Court Opinion

ID: 3713789
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:47:35.691957+00
Date Added: 2024-06-11T15:46:12.440634
License: Public Domain

I respectfully dissent from the opinion of the majority. In the case sub judice, defendant-appellee Sentry Claims Services ("Sentry") alleged partiality or corruption on the part of arbitrator Howard A. Schulman as a result of an alleged prior attorney-client relationship that had existed between the plaintiffs-appellants and Schulman. Sentry, in its motion to vacate the arbitration award, alleged that Schulman had previously filed a lawsuit on behalf of the appellants against the Lakewood Board of Education for injuries suffered prior to the motor vehicle accident which formed the basis of the present appeal.
This court, in Gerl Constr. Co. v. Medina Cty. Bd. ofCommrs. (1985), 24 Ohio App.3d 59, 24 OBR 113, 493 N.E.2d 270, established that an arbitration *Page 707 
award should be vacated where there existed an undisclosedrelationship between one of the arbitrators and one of the parties and an impression of possible bias is created. Specifically, the court in Gerl analyzed the various leading cases which have dealt with the issue of vacating an arbitration award on the basis of partiality.
"However, prior to Polk, this court recognized that:
"`Authorities are numerous on the question of disqualification of arbitrators on account of interest in the matter submitted, or of special interest in one of the parties.
"`In the 5th Vol. of Am.  Eng. Enc. of Law and Practice, pp. 83 and 84, authorities are collected, both English and American, and the result is summed up in the test:
"`"To constitute grounds for setting aside the award, thebias must have been such as to furnish reasonable ground forbelieving that the arbitrator was improperly influenced.
"`"If the interest of the arbitrator was too remote and contingent to induce any reasonable suspicion that it could have influenced his decision, the award will not be set aside."'Ernst v. McDowell (1911) [33 OCD 91], 18 Ohio C.C. (N.S.) 360, 366.
"Similarly, the New York Supreme Court, Appellate Division, in Cross Properties, Inc. v. Gimbel Brothers, Inc. (1962),15 App.Div. 2d 913, at 914, 225 N.Y.S.2d 1014, 1016, affirmed (1962), 12 N.Y.2d 806, 236 N.Y.S.2d 61 [187 N.E.2d 129] stated the general modern rule:
"`* * * The type of relationship which would appear todisqualify is one from which it may not be unreasonable to inferan absence of impartiality, the presence of bias or theexistence of some interest on the part of the arbitrator in thewelfare of one of the parties.'
"The Vermont Supreme Court in R.E. Bean Constr. Co. v.Middleburg Assoc. (1980), 139 Vt. 200, at 207, 428 A.2d 306, at 310, relied in part upon Cross when it commented:
"`* * * An award should be vacated where undisclosedrelationships create an impression of possible bias. However, if that rule is not "to emasculate the policy of the law in favor of the finality of arbitration," not every relationship will require that an award be vacated. San Luis Obispo BayProperties, Inc. v. Pacific Gas  Electric Co., 28 Cal.App.3d 556,568, 104 Cal.Rptr. 733, 741 (1972). Only relationships fromwhich one could reasonably infer bias, not those which are"peripheral, superficial or insignificant," will requirevacating the award. Cross Properties, Inc. v. *Page 708 Gimbel Brothers, Inc., 15 App.Div.2d 913, 914, 225 N.Y.S.2d 1014,1016 (per curiam), aff'd mem., 12 N.Y.2d 806, 187 N.E.2d 129,236 N.Y.S.2d 61 (1962).'
"It should be noted that the foregoing cases deal only with the direct relationship between the arbitrator and one of the parties. More analogous to the instant case is Freeport Constr.Co. v. Star Forge, Inc. (1978), 61 Ill.App.3d 999, 1003-1004
[19 Ill.Dec. 57, 61], 378 N.E.2d 558, 562, which notes:
"`* * * While the case law indicates that an undisclosed relationship between an arbitrator and a nonparty may also "be sufficient to create an impression of bias" (San Luis Obispo BayProperties, Inc. v. Pacific Gas  Electric Co., 28 Cal.App.3d 556,104 Cal.Rptr. 733, 742 (1972); McKinney Drilling Co.,32 Md. App. 205, 359 A.2d 100, 104 [(1976)]), it is obvious that the nexus between the non-party and the arbitration must be substantial in order to reasonably create such an impression. In the final analysis, these matters must be decided on a case-by-case basis depending on the facts. 28 Cal.App.3d 556,104 Cal.Rptr. 733, 742; Colony Liquor Distributors, Inc. v.Teamsters Local 699, 34 App.Div.2d 1060, 312 N.Y.S.2d 403, 405
(1970).'" (Emphasis added.) Gerl Constr. Co. v. Medina Cty. Bd.of Commrs., supra, 24 Ohio App.3d at 62, 24 OBR at 115,493 N.E.2d at 274.
A review of the record herein clearly reveals the creation of an impression of possible bias as a result of the previous filing of a lawsuit on behalf of the appellants by arbitrator Howard A. Schulman. This impression of possible bias is even more evident in light of the fact that the arbitration award was not the result of a unanimous decision and that a continuing legal-business relationship exists between Howard A. Schulman and appellants' counsel. This possible bias was not "peripheral,superficial or insignificant" and the trial court's vacation ofthe arbitration award was mandated as a result of the specter ofpartiality which tainted the original arbitration hearing.
Therefore, I would affirm the judgment of the trial court. *Page 709