Case Title: ALTHOFF, INC., D/B/A ALTHOFF CONSTRUCTION COMPANY, AND WELDON J. ALTHOFF v. IFG LEASING COMPANY

Citation: 

Docket Number: 

State: wyoming

Court: Wyoming Supreme Court

Date: 1985-08-19T00:00:00Z

Document:
ALTHOFF, INC., D/B/A ALTHOFF CONSTRUCTION COMPANY, AND WELDON J. ALTHOFF v. IFG LEASING COMPANY1985 WY 114704 P.2d 1302Case Number: 84-311Decided: 08/19/1985Supreme Court of Wyoming
ALTHOFF, INC., D/B/A 
ALTHOFF CONSTRUCTION COMPANY, AND WELDON J. ALTHOFF, APPELLANTS (PLAINTIFF AND 
THIRD-PARTY DEFENDANT), 

v. 

IFG LEASING COMPANY, 
APPELLEE (DEFENDANT AND THIRD-PARTY PLAINTIFF).

 
 
Appeal from the 
DistrictCourtofParkCounty, John T. Dixon, 
J.

 
 
S.B. Freeman, 
III, of Bormuth, Freeman & Fuller, Cody, for appellants.

David W. 
Edwards, of Edwards and Edwards, Cody, for appellee.

Before THOMAS, C.J., and 
ROSE, ROONEY, BROWN, and CARDINE, JJ.

ROONEY, 
Justice.

[¶1.]     This is an appeal from 
a district court modification of an arbitration award. The appellants, 
plaintiffs below, raise the following issues:

(1) Did the district 
court have authority to modify the award of the arbitrator? 

(2) If so, did the 
district court err by increasing said award to the 
appellee?

[¶2.]     We 
affirm.

[¶3.]     Arbitration resulted 
from an arbitration clause in a lease of two Oshkosh diesel trucks. Western Equipment 
Company approached McKamey Trucking and Concrete in an effort to sell the two 
trucks, but McKamey was financially unable to make the purchase. Sometime 
thereafter, appellant Weldon Althoff, who owned a substantial portion of 
appellant Althoff, Inc. (both hereinafter referred to as "appellant"), purchased 
one-half interest in McKamey. Still later, Western Equipment Company contacted 
McKamey again about a sale of the trucks. Because of McKamey's financial 
condition, a deal was finally struck whereby appellee IFG Leasing Company would 
purchase the trucks from Western Equipment Company, and lease them to appellant. 
Appellant would in turn lease them to McKamey. The present lawsuit arose when, 
after a number of payments had been made, appellant learned that the trucks were 
1977 models, not 1979 models as represented, and that appellee was treating the 
lease as a straight lease and not as a lease-purchase. Consequently, appellant 
stopped making payments and appellee repossessed the trucks and eventually sold 
them at a private sale.

[¶4.]     Appellant brought suit 
in district court against IFG Leasing and Western Equipment Company alleging 
mutual mistake and fraudulent misrepresentation in connection with the lease and 
praying for equitable relief. Appellee-defendant, IFG Leasing Company, denied 
that there was any mutual mistake or fraud, and filed a counterclaim against 
appellant-plaintiff and a cross-claim against defendant Western Equipment 
Company.1 Also in appellee's answer, the 
arbitration clause of the lease was invoked. The district court thus stayed 
further proceedings until arbitration proceedings could be 
completed.

[¶5.]     The arbitrator's award 
read in part as follows:

"The evidence showed that 
Althoff was using the leasing device as an alternative to financing. 
Accordingly, guidance shall be sought to resolve the dispute, in W.S. Section 
34-21-201, et seq. Under W.S. Section 
34-21-293, Althoff has a remedy for any non-conformity of tender. Under W.S. 
Section 34-21-270, IFG Leasing Company has a remedy for the contract 
price.

