A BETTER WAY WHOLESALE AUTOS, INC.
v.
JAMES SAINT PAUL ET AL.
Argued
May 21 and October 10, 2018
Procedural
History
Application
to vacate anarbitration award, brought to the Superior Court
in the judicial district of Waterbury, where the defendants
filed motions to confirm the award and for attorney's
fees, and to dismiss the application to vacate the award;
thereafter, the matter was tried to the court, M. Taylor,
J.; judgment dismissing the application to vacate, and
granting the motions to confirm and for attorney's fees,
from which the plaintiff appealed to this court.
Affirmed.
Kenneth A. Votre, for the appellant (plaintiff).
Richard F. Wareing, withwhom was Daniel S. Blinn, for the
appellees (defendants).
DiPentima, C. J., and Lavine, Sheldon, Keller, Elgo, Bright,
Moll and Lavery, Js. [*]
OPINION
MOLL,
J.
The
plaintiff, A Better Way Wholesale Autos, Inc., appeals from
the judgment of the trial court dismissing its application to
vacate an arbitration award issued in favor of the
defendants, James Saint Paul and Julie J. Saint Paul, and
granting the defendants' application to confirm the
arbitration award. On appeal, the plaintiff contends that the
court improperly (1) dismissed its application to vacate as
untimely, (2) engaged thereafter in a review of the substance
of the plaintiff's application to vacate and concluded
that the arbitration award did not manifest an egregious or
patently irrational application of the law, and (3) awarded
the defendants $2185 in supplemental attorney's fees. We
conclude that the court properly dismissed the
plaintiff's application to vacate as untimely and did not
abuse its discretion in awarding supplemental attorney's
fees. In light of our conclusion that the court properly
dismissed the plaintiff's application to vacate as
untimely, we also conclude that the court erred by reviewing
the substance of the application but that such error was
harmless. Accordingly, we affirm the judgment of the trial
court.
The
following undisputed facts and procedural history are
relevant to this appeal. In early 2015, the defendants
purchased a motor vehicle from the plaintiff, a motor vehicle
dealer located in Naugatuck. To finance their purchase, the
defendants entered into a financing agreement with the
plaintiff. The agreement contains an arbitration provision
that provides, in part, that any dispute arising out of or
relating to the purchase of the defendants' vehicle shall
be resolved by binding arbitration. The agreement also
contains a general choice of law clause, which provides that
‘‘[f]ederal law and the law of the state of our
address shown on the front of this contract apply to this
contract.'' The front of the financing agreement
shows an address in Naugatuck. The arbitration section of the
financing agreement contains a specific choice of law
provision, which provides in relevant part: ‘‘[1]
Any arbitration under this Arbitration Provision shall be
governed by the Federal Arbitration Act [(FAA)] (9 U.S.C.
§ 1 et seq. [2012]) and not by any state law concerning
arbitration. [2] Any award by the arbitrator shall be in
writing and will be final and binding on all parties, subject
to any limited right to appeal under the [FAA].'' The
arbitration section further provides in part that
‘‘[a]ny court having jurisdiction may enter
judgment on the arbitrator's award.''
On
December 15, 2015, the defendants filed an arbitration demand
with the American Arbitration Association, claiming that the
plaintiff required the defendants to purchase an oil change
contract and a service contract as a condition of financing
in violation of the federal Truth in Lending Act (TILA), 15
U.S.C. § 1601 et seq. (2012), and the Connecticut Unfair
Trade Practices Act, General Statutes § 42-110a et seq.
On July 21, 2016, following an evidentiary hearing,
[1] the
arbitrator issued a so-called ‘‘unreasoned
award'' in favor of the defendants in the amount of
$8797.81, which included $2297.81 in actual damages, $2000 in
statutory damages under TILA, and $4500 in attorney's
fees and costs. The arbitrator concluded that the plaintiff
violated TILA by failing to include the oil change contract
and the service contract in the finance charge disclosure
provision of the agreement.
