Opinion ID: 484676
Heading Depth: 1
Heading Rank: 4

Heading: Adequacy of Arbitration Award

Text: 17 Appellant also contends that the arbitration award is unenforceable because the arbitrators exceeded their powers, [and] so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made. See 9 U.S.C. Sec. 10(d). Bosarge contends that the arbitration award failed to meet the statutory requirements of 9 U.S.C. Sec. 10(d) on three separate grounds. First, he claims that certain provisions of the arbitration award are incomplete, ambiguous, and contradictory. Second, he claims that the ex parte receipt of information constituted prejudicial misconduct on the part of the arbitrators. Lastly, he claims that there was evident partiality on the part of one of the arbitrators. The district court, however, concluded that, as a matter of law, [n]o statutory grounds exist for the vacation of the arbitrators' award. 18 Bosarge's allegations concerning the insufficiency and inadequacy of certain provisions of the award are unfounded. 3 Although the 1982 award does not specify which shares are to be repurchased, the partnership agreement clearly states that [i]f less than all of the limited partnership interests tendered are purchased, the interest purchased will be selected by lot. 4 It is a relatively simple matter, therefore, to ascertain whose limited partnership shares Bosarge will be required to purchase. 19 The same rationale holds true for calculating Bosarge's obligation to repurchase shares under the 1983 award. While the arbitration award did not include the number and cost of the shares to be repurchased, it specified the method and the procedures to be used to obtain the exact figures. Bosarge's duties under the arbitration award are clear and unambiguous. 20 There is no authority for Bosarge's contention that the ex parte receipt of evidence at the arbitration hearing, occasioned by his non-participation, constituted prejudicial misbehavior on the part of the arbitrators. Food Handlers Local 425 v. Pluss Poultry, Inc., 260 F.2d 835 (8th Cir.1958), the case relied upon by appellant, does not stand for the proposition that any arbitration award decided without the participation of both parties is void and unenforceable. Instead, the action to enforce the arbitration award in Food Handlers was dismissed only after the district court determined that the arbitration panel had been improperly convened. Id. at 836-37. Accord Avis Rent A Car System, Inc. v. Garage Employees' Union, 791 F.2d 22, 25 (2d Cir.1986) (arbitration award vacated in Food Handlers because arbitration panel [was] composed of one agency-appointed and one union-appointed member, when contract called for jointly-appointed panel of three). Since BS & K followed the procedures set out in the limited partnership agreement in setting up the arbitration panel, Bosarge is in no position to object because he did not participate. 5 21 Bosarge's remaining asserted ground for vacating the arbitration award, evident partiality or corruption on the part of one of the arbitrators, Herman Goetzoff, must also fail. Appellant had the obligation to make his objection to the composition of the arbitration panel at the time of the hearing. By not doing so, Bosarge waived his right to challenge the selection of the arbitrators. See Sheet Metal Workers International Association v. Kinney Air Conditioning Co., 756 F.2d 742, 746 (9th Cir.1986) (Kinney failed to object to the selection of the Board members at the time they were seated and has hereby waived this objection.). Even assuming no waiver, Bosarge failed to prove the existence of facts which would establish a reasonable impression of partiality.... Id. at 745. The appearance of impropriety, standing alone, is insufficient. Id. at 746. The only evidence produced at trial concerning Goetzoff's alleged partiality was that at one time Goetzoff owned a fractional share of appellant's partnership interest, and he had received commissions on the sale of limited partnership interests in Hugoton. This evidence is insufficient to prove bias under the strict standard of 9 U.S.C. Sec. 10. Evident partiality means more than a mere appearance of bias. Florasynth, Inc. v. Pickholz, 750 F.2d 171, 173 (2d Cir.1984). 22 The district court did not abuse its discretion by refusing to allow Bosarge to amend his pleadings to include evidence of Goetzoff's alleged partiality. As the court pointed out, the issue should have been raised earlier. While appellant claimed to have no prior knowledge of the arbitrator's bias, the undisputed testimony is that Goetzoff received his interest in Hugoton from Bosarge. Bosarge's assertion of newly discovered evidence is belied by the record.