AI Generated Opinion Summaries

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 case involves a multi-claim dispute between partners and related parties in a general partnership, Sycamore Plaza, Ltd., formed to develop and lease land. The dispute arose over allegations that one partner, acting through related entities, used partnership resources for personal financial benefit, including constructing and selling an office building. The partnership agreement contained an arbitration clause, and the parties disagreed on whether certain claims and entities were subject to arbitration (paras 1-4).

Procedural History

• District Court, Bernalillo County: Referred the case to arbitration, allowing the arbitration panel to determine whether the claims and parties were subject to the partnership agreement's arbitration clause (paras 5-6).
• Arbitration Panel: Concluded that all claims were subject to arbitration under the partnership agreement and ruled that neither side was entitled to recovery (para 1).
• District Court, Bernalillo County: Denied the motion to vacate the arbitration award and confirmed the panel's decision (para 1).

Parties' Submissions

• Appellants (Family Partnership and Edward): Argued that they were not parties to the partnership agreement and thus not bound by its arbitration clause. They contended that the arbitration panel exceeded its jurisdiction by addressing their claims (paras 1, 10, 17).
• Appellees (Browns and Brown & Associates): Asserted that the Family Partnership and Edward were effectively bound by the partnership agreement due to their conduct and entanglement with the Revocable Trust. They argued that the arbitration panel had jurisdiction to resolve all claims (paras 10, 14).

Legal Issues

• Was the Family Partnership and Edward bound by the arbitration clause in the partnership agreement?
• Did the district court err in delegating the determination of arbitrability to the arbitration panel?
• Should the arbitration award be vacated due to the panel exceeding its jurisdiction?

Disposition

• The Court of Appeals reversed the district court's judgment confirming the arbitration award and remanded the case for a determination of whether the Family Partnership and Edward were bound by the arbitration clause (para 20).

Reasons

Per Wechsler J. (Fry and Kennedy JJ. concurring):

• The district court failed to make a proper judicial determination on whether the Family Partnership and Edward were bound by the arbitration clause before referring the case to arbitration. This threshold issue is a matter of law for the court, not the arbitrator, to decide (paras 10-13).
• The district court improperly delegated the issue of arbitrability to the arbitration panel, which lacked authority to decide whether the Family Partnership and Edward were bound by the partnership agreement (paras 13-15).
• The arbitration panel's decision, while addressing the factual questions, could not substitute for the district court's obligation to determine the existence of an arbitration agreement binding the parties (paras 17-18).
• The district court abused its discretion in confirming the arbitration award without resolving the threshold issue of arbitrability (para 18).
• The case was remanded for the district court to summarily determine whether the Family Partnership and Edward were bound by the arbitration clause, as required by the New Mexico Uniform Arbitration Act (paras 19-20).