Always Busy Consulting v. Babford & Company
247 A.3d 1033
Pa. Super. Ct.2021Background
- Always Busy Consulting (Appellant) subcontracted Babford & Company (Appellee) for consulting services; the written subcontract contained an arbitration clause that awarded the prevailing party arbitration costs and attorneys’ fees “as part of any arbitration award.”
- Babford performed additional services it claimed were outside the subcontract, invoiced Always Busy, and initiated arbitration after nonpayment; the arbitrator awarded Babford $15,937.50 (no attorneys’ fees at arbitration).
- Always Busy timely filed a petition in the Court of Common Pleas to vacate or modify the arbitration award; the trial court denied the petition and confirmed the award on December 28, 2018.
- Always Busy filed a praecipe and judgment was entered January 31, 2019 “in the amount of $15,937.50, plus interest, costs, and fees.” The trial court later awarded Babford $12,500 in attorneys’ fees for post‑arbitration litigation, reasoning the praecipe amounted to a concession and that the fee clause should cover challenges to the arbitration award.
- On appeal, the Superior Court (after Supreme Court remand) affirmed denial of vacatur (finding Always Busy had assented to arbitration jurisdiction by not objecting during arbitration), but vacated the judgment and the trial court’s post‑arbitration fee award and remanded for correct application of contract and fee law.
Issues
| Issue | Plaintiff's Argument (Always Busy) | Defendant's Argument (Babford) | Held |
|---|---|---|---|
| 1) Whether the arbitrator exceeded authority by deciding an oral contract claim / awarding relief beyond the subcontract’s scope | Arbitrator decided a theory not submitted (oral contract/promissory estoppel) and exceeded his authority | Dispute concerned extra work beyond the written subcontract; Always Busy never objected at arbitration so arbitrator could resolve scope | Court: Affirmed denial to vacate. Always Busy assented to arbitrator jurisdiction by failing to object; courts will not reweigh arbitrator’s legal findings absent process irregularity |
| 2) Whether trial court erred in awarding attorneys’ fees for post‑arbitration litigation | Fee clause applies only to arbitration awards; no statute or exception authorizes fees for trial‑court proceedings; praecipe does not waive defenses to a fees award | Praecipe/entry of judgment including “fees” amounted to waiver; fee clause should be read to permit fee recovery at trial‑court level | Court: Vacated the trial‑court fee award and judgment as to fees and remanded. Rejected adopting praecipe‑waiver theory; instructed trial court to apply proper contract interpretation and fee law |
Key Cases Cited
- Weinmann v. Meehan, 631 A.2d 684 (Pa. Super. 1993) (silence before arbitrator can constitute assent to arbitrator’s jurisdiction)
- Provenzano v. Ohio Valley Gen. Hosp., 121 A.3d 1085 (Pa. Super. 2015) (contract interpretation principles; arbitrators decide issues relating to contract interpretation and arbitration clause scope)
- Neuhard v. Travelers Ins. Co., 831 A.2d 602 (Pa. Super. 2003) (scope/application of an arbitration clause may be an arbitrable issue)
- Weinar v. Lex, 176 A.3d 907 (Pa. Super. 2017) (distinguishing common‑law arbitration governed by the Judicial Code from statutory arbitration)
- Cargill v. Northwestern Nat. Ins. Co. of Milwaukee, Wis., 462 A.2d 833 (Pa. Super. 1983) (arbitrators are final judges of law and fact; courts generally will not vacate for errors of law)
- Gargano v. Terminix Int’l Co., L.P., 784 A.2d 188 (Pa. 2001) (arbitral ‘irregularity’ refers to process, not the award result)