Woods v. Commercial Union Insurance
Woods v. Commercial Union Insurance
Opinion of the Court
The plaintiff brought this action against Commercial Union Insurance Companies (C.U.) pursuant to G. L. c. 251, § 11, to confirm an arbitration award. Acting on cross motions for summary judgment, a Superior Court judge allowed that of the plaintiff. In its appeal, C.U. repeats the claim it made below, that it was not a party to the arbitration proceeding.
By letter dated September 2, 1997, plaintiff’s counsel informed C.U. that it was “being notified of the pending arbitration so as to be an included party in the same.” The letter also identified the plaintiff’s mother as C.U.’s insured and stated that “damages will exceed the applicable policy limits” under Commonwealth’s bodily injury policy. By letter dated September 10, 1997, an adjuster from C.U. requested information concerning the accident, copies of medical records and bills, and a statement of lost wages. Records and bills relating to the plaintiff’s medical treatment were forwarded to C.U. by plaintiff’s counsel on October 10, 1997.
On or about October 7, 1997, NAM’s regional manager
On November 24, 1997, an arbitration conducted by NAM was attended by the plaintiff, his counsel and a representative of Commonwealth. On November 26, 1997, the arbitrator rendered a decision, which included findings as to liability, causation and damage and an award in the “net amount” of $40,000 in favor of the plaintiff. Commonwealth paid $20,000 upon receipt of the arbitrator’s decision. After receiving a copy of the decision together with the plaintiff’s demand for payment of the excess $20,000 under its underinsurance coverage, C.U. notified plaintiff’s counsel that it would not recognize the award. Soon thereafter, the plaintiff filed his complaint to confirm the arbitrator’s award and, based thereon, to obtain a judgment ordering C.U. to pay him the disputed $20,000.
Discussion. The summary judgment record is devoid of any evidence that C.U. was a party to the arbitration. Neither the
It is arguable that, had an arbitrator been chosen by statute or
Relying on Local 589, Amalgamated Transit Union v. Massachusetts Bay Transp. Authy., 397 Mass. 426 (1986), the judge ruled that C.U. was barred from seeking to avoid the NAM award because of its failure to timely move to vacate the award pursuant to G. L. c. 251, § 12.
The defendant’s position is further reinforced by the following provision of its underinsurance coverage: “If an injured person settles a claim as a result of an accident covered [by the underinsurance provision], we will pay that person only if the claim was settled with our consent. We will not be bound . . . by any judgment resulting from a lawsuit brought without our written consent. We will not, however, unreasonably withhold our consent.” Even if an arbitration proceeding and award may be treated as a “lawsuit” and “judgment,” plaintiff’s notice to C.U. of the pending NAM arbitration may not reasonably be interpreted as a request for consent to such proceeding. Nor may C.U.’s written request of the plaintiff for further information, or its statement that it was “not in any position to participate,” reasonably be construed as consent to the plaintiff settling his bodily injury claim by arbitration.
Judgment reversed.
Judgment for defendant.
The parties devote a substantial part of their briefs to the issue of whether notice to C.U. of the plaintiff’s claim was late or defective as matter of law and whether C.U. was prejudiced by late notice. See Goodman v. American Cas. Co., 419 Mass. 138, 141 (1994) (“a late-notified insurer may deny under-insured motorist coverage only when it proves that it was prejudiced by the delay”). Given our conclusion that C.U. was not a party to the award in issue, we need not reach the issue of coverage.
The submission form also set forth a “HI/LOW LIMITATION” with indicated “PARAMETERS” of a “HIGH” of $20,000 and “LOW” of $10,000, together with an anomalous checking off of “UM Arbitration” from among the choices of “ADR PROCESS” listed. The other, unchecked, categories were “Non-Binding Mediation,” “UIM Arbitration,” “Paper Arbitration” and “Binding Arbitration.”
General Laws c. 251, § 2, inserted by St. 1960, c. 374, § 1, provides that “[a] party aggrieved by the failure or refusal of another to proceed to arbitration under an agreement [to arbitrate] may apply to the superior court for an order directing the parties to proceed to arbitration.”
General Laws c. 251, § 3, inserted by St. 1960, c. 374, § 1, provides the following: “If the arbitration agreement provides a method of appointment of arbitrators, such method shall be followed. In the absence thereof, or if the agreed method fails or for any reason cannot be followed, or if an arbitrator appointed fails or is unable to act and his successor has not been duly appointed, the court on application of a party shall appoint an arbitrator. An arbitrator so appointed shall have all the powers of an arbitrator specifically named in the agreement.”
General Laws c. 251, § 2A, inserted by St. 1977, c. 414, provides that “[a] party aggrieved by the failure or refusal of another to agree to consolidate one arbitration proceeding with another or others, for which the method of appointment of the arbitrator or arbitrators is the same . . . may apply to the superior court for an order for such consolidation . . . .” We assume, without deciding, that in the absence of a designation of a method of appointment of the arbitrator in the underinsurance policy, this section would have been available to the plaintiff.
General Laws c. 251, § 5, inserted by St. 1960, c. 374, § 1, provides in pertinent part that an arbitrator may, after giving written notice to the parties of the appointed time and place of the arbitration hearing, “hear and determine the controversy upon the evidence produced notwithstanding the failure of a party duly notified to appear.” The counterpart of this section in the Uniform Arbitration Act has been cited by a commentator as supporting ex parte arbitration without a court order compelling arbitration. See Domke on Commercial Arbitration § 18:04 (rev. ed. 2000).
In pertinent part, G. L. c. 251, § 12, as amended by St. 1972, c. 200, § 1, provides that an application by a “party” to. vacate an award “shall be made within thirty days after delivery of a copy of the award to the applicant . . . .”
Our decision is not to be interpreted as prohibiting the plaintiff from seeking any benefits to which he may be entitled pursuant to the underinsurance provisions of the C.U. policy held by his mother.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.