This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.
Facts
The Plaintiff and Defendant cohabited from March 1989 to October 1990. Following the dissolution of their relationship, the Plaintiff filed a complaint alleging malicious prosecution and seeking an allocation of debts and assets, creation of a constructive trust, and injunctive relief. The Defendant counterclaimed for breach of contract and later added a fraud allegation. The parties agreed to binding arbitration, which resulted in an award favoring the Defendant (paras 2-3).
Procedural History
- District Court, May 18, 1992: Denied the Plaintiff's application to vacate the arbitration award and confirmed the arbitrator's decision (para 5).
Parties' Submissions
- Plaintiff-Appellant: Argued that the arbitration award should be vacated due to insufficient notice of the third arbitration hearing, the arbitrator's refusal to postpone the hearing despite sufficient cause, and the resulting prejudice. The Plaintiff also contended that the arbitrator demonstrated partiality and that the trial court erred in failing to adopt findings of fact and conclusions of law (paras 1, 6, and 13).
- Defendant-Appellee: Asserted that the Plaintiff was not prejudiced by the lack of notice or the arbitrator's refusal to postpone the hearing, as the Plaintiff would have been unable to attend due to a prior military commitment. The Defendant also argued that the Plaintiff's counsel cross-examined witnesses at the hearing and that the arbitrator had already found the Plaintiff's testimony to lack credibility (paras 6 and 9-12).
Legal Issues
- Whether the arbitration award should be vacated due to insufficient notice of the third hearing and the arbitrator's refusal to postpone the hearing upon sufficient cause being shown.
- Whether the arbitrator demonstrated evident partiality, warranting the vacation of the arbitration award.
Disposition
- The Supreme Court of New Mexico reversed the trial court's judgment and remanded the case with instructions to vacate the arbitration award (paras 14-15).
Reasons
Per Baca J. (Ransom C.J. and Montgomery J. concurring):
The Court found that the arbitrator failed to provide the Plaintiff with the required five-day notice of the third arbitration hearing, as mandated by Section 44-7-5(A) of the New Mexico Uniform Arbitration Act. The Plaintiff's inability to attend the hearing due to a prior military commitment constituted sufficient cause for a continuance, and the arbitrator's refusal to grant it was deemed an abuse of discretion (paras 8-10).
The Court rejected the Defendant's argument that the Plaintiff was not prejudiced by the lack of notice. It held that the Plaintiff was deprived of the opportunity to present evidence and be heard at the third hearing, which constituted substantial prejudice under Section 44-7-12(A)(4) (paras 11-12).
The Court also expressed concern over the arbitrator's apparent predisposition to discredit the Plaintiff's testimony, which raised questions about the arbitrator's impartiality. However, the Court limited its holding to the issue of notice and the refusal to postpone the hearing, finding these sufficient to vacate the arbitration award (paras 12-13).