Argued
January 31, 2019
Procedural
History
Application
to confirm an arbitration award, brought to the Superior
Court in the judicial district of Ansonia-Milford, where the
defendants filed a motion to vacate the award; thereafter,
the matter was tried to the court, Hon. Arthur A.
Hiller, judge trial referee; judgment granting the
application to confirm and denying the motion to vacate, from
which the defendants appealed to this court; subsequently,
the court issued an articulation of its decision.
Affirmed.
Lori
Welch-Rubin, for the appellants (defendants).
Thomas
J. Weihing, for the appellee (plaintiff).
Keller, Prescott and Harper, Js.
OPINION
PRESCOTT, J.
The
defendants, Jason Robert's, Inc., and Robert D. Hartmann,
Sr., appeal from the judgment of the trial court denying
their motion to vacate an arbitration award and granting an
application to confirm the award filed by the plaintiff,
Michael DeRose. On appeal, the defendants claim that the
court improperly (1) found that the arbitrator effectively
had defaulted the defendants for failing to appear at the
final arbitration hearing, and that this allegedly erroneous
factual finding colored the court's decision-making
process with respect to the motion to vacate; (2) failed to
provide the defendants with an evidentiary hearing before
ruling on the motion to vacate; (3) granted a motion to quash
a subpoena duces tecum directed at the arbitrator and his
files; (4) failed to vacate the arbitration award on the
ground that the arbitrator had not addressed the entirety of
the submission; (5) confirmed an award that violated public
policy; and (6) confirmed an award made in manifest disregard
of the law in violation of General Statutes § 52-418 (a)
(4).[1]
We disagree and, accordingly, affirm the judgment of the
trial court.
The
facts underlying the parties' long-standing dispute are
set forth in our decision in Jason Robert's, Inc. v.
Administrator, Unemployment Compensation Act, 127
Conn.App. 780, 782-85, 15 A.3d 1145 (2011). Additional facts
and procedural history are set forth in the arbitrator's
award and in the trial court's oral decision and
subsequent articulation. ‘‘[Jason Robert's,
Inc., ] is a concrete business. During the years 1998, 1999
and 2000, [it] employed [DeRose] as a concrete artisan. While
[DeRose] was working for [Jason Robert's, Inc.] as an
employee, he asked for a raise in salary. In order to give
[DeRose] the potential to earn more money, [Jason
Robert's, Inc., ] directed [DeRose] to set up a business
so that he could enter into an agreement with [it] as a
licensed dealer. In or about 2001, after [DeRose] had set up
his own business, [Jason Robert's, Inc., ] presented him
with a licensed dealer authorization (agreement), and, on May
4, 2001, [DeRose] signed the agreement and became a licensed
dealer for [Jason Robert's, Inc.]
‘‘[DeRose]
was a licensed dealer of [Jason Robert's, Inc., ] during
the years 2001 and 2002. During those years, [Jason
Robert's, Inc., ] classified [DeRose] as an independent
contractor. At the end of 2002, [DeRose] terminated the
agreement because the arrangement had become unprofitable for
him. After terminating the agreement, [DeRose] filed a claim
for benefits under the Unemployment Compensation Act (act),
General Statutes § 31-222 et seq. This claim for
benefits caused . . . the administrator of the act
[administrator] to issue a missing wage assignment. . . . On
April 25, 2003 . . . [a field auditor of the employment
security division of the state department of labor] issued
[a] written report, wherein he concluded that [DeRose] was an
employee [of Jason Robert's, Inc., ] during the years
2001 and 2002. In a letter dated April 29, 2003, the
[administrator] informed [Jason Robert's, Inc., ] of this
determination and that there would be an assessment for the
contributions due in the amount of $4366.03 plus interest. On
May 16, 2003, [Jason Robert's, Inc., ] appealed this
determination to the appeals division . . . . On September
12, 2007 . . . the appeals referee affirmed the
determination. In its decision, the appeals referee applied
§ 31-222 (a) (1) (B) (ii), more commonly known as the
‘ABC test,' . . . and concluded that [DeRose] was
an employee of [Jason Robert's, Inc.] The referee reached
this conclusion after having determined that [Jason
Robert's, Inc., ] failed to satisfy any of the three
prongs of the ABC test.'' (Footnote omitted.)
