Case Title: Hardy Constr. Co., Inc. v. Arkansas State Highway and Transp. Dep't

Citation: 

Docket Number: 

State: arkansas

Court: Arkansas Supreme Court

Date: 1996-05-28T00:00:00Z

Document:
HARDY CONSTRUCTION COMPANY, Inc. v. ARKANSAS
STATE HIGHWAY AND TRANSPORTATION DEPARTMENT

96-67                                              ___ S.W.2d ___

                    Supreme Court of Arkansas
                 Opinion delivered May 28, 1996


1.   Courts -- subject-matter jurisdiction cannot be conferred by
     agreement -- parties may agree on court if subject-matter
     jurisdiction is appropriate. -- While it is true that the
     parties may by agreement consent to personal jurisdiction in
     a given court, subject-matter jurisdiction cannot be conferred
     merely by agreement of the parties; if subject-matter
     jurisdiction is appropriate, the parties may agree on the
     appropriate court in which to resolve disputes.

2.   Equity -- specific performance is equitable remedy. --
     Specific performance is an equitable remedy cognizable only in
     equity.

3.   Courts -- chancery court had subject-matter jurisdiction to
     enforce contracts under Uniform Arbitration Act. -- The
     supreme court held that the chancery court had jurisdiction to
     enforce the construction contracts in the present case
     pursuant to the Uniform Arbitration Act.

4.   Appeal & error -- arguments raised for first time on appeal
     not considered -- order affirmed because of lack of sufficient
     information in appellant's abstract. -- Nothing in appellant's
     abstract indicated that Ark. Code Ann.  16-108-203 (1987),
     which authorizes a party to petition the court to appoint one
     or more arbitrators if the agreed method fails or for any
     reason cannot be followed, was argued to the chancery court or
     that a ruling was obtained with respect to that argument;
     appellant's response to the motion to dismiss was not
     abstracted, and there was nothing in the chancery court's
     order otherwise reflecting that  16-108-203 was considered by
     the chancery court; the supreme court has been adamant in
     refusing to consider an argument raised for the first time on
     appeal where that argument has not been first presented to the
     trial court for resolution; while the issue or argument may be
     contained in a pleading or brief in the record, the supreme
     court has stated many times that there are seven justices and
     one record, and the court will not be placed in the position
     of having seven justices scour one record for pertinent
     information; accordingly, the supreme court affirmed the
     chancery court's order because of lack of sufficient
     information in the appellant's abstract to enable it to decide
     the point.

5.   Appeal & error -- showing in abstract that argument has been
     raised and considered below -- absolute prerequisite to
     review. -- Showing the appellate court in the appellant's
     abstract that an argument has been raised and considered by
     the trial court is an absolute prerequisite to review on
     appeal; because the abstract was deficient in that regard, the
     supreme court affirmed the chancery court's order.


     Appeal from Pulaski Chancery Court; Robin L. Mays, Chancellor;
affirmed.
     Rose Law Firm, by: John A. Davis III, for appellant.
     Robert L. Wilson, Chief Counsel, Mark J. Whitmore, and
Lawrence W. Jackson, for appellee.

     Robert L. Brown, Justice.Associate Justice Robert L. Brown
May 28, 1996   *ADVREP*SC7*






HARDY CONSTRUCTION COMPANY,
INC.,
                    APPELLANT,

V.

ARKANSAS STATE HIGHWAY AND
TRANSPORTATION DEPARTMENT,
                     APPELLEE,

96-67




APPEAL FROM THE PULASKI COUNTY
CHANCERY COURT,
NO. 95-4780,
HON. ROBIN L. MAYS, JUDGE,




AFFIRMED.