On
August 26, 2016, the plaintiff filed in the Superior Court an
application to vacate the arbitration award pursuant to the
FAA, claiming therein that the arbitrator exceeded his
powers. On September 28, 2016, pursuant to General Statutes
§ 52-417, [2] the defendants filed an omnibus
‘‘motion to confirm arbitration award, opposition
to plaintiff's application to vacate arbitration award,
and motion for supplemental attorney's fees''
(application to confirm). On November 9, 2016, the defendants
filed a supplemental memorandum of law in opposition to the
plaintiff's application to vacate, arguing therein that
the plaintiff's application to vacate should be dismissed
for lack of subject matter jurisdiction because it was not
timely filed pursuant to General Statutes § 52-420 (b)
(‘‘[n]o motion to vacate, modify or correct an
award may be made after thirty days from the notice of the
award to the party to the arbitration who makes the
motion''). On December 7, 2016, the plaintiff filed a
memorandum of law in support of its application to vacate,
which did not address the timeliness issue raised by the
defendants.
On
December 30, 2016, following a hearing, the trial court
dismissed the plaintiff's application to vacate as
untimely filed pursuant to § 52-420 (b) and granted the
defendants' application to confirm, including the
defendants' request therein for $2185 in supplemental
attorney's fees under TILA. This appeal
followed.[3] Additional facts will be set forth as
necessary.
I
As a
threshold matter, we address the defendants' claim that
the plaintiff's appeal should be dismissed as moot. The
defendants argue that, because the plaintiff failed to file
in the Superior Court an opposition to their application to
confirm and did not address in this court the application to
confirm, this court can no longer grant the plaintiff any
practical relief. We disagree.
‘‘Mootness
is a question of justiciability that must be determined as a
threshold matter because it implicates [a] court's
subject matter jurisdiction . . . . A case is considered moot
if [the] court cannot grant . . . any practical relief
through its disposition of the merits . . . .''
(Internal quotation marks omitted.) Glaston-bury v.
Metropolitan District Commission, 328 Conn. 326, 333,
179 A.3d 201 (2018). ‘‘Because mootness
implicates our subject matter jurisdiction . . . it is a
proper basis upon which to seek the dismissal of an
appeal.'' (Citation omitted.) Sovereign Bank v.
Licata, 178 Conn.App. 82, 96-97, 172 A.3d 1263 (2017).
In the
present case, the question of mootness is inextricably
intertwined with the principal substantive issue that the
plaintiff raises on appeal, namely, whether the trial court
improperly dismissed the plaintiff's application to
vacate on timeliness grounds. See Argent Mortgage Co.,
LLC v. Huertas, 288 Conn. 568, 575-76, 953 A.2d 868
(2008). Notwithstanding the plaintiff's failure to file
an opposition to the application to confirm in the Superior
Court and its failure to address such application in its
appellate brief, this court could afford the plaintiff
practical relief by reversing the court's dismissal of
the plaintiff's application to vacate on timeliness
grounds. See General Statutes § 52-417
(‘‘[t]he court or judge shall grant such an order
confirming the award unless the award is vacated,
modified or corrected as prescribed in sections 52-418 and
52-419'' [emphasis added]). Therefore, we conclude
that the plaintiff's appeal is not moot.[4]
II
We turn
now to the merits of the plaintiff's claims on appeal.
The plaintiff first claims that the court erred in dismissing
its application to vacate as untimely under our state law on
the ground that it was filed beyond the thirty day limitation
period set forth in § 52-420 (b).[5] According to the
plaintiff, the arbitration provision contained in the
parties' financing agreement requires the application of
the FAA in all respects, including its three month limitation
period to file an application to vacate. See 9 U.S.C. §
12 (2012).[6] The defendants maintain that our state law
governs the timeliness question presented, and, therefore,
the trial court properly dismissed the plaintiff's
application to vacate as untimely under § 52-420 (b). We
agree with the defendants.
In the
present case, it is uncontested that the plaintiff filed its
application to vacate after the expiration of the thirty day
limitation period set forth in § 52-420 (b) but within
the three month limitation period set forth in 9 U.S.C.
§ 12. Whether the court properly dismissed the
plaintiff's application to vacate as untimely depends on
whether state or federal law controls the limitation period
in which the plaintiff was required to file such application.
Therefore, the question before us is a legal one.
‘‘[W]e review a [trial] court's decision to
confirm or vacate an arbitration award de novo on questions
of law . . . .'' (Internal quotation marks omitted.)