Id., 782-84.
Both
the Worker's Compensation Review Board (board) and the
Superior Court subsequently affirmed the decision of the
appeals referee. Id., 784-85. Jason Robert's,
Inc., then appealed to this court claiming that, in
determining whether DeRose was an employee, the board should
have applied General Statutes § 42-133e (b), rather than
the ‘‘ABC test'' to the underlying facts.
Id., 785. We disagreed and affirmed the judgment of
the trial court. Id.
In
2007, during the pendency of the worker's compensation
appeal, DeRose filed a civil action against the
defendants.[2] The operative complaint contained seven
counts in which DeRose alleged that the defendants (1)
breached their agreement with him by failing to compensate
him for various jobs, (2) breached the implied covenant of
good faith and fair dealing, (3) made negligent
misrepresentations, (4) made fraudulent misrepresentations,
(5) violated several state labor statutes, (6) committed
unfair trade practices, and (7) negligently inflicted
emotional distress. In May, 2011, the defendants filed an
amended answer to the complaint raising a number of special
defenses.[3] Jason Robert's, Inc., also filed a
counterclaim against DeRose, alleging that he had breached
the parties' agreement by failing to complete work or
utilizing poor workmanship, and committed statutory theft by
retaining funds belonging to Jason Robert's, Inc.
On June
6, 2012, the parties entered into an agreement to resolve
their civil action through binding arbitration. DeRose
subsequently withdrew his civil action from the Superior
Court. The arbitration agreement contains a clause titled
‘‘Submission to Arbitration and Scope of
Arbitration, '' which states as follows:
‘‘The controversy shall be submitted to a panel
of one arbitrator (Attorney Daniel Portanova), who shall
hear, settle and determine by arbitration the matters in
controversy within the scope of the claim based upon the
evidence and testimony presented. The arbitrator is
permitted, but not required, to apply the rules of evidence
in civil cases when considering the evidence presented. No
party shall have the right or power to revoke the submission
without the written consent of the other party except on the
grounds asexist in law or equity for the rescission or
revocation of any contract. All issues shall be submitted to
and fully and finally adjudicated by the arbitrator
including, but not limited to, the issue of coverage,
liability, causation and damages. The arbitrator will apply
the procedural and substantive law of Connecticut.''
The
arbitrator held hearings between July 1, 2012, and January
24, 2013, during which the parties submitted evidence,
including testimony from DeRose and Hartmann. A period of
inactivity then followed. By letter dated September 25, 2014,
the arbitrator notified the parties as follows:
‘‘Please be advised that I am holding [$2, 100]
in my trustee account regarding the above arbitration. I have
attached my invoice showing that each respective party has
paid [$4, 500]; therefore, each party is owed a refund of
[$1, 050].''
DeRose
sent the arbitrator a letter dated May 15, 2015, attached to
which were additional documents that DeRose sought tofile
with the arbitrator ‘‘with the intention to
restart the . . . arbitration matter.'' A copy of
that letter and its attachments were also sent to the
defendants' counsel. The defendants responded to DeRose
by letter dated May 19, 2015. The defendants indicated that,
because the last arbitration hearing had taken place on
January 24, 2013, and DeRose, until he sent the May 15, 2015
letter, had not complied with the arbitrator's request
‘‘to submit everything, '' they
considered the arbitration abandoned.[4] DeRose replied to the
defendants by letter dated June 1, 2015. In the letter, he
stated that the arbitration proceedings had never been
closed, he had not abandoned the matter, and he intended to
proceed to a final decision. He indicated that he had no more
testimony or evidence to present and that, if the defendants
failed to participate going forward, they did so at their own
peril. A few days later, on June 4, 2015, DeRose sent a
letter to the arbitrator stating: ‘‘It has come
to my attention that [counsel for the defendants] will not
file any more documents or bring any witnesses into
arbitration. We therefore respectfully request that you
declare the arbitration closed and issue a decision in this
matter.''