     Appellant Hardy Construction Company, Inc., appeals the
chancery court's dismissal of its petition for the appointment of
an arbitrator and raises four points for reversal: (1) the chancery
court was required by statute to appoint an arbitrator; (2) the
arbitrators decide procedural matters, not the courts; (3) the
chancery court has jurisdiction to enforce the arbitration clauses
at issue; and (4) sovereign immunity is no defense to the petition
by Hardy Construction.  We agree with Hardy Construction that the
chancery court had subject-matter jurisdiction, but we affirm the
decision of that court because of the insufficiency of the
abstract.
     In 1987, Hardy Construction entered into a contract with
appellee Arkansas State Highway and Transportation Department to
construct a project designated as Missouri Street overpass in West
Memphis.  In 1989, the same parties contracted for Hardy
Construction to construct a second project, also in West Memphis,
designated as the West Memphis Interchange at Interstate Highway
55.  Both contracts provided that any disputes would be settled by
arbitration.
     The two contracts provided with respect to arbitration that
each party would appoint a member to serve on the arbitration
panel.  Those two arbitrators would then select a third member. 
The provision further states:
          If such arbitrators are unable to agree upon the
     third member of the Board of Arbitration within ten (10)
     calendar days after their appointment, application may be
     made by either party to the Chancery Court of Pulaski
     County within ten (10) calendar days for such purpose,
     and the court shall, on or before ten (10) calendar days
     thereafter[,] appoint a disinterested party to serve as
     the third member of said Board of Arbitration.
The contracts further provided that prefatory to arbitration any
disputes must be submitted to the resident engineer and, if
unsuccessful, then appealed to the Chief Engineer of the Highway
Department for final decision.  Within 20 days of an unfavorable
decision, a party could request arbitration.  Thus, according to
the contracts, the party requesting arbitration first had to
exhaust all remedies within the Highway Department.
     Disputes arose over the final estimates of compensation due
Hardy Construction on both projects.  On June 21, 1995, Hardy
Construction gave notice of arbitration and designated its
arbitrator for the arbitration process.  On August 4, 1995, Hardy
Construction filed its Petition for Appointment of Arbitrator.  In
that petition, Hardy Construction asserted that the Highway
Department had refused to select its arbitrator and was frustrating
the arbitration process under both contracts.  Hardy Construction
further prayed that the chancery court appoint the third arbitrator
in accordance with the contracts so as to move the process along.
     On August 28, 1995, the Highway Department moved to dismiss
the petition in separate motions for each job.  (Both motions are
substantially the same and are treated as one for purposes of this
opinion.)  The Department urged in its motion that the petition
failed to show that the chancery court had jurisdiction over the
subject matter and further that Hardy Construction had failed to
allege that it had exhausted administrative remedies under the
contracts by submitting the dispute to the Department's engineers. 
Finally, the Department cited sovereign immunity as grounds for
dismissal.  On September 5, 1995, Hardy Construction amended its
petition to add a paragraph to state "that all conditions precedent
have been performed ...."  On October 16, 1995, the chancery court
concluded in part:
     Plaintiff has appointed an arbitrator; however, the
     defendant has not appointed an arbitrator, because it
     contends plaintiff has not followed the administrative
     procedures under the contract.  Therefore, there is no
     situation where the two arbitrators appointed by the
     parties are unable to agree on a third arbitrator, and,
     under the terms of the contract, that is the only
     provision for court intervention.
          Plaintiff amended its petition on September 5, 1995;
     however, it still does not request any relief in this
     court that is cognizable in equity.  It is simply trying
     to get this court to appoint a third arbitrator, and the
     provisions for that contingency have not occurred.  Since
     plaintiff is asking this court to perform a duty that is
     not provided for in the contract, it is attempting to
     modify the terms of the arbitration provisions.  At the
     hearing, plaintiff contended that it was asking for
     specific performance; however, its pleadings have not
     been amended, nor have any additional parties been named. 
     It is axiomatic that the State cannot "be made a
     defendant in any of her courts."  Article 5, Section 20,
     Constitution of Arkansas.
The chancery court ordered that the petition be dismissed under
Ark. R. Civ. P. 12(b)(6).

                         I. Jurisdiction
     The issue of subject-matter jurisdiction raised by the Highway
Department is paramount and must be addressed first.  Under the
Uniform Arbitration Act, codified at Ark. Code Ann.  16-108-201 et
seq. (1987), the following section is found:
          The term "court" means any circuit or chancery court
     of this state.  The making of an agreement described in
      16-108-201 providing for arbitration in this state
     confers jurisdiction on the court to enforce the
     agreement under this subchapter and to enter judgment on
     an award thereunder.
Ark. Code Ann.  16-108-217 (1987).  The contract provision set
forth above in this opinion alludes to jurisdiction in Pulaski
County Chancery Court.  While it is true that the parties may by
agreement consent to personal jurisdiction in a given court,
subject-matter jurisdiction cannot be conferred merely by agreement
of the parties.  See, e.g., Flemens v. Harris, 319 Ark. 659, 893 S.W.2d 783 (1995); Arkansas Dep't of Human Servs v. Estate of
Hogan, 314 Ark. 19,