Court Opinion

ID: 4659643
Source: CourtListenerOpinion
Date Created: 2021-02-11 18:02:35.276332+00
Date Added: 2024-06-11T08:02:01.259510
License: Public Domain

The summaries of the Colorado Court of Appeals published opinions
  constitute no part of the opinion of the division but have been prepared by
  the division for the convenience of the reader. The summaries may not be
    cited or relied upon as they are not the official language of the division.
  Any discrepancy between the language in the summary and in the opinion
           should be resolved in favor of the language in the opinion.

                                                                  SUMMARY
                                                           February 11, 2021

                                2021COA17

No. 19CA2234, Tug Hill Marcellus LLC v. BKV Chelsea LLC —

Courts and Court Procedure — Colorado Uniform Arbitration

Act — Appeals

     A division of the court of appeals considers for the first time

whether the court has jurisdiction to hear an appeal of an order

denying a motion to consolidate arbitration proceedings under

section 13-22-228(1), C.R.S. 2020, of the Colorado Revised Uniform

Arbitration Act. The division concludes that, because an order

denying a motion to consolidate arbitration proceedings is neither

one of the pre-arbitration orders listed in section 13-22-228(1)(a)

and (b), nor a “final judgment” under section 13-22-228(1)(f), the

court lacks jurisdiction over the appeal.
COLORADO COURT OF APPEALS                                         2021COA17

Court of Appeals No. 19CA2234
City and County of Denver District Court No. 19CV33147
Honorable Morris B. Hoffman, Judge

Tug Hill Marcellus LLC, Radler 2000 LP, and Chief Exploration & Development
LLC,

Petitioners-Appellants,

v.

BKV Chelsea LLC,

Respondent-Appellee.

                               APPEAL DISMISSED

                                   Division VI
                           Opinion by JUDGE LIPINSKY
                          Richman and Pawar, JJ., concur

                          Announced February 11, 2021

Lewis Roca Rothgerber Christie LLP, Douglas B. Tumminello, Denver,
Colorado; Sidley Austin LLP, Angela C. Zambrano, Barret V. Armbruster,
Dallas, Texas, for Petitioners-Appellants Tug Hill Marcellus LLC and Radler
2000 LLP

Hayes and Boone, LLP, Lee F. Jonston, Kate Repko, Kelli Bills, Denver,
Colorado, for Petitioner-Appellant Chief Exploration & Development LLC

Fox Rothschild LLP, Patrick J. Casey, Spencer L. Sears, Esther H. Lee, Denver,
Colorado, for Respondent-Appellee
¶1    Appellants Tug Hill Marcellus LLC, Radler 2000 LP, and Chief

 Exploration & Development LLC (collectively, Sellers), appeal the

 district court’s order denying their petition to consolidate appellee

 BKV Chelsea LLC’s three separate arbitration proceedings against

 them. Because orders denying petitions to consolidate arbitration

 proceedings are not one of the two pre-award court orders that may

 be appealed under the Colorado Revised Uniform Arbitration Act

 (the Act), we lack jurisdiction over this matter and dismiss Sellers’

 appeal.

                           I.    Background

¶2    Sellers entered into substantially similar agreements with BKV

 for the sale of interests in oil, gas, and mineral leases and related

 assets. The agreements included identical arbitration provisions.

 BKV alleged that Sellers breached their agreements and served the

 individual Sellers with a demand for arbitration. BKV requested a

 separate arbitration proceeding against each of the Sellers.

¶3    Sellers proposed that the arbitration proceedings be

 consolidated, but BKV refused. Sellers petitioned the district court

 to consolidate the three arbitration proceedings. The district court

 entered an order denying Sellers’ petition on the grounds that the

                                    1
 arbitration provisions in the agreements did not indicate that BKV

 had consented in advance to consolidate the separate arbitration

 proceedings.

¶4    Sellers appealed the district court’s order. Sellers assert that

 this court has jurisdiction over this appeal under section

 13-22-228(1)(f), C.R.S. 2020, and C.A.R. 1(a)(1). BKV moved to

 dismiss the appeal on jurisdictional grounds. A motions division of

 this court deferred a decision on BKV’s motion until Sellers and

 BKV had fully briefed the issue.

                            II.   Discussion

     A.    An Order Denying a Motion to Consolidate Arbitration
          Proceedings Is Not One of the Two Pre-Award Arbitration
            Orders Appealable Pursuant to Section 13-22-228(1)

¶5    Although section 13-4-102, C.R.S. 2020, and C.A.R. 1(a)(1)

 grant this court jurisdiction over the “final judgments” of district

 courts, section 13-22-228(1) of the Act narrowly circumscribes our

 jurisdiction to hear appeals of arbitration-related orders.