The
arbitrator next met with the parties in March, 2016. He later
sent notice to the parties by letter dated April 1, 2016,
stating: ‘‘I have reviewed the file since our
meeting of last week. This file will remain open for further
consideration.'' The parties and the arbitrator met
again in June, 2016. By that time, Hartmann had discharged
the defendants' attorney and was proceeding as a
self-represented party. Hartman made an oral motion to have
the arbitration terminated, but the arbitrator denied the
motion, continuing the matter until January 16, 2017.
Despite
the arbitrator's decision that the arbitration would go
forward, the defendants, who were now represented by their
present counsel, sent DeRose a letter dated January 13, 2017,
asserting that they intended to treat the arbitration as
abandoned ‘‘by virtue of laches.'' The
defendants did not attend the final January 16, 2017
arbitration hearing, despite having been duly served with
subpoenas.
On
February 1, 2017, the arbitrator issued a final award
resolving the matter in favor of DeRose. Among other things,
the arbitrator found that (1) DeRose was an employee of Jason
Robert's, Inc., (2) DeRose never authorized the
defendants to make deductions as was claimed by the
defendants, and (3) Hartman was the individual who ultimately
was responsible for the wage violations that had occurred.
The arbitrator found that the defendants were liable to
DeRose under General Statutes § 31-72, [5] and ordered them
to pay DeRose damages, costs, and attorney's fees
totaling $171, 938.20.[6]Notice of the arbitrator's award issued
on February 3, 2017.
On
February 15, 2017, DeRose filed an application with the
Superior Court for an order confirming the arbitration award.
See General Statutes § 52-417.[7] On March 6, 2017, the
defendants filed a motion to vacate the arbitration award
pursuant to § 52-418. According to the defendants, the
arbitrator's award violated clear public policy, as
embodied in the equitable doctrine of laches, and contravened
one or more of the statutory proscriptions set forth in
§ 52-418. The defendants also filed an objection to
DeRose's application to confirm the arbitration award
raising these same arguments. DeRose filed an objection to
the motion to vacate the arbitration award, arguing that no
legally cognizable reason existed to vacate the award.
The
defendants served a subpoena duces tecum on the arbitrator
ordering him to appear in court on July 17, 2017, and to
produce the entire arbitration file maintained by him in his
capacity as arbitrator. The arbitrator filed a motion to
quash the subpoena, arguing that the contents of the
arbitration file, which included his research and personal
notes, were not relevant to any of the theories the
defendants had advanced in support of their motion to vacate
the arbitration award.
The
parties argued the motion to quash before the court on July
17, 2017. After hearing from the parties, the court granted
the arbitrator's motion to quash the subpoena. The court
also denied the defendants' motion to vacate the
arbitration award and granted the application to confirm the
award. The court explained as follows on the record:
‘‘The court has heard the arguments. The court
has read all the papers in this file that have been filed.
The court will grant the motion to quash the subpoena. The
court will find that any delay in this arbitration was caused
because the arbitrator gave the defendants extra time to
present their case. The court finds no prejudice. The court
finds that any delay [that] may have occurred did not cause
any prejudice to the defendants and that the delay, if
anything, was to their benefit. . . .
‘‘The
defendants were apprised of the final hearing date, and . . .
Hartmann, both in his corporate and his personal capacity,
[was] served by subpoenas on January 11, 2017. Hartmann and
Jason Robert's, Inc., were in effect defaulted and failed
to appear at the hearing. And as a result of their failure to
appear at the hearing, Hartmann did not have another attorney
filing an appearance on his behalf and he did not ask for a
continuance and had a letter sent that the defendants were
not coming to the hearing. . . . Hartmann, once again, did
not appear at the final hearing, nor did any attorney
representing him, and the arbitrator went forward after
finding the ...