Court Opinion

ID: 7123758
Source: CourtListenerOpinion
Date Created: 2022-07-24 12:56:52.56303+00
Date Added: 2024-06-11T16:14:11.710445
License: Public Domain

Meyer, J.:
I dissent. Generally, an arbitration award is considered final and binding, and thus not subject to collateral attack, insofar as it relates to matters properly submitted to and considered by the arbitrator.
“Where parties have agreed to be bound by a submission to arbitration, errors of law and fact, or an erroneous decision of matters submitted to the judgment of the arbitrators, are insufficient to invalidate an award fairly and honestly made. Nothing in an award relative to the merits of the controversy as submitted, even though incorrectly decided, is ground for setting aside the award in the absence of fraud, misconduct, or other valid objections.” Evans Electrical Constr. Co. v. University of Kansas Med. Center, 230 Kan. 298, Syl. ¶ 5, 634 P.2d 1079 (1981).
This rule in favor of finality and validity does not, however, totally preclude a successful judicial attack on an arbitration award. Certain grounds for avoidance are recognized. One paramount objection to validity is want of proper authority to issue a *327particular ruling. This ground of objection was recognized in Kansas long ago. See Clark v. Goit, 1 Kan. App. 345, 353, 41 Pac. 214 (1895).
This same rule has governed more recent cases also.
“It is stated in 3 Am. Jur., Arbitration and Award, § 130, p. 951:
“ ‘The award of arbitrators acting within the scope of their authority determines the rights of the parties as effectually as a judgment secured by regular legal procedure, and is as binding as a judgment until it is regularly set aside or its validity questioned in a proper manner. . . .’
“Relief will be granted against an award which the arbitrators had no jurisdiction to make. Thus, in the instant case we must inquire whether the Board of Arbitration has exceeded the limitation placed upon its contractually invested authority by the Agreement, since the parties to such an Agreement are bound by the arbitrators’ award only to the extent and in the manner prescribed by the contract and only if the award is rendered in conformity thereto. [Citations omitted.]” Coleman v. Local No. 570, 181 Kan. 969, 976-77, 317 P.2d 831 (1957).
In determining whether the arbitrator herein exceeded his powers, one must first define those powers. Generally, the agreement is the source of authority, and its terms define and limit the arbitrator’s powers. State v. Thomas Constr. Co., 8 Kan. App. 2d 283, 655 P.2d 471 (1982). In construing an agreement to arbitrate, the courts should apply the same rules of construction as to any contract. Wagoner v. City of Hutchinson, 169 Kan. 44, 48, 216 P.2d 808 (1950). The primary rule of construction for contracts is that the court should enforce the intention of the parties, as evidenced by the plain and unambiguous wording of their contract. Martin v. Edwards, 219 Kan. 466, 473, 548 P.2d 779 (1976). The courts will not presume that it was the intention of the parties that the arbitrator be allowed to determine the extent of his own jurisdiction. Coleman v. Local No. 570, 181 Kan. at 978.
Examining the collective bargaining agreement here involved, one finds that the grievance procedure is addressed entirely in section 32. Some important language from that section deserves attention.
“Arbitrator does not have the right or power to add to, delete from, amend, change or modify the terms of this agreement.
“Any discharged or suspended employee who is re-instated by the settlement or decision of any grievance shall be paid for all time lost during the period of his discharge or suspension.”
*328This language is plain and definite. It allows for no leeway in its construction. It clearly prohibits the arbitrator from departing in any way from the terms of the agreement. It just as clearly specifies one of these terms — that all employees who are ordered reinstated following suspension or dismissal must be paid for all time lost. The arbitrator’s award herein patently violated these mandates in its denial of back pay. For this reason, that much of the award is void. The district court so held, and should have been affirmed on that ground.
The majority relies on the rule that an arbitrator is endowed with wide latitude and discretion in the fashioning of remedies pursuant to his issuance of an award. At the outset, let me state that I do not take issue with this general statement, per se. It is a correct statement of the prevailing rule of law on this subject. Furthermore, it is a principle rooted in wisdom and practicality.
But, like all rules, it is not without its exceptions. The operative exception in the instant case is that which restricts such latitude and discretion, according to language of limitation contained in the agreement to arbitrate. This exception is as universally recognized as the general rule from which it derives. Attention is directed to the numerous citations found in the majority opinion herein. The careful reader will have already noted what I now point out, that each and every opinion cited by the majority recognizes the aforementioned exception as a qualifier to the general rule.
To avoid this exception to the rule, the majority ascribes to the term “reinstatement,” a meaning which is far too restrictive. It is held that this term, as used in the collective bargaining agreement, refers only to cases where an employee is entirely vindicated in the arbitration proceedings. Thus, according to the majority’s reasoning, appellee was not “reinstated” by the arbitration award, even though it gave him the right to demand his return to his previous position. The majority offers no alternative term to describe the award’s effect on appellee. I submit that “reinstatement” is the only proper descriptive label for that effect, and that its use in the collective bargaining agreement was meant to encompass situations such as that now before us. The majority’s interpretation of “reinstatement” is an unreasonable one; it departs from the common understanding of that term, and it impresses upon the agreement a meaning clearly beyond *329the intention of the parties, in direct contravention to the cardinal rules for construction of contracts.