"Accordingly, IFG Leasing 
is awarded the remaining balance represented by the `accounts receivable 
balance' amounting to $123,909.28, which, after discounted for present value, 
amounts to $93,000.00. Other elements of the claim of IFG Leasing Company are 
denied. 

"Althoff, Inc., d/b/a 
Althoff Construction Company, is entitlted [sic] to an offsetting award of 
$25,000.00 arising from nonconformity of tender.

"The evidence further 
showed that the vehicles were sold for $40,000.00, and this amount should be a 
further offset against the award to IFG Leasing Company. Accordingly, after 
taking into account the offsets, IFG Leasing Company is awarded the amount of 
$28,000.00.

"The counterclaims of 
Althoff, Inc., d/b/a Althoff Construction Company, against IFG Leasing Company 
are rejected, and no award shall be made in favor of Althoff, except to the 
extent noted in the offset mentioned above.

"The fees and expenses of 
the American Arbitration Association shall be borne by IFG Leasing Company and 
paid as directed by the American Arbitration Association.

"The cost of maintaining 
a court reporter shall be borne equally by IFG Leasing Company and Althoff, 
Inc., d/b/a Althoff Construction Company.

"This award is in full 
settlement of all claims submitted to this arbitration."

[¶6.]     Appellee applied to the 
arbitrator for a modification of the award and appellant objected. The 
modification was denied. Appellee then filed a motion with the district court, 
asking for a modification or a correction or a vacation of the award. Appellant 
filed an application to confirm the award, and objection to the motion of 
appellee to modify it.

[¶7.]     As stated in the 
decision letter of the district court:

"Defendant asserts the 
arbitrator made an evident miscalculation of figures in offsetting twice the 
amount realized from the private sale of the vehicles. "The arbitrator found 
Defendant was entitled to `the remaining balance represented by the "accounts 
receivable balance" amounting to $123,909.28', discounted to a present value of 
$93,000.00, less an offset of $25,000.00 to Plaintiff for nonconformity of 
tender, less a further offset of $40,000.00, the amount for which the vehicles 
were sold. It is this last offset for which Defendant complains, asserting that 
the $123,909.28 figure already reflected a credit for the amount realized on the 
sale of the two trucks."

[¶8.]     The district court 
agreed that the $40,000.00 proceeds from the private sale had already been taken 
into account in the $123,909.28 figure, and so increased the arbitrator's award 
by $40,000.00, for a total of $68,000.00. This appeal 
followed.

AUTHORITY TO 
MODIFY

[¶9.]     We have consistently 
expressed the view that arbitrations are favored, Matter of Town of Greybull, Wyo., 560 P.2d 1172 (1977); Riverton Valley 
Electric Association v. Pacific Power and Light Company, 391 P.2d 489 
(1964), and we are reluctant to disturb arbitrators' just solutions to 
controversies, Riverton Valley Electric 
Association v. Pacific Power and Light Company, supra; Oil, Chemical & Atomic Workers Union, 
Local 2-230 v. Great Lakes Carbon Corporation, Wyo., 376 P.2d 640 
(1962).

[¶10.]  However, there are some situations 
wherein a district court must modify an arbitrator's award. Section 1-36-115 of 
the Uniform Arbitration Act, § 1-36-101 et seq., W.S. 1977, states in 
part:

"(a) Upon application 
made within ninety (90) days after delivery of a copy of the award to the 
applicant, the court shall modify or correct the award 
where:

"(i) There was an evident 
miscalculation of figures or an evident mistake in the description of any person 
or property referred to in the award;

"(ii) The arbitrators 
awarded upon a matter not submitted to them and the award may be corrected 
without affecting the merits of the decision upon the issues submitted; 
or

"(iii) The award is 
imperfect in a matter of form, not affecting the merits of the 
controversy.

"(b) If the application 
is granted, the court shall modify and correct the award as to intent and shall 
confirm the award as so modified and corrected. Otherwise the court shall 
confirm the award as made."