Henry v. Imbruce, 178 Conn.App. 820, 828, 177 A.3d
1168 (2017).
A
We
first turn our attention to the fundamental question of
whether parties can, as a matter of law, agree to
have the FAA's three month limitation period set forth in
9 U.S.C. § 12 apply to a vacatur proceeding filed in
Connecticut state court so as to supplant or override the
thirty day limitation period in § 52-420 (b). For the
reasons that follow, we conclude that they cannot.
We
begin with a brief review of the purposes and limitations of
the FAA. In 1925, Congress enacted the FAA ‘‘[t]o
overcome judicial resistance to arbitration'';
Buckeye Check Cashing, Inc. v. Cardegna,
546 U.S. 440, 443, 126 S.Ct. 1204, 163 L.Ed.2d 1038 (2006);
and to declare ‘‘ ‘a national policy
favoring arbitration' of claims that parties contract to
settle in that manner.'' Preston v. Ferrer,
552 U.S. 346, 353, 128 S.Ct. 978, 169 L.Ed.2d 917 (2008),
quoting Southland Corp. v. Keating, 465
U.S. 1, 10, 104 S.Ct. 852, 79 L.Ed.2d 1 (1984). In that
connection, § 2 of the FAA provides that arbitration
agreements in contracts ‘‘involving
commerce'' are ‘‘valid, irrevocable, and
enforceable.'' 9 U.S.C. § 2 (2012). The FAA was
designed to place agreements to arbitrate ‘‘upon
the same footing as other contracts . . . .''
(Citation omitted; internal quotation marks omitted.)
Volt Information Sciences, Inc. v. Board of
Trustees of Leland Stanford Junior University, 489 U.S.
468, 474, 109 S.Ct. 1248, 103 L.Ed.2d 488 (1989)
(Volt). The FAA ‘‘ ‘creates a body
of federal substantive law,' '' and
‘‘the substantive law the [FAA] created [is]
applicable in state and federal courts.''
Southland Corp. v. Keating, supra, 12,
quoting Moses H. Cone Memorial Hospital v. Mercury
Construction Corp., 460 U.S. 1, 25 n.32, 103 S.Ct. 927,
74 L.Ed.2d 765 (1983). The United States Supreme Court has
stated that ‘‘[t]he FAA contains no express
pre-emptive provision, nor does it reflect a congressional
intent to occupy the entire field of arbitration. . . . But
even when Congress has not completely displaced state
regulation in an area, state law may nonetheless be
pre-empted to the extent that it actually conflicts with
federal law- that is, to the extent that it stands as an
obstacle to the accomplishment and execution of the full
purposes and objectives of Congress.'' (Citation
omitted; internal quotation marks omitted.) Volt,
supra, 477.
The FAA
does not create independent federal jurisdiction. The United
States Supreme Court has described the nonjurisdictional
nature of the FAA as follows: ‘‘As for
jurisdiction over controversies touching arbitration, the
[FAA] does nothing, being ‘something of an anomaly in
the field of federal-court jurisdiction' in bestowing no
federal jurisdiction but rather requiring an independent
jurisdictional basis.'' Hall Street Associates,
L.L.C. v. Mattel, Inc., 552 U.S. 576, 581-82, 128 S.Ct.
1396, 170 L.Ed.2d 254 (2008), citing Moses H. Cone
Memorial Hospital v. Mercury Construction Corp., supra,
460 U.S. 25 n.32. ‘‘While the [FAA] creates
federal substantive law requiring the parties to honor
arbitration agreements, it does not create any independent
federal-question jurisdiction under 28 U.S.C. § 1331 or
otherwise.''Southland Corp. v.
Keating, supra, 465 U.S. 15 n.9.
‘‘Given
the substantive supremacy of the FAA, but [its]
nonjurisdictional cast, state courts have a prominent role to
play as enforcers of agreements to arbitrate.''
Vaden v. Discover Bank, 556 U.S. 49, 59, 129 S.Ct.
1262, 173 L.Ed.2d 206 (2009), superseded by statute in part
on other grounds as stated in Vermont v. MPHJ Technology
Investments, LLC, 803 F.3d 635, 643-44 (Fed. Cir. 2015),
cert. denied, U.S., 136 S.Ct. 1658, 194 L.Ed.2d 766 (2016),
and cert. denied, MPHJ Technology Investments, LLC v.
