Case Title: Malibu Pools of New Mexico, Inc. v. Harvard

Citation: 637 P.2d 537

Docket Number: 

State: new-mexico

Court: New Mexico Supreme Court

Date: 1981-11-09T00:00:00Z

Document:
637 P.2d 537 (1981) MALIBU POOLS OF NEW MEXICO, INC., Plaintiff-Appellant, v. H. Lee HARVARD and Joanne W. Harvard, Defendants-Appellees. In the Matter of the Arbitration Between Malibu POOLS OF N.M., INC., Claimant-Appellant, v. H. Lee HARVARD and Joanne W. Harvard, Respondents-Appellees. No. 13137. Supreme Court of New Mexico. November 9, 1981. Rehearing Denied December 3, 1981. Bruce E. Pasternack, Albuquerque, for appellant. Hinkle, Cox, Eaton, Coffield & Hensley, Paul M. Bohannon, Roswell, for appellees. RIORDAN, Justice. The plaintiff, Malibu Pools of New Mexico, Inc., (Malibu) performed services and furnished materials in 1976 for construction of a swimming pool and garden room at the residence of defendants, Lee and Joanne Harvard (Harvard). As a result of disputes between the parties over the construction *538 agreement, Harvard terminated progress payments and Malibu discontinued work on the project. Malibu filed a demand for arbitration of the dispute pursuant to the contract between the parties. In response, Harvard claimed that Malibu owed Harvard $36,000 in damages caused by improper construction. After hearing testimony and considering various depositions and exhibits, the panel of arbitrators awarded Harvard $35,976.43 and denied Malibu's claims. Neither party requested that a record or transcript be made of the arbitration hearing. Malibu filed an action in the District Court of Bernalillo County to modify or vacate the arbitration award pursuant to the Uniform Arbitration Act § 44-7-1 through 44-7-22, N.M.S.A. 1978. It charged the arbitration panel with misconduct for failure to hear pertinent material evidence pursuant to § 44-7-12(A)(2) and (4). Harvard filed a separate action to confirm the award. The actions were consolidated for trial by stipulation. The trial court confirmed the arbitration award, holding that Malibu, by waiving its right to a transcript of the hearing waived any right to attack the award. We reverse. The issues we discuss on appeal are: The first question we address is whether Malibu's waiver of a stenographic transcript of the arbitration hearing precludes Malibu from challenging the award based on the panel's refusal to hear material evidence. We hold that it does not. Malibu's appeal for vacating the award is grounded in the Uniform Arbitration Act (Act). Section 44-7-12(A)(4), provides in part: There is no provision in the Act which would preclude an aggrieved party from asserting and proving any grounds set forth in § 44-7-12, where a record of the arbitration proceeding is unavailable. The fact that a record is permitted in the arbitration proceeding cannot be construed to mean that a record is a prerequisite to the appeal provisions afforded by the Act. Depending on the grounds for the appeal, a party who waives a record, of course, may be unable to prove the allegations because of the lack of a transcript. That is not the case here where the parties do not dispute that certain evidence was not presented or considered. We agree with the reasoning of the supreme court of New Jersey in Kearny PBA Local No. 21 v. Town of Kearny, 81 N.J. 208, 405 A.2d 393 (1979), when it said: Kearny, supra at 219-20, 405 A.2d at 399. The second issue to be considered is whether the trial court erred in refusing to *539 hear evidence of the arbitration panel's alleged misconduct for its failure to hear material evidence. Based upon our decision on the waiver issue, we hold that the court erred. There are circumstances contemplated by the Act which require the court to vacate an award where there was misconduct for failure to hear material evidence. The trial court must consider all relevant and material evidence offered by Malibu to prove its contention. The Act specifically provides for vacation of an award when the panel has failed to hear evidence material to the controversy. § 44-7-12(A)(2) and (4). The next issue to be discussed is whether the trial judge erred by leaving the courtroom during an offer of proof. We hold that she did. N.M.R. Evid. 103, N.M.S.A. 1978 provides an opportunity for evidence to be made known to the judge by "offer". 75 Am.Jur.2d Trial § 128 (1974) (footnotes omitted). The same reasoning applies here as did in City of Albuquerque v. Ackerman, 82 N.M. 360, 482 P.2d 63 (1971). Concerning the absence of a trial judge during objections to jury instructions we stated: Id. at 365, 482 P.2d at 68. In this case, the trial judge apparently did not feel that she should have to hear the tendered evidence since she had already decided that Malibu waived its right to appeal and the offered evidence was not material to that decision, but was only for the record. Since we hold that the evidence should have been presented, the judge erred in not remaining for the tender. The case is reversed and remanded to the district court with instructions to conduct a hearing on the claims raised by appellants in attacking the award of the arbitration panel. In the event the district court finds error in the arbitration proceedings and vacates the proceedings, the parties will have to begin with a new panel of arbitrators since two of the prior arbitrators are now judges in the district court. IT IS SO ORDERED. SOSA, Senior Justice, and SCARBOROUGH, District Judge, concur.