¶6    Under section 13-22-228(1), a party may only appeal two types

 of arbitration-related court orders entered before an arbitrator

 enters an award — an order denying a motion to compel arbitration

 and an order granting a motion to stay arbitration.

                                    2
 § 13-22-228(1)(a) & (b). (Section 13-22-228(1) also authorizes

 appeals of orders confirming or denying confirmation of an award,

 modifying or correcting an award, vacating an award without

 directing a rehearing, and a final judgment entered pursuant to the

 Act. § 13-22-228(1)(c), (d), (e) & (f).) A division of this court

 explained that “[t]he specific language of the Act reveals a legislative

 intent to limit appeals to the listed circumstances.” Gergel v. High

 View Homes, L.L.C., 58 P.3d 1132, 1134 (Colo. App. 2002).

¶7    Section 13-22-228(1)’s limited grant of appellate jurisdiction is

 consistent with the state’s policy of favoring arbitration “as a

 convenient and efficient alternative to resolving disputes by

 litigation.” Vallagio at Inverness Residential Condo. Ass’n v. Metro.

 Homes, Inc., 2015 COA 65, ¶ 13, 412 P.3d 709, 713, aff’d, 2017 CO

 69, ¶ 13, 395 P.3d 788. “In Colorado, arbitration is a favored

 method of dispute resolution. Our constitution, our statutes, and

 our case law all support agreements to arbitrate disputes.” Lane v.

 Urgitus, 145 P.3d 672, 678 (Colo. 2006) (citations omitted). The

 General Assembly adopted the Act “to provide a uniform statutory

 framework for arbitration and to encourage settlement of disputes

                                     3
  through the arbitration process.” Sopko v. Clear Channel Satellite

  Servs., Inc., 151 P.3d 663, 666 (Colo. App. 2006).

¶8     The Act expressly authorizes parties to file specified

  arbitration-related motions in district court, even though the court’s

  rulings on those motions may not be appealable. (We interpret

  Sellers’ “petition” as a motion.) “Not all orders entered by a trial

  court respecting arbitration proceedings are appealable.” Thomas v.

  Farmers Ins. Exch., 857 P.2d 532, 534 (Colo. App. 1993).

¶9     For example, one of the permissible arbitration-related

  motions is a motion for the “consolidation of separate arbitration

  proceedings.” § 13-22-210(1), C.R.S. 2020. The district court “may

  order consolidation . . . as to all or some of the claims if all parties

  in the arbitration proceedings consent” and the court finds that the

  criteria listed in the statute are met. Id.

¶ 10   But an order denying a motion to consolidate separate

  arbitration proceedings is not appealable because it is not one of

  the pre-award orders listed in section 13-22-228(1). Such orders

  are neither orders denying a motion to compel arbitration nor

  orders granting a motion to stay arbitration, which are appealable

                                      4
  under section 13-22-228(1)(a) and (b). (And, as explained in Part

  II.B below, they are also not appealable “final judgments.”)

¶ 11   “[W]hen the legislature speaks with exactitude, [courts] must

  construe the statute to mean that the inclusion or specification of a

  particular set of conditions necessarily excludes others.” Lunsford

  v. W. States Life Ins., 908 P.2d 79, 84 (Colo. 1995). The precise

  language of section 13-22-228(1) “leaves no room for permitting

  appeals other than those specifically enumerated.” J.P. Meyer

  Trucking & Constr., Inc. v. Colo. Sch. Dists. Self Ins. Pool, 18 P.3d

  198, 202 (Colo. 2001). The omission of orders denying motions to

  consolidate arbitration proceedings from section 13-22-228(1)

  indicates that “the legislature could not have intended” to allow

  appeals of such orders. Beeghly v. Mack, 20 P.3d 610, 613 (Colo.

  2001) (“Under the rule of interpretation expressio unius [est] exclusio

  alterius, the inclusion of certain items implies the exclusion of

  others.”).

¶ 12   Our conclusion is consistent with the case law addressing the

  appealability of other types of pre-award orders not listed in section

  13-22-228(1). For example, “an order compelling arbitration is not

  appealable because it is not denominated as such by the Act.”

                                      5
  Gergel, 58 P.3d at 1135; see Frontier Materials, Inc. v. City of

  Boulder, 663 P.2d 1065, 1066 (Colo. App. 1983) (“Conspicuously

  absent from that list [in the substantially similar predecessor

  statute to 13-22-228(1)] is an order by the court compelling the

  parties to arbitrate.”).

¶ 13   Courts in other states that have adopted statutes identical to

  section 13-22-228(1) have reached the same conclusion. In St.

