Defendant, Maryland Casualty Company, appeals the district court’s summary judg
The arbitration grew out of a claim by Ricardo Lozano, who received substantial injuries in an automobile accident, under the provisions of his uninsured motorist policy with Maryland Casualty Company. Under the plan of arbitration, each party named an arbitrator, and those two were to select a third, so-called “neutral” arbitrator. After plaintiff’s three nominations were rejected by Maryland Casualty, its arbitrator nominated three persons. From this list, plaintiff’s arbitrator accepted Gene Kubicki, provided he or his firm was neither representing nor planning to represent Maryland Casualty Company. After a five-day arbitration proceeding, the panel issued an award of $850,000. This action was brought in the district court to confirm that award.
Maryland Casualty argues the award should not have been confirmed on summary judgment because the neutral arbitrator, Gene Kubicki, breached a duty to disclose certain business dealings which shows “evident partiality” on his part within the meaning of Fla.Stat.Ann. § 682.13(1)(b).
See also Commonwealth Coating Corp. v. Continental Cas. Co.,
An affirmative duty is imposed on arbitrators to disclose “any dealings that might create an impression of possible bias.”
Commonwealth Coating,
682.13. Vacating an award
(1) Upon application of a party, the court shall vacate an award when:
(b) There is evident partiality by an arbitrator appointed as a neutral or corruption in any of the arbitrators or umpire or misconduct prejudicing the rights of any party.
Fla.Stat.Ann. § 682.13(l)(b).
Kubicki was an investor in two real estate limited partnerships in which Lozano’s designated arbitrator was also a limited partner. The general partner of both partnerships had previously been a law partner with plaintiff’s attorney and his designated arbitrator. The district court stated:
The record herein indicates that Post [Lo-zano’s designated arbitrator] and Kubicki had each invested in a real estate transaction which was controlled by a third party. Their only obligation was to furnish money in accordance with the terms of the limited partnership agreement. There was nothing that one could do to curry favor with the other. Except for the size of the transaction and the number of investors, this is no different than two individuals buying the same issue of corporate stock or investing in the same mutual fund. The court finds nothing in this relationship which would be the basis for a disclosure by either Post or Kubicki. Nor is the fact that William Alper was the general partner a significant fact. Alper was once a partner with Anderson and Post but this relationship terminated some eleven years before the award. The defendant’s claim to set aside the award based upon the facts appearing in this record are so attenuated that it forms no basis for relief under Fla.Stat. § 682.13. The court has carefully examined the record in this cause to determine if there is any evidence of partiality or improper conduct and has found none.
Nor is there merit to Maryland Casualty’s argument that the limited partnership in which both plaintiff's designated arbitrator and counsel for plaintiff were investors requires vacation of the arbitration award on the grounds of the former’s evident partiality. An arbitrator appointed by a party is a partisan only one step removed from the controversy and need not be impartial.
Lee v. Marcus,
Kubicki’s failure to disclose his law firm’s representation of clients who were adversaries of Maryland Casualty in two Dade County circuit court cases does not require vacation of the award. A district court in this Circuit vacated an arbitration award on such a ground.
See Continental Ins. Co. v. Williams
[available on WEST-LAW,
The award was not invalid as a matter of law, just because it did not address the seatbelt defense.
See Ins. Co. of N.A. v. Pasakamis,
Maryland Casualty’s next three arguments overlap considerably. Maryland Casualty contends that material questions of fact precluded entry of summary judgment for Lozano; that the district court improperly limited discovery requests into the identities and interests of the investors in the limited partnerships; and that the arbitration award could have been vacated on the grounds of corruption on the part of either Post or Kubicki had these discovery requests been granted. Corruption is a
The district court properly denied Maryland Casualty’s discovery request for two reasons. First, the purpose of discovery is to provide a mechanism for making relevant information available to the litigants. Fed.R.Civ.P. 26 advisory committee notes. The trial court reviewed the partnership documents
in camera
to determine if there was any information relevant to Maryland Casualty, because the district judge was of the opinion that the other investors, non-parties to this action, should not have their name and investments “spread around.” There was no abuse of discretion in denying Maryland Casualty’s discovery requests after making this
in camera
inspection.
Commercial Union Ins. Co. v. Westrope,
Second, that arbitrators appoint each other to panels does not
per se
manifest “evident partiality or corruption.”
Andros Compania Maritima, S.A. v. Marc Rich & Co., A.G.,
The award of attorney’s fees was proper. The district court stated that:
Counsel for Plaintiff reasonably expended 73 hours in prosecuting the Motion to Confirm the Arbitration Award. The witness for each party testified that a lodestar multiplier of 1.5 was appropriate, and I so find. A fee of $200.00 per hour is reasonable, taking into account all of the appropriate factors.
These findings satisfy
Kreager v. Solomon & Flanagan, P.A.,
AFFIRMED.