[¶11.]  The district court found in its decision 
letter that:

"In this case, the 
asserted miscalculation is `patently clear' to the reviewing court. The figure 
of $123,909.28 is obviously taken from exhibit C-42 and comparing this with the 
figures contained on exhibit C-31, it is equally obvious that credit had already 
been given for the proceeds from the sale of the 
vehicles."

[¶12.]  If there was here an "evident 
miscalculation of figures," the court not only had the authority to modify the 
award, but the statute directs that it "shall" do so.

INCREASE OF 
AWARD

[¶13.]  The second issue as worded by appellant 
is answered by the first issue and vice versa. If there was an "evident 
miscalculation of figures," thus increasing the award, the court had not only 
the authority, but it had the statutory duty to increase the award. Conversely, 
if the court did not err in increasing the award it follows that there was an 
"evident miscalculation of figures," and the court had a duty to modify the 
award.2

[¶14.]  The evidence before the arbitrator 
confirmed the finding of the court that there was a duplication of figures in 
the arbitrator's calculations. The arbitrator found the lease to be a contract 
which was breached by appellant when the promised payments were not made. As 
damages, he awarded appellee the balance remaining to be paid under the lease, 
reduced to present value. He then allowed an offset for nonperformance of 
tender, i.e., for not furnishing the trucks of the vintage promised. Finally, he 
allowed an offset of $40,000.00 for that received by appellee for sale of the 
vehicles. Obviously, the arbitrator treated the agreement as a lease-sale with 
the trucks becoming the property of appellant upon completion of the lease 
term.

[¶15.]  The contest results from a contention by 
appellee that the offset of $40,000.00 was improper inasmuch as the figure used 
by the arbitrator for the balance remaining to be paid under the lease had 
already been reduced by $40,000.00 for sale of the trucks.

[¶16.]  The record on appeal does not contain a 
transcript of the proceedings before the arbitrator which may have reflected an 
explanation of the exhibits. The record does contain Exhibit C-31 reflecting 
payments made on the account with an accounts receivable balance after each 
payment. It reflects the final balance to be $162,732.64. The arbitrator used 
the figure of $123,909.28 as the balance to be paid. This figure is reflected on 
Exhibit C-42, a handwritten computation of figures, including those for sales 
tax and other costs such as repossession expense, accrued service charges, 
default interest, etc. - not allowed by the arbitrator. Accordingly, we cannot 
disagree with that said by the trial court in its opinion letter and quoted 
above.

[¶17.]  We will not concern ourselves with the 
fact that the difference between $162,732.64 and $123,909.28 does not equal 
$40,000.00. The approximately $1,200.00 which the difference is short of 
$40,000.00 may result from sales tax computation or some of the other 
adjustments made by the arbitrator. There is no argument that the offset for 
sale of the vehicles was $40,000.00. We cannot say from the record before us 
that the trial court did not modify the award in the proper 
amount.

[¶18.]  Affirmed.

1 When judgment was 
finally entered between Althoff, Inc. and IFG Leasing, the district court made 
the express determination pursuant to Rule 54(b), W.R.C.P., that the judgment 
was a final one for purposes of appeal. Western Equipment Company's role in this 
lawsuit is thus not dealt with in this appeal.

2 Although the pertinency 
of the argument is not apparent, appellant would have us review this matter as 
if it were an appeal from an administrative action. It is not. The appeal is not 
in connection with an agency action. Section 16-3-101(b), W.S. 1977, reads in 
part:

"(i) `Agency' means any 
authority, bureau, board, commission, department, division, officer or employee 
of the state, a county, city or town or other political subdivision of the 
state, except the governing body of a city or town, the state legislature and 
the judiciary."

The Uniform 
Arbitration Act provides in § 1-36-119(b) that appeals shall be taken in the 
manner of a civil action. Further, as noted, § 1-36-115 limits and specifies the 
extent of the district court's review of an arbitrator's 
award.