This scrivener would further note that there is a second reason why the award was void insofar as it denied back pay — because that issue was not submitted to the arbitrator. The rule is well established that an arbitrator is limited in his decision to those issues properly presented by the parties; an issue not submitted is beyond the scope of the award.
“ ‘A party may, even at common law, set up, in defense to an action on an award, any matter which shows that the arbitrator has not pursued his authority, either in not determining some matter brought before him which he ought to determine, or in determining some matter which he had no authority to determine. The ground on which these cases stand is, not that the award is bad for misbehavior of the arbitrator, but that there is no award within the terms of the submission.’ (5 C J. 193.)” Graff v. Insurance Co., 107 Kan. 648, 652, 193 Pac. 356 (1920).
And in Retail Store Employees U. Loc. 782 v. Sav-On Groceries, 508 F.2d 500, 502 (10th Cir. 1975), the court adopted as the better rule one which restricts the subject matter of an arbitration to those issues agreed to and submitted by the parties. And see also Kansas City Luggage & Nov. Wkrs. U. v. Neevel Luggage Mfg. Co., 325 F.2d 992 (8th Cir. 1964).
In the case at bar, the arbitrator’s own award indicates that he considered only one issue to be involved.
“The Grievant was discharged on August 29, 1980, and the issue was whether the Grievant, Glenn Weems, was discharged for just cause on August 29, 1980.”
This singularity of issue was recognized by the district court, and was made one of its findings of fact in the court’s journal entry.
“The sole issue present [sic] to the arbitrator in this case was whether or not the Plaintiffs discharge was proper.”
From the foregoing, it becomes apparent that the arbitrator not only transcended his powers under the agreement, but also exceeded the scope of his submission in determining the issue of back pay. Appellant would have this court sustain the denial of back pay. It cites “The Steelworkers’ Trilogy,” which landmark decisions stand, inter alia, for the proposition that arbitrators must be allowed great latitude in fashioning remedies. This same argument was posed in Retail Store Employees U. Loc. 782 v. Sav-On Groceries, 508 F.2d 500, where the issue was whether *330the award of back pay was within the scope of the submission to arbitration. The court, in Sav-On, rejected an implied power to exceed the submission in the fashioning of remedies. See 508 F.2d at 503. Concluding that the rule of Sav-On is the better guide, I would rule against appellant on this point.
I am not persuaded by the majority’s argument that it is logically inconsistent for appellee to accept such part of the award as ordered his reinstatement, but to attack such part as denied him back pay for time lost. As I have earlier noted, the arbitrator was free to fashion an appropriate remedy, within the confines of the agreement. He fashioned a proper remedy — reinstatement — based on his conclusion that discriminatory enforcement of the particular work rule removed the “just cause” from appellee’s discharge for violation thereof. Having made this determination, and fashioned this remedy, he attempted to go one step further, and deny appellee his back pay. This was beyond his powers and authority under the agreement, and hence, was void.
The majority decision distresses me for yet another reason. I am of the opinion that the majority is today reversing a finding of fact made by the trial court. As was cogently expressed in Aslin v. Seamon, 225 Kan. 77, 78, 587 P.2d 875 (1978), it is not the province of an appellate tribunal to reweigh the evidence and adjust the lower court’s findings of fact according to its own beliefs. This rule is long-standing, and the cases applying it abound. See International Petroleum Services, Inc. v. S & N Well Service, Inc., 230 Kan. 452, Syl. ¶ 8, 639 P.2d 29 (1982), and City of Council Grove v. Ossmann, 219 Kan. 120, Syl. ¶ 1, 546 P.2d 1399 (1976). The majority has regrettably departed from this rule.
To summarize my reasoning herein, while an arbitrator’s award is generally final and binding, this is true only insofar as the award is within the arbitrator’s authority, as prescribed by the employment contract. Here, the collective bargaining agreement expressly provided that any employee reinstated after suspension or termination shall be paid for all time lost. The agreement is specific and unequivocal, to the effect that whenever an employee, as the result of an arbitrator’s award, is reinstated, that employee is entitled to recover, in full, his back pay. The agreement thus circumscribed the arbitrator’s powers, *331and having ordered appellee’s reinstatement, he was without authority to deny appellee his back pay. Also, the issue as to back pay was not expressly submitted to the arbitrator. This, too, is an adequate legal ground for setting aside the award insofar as it denied back pay to appellee.
I am cognizant of the argument that my reasoning herein has the effect of interpreting the collective bargaining agreement in such a way as to hamstring the arbitrator in his fashioning of remedies. It is not my intent to espouse a rule restricting an arbitrator’s power or discretion beyond that level of restriction which may be found in the particular agreement to arbitrate. However, since the arbitrator herein was without authority to go beyond the powers allocated to him in the collective bargaining agreement, and since that agreement in specific terms stated that reinstated employees shall receive back pay, it is clear that the judgment of the district court was correct. That court was fully within its powers to approve the arbitrator’s award in all its other respects, but to set such award aside insofar as it denied back pay to appellee, contrary to the specific terms of the collective bargaining agreement. Such provisions in the agreement being unequivocal and unambiguous, the district court was, and this court is, without power to alter said terms of the contract, because any such alteration would amount to judicial revision of the contract between the parties. Wood v. Hatcher, 199 Kan. 238, Syl. ¶ 3, 428 P.2d 799 (1967).