  Francis Xavier Hospital v. Ruscon/Abco, the South Carolina Court of

  Appeals refused to hear the appeal of an order denying the

  consolidation of arbitration proceedings because the language of

  that state’s analogue to section 13-22-228(1) “does not expressly

  allow an appeal from an order denying an application to consolidate

  pending arbitration proceedings.” 330 S.E.2d 548, 550 (S.C. Ct.

  App. 1985). The Washington Court of Appeals similarly noted that,

  while the statute “designates specific orders in arbitration actions

  from which an appeal may be taken, . . . an order of consolidation is

  not one of them.” Cummings v. Budget Tank Removal & Env’t Servs.

  LLC, 260 P.3d 220, 224 (Wash. Ct. App. 2011).

¶ 14   Our reading of section 13-22-228(1) is also consistent with the

  policy underlying the Act — to provide a convenient and efficient

                                     6
  alternative to litigation. See Vallagio at Inverness Residential

  Condo. Ass’n, ¶ 13, 412 P.3d at 713. Appeals of district court

  orders denying motions to consolidate separate arbitration

  proceedings would delay the arbitration process and increase the

  parties’ legal expenses. Notably, the only pre-award orders that are

  appealable under section 13-22-228(1) are orders blocking or

  hindering the arbitration process. See § 13-22-228(1)(a) & (b)

  (authorizing appeals of orders denying motions to compel

  arbitration and orders staying arbitration). An order denying a

  motion to consolidate separate arbitration proceedings neither

  blocks nor hinders the arbitration process. Rather, it allows the

  arbitration process to proceed.

¶ 15      For these reasons, we conclude that we lack jurisdiction to

  hear appeals from orders denying a motion to consolidate separate

  arbitration proceedings. “Because this court’s jurisdiction is

  conferred by statute, we cannot expand its scope beyond [its]

  legislative grant,” Wilson v. Kennedy, 2020 COA 122, ¶ 6, ___ P.3d

  ___, ___, and, therefore, we may not exercise jurisdiction in this

  case.

                                      7
       B.   An Order Denying a Motion to Consolidate Arbitration
                   Proceedings Is Not a “Final Judgment”

¶ 16   Sellers seek to circumvent the omission of orders denying

  motions to consolidate separate arbitration proceedings from

  section 13-22-228(1) by arguing that the district court’s order is an

  appealable “final judgment” under section 13-22-228(1)(f) and

  C.A.R. 1(a)(1). As noted above, subsections 13-22-228(1)(a) and (b)

  describe with specificity the pre-award orders that may be appealed,

  and an order denying a motion to consolidate separate arbitration

  proceedings is not one of them.

¶ 17   More fundamentally, an order denying a motion to consolidate

  separate arbitration proceedings is not the equivalent of a “final

  judgment.” “[I]n determining whether a trial court’s order is subject

  to review, the appellate court must consider the substance and not

  the form of the order.” Gergel, 58 P.3d at 1136. Gergel concerned

  an attempt to appeal an order compelling the parties to arbitrate.

  The appellants contended that their motion to stay the arbitration

  proceedings, which the district court denied, was substantively a

  motion for a temporary injunction, as they had labeled it. Id. at

  1135-36. The grant or denial of a temporary injunction is an

                                    8
  appealable order. Id. at 1135. But because the parties’ motion

  “requested neither temporary relief nor preservation of the status

  quo,” the division of this court concluded that the district court’s

  denial of the motion was the functional equivalent of an order

  directing arbitration. Id. at 1136. Such an order is not listed in

  section 13-22-228(1) and, thus, is not appealable. Id.

¶ 18   In contrast to the form and substance of the court’s order

  denying Sellers’ motion to consolidate BKV’s arbitration

  proceedings, an order entering a “final judgment” “finally disposes

  of the particular action and prevents further proceedings . . . .”

  State ex rel. Suthers v. CB Servs. Corp., 252 P.3d 7, 10 (Colo. App.

  2010) (quoting Levine v. Empire Savings & Loan Ass’n, 192 Colo.

  188, 190, 557 P.2d 386, 387 (1976)). In civil cases, our supreme

  court has “consistently held that a ‘final judgment is one which

  ends the particular action in which it is entered, leaving nothing

  further for the court pronouncing it to do in order to completely

  determine the rights of the parties involved in the proceeding.’”

  Scott v. Scott, 136 P.3d 892, 895 (Colo. 2006) (quoting Harding

  Glass Co. v. Jones, 640 P.2d 1123, 1125 n.2 (Colo. 1982)).

                                     9
¶ 19   Here, although Sellers’ motion to consolidate was the only

  filing in the underlying case, the district court’s order denying it did

  not “finally dispose[] of the . . . action and prevent[] further

  proceedings.” See Suthers, 252 P.3d at 10. The parties may return

  to the district court before, during, or after the arbitrations by filing

  one of the arbitration-related motions authorized under the Act.

