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McNaughton & Rodgers v. Besser5/2/1996
Defendant, Bruce Besser, appeals the district court judgment confirming an arbitrator's award settling his fee dispute and malpractice claims against plaintiffs, McNaughton & Rodgers and Stutz & Miller. We affirm.
Besser hired the law firm of McNaughton & Rodgers to perform real estate transactional work. Dissatisfied, he took his business to the firm of Stutz & Miller. Still dissatisfied, Besser retained a third law firm to complete his real estate transactions. When Besser refused to pay balances of about $7,000 claimed by McNaughton & Rodgers and about $11,000 claimed by Stutz & Miller, the two firms sued to recover the fees. Besser denied owing any fees and asserted counterclaims for malpractice against both law firms.
After much initial litigation, Besser and plaintiffs entered into an agreement for the arbitration of their fee disputes through the use of the Denver Bar Association's Legal Fee Arbitration Committee (DBA Committee). The arbitration contract provided that: (1) it would be governed by the DBA Committee's by-laws; the Uniform Arbitration Act, § 13-22-201, et seq., C.R.S. (1987 Repl. Vol. 6A); and Colorado law generally; (2) the DBA Committee's decision would be final and binding and could be entered as a judgment; and (3) the DBA Committee also could determine Besser's malpractice counterclaims.
Three attorneys from the DBA Committee were selected to serve as the fact-finding panel and were so notified in writing. The notification listed the names of the parties to the dispute and scheduled the hearing for February 28, 1994.
Since none of the parties had the hearing transcribed, the record is sparse. However, certain facts are undisputed.
At the commencement of the hearing, one panel member disclosed that she knew three of the attorneys in the plaintiff law firms. Nevertheless, she stated that her acquaintance with these attorneys would not compromise her impartiality. Besser immediately moved for her recusal and requested that the hearing be postponed for the convening of a new panel. The panel chair denied Besser's motions, and Besser participated in the hearing under protest.
Following the hearing, the panel of three arbitrators presented its report to the full DBA Committee, which announced its award in April 1994. The Committee awarded McNaughton & Rodgers $4,683.15, and awarded Stutz & Miller $12,877.63. The committee did not mention Besser's counterclaim for malpractice in its award and Besser's later written request asking the Committee to reconsider the award received no response.
Plaintiffs filed a motion in the district court to confirm the award. Besser filed an objection, asserting that he had been denied an impartial tribunal because of the one panel member's alleged conflict of interest. He attached no affidavits to his motion, but characterized the panel member's disclosure as a statement that "she was personally and professionally acquainted with" principals of the plaintiff law firms. Besser claimed prejudice because the disclosure by the panel member was not made until the hearing had begun, and because the panel chair had refused to postpone the hearing. Besser asked that the matter be stayed and remanded to the DBA Committee for further consideration of the panel member's alleged conflict.
In May 1994, the district court confirmed the award. It acknowledged its authority under § 13-22-214(1)(a)(II), C.R.S., (1987 Repl. Vol. 6A) to vacate the award upon a finding of "evident partiality," but found that the one panel member's acquaintance with some of the plaintiff attorneys did not meet this standar
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