Davidson v. Hensen

135 Wash. 2d 112
CourtWashington Supreme Court
DecidedMay 7, 1998
DocketNo. 65230-9
StatusPublished
Cited by107 cases

This text of 135 Wash. 2d 112 (Davidson v. Hensen) is published on Counsel Stack Legal Research, covering Washington Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Davidson v. Hensen, 135 Wash. 2d 112 (Wash. 1998).

Opinion

Talmadge, J.

This case involves both the policy of Washington’s arbitration act, RCW 7.04, which confers substantial finality on decisions of arbitrators, and the contractor registration act, RCW 18.27, which denies unregistered contractors access to the courts to seek collection of compensation for work performed. Because the parties entrusted the issue of a contractor’s compliance with RCW 18.27 to the arbitrator, and the homeowners failed to assert any grounds under RCW 7.04.160 for vacating the arbitrator’s award, Washington’s strong public policy preference for finality of arbitrators’ awards applies. We affirm the Court of Appeals’ decision upholding the confirmation of the arbitrator’s award.

ISSUE

In the proceeding before the superior court to confirm an arbitration award, did the homeowners raise any grounds under RCW 7.04.160 for overturning the arbitration award in the contractor’s favor?

FACTS

Contractor Bruce Hensen agreed to remodel a barn into a house for the Davidsons. The parties signed a written contract on January 25, 1994, and Hensen began work on January 31, 1994. The contract contained a broad arbitration clause:

5. Disputes
[116]*1165.1 Any claims or disputes between the Contractor and the Owner arising from this Agreement shall be resolved by arbitration in accordance with Construction Industry Arbitration Rules of the American Arbitration Association unless both parties agree otherwise.

Clerk’s Papers at 37.

After disputes arose, Hensen filed for arbitration in December 1994 in accordance with the parties’ contract for amounts due thereunder. The Davidsons answered and counterclaimed in January 1995, asserting theories of breach of contract, breach of warranty, conversion, fraud, misrepresentation, violation of the Consumer Protection Act (RCW 19.86), and failure to account. Some four months after Hensen filed for arbitration, and just prior to the commencement of the arbitration hearing, the Davidsons’ trial counsel contacted the Department of Labor and Industries (Department) by phone on April 21, 1995, and was told Hensen had been continuously licensed and bonded, as required by RCW 18.27, since 1989 with no substantial lapses. The Davidsons’ trial counsel requested copies of documents confirming Hensen’s registration status that same day.

The arbitration hearing took place on April 27, 28, and May 1, 1995. Although the exact nature and scope of the questioning is disputed because there is no transcript of the arbitration hearing, it is undisputed the parties questioned Hensen about his registration status. At the completion of the hearing on May 1, the arbitrator asked if either side had any additional evidence to present. Both sides agreed they had completed their cases except for the post-hearing briefs. The arbitrator then closed the evidentiary hearing on May 1 and began drafting the award.

On May 12, 1995, the Davidsons’ attorney received a certified copy of Hensen’s registration status from the Department showing Hensen’s registration had lapsed from October 27, 1991, to March 30, 1994, and his bond had lapsed from October 27, 1991, to January 31, 1994. A few days later on May 16, 1995, the Davidsons moved to reopen [117]*117the hearing. The arbitrator denied the request and subsequently awarded Hensen approximately $7,500.

When Hensen moved to confirm the award, the David-sons argued that Hensen was not in compliance with RCW 18.27 at the time of contracting, and the court should therefore vacate the award. In its memorandum opinion, the trial court, the Honorable M. Karlynn Haberly, found the arbitrator had heard and determined Hensen’s registration status, and ruled the court was limited to reviewing the face of the arbitration award unless a party was deprived of a full and fair hearing. Because no error existed on the face of the award,1 the trial court confirmed the arbitration award.2 The Court of Appeals affirmed the trial court order. Davidson v. Hensen, 85 Wn. App. 187, 189, 933 P.2d 1050 (1997). On the Davidsons’ petition, we granted review.

ANALYSIS

A. Arbitration Under RCW 7.04

Washington has established its policy for arbitration in RCW 7.04, our “code of arbitration.” Price v. Farmers Ins. Co., 133 Wn.2d 490, 495, 946 P.2d 388 (1997); [118]*118Northern State Constr. Co. v. Banchero, 63 Wn.2d 245, 249, 386 P.2d 625 (1963). Washington law generally favors the use of alternative dispute resolution such as arbitration where the parties agree by contract to submit their disputes to an arbitrator. Boyd v. Davis, 127 Wn.2d 256, 262, 897 P.2d 1239 (1995) (noting encouraging parties voluntarily to submit their disputes to arbitration is an increasingly important objective in our ever more litigious society). See, e.g., Perez v. Mid-Century Ins. Co., 85 Wn. App. 760, 765, 934 P.2d 731 (1997) (recognizing a strong public policy in Washington state favoring arbitration of disputes); Clearwater v. Skyline Constr. Co., 67 Wn. App. 305, 314, 835 P.2d 257 (1992), review denied, 121 Wn.2d 1005, 848 P.2d 1263 (1993) (same). See also Munsey v. Walla Walla College, 80 Wn. App. 92, 94-95, 906 P.2d 988 (1995) (recognizing the strong public policy favoring arbitration of disputes and noting arbitration eases court congestion, provides an expeditious method of resolving disputes and is generally less expensive than litigation); accord King County v. Boeing Co., 18 Wn. App. 595, 602-03, 570 P.2d 713 (1977) (and cases cited therein). See also Barnett v. Hicks, 119 Wn.2d 151, 160, 829 P.2d 1087 (1992) (noting the object of arbitration is to avoid the formalities, delay, expense and vexation of ordinary litigation).

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Bluebook (online)
135 Wash. 2d 112, Counsel Stack Legal Research, https://law.counselstack.com/opinion/davidson-v-hensen-wash-1998.