  For example, if one of the Sellers refused to arbitrate, BKV could file

  a motion to compel arbitration under section 13-22-207(1), C.R.S.

  2020, or, if a party found evidence that one of the arbitrators

  engaged in misconduct in connection with the arbitration, that

  party could file a motion to vacate the arbitrator’s award under

  section 13-22-223(1)(b)(III), C.R.S. 2020. The district court’s order

  denying Sellers’ motion to consolidate the arbitration proceedings

  does not prevent any of these further proceedings.

¶ 20   In any event, a final and appealable judgment will be entered

  in this case only if and when an arbitrator enters an award in one of

  the arbitration proceedings and the district court enters a judgment

  “in conformity therewith.” See § 13-22-225(1), C.R.S. 2020;

  S. Wash. Assocs. v. Flanagan, 859 P.2d 217, 220 (Colo. App. 1992)

  (“The ‘award’ of a panel of arbitrators . . . [was] not . . . a ‘final

                                       10
  judgment.’” Rather, the final judgment in the case was “the

  stipulated order and judgment confirming the arbitration award

  pursuant to the [Act].”); see Mountain Plains Constructors, Inc. v.

  Torrez, 785 P.2d 928, 930-31 (Colo. 1990) (holding that “an order

  denying a motion to compel arbitration may . . . be appealed after

  final judgment”). The language of Mountain Plains Constructors

  would make no sense if an order denying a motion to compel

  arbitration could be appealed immediately after the district court

  ruled on a different pre-award motion, such as a motion to

  consolidate separate arbitration proceedings.

¶ 21   Sellers attempt to distinguish Marshwood Associates v.

  Krumbhaar & Holt, Associated Architects, P.A., 451 A.2d 305 (Me.

  1982), and St. Francis Xavier Hospital, the two out-of-state cases

  BKV cites in support of its argument that an order denying

  consolidation is not an appealable final judgment. Both cases held

  that an order denying consolidation of arbitration proceedings does

  not have the effect of a final judgment and is thus not appealable.

  Marshwood Assocs., 451 A.2d at 307; St. Francis Xavier Hosp., 330

  S.E.2d at 550. Sellers contend that these cases are distinguishable

                                    11
  because they interpreted versions of the Act that do not authorize

  trial courts to consolidate arbitration proceedings.

¶ 22     But Sellers’ argument assumes, contrary to the Act, that every

  ruling on a permitted arbitration-related motion is appealable. As

  explained in Part II.A above, simply because a statute authorizes

  the court to take an action does not make that action appealable.

¶ 23     Moreover, under Sellers’ reasoning, any pre-award order, even

  if not listed in section 13-22-228(1), would be an appealable final

  judgment. This argument cannot be squared with section

  13-22-228(1)’s meticulous delineation of the only pre-award court

  orders that may be appealed. See § 13-22-228(1)(a) & (b). If any

  pre-award order were a “final judgment,” then section

  13-22-228(1)(a) & (b) would be superfluous; there would be no need

  to specify that an order denying a motion to compel arbitration and

  an order granting a motion to stay arbitration are appealable. We

  do not interpret statutes to render the language in a subsection

  superfluous. People v. Burnett, 2019 CO 2, ¶ 21, 432 P.3d 617,

  622.

¶ 24     It is significant that section 13-22-228(1) places the two

  appealable pre-award orders in separate subsections from “final

                                     12
  judgments.” Because they are listed in different subsections from

  “final judgments,” an order denying a motion to compel arbitration

  and an order granting a motion to stay arbitration cannot be “final

  judgments.” And it would make no sense to read section

  13-22-228(1) to mean that, while these two pre-award orders are

  not “final judgments,” all other types of pre-award orders may be

  deemed “final judgments.”

¶ 25   In sum, we only have jurisdiction to “review interlocutory

  orders where specifically authorized by statute or rule.” Gergel, 58

  P.3d at 1134 (emphasis added). “We have ‘no authority to expand

  [our] appellate jurisdiction’” beyond that granted by the General

  Assembly and “cannot ‘modify the jurisdiction granted [us] by

  statute.’” Wilson, ¶ 6, ___ P.3d at ___ (alterations in original)

  (quoting People in Interest of L.R.B., 2019 COA 85, ¶ 15, ___ P.3d

  ___, ___). Under the plain language of section 13-22-228(1), we

  have no jurisdiction to review an order denying a motion to

  consolidate arbitration proceedings.

                             III.   Conclusion

¶ 26   The appeal is dismissed.

       JUDGE RICHMAN and JUDGE PAWAR concur.

                                     13