Vermont, U.S., 136 S.Ct. 1660, 194 L.Ed.2d 766 (2016).
Accordingly, despite its expansive reach, the FAA does not
extend so far as to preempt the procedural rules governing
state court proceedings in the absence of an actual conflict
with the purposes of Congress. That is because, as the United
States Supreme Court has made clear, ‘‘[t]here is
no federal policy favoring arbitration under a certain set of
procedural rules; the federal policy is simply to ensure the
enforceability, according to their terms, of private
agreements to arbitrate.'' Volt, supra, 489
U.S. 476.
We now
turn to our state law procedures governing an application to
vacate an arbitration award brought in Connecticut state
court. ‘‘A proceeding to vacate an arbitration
award is not a civil action, but is rather a special
statutory proceeding. . . . Section 52-420(b) requires that a
motion to vacate an arbitration award be filed within thirty
days of the notice of the award to the moving
party.'' (Citations omitted.) Middlesex Ins.
Co. v. Castellano, 225 Conn. 339, 344, 623 A.2d
55 (1993).
Our
Supreme Court repeatedly has held that the thirty day
limitation period set forth in § 52-420 (b) is subject
matter jurisdictional. See id. (‘‘[i]f
the motion is not filed within the thirty day time limit, the
trial court does not have subject matter jurisdiction over
the motion''); see also Wu v. Chang, 264
Conn. 307, 312, 823 A.2d 1197 (2003); Rosenthal Law Firm,
LLC v. Cohen, 165 Conn.App. 467, 471, 139 A.3d 774,
cert. denied, 322 Conn. 904, 138 A.3d 933 (2016);
Petrucelli v. Travelers Property Casualty Ins. Co.,
146 Conn.App. 631, 640-41, 79 A.3d 895 (2013), cert. denied,
311 Conn. 909, 83 A.3d 1164 (2014). Indeed, in Angersola
v. Radiologic Associates of Middletown, P.C., 330 Conn.
251, 267-68, 193 A.3d 520 (2018), our Supreme Court recently
reaffirmed the principle of legislative acquiescence, which,
as applied to the present case, serves to buttress the
court's long-standing interpretation of the limitation
period set forth in § 52-420 (b) as subject matter
jurisdictional. See id., 268 (‘‘the
legislature has never seen fit to overrule our conclusion
that compliance with the repose period [in General Statutes
§ 52-555, this state's wrongful death statute] is a
jurisdictional prerequisite to suit'').[7]
‘‘[A]s an intermediate appellate court, we are
bound by Supreme Court precedent and are unable to modify it
. . . . [W]e are not at liberty to overrule or discard the
decisions of our Supreme Court but are bound by them. . . .
[I]t is not within our province to reevaluate or replace
those decisions.'' (Internal quotation marks
omitted.) State v. Montanez, 185 Conn.App. 589, 605
n.5, 197 A.3d 959 (2018).
It is,
of course, a bedrock principle that parties cannot agree to
confer subject matter jurisdiction on a court, nor can they
waive the lack of subject matter jurisdiction. Angersola
v. Radiologic Associates of Middletown, P.C., supra, 330
Conn. 265-66 (statutory time limitation that is
jurisdictional may not be waived); Rayhall v. Akim
Co., 263 Conn. 328, 337, 819 A.2d 803 (2003)
(‘‘[a]lthough both parties agree that this court
has jurisdiction, a subject matter jurisdictional defect may
not be waived . . . [or] conferred by the parties, explicitly
or implicitly'' [internal quotation marks omitted]);
Manning v. Feltman, 149 Conn.App. 224, 236, 91 A.3d
466 (2014) (‘‘subject matter jurisdiction cannot
be conferred by waiver or consent'').
The
foregoing well settled principles require us to conclude
that, as a matter of law, parties cannot contract around, by
way of a choice of law provision, the subject matter
jurisdictional nature of § 52-420 (b), applicable to any
application to vacate an arbitration award brought in
Connecticut state court. Therefore, the limitation period set
forth in § 52-420 (b) applies to the plaintiff's
application to vacate. It is not disputed that, if §
52-420 (b) is deemed to be the applicable limitation period,
the plaintiff's application was ...