K.R. Swerdfeger Construction, Inc. v. Board of Regents

2006 NMCA 117, 142 P.3d 962, 140 N.M. 374
CourtNew Mexico Court of Appeals
DecidedJuly 28, 2006
Docket25,085
StatusPublished
Cited by26 cases

This text of 2006 NMCA 117 (K.R. Swerdfeger Construction, Inc. v. Board of Regents) is published on Counsel Stack Legal Research, covering New Mexico Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
K.R. Swerdfeger Construction, Inc. v. Board of Regents, 2006 NMCA 117, 142 P.3d 962, 140 N.M. 374 (N.M. Ct. App. 2006).

Opinion

OPINION

FRY, Judge.

{1} Plaintiff K.R. Swerdfeger Construction, Inc. (KRSC) appeals the district court’s confirmation of an arbitration award. KRSC seeks to vacate a portion of the arbitration award that denied KRSC damages against the University of New Mexico (UNM), arguing that the award violates New Mexico public policy and is therefore unenforceable. Because we hold that KRSC has failed to establish a public policy basis to vacate the arbitration award, we affirm the district court.

I. BACKGROUND

{2} In March 2001 KRSC entered into a contract with UNM under which KRSC was to construct a new water-line loop on UNM’s Albuquerque campus as part of a large-scale upgrade to the campus’s utility services. The project was referred to as UNM Phase I Domestic Water System Improvements. The construction of the water-line loop required excavation in areas where there were numerous underground facilities owned by UNM. The term underground facilities refers generally to cable television lines, oil and natural gas pipelines, and utility lines. See NMSA 1978, § 62-14-2(C), (L), (N), (O) (2001).

{3} Excavation involving underground facilities is governed by NMSA 1978, §§ 62-14-1 to -10 (1973, as amended through 2001), commonly referred to as the “One-Call Statute.” Pursuant to the One-Call Statute, persons planning to engage in excavation must first notify a call-in center and give notice of the area of planned excavation. § 62-14-3(A), (C). The call-in center in turn notifies the owners and operators of underground facilities in the area of planned excavation. § 62-14-7.1(E). The owners and operators of underground facilities in the area are then required to mark the location of their facilities on the surface before excavation begins. The statute provides:

A. Every person owning or operating an underground facility shall, upon the request of a person intending to commence an excavation and upon advance notice, locate and mark on the surface the actual horizontal location, within twelve inches by some means of location, of the underground facilities in or near the area of excavation so as to enable the person engaged in excavation work to locate the facilities in advance of and during the excavation work.

§ 62-14-5(A).

{4} The parties’ dispute in this case concerned who was responsible for locating and marking the underground facilities before KRSC commenced excavation. KRSC’s position was that UNM was responsible for locating and marking the underground facilities and that because of delays and additional work caused by UNM’s failure to do so, KRSC was entitled to an additional compensation of $349,000. KRSC relied on Section 62-14-5(0 of the One-Call Statute, which states:

C. If the owner or operator fails to correctly mark the underground facility after being given advance notice and such failure to correctly mark the facility results in additional costs to the person doing the excavating, then the owner or operator shall reimburse the person engaging in the excavation for the reasonable costs incurred.

{5} UNM’s position was that KRSC had contracted to locate and mark the underground facilities prior to beginning excavation. Pursuant to an arbitration clause in the parties’ contract, the district court entered an order compelling arbitration of all the parties’ claims. KRSC did not appeal the order compelling arbitration.

{6} The parties submitted to the arbitrator several issues, including whether duties under the One-Call Statute are mandatory, whether they are delegable, and whether UNM delegated those duties to KRSC. KRSC argued in part that an owner’s duty under the One-Call Statute to mark its underground facilities prior to excavation was non-delegable, and that any contractual provision that purported to delegate those duties was a violation of public policy. In the arbitration award, the arbitrator made the following findings:

Although the one-call statute is mandatory, I find and conclude that an owner of underground facilities may delegate the spotting responsibilities under the circumstances presented. I find that the spotting responsibilities were effectively and unambiguously delegated to KRSC for the construction of the UNM Phase I Domestic Water System Improvements Project.

{7} KRSC then moved in the district court to set aside that portion of the arbitration award determining that UNM could delegate its duties under the One-Call Statute. KRSC again argued that the duty to mark the location of underground facilities cannot be delegated by contract, and that a contract delegating those duties is void as contrary to public policy. The district court ruled that none of the grounds for vacating an arbitration award set forth in NMSA 1978, § 44-7-12 (1971), had been met and confirmed the award. KRSC’s appeal is limited to this issue. KRSC is joined on appeal by several amici curiae from the construction industry.

II. DISCUSSION

{8} When we assigned this case to the general calendar, we directed the parties to brief whether the district court’s order compelling arbitration was a final appealable order because it initially appeared that KRSC was appealing the district court’s order compelling arbitration. We raised this issue on our own motion because if KRSC were appealing the order compelling arbitration and that order was a final appealable order, then the appeal would have been untimely. See Lyman v. Kern, 2000-NMCA-013, ¶ 9, 128 N.M. 582, 995 P.2d 504. The arguments made in the briefs, however, clarified that KRSC’s appeal is from the district court’s confirmation of the arbitration award, not from the order compelling arbitration, and the appeal is therefore timely. See NMSA 1978, § 44-7-19(A)(3) (1971). We now proceed to address the merits of the appeal.

{9} As a preliminary matter, we clarify which version of the Uniform Arbitration Act applies. KRSC cites to both the 1971 version of the Uniform Arbitration Act (UAA), NMSA 1978, §§ 44-7-1 to -22 (1971), and the revised version of the Uniform Arbitration Act, NMSA 1978, §§ 44-7A-1 to -32 (2001). The contract at issue was signed on May 8, 2001, prior to the effective date of the 2001 amendments, and it is governed by the 1971 version of the UAA. We therefore confíne our analysis to the 1971 Act. See Piano v. Premier Distrib. Co., 2005-NMCA-018, ¶ 3, 137 N.M. 57, 107 P.3d 11 (noting that “[arbitration agreements made on or after July 1, 2001, are governed by the current UAA, NMSA 1978, §§ 44-7A-1 to -32 (2001)”); Collier v. Pennington, 2003-NMCA-064, ¶ 2, 133 N.M. 728, 69 P.3d 238 (applying 1971 version of the UAA to a contract signed in 1999).

{10} KRSC argues that the portion of the arbitration award determining that an owner/operator of underground facilities can contractually delegate its duty to mark the facilities’ location in advance of excavation violates New Mexico public policy and must be vacated. KRSC claims that this public policy derives from the One-Call Statute itself, which does not expressly or impliedly permit delegation.

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Cite This Page — Counsel Stack

Bluebook (online)
2006 NMCA 117, 142 P.3d 962, 140 N.M. 374, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kr-swerdfeger-construction-inc-v-board-of-regents-nmctapp-2006.