81 So. 3d 1250
Ala.2011Background
- Turquoise appeals a circuit court denial of its motion to alter, amend, or vacate an arbitration award under FAA §11.
- Arbitration governed by FAA and AAA Construction Industry Dispute Resolution Procedures; claimants sought conversion damages for refund of excess 5% from deposits.
- Excess 5% represented 20% deposits; 15% liquidated damages cap applied; Turquoise refunded excess 5% in June 2009.
- Arbitrator awarded damages for conversion; Turquoise sought modification for alleged miscalculation by not crediting the refund; circuit court decision reviewed de novo for legal issues and clearly errored findings of fact.
- Final judgment entered on arbitration award; Turquoise appeals to Baldwin Circuit Court and then to Alabama Supreme Court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §11(a) allows modification for evident miscalculation. | Turquoise—miscalculation, double recovery. | Cooper/Overmyers—only simple mathematical errors allowed. | No, §11(a) limited to mathematical mistakes; double recovery not à simple miscalculation. |
| Whether double recovery constitutes an evident material miscalculation under §11(a). | Double recovery shown by awards equal to no-credit calculation. | Award reflects proper measure with potential credit; no evident face-value error. | Court recognizes double-recovery theory but limits to miscalculations evident on face of award. |
| Whether collateral estoppel barred Turquoise’s FAA §11(a) challenge. | Saad collateral estoppel applies; issue identical. | Appeal of arbitration award is separate action; not prior action for estoppel. | Collateral estoppel not applicable; permissible to appeal arbitration award. |
| Standard of review for FAA §11(a) modifications on appeal. | Questions of law de novo; findings of fact reviewed for clear error. |
Key Cases Cited
- Roebuck Auto Sales, Inc. v. Wallace, 293 Ala. 231 (Ala. 1974) (damages for conversion measured by value plus interest; applies to this dispute)
- Eljer Mfg., Inc. v. Kowin Dev. Corp., 14 F.3d 1250 (7th Cir. 1994) (double recovery can be an evident material miscalculation under §11(a))
- AIG Baker Sterling Heights, LLC v. American Multi-Cinema, Inc., 508 F.3d 995 (11th Cir. 2007) (discusses misinterpretation vs. miscalculation; facial appearance of error required)
- Apex Plumbing Supply, Inc. v. U.S. Supply Co., 142 F.3d 188 (4th Cir. 1998) (limits 11(a) to errors apparent on the face of the award)
- Lee L. Saad Construction Co. v. DPF Architects, P.C., 851 So.2d 507 (Ala. 2002) (collateral estoppel applies across arbitration when identical issues)