Medina v. Foundation Reserve Insurance

1997 NMSC 027, 940 P.2d 1175, 123 N.M. 380
CourtNew Mexico Supreme Court
DecidedApril 30, 1997
Docket23147
StatusPublished
Cited by16 cases

This text of 1997 NMSC 027 (Medina v. Foundation Reserve Insurance) is published on Counsel Stack Legal Research, covering New Mexico Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Medina v. Foundation Reserve Insurance, 1997 NMSC 027, 940 P.2d 1175, 123 N.M. 380 (N.M. 1997).

Opinion

OPINION

BACA, Justice.

1.Foundation Reserve appeals the denial of its motion to vacate an arbitration award. The district court found that the award was obtained by fraud, corruption, and undue means, and therefore should be vacated under the New Mexico Uniform Arbitration Act. See NMSA 1978, § 44-7-12(A)(l). However, the district court concluded that it had no authority to order relief because, under Rule 1-060(B)(6) NMRA 1997, of the rules of civil procedure, the motion to vacate the arbitration award was not timely. We vacate the district court order affirming the award and remand the case to a new panel of arbitrators to evaluate the merits of the original claim.

I.

2.In 1985 Ricardo Medina filed a claim for uninsured motorist benefits with his insurance carrier, Foundation Reserve Insurance Company, Inc., alleging that he was injured in an automobile accident. Medina claimed that his injuries forced him to abandon his pursuit of a teaching degree because he was unable to perform the activities necessary to fulfill the student teaching requirements. Following arbitration of the claim, Medina was awarded policy limits of $100,000. The district court confirmed the arbitration award. Foundation Reserve appealed the confirmation, contesting the discovery limitations imposed by the arbitrators. Despite the discovery limitations, this Court upheld the arbitration award because the parties had agreed to resolve the dispute through arbitration, a process which does not utilize the extensive discovery devices available in judicial proceedings. See Medina v. Foundation Reserve Ins. Co., No. 18,930, slip op. at 4-5 (N.M. Aug. 29, 1991). This Court concluded that Foundation Reserve “had adequate knowledge to frame its case and defend its position at the arbitration hearings.” Id. at 5.

3. Next, Medina filed a claim alleging that Foundation Reserve had acted in bad faith by attempting to avoid coverage under the policy. The district court found that Medina obstructed discovery throughout the bad faith case. The district court also found that Medina had lied and concealed documents both during arbitration and during the bad faith case. Therefore, the district court dismissed Medina’s claim of bad faith. This Court upheld the dismissal in light of the clear evidence of Medina’s flagrant disregard for his discovery obligations. See Medina v. Foundation Reserve Ins. Co., 117 N.M. 163, 167, 870 P.2d 125, 129 (1994).

4. Following dismissal of the bad faith case, and in light of the information revealed during discovery for that ease, Foundation Reserve filed a motion to set aside the arbitration award. The district court’s findings in that case included the following:

8. Plaintiff obtained his arbitration award by corruption, fraud, and undue means.
11. Relevant and material evidence was concealed, withheld, and otherwise not made available to Foundation Reserve because of Plaintiffs obstruction.
14. Plaintiff obstructed Foundation Reserve from obtaining access to material documents and information.
15. Plaintiff concealed material documents and information.
16. Plaintiff withheld material documents and information.

Medina v. Foundation Reserve Ins. Co., No. CV 87-7192, slip op. at 2 (N.M.Dist.Ct. May 4. 1995). These findings meet the requirement for vacatur of an arbitration award based on fraud, corruption, and undue means, as provided for in the Arbitration Act. See Section 44-7-12(A)(l). In addition, the district court concluded that the motion to vacate the award was timely filed under the Arbitration Act.

5. Despite these findings of fact and the district court’s acknowledgement that the arbitration award should be set aside, the court confirmed the award. The court’s decision rested on application of Rule 1 — 060(B)(6), which explicitly requires that a motion to vacate an award be filed within one year after entry of the award, unless the award was procured through “fraud upon the court.” The district court found that Medina’s conduct did not rise to the level of fraud upon the court. Further, the district court concluded that it lacked the power to vacate the award because the motion to set aside the judgment was filed more than one year after the award was made. Foundation Reserve appeals this ruling.

