that “evident miscalculation… Continue reading In a Matter of First Impression, the Supreme Court Reverses Trial Court: No “Evident Miscalculation” in Arbitration Award<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[41],"tags":[9895,42,10482],"class_list":["post-894320","post","type-post","status-publish","format-standard","hentry","category-arbitration","tag-advise-consult","tag-arbitration-2","tag-arbitration-award","entry"],"jetpack_publicize_connections":[],"yoast_head":"\nIn a Matter of First Impression, the Supreme Court Reverses Trial Court: No "Evident Miscalculation" in Arbitration Award - 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