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Cons. Br. Corp. v. Am. Arbitration Assn

OPINION FILED JUNE 15, 1983.

CONSOLIDATED BROADCASTING CORPORATION, PLAINTIFF-APPELLANT,

v.

AMERICAN ARBITRATION ASSOCIATION ET AL., DEFENDANTS-APPELLEES.



Appeal from the Circuit Court of Cook County; the Hon. Arthur L. Dunne, Judge, presiding.

JUSTICE MCGILLICUDDY DELIVERED THE OPINION OF THE COURT:

Plaintiff, Consolidated Broadcasting Corporation (CBC), appeals from a decision of the circuit court of Cook County ordering plaintiff to proceed to arbitration with defendant, American Federation of Television and Radio Artists (AFTRA), before the American Arbitration Association. Plaintiff had sought an order from the circuit court staying arbitration pursuant to section 2(b) of the Uniform Arbitration Act (Ill. Rev. Stat. 1979, ch. 10, par. 102(b)). Following a hearing, the court denied plaintiff's application, but granted plaintiff's motion to stay enforcement of the arbitration order during the pendency of this appeal pursuant to Supreme Court Rule 305 (87 Ill.2d R. 305(b)(1)).

Plaintiff contends (1) that it is the function of the court rather than an arbitrator to determine whether an agreement to arbitrate exists between the parties; (2) that since defendant did not seek arbitration until 1980, the collective bargaining agreement executed in 1968 by the parties is no longer binding; and (3) that the American Arbitration Association is not authorized to exercise jurisdiction over the parties.

On July 22, 1968, plaintiff and defendant entered into a collective bargaining agreement which remained in effect through 1977. The agreement contained the following provision:

"In the event that there shall be any claim, controversy or dispute arising with respect to this contract or the interpretation or breach thereof between AFTRA and the Company, or between a staff announcer and the Company, AFTRA and the Company agree promptly and in good faith to attempt to settle such dispute amicably. In the event that they are unable to do so, any such claim, controversy or dispute shall be settled by arbitration in accordance with the industrial arbitration rules then obtaining of the American Arbitration Association * * *."

On August 8, 1978, a group of former employees of plaintiff filed suit in a Wisconsin State court to recover money allegedly due them under the terms of the 1968 collective bargaining agreement. All of the claims involved arose between 1969 and 1976 while the individual claimants were employed by plaintiff and the collective bargaining agreement of 1968 remained in full force and effect.

Plaintiff removed the suit to the United States District Court for the Eastern District of Wisconsin on October 10, 1978. The suit was dismissed on the stipulation that the claims:

"* * * shall be submitted to arbitration in accordance with the terms and conditions of the Collective Bargaining Agreement executed on July 22, 1968, it being expressly agreed by all the parties that [Consolidated] does not and will not waive its procedural defenses to such arbitration proceedings including untimeliness * * *."

The former employees attempted to arbitrate individually with plaintiff. When plaintiff refused to arbitrate, the employees returned to Federal court in an attempt to reopen the proceedings. On February 4, 1980, the court refused, holding:

"The Collective Bargaining Agreement only requires [Consolidated] to arbitrate with [AFTRA]. The stipulation also expressly reserves [Consolidated's] right to raise procedural defenses to the arbitration proceedings. This implies that the parties were aware of the possibility that arbitration might not actually take place if [Consolidated] were to raise a legitimate procedural defense. [Consolidated's] refusal to arbitrate was based on such a defense and [ex-employees] cannot be heard to claim surprise."

In August 1980, defendant, AFTRA, initiated arbitration proceedings before the American Arbitration Association in Chicago, Illinois, on behalf of the former employees. On October 22, 1980, plaintiff filed an action in the trial court seeking an order staying arbitration. The circuit court of Cook County ordered plaintiff to participate in the arbitration proceedings. Plaintiff appeals.

I

Plaintiff first contends and defendant agrees that it is the function of the court rather than an arbitrator to determine whether an agreement to arbitrate exists when that issue is in genuine dispute. This is a well-established principle of law. United Steel Workers of America v. American Manufacturing Co. (1960), 363 U.S. 564, 4 L.Ed.2d 1403, 80 S.Ct. 1343; Atkinson v. Sinclair Refining Co. (1962), 370 ...


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