Opinion ID: 199116
Heading Depth: 2
Heading Rank: 2

Heading: Timeliness of Bull's Application to Vacate

Text: 28 Hutson argues that Bull's application to vacate the Modified Award was untimely because it was not filed within Massachusetts' 30-day filing period for applications to vacate arbitral awards. Mass. Gen. Laws ch. 251, § 12(b). Hutson's contention is that the filing period is jurisdictional and therefore unwaivable. There is contrary case law that filing periods are akin to statutes of limitations, which are routinely subject to waiver when parties fail to raise them, Cf. Zipes v. Trans World Airlines, Inc., 455 U.S. 385, 393 (1982) (filing timely charge within EEOC filing period like a statute of limitations, subject to waiver, estoppel, and equitable tolling), and we have referred to the FAA filing period as a limitations period, see Fradella v. Petricca, 183 F.3d 17, 19 (1st Cir. 1999). The question is also raised of whether the Massachusetts or federal filing period applies in this case. 29 But Hutson's argument is an afterthought. It was not raised before the district court and so it is waived. 30 C. The District Court's Order Vacating the Arbitrator's Award and Remanding to a New Arbitrator 31 There are bifurcated standards of review. We review the district court's ruling on an arbitration award de novo, but we also are mindful that the district court's review of arbitral awards must be extremely narrow and exceedingly deferential. Wheelabrator Envirotech Operating Services Inc. v. Massachusetts Laborers Dist. Council Local 1144, 88 F.3d 40, 43 (1st Cir. 1996). Indeed, [a]rbitral awards are nearly impervious to judicial oversight. Teamsters Local Union No. 42 v. Supervalu, Inc., 212 F.3d 59, 61 (1st Cir. 2000). A court's review of an arbitration award is highly deferential because the parties have contracted to have disputes settled by an arbitrator and thus, it is the arbitrator's view of the facts and of the meaning of the contract that they have agreed to accept. United Paperworkers Int'l Union v. Misco, Inc., 484 U.S. 29, 37-38 (1987). While the arbitrator's award must draw its essence from the contract, as long as the arbitrator is even arguably construing or applying the contract and acting within the scope of his authority, that a court is convinced he committed serious error does not suffice to overturn his decision. Id. at 38. 32 Courts do retain limited authority to vacate an arbitrator's award. Section 10 of the FAA lists the circumstances in which a court has the authority to vacate an award, including certain types of misconduct by the arbitrator or where the arbitrator exceeded [his] powers. 9 U.S.C. § 10(a)(4). To determine whether an arbitrator has exceeded his authority under § 10, however, courts do not sit to hear claims of factual or legal error by an arbitrator as an appellate court does in reviewing decisions of lower courts, United Paperworkers Int'l, 484 U.S. at 38, and [e]ven where such error is painfully clear, courts are not authorized to reconsider the merits of arbitration awards, Advest, Inc. v. McCarthy, 914 F.2d 6, 8 (1st Cir. 1990) (internal quotation marks omitted). 33 Beyond the specific grounds enumerated in § 10, courts retain a very limited power to review arbitration awards. Id. Essentially, arbitral awards are subject to review where an award is contrary to the plain language of the [contract] and instances where it is clear from the record that the arbitrator recognized the applicable law -- and then ignored it. Id. at 9. In the parlance of this and other circuits, a reviewing court may vacate an arbitral award if it was made in manifest disregard of the law. See id. The district court's order in this case vacating the Modified Phase 1 Award is based on its finding that the arbitrator exceeded his authority, see 9 U.S.C. § 10(a)(4), and ignored the law, see Advest, 914 F.2d at 9. 34 The arbitral award had two essential components: a finding that, for various reasons, there was no time-bar to the arbitration and a finding as to the amount of commissions owed. Bull has not challenged the commissions portion of the award in this appeal. 