Association Arbitration Award Affirmed

Read the full decision: The Maine Real Estate Network v. E to P, LLC, No. CV-15-245 (Me. Super. Ct. Cumberland Oct. 28, 2015).

A Maine court has considered a challenge to an arbitration conducted by the Greater Portland Board of REALTORS® (“Association”).

The Maine Real Estate Network (“Challenger”) filed a lawsuit seeking to vacate an arbitration award made to E to P LLC (“Company”) by a hearing panel of the Association.  In its lawsuit, the Challenger argued that the panel had failed to issue any findings of facts or conclusions of law in making its determination, and also failed to release a tape of the hearing.  Because of those failings, the Challenger argued that the arbitration award should be vacated.

The Superior Court of Maine, Cumberland, denied the Challenger’s arguments, confirmed the award, and allowed the Company to seek reimbursement for its costs and attorney fees incurred in confirming the award.  A court has very limited statutory grounds under which it can review an arbitration proceeding.  The Challenger asserted that one of the grounds for review, an arbitrator’s refusal to stay a hearing after a party demonstrated sufficient cause that caused prejudice to the party, allowed the court to review the Association’s arbitration proceeding.

The court rejected the Challenger’s argument because the asserted failure of the Association’s arbitration panel to issue findings of fact or conclusions of law had nothing to do with the asserted grounds for review, the refusal to postpone a hearing; indeed, the Challenger didn’t allege that the Association refused to postpone the hearing.  The court found that there is no requirement that the arbitration panel issue findings of fact or conclusions of law and noted that the NAR Code of Ethics and Arbitration Manual specifically prohibits a panel from issuing either of these.  The Challenger had also not asserted a denial of due process (another possible ground for review), and so the Association’s refusal to release the hearing tape did not give the court grounds to overturn the arbitration award.  Therefore, the court confirmed the arbitration award in favor of the Company.

Next, the court reviewed the Company’s request for its costs and fees in seeking judicial confirmation of the award.  In its arbitration request with the Association, the Challenger had included a provision that if any party had to seek judicial confirmation of an arbitration award, then that party could obtain reimbursement for the reasonable costs and fees incurred in obtaining judicial confirmation.  Based on that language, the court ordered additional proceedings to determine the amount of fees and costs that the Company could receive.

The Maine Real Estate Network v. E to P, LLC, No. CV-15-245 (Me. Super. Ct. Cumberland Oct. 28, 2015).  [Note: This opinion was not published in an official reporter and therefore should not be cited as authority. Please consult counsel before relying on this opinion.]

Editor’s Note:  Thanks to Suzanne Guild, CEO of the Maine Association of REALTORS®, for alerting NAR Legal Affairs to this decision.


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