II.

6. On appeal we determine whether the district court erred when it refused to vacate Medina’s arbitration award. We begin by determining which appellate rules apply to the vacatur of an arbitration award: the Rules of Civil Procedure or the provision governing vacatur of an arbitration award contained in the Arbitration Act. Then we must determine whether there is substantial evidence to support the findings of fact relevant to vacatur of the award under the appropriate rules.

A.

7. Both the Rules of Civil Procedure and the Arbitration Act contain a provision governing the time limitation for filing a motion to vacate an award. Rule 1-060(B)(6) provides that a judgment may be set aside within one year following its entry for certain statutorily provided reasons. A judgment may also be set aside more than one year after entry of that judgment provided there is a finding of fraud upon the court. See Rule 1 — 060(B)(6). By contrast, the Arbitration Act provides that an award may be vacated if it is “predicated upon corruption, fraud, or other undue means.” Section 44-7-12(A)(1). In the case of fraud, corruption, and undue means, the motion to vacate must be filed within ninety days after such grounds are known or should have been known. See NMSA1978, § 44-7-12(B).

8.The district court, applying the one-year limitation period set forth in Rule 1-060(B)(6) of the Rules of Civil Procedure, found that the award was not challenged within one year after it was made. The district court also found that Medina’s conduct did not rise to the level of fraud upon the court. Thus, the district court concluded that it was precluded from vacating the arbitration award. We hold that the district court erred in applying Rule 1 — 060(B)(6) and in concluding that it was precluded from vacating the award.

9. The Rules of Civil Procedure provide that they are not to be applied where “existing rules applicable to special statutory or summary proceedings are inconsistent herewith.” Rule 1-001 NMRA 1997 (providing scope of rules); see, e.g., Holman v. Oriental Refinery, 75 N.M. 52, 54, 400 P.2d 471, 473 (1965) (recognizing that rules of civil procedure are inapplicable to special statutory proceedings of workmen’s compensation claims where they conflict with rules provided in the Workmen’s Compensation Act). Case law has established that in the event of conflict, the rules governing special statutory proceedings take precedence over the general rules of civil procedure. See Holman, 75 N.M. at 54, 400 P.2d at 473.

10.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Mottola v. Triad Nat'l Sec., LLC
New Mexico Court of Appeals, 2026
State ex rel. CYFD v. Lynn
New Mexico Court of Appeals, 2024
Singleton Revocable Tr. v. Brown
New Mexico Court of Appeals, 2023
Castillo v. Allstate Prop. & Cas. Ins. Co.
New Mexico Court of Appeals, 2022
Rogers v. Red Boots Invs.
2020 NMCA 028 (New Mexico Court of Appeals, 2019)
Pool v. Drivetime Car Sales
New Mexico Court of Appeals, 2016
Terminix International Co. v. Scott
142 So. 3d 512 (Supreme Court of Alabama, 2013)
Pargin Realty ERA v. Schmidt
New Mexico Court of Appeals, 2013
Low v. MINICHINO
267 P.3d 683 (Hawaii Intermediate Court of Appeals, 2011)
Durham v. Guest
2007 NMCA 144 (New Mexico Court of Appeals, 2007)
Suffolk County Sheriff v. AFSCME Council 93, Local 3643
16 Mass. L. Rptr. 511 (Massachusetts Superior Court, 2003)
Waverlee Homes, Inc. v. McMichael
855 So. 2d 493 (Supreme Court of Alabama, 2003)
Eagle Laundry v. Fireman's Fund Insurance
2002 NMCA 056 (New Mexico Court of Appeals, 2002)
Aguilera v. Palm Harbor Homes, Inc.
2001 NMCA 091 (New Mexico Court of Appeals, 2001)

Cite This Page — Counsel Stack

Bluebook (online)
1997 NMSC 027, 940 P.2d 1175, 123 N.M. 380, Counsel Stack Legal Research, https://law.counselstack.com/opinion/medina-v-foundation-reserve-insurance-nm-1997.