35 The sole issue for our review, therefore, is the district court's rejection of the arbitrator's conclusion that Hutson's demand for arbitration was timely. Bull contends that Hutson was bound by the procedural requirements of AAA Commercial Arbitration Rule 6, which requires that a claimant's written notice of its intention to arbitrate shall contain a statement setting forth the nature of the dispute, the amount involved, if any, the remedy sought, and the hearing locale requested and that the claimant shall file at any regional office of the AAA three copies of the notice and three copies of the arbitration provisions of the contract. Bull asserts that Hutson's claims are barred because he failed to file three copies of his 1991 requests with the American Arbitration Association and failed to specify the locale requested. Thus, Bull says, only the 1995 claim is operable, and that claim was too late. 36 In his Modified Phase 1 Award, the arbitrator found that the claim for arbitration was not untimely. That conclusion must be upheld unless it was made in manifest disregard of the law or we are convinced that the arbitrator exceeded his authority. Neither of these conditions exist. 37 The arbitrator referred to the contract as one of adhesion but, of course, even a contract of adhesion is enforced unless unconscionable or unfair. See Lechmere Tire & Sales Co. v. Burwick, 277 N.E.2d 503, 506 & n.3 (Mass. 1972) (adhesion contracts generally enforceable unless unconscionable, offend public policy, or shown to be unfair in the particular circumstances), cited in Chase Commercial Corp. v. Owen, 588 N.E.2d 705, 708 (Mass. App. Ct. 1992). We think, however, that what the arbitrator rather clearly meant is that effective notice was given to the company even if not in precisely the formal terms that were specified in the contract; that the contract was drafted by the company and the cross-reference to the arbitration rules was not as informative as it should have been; and that in substance the company got the gist of what it had bargained for and that was enough to satisfy the contract. Under Massachusetts law, the governing law here, contracts of adhesion are construed strictly against the drafter and the risks of ambiguity fall on the drafter. See 17 R. Bishop, Massachusetts Practice, § 2.2, at 15 (4th ed. 1997). After all, the interpretation by the Hutsons, lay people, that they were demanding arbitration by sending letters to the company asking for arbitration is an eminently sensible one. 7 38 The magistrate judge also incorrectly concluded that the arbitrator had exceeded his authority. The parties' stipulation expressly set forth the issues to be decided -- timeliness and compensation due -- authorizing the arbitrator to interpret the contract's time-limitation provision. 8 The arbitrator's inquiry rationally encompassed what the clause required, whether it was enforceable, and whether Hutson complied with it. As other courts have noted, the arbitrator's interpretation of the scope of the issue submitted to him is to be treated with great deference, Federated Dept. Stores v. United Food & Commercial Workers Union, Local 1442, 901 F.2d 1494, 1498 (9th Cir. 1990), and must be upheld so long as it is rationally derived from the parties' submission. Richmond, Fredericksburg & Potomac R.R. Co. v. Transportation Communications Int'l Union, 973 F.2d 276, 280 (4th Cir. 1992); see also Mobil Oil Corp. v. Independent Oil Workers Union, 679 F.2d 299, 302 (3d Cir. 1982). 39 As such, there is no basis for the matter to be remanded to a different arbitrator. We have reversed the finding that the former arbitrator manifestly disregarded the law and exceeded his authority, and there is no showing of bias or prejudice that would warrant remanding the case to a new arbitrator. Cf. Grand Rapids Die Casting Corp. v. Local Union No. 159, 684 F.2d 413, 417 (6th Cir. 1982) (arbitrator's outburst against the language of the contract compromise[d] appearance of impartiality); Stroehmann Bakeries, Inc. v. Local 776 Int'l Brotherhood of Teamsters, 762 F. Supp. 1187, 1189-90 (M.D. Pa. 1991) (arbitrator expressed personal opinions derogatory to victim of sexual assault, used inappropriate language, and exhibited personal bias), aff'd, 969 F.2d 1436 (3d Cir.), cert. denied, 506 U.S. 1022 (1992).