506 P.3d 310
Mont.2022Background
- Sutey Oil (plaintiff) supplied fuel to Monroe’s High Country Travel Plaza under an Account Agreement; Monroe paid via daily credit-card proceeds and occasional EFTs. Monroe failed to pay for multiple summer 2014 deliveries.
- Sutey sued; after years of litigation the parties agreed to binding arbitration in 2018; a two-day hearing occurred in August 2020.
- The arbitrator accepted Sutey’s “Master Report,” found five unpaid 2014 invoices totaling $220,750.43, rejected Sutey’s claim for prompt-pay reimbursement and compound interest, and awarded simple interest at 18%, yielding a total judgment of $472,333.34 as of Oct. 27, 2020.
- Monroe promptly requested a clarification, asserting the Master Report included two undisputed credits ($33,892.93 and $20,025.04) that the arbitrator apparently did not deduct; Sutey moved to confirm the award the next day and the district court entered judgment and postjudgment interest.
- Monroe moved to vacate/modify under § 27-5-313(1)(a) ("evident miscalculation"); the district court denied relief, construing its review narrowly and declining to consider the arbitration record; it also denied Sutey’s request for attorney fees.
- The Montana Supreme Court reversed the denial of Monroe’s motion and remanded for the district court to submit the matter to the arbitrator for clarification under § 27-5-217, but affirmed denial of Sutey’s fee request.
Issues
| Issue | Plaintiff's Argument (Sutey) | Defendant's Argument (Monroe) | Held |
|---|---|---|---|
| Whether the district court properly denied modification/correction of the arbitration award for an "evident miscalculation of figures" under § 27-5-313(1)(a) | The award reflects the arbitrator’s factfinding and rejection of credits; the $220,750.43 figure is not a math error but a merits-based determination | The Master Report (adopted by the arbitrator) shows two undisputed credits that were not subtracted, producing an obvious arithmetic error on the face of the award/arbitration record | Reversed and remanded: court erred by applying too narrow "face of the award only" standard; matter must be submitted to the arbitrator for clarification under § 27-5-217 (clarification/correction allowed where miscalculation appears on award or in arbitration record) |
| Whether Sutey is entitled to attorney fees for Monroe’s post-award challenge as an unreasonable/vexatious multiplication of proceedings | Monroe’s challenge was vexatious and caused costly delay; fees should be awarded | Monroe’s challenge was timely and partially justified by Sutey’s early confirmation; fee award unwarranted | Affirmed denial of fees: district court did not abuse discretion in refusing fees |
Key Cases Cited
- Tedesco v. Home Sav. Bancorp, Inc., 389 Mont. 468, 407 P.3d 289 (Mont. 2017) (describing narrow judicial review under Montana’s UAA)
- Paulson v. Flathead Conservation Dist., 321 Mont. 364, 91 P.3d 569 (Mont. 2004) (UAA does not permit merits review of arbitration awards)
- Colstrip Energy L.P. v. N.W. Corp., 360 Mont. 298, 253 P.3d 870 (Mont. 2011) (court may only confirm, vacate, modify, or correct under statutory grounds)
- Dick Anderson Constr., Inc. v. Monroe Constr. Co., LLC, 353 Mont. 534, 221 P.3d 675 (Mont. 2009) (distinguishing arbitrator correction under § 27-5-217 and judicial correction under § 27-5-313)
- Severtson v. Williams Constr. Co., 220 Cal. Rptr. 400 (Cal. Ct. App. 1985) (an "evident miscalculation" must appear on the face of the award or be readily apparent from the arbitration record)
- Prestige Ford v. Ford Dealer Computer Servs., 324 F.3d 391 (5th Cir. 2003) (incorrect arithmetic correction allowed where the arbitration record shows an unambiguous mistake relied on by arbitrator)
- D.W. Caldwell, Inc. v. W.G. Yates & Sons Constr. Co., 242 So. 3d 92 (Miss. 2018) (evident miscalculation must be apparent from the four corners of the award and arbitration record)
- Riha v. Smulcer, 843 S.W.2d 289 (Tex. App. 1992) (distinguishing a clear mathematical error from cases where arbitrator’s reasoning leaves open whether credits were applied)
