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08/12/87 Tri-City Jewish Center, v. Blass Riddick Chilcote Et

August 12, 1987

TRI-CITY JEWISH CENTER, PLAINTIFF-APPELLANT AND CROSS-APPELLEE

v.

BLASS RIDDICK CHILCOTE ET AL., DEFENDANTS-APPELLEES AND CROSS-APPELLANTS



APPELLATE COURT OF ILLINOIS, THIRD DISTRICT

512 N.E.2d 363, 159 Ill. App. 3d 436, 111 Ill. Dec. 247 1987.IL.1162

Appeal from the Circuit Court of Rock Island County; the Hon. Robert W. Castendyck, Judge, presiding.

APPELLATE Judges:

JUSTICE WOMBACHER delivered the opinion of the court. HEIPLE and SCOTT, JJ., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE WOMBACHER

Plaintiff, Tri-City Jewish Center, is a religious corporation located in Rock Island, Illinois. The plaintiff entered a contract with the defendant Blass Riddick Chilcote, an architectural firm located in Little Rock, Arkansas, to furnish architectural and engineering services in connection with plaintiff's construction of a community center, education and worship building.

An arbitration clause in the contract, entered May 24, 1979, provided that all claims, disputes and other matters arising out of or relating to the agreement were to be arbitrated by the parties. The contract further provided that the agreement was to be governed by the law of the place of business of the architect. Therefore, Arkansas law applied to the arbitration agreement.

After the building was constructed the plaintiff asserted that the building was defective and the defendant had been negligent in the design of the building. The defendant filed a demand for arbitration on December 2, 1983, for arbitration of a dispute over payment of the balance due for services. The plaintiff filed a counterclaim against the defendant alleging professional negligence in connection with the performance of such services.

Arbitration hearings were held November 12-15, 1985. On February 6, 1986, the arbitrators rendered an award granting $65,000 to the defendant for fees and $40,000 to the plaintiff for damages. Plaintiff subsequently filed suit in the Rock Island circuit court seeking to vacate the award pursuant to the Uniform Arbitration Act (Ill. Rev. Stat. 1985, ch. 10, pars. 112, 115). The plaintiff contended that under Arkansas law the arbitrability of the claim was precluded. They further alleged that the arbitrators' award lacked fundamental rationality and/or demonstrated evident partiality on the part of one or more of the arbitrators. The defendants filed a motion to confirm the arbitration award and dismiss the complaint.

The trial court found that the plaintiff had waived its objections to the arbitration by participating in the proceedings. The court dismissed the plaintiff's complaint with prejudice.

The plaintiff appeals the trial court's order asserting that Arkansas law precludes the arbitration of the subject dispute and both parties participated in arbitration proceedings pursuant to a mutual mistake of fact. Plaintiff further asserts that the trial court should not have dismissed the complaint without determining whether the award met the test of "fundamental rationality."

Under Arkansas law only certain types of arbitration agreements are enforceable; included in these are agreements to arbitrate future disputes arising out of a contract for construction:

"A written agreement to submit to arbitration any existing or future controversy arising out of a contract for construction and/or manufacture, is and shall be valid and enforceable and irrevocable, save upon such grounds as exist at law or in equity for the revocation of any contract; provided, that this Act shall have no application to personal injury or tort matters, employer-employee disputes, nor to any insured or beneficiary under any insurance policy or annuity contract." 1969 Ark. Acts No. 260, sec. 1, at 807-808.

The appellant contends that the arbitrated claim at issue in the instant case was not arbitrable under Arkansas law inasmuch as it involved a tort matter or alternatively involved ...


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