APPELLATE COURT OF ILLINOIS, THIRD DISTRICT
515 N.E.2d 401, 162 Ill. App. 3d 411, 113 Ill. Dec. 592 1987.IL.1623
Appeal from the Circuit Court of Knox County; the Hon. Stephen C. Mathers, Judge, presiding.
JUSTICE STOUDER delivered the opinion of the court. BARRY, P.J., and HEIPLE, J., concur.
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE STOUDER
Petitioner, United Cable Television Corporation (United), and respondent, Northwest Illinois Cable Corporation (Northwest), are parties to an agreement of limited partnership known as Northwest Illinois Cable TV Company (Company). The partnership agreement included an arbitration provision which requires the parties to submit a matter to arbitration provided a number of requirements are fulfilled. By a letter dated April 30, 1986, Northwest purported to commence arbitration proceedings against United pursuant to the terms of the partnership agreement. Northwest sought to have three disputes between Northwest and United submitted to arbitration. United then filed this action pursuant to section 2(b) of the Illinois Uniform Arbitration Act (Ill. Rev. Stat. 1985, ch. 10, par. 102(b)), seeking a stay of all arbitration proceedings initiated by Northwest. The trial court found one of the three disputes cited by Northwest to be subject to arbitration under the terms of the partnership agreement. Thus, United's application for a stay of arbitration was denied as to one issue and granted as to the two remaining issues. Both parties have appealed.
On appeal United contends the trial court erred when finding one of the three disputes between United and Northwest to be arbitrable. Northwest contends that all three disputes should be subject to arbitration.
The arbitration agreement at issue is set forth in section 10(4) of the agreement, which provides in relevant part as follows:
"Arbitration. In the event that the general partners fail to agree on a matter on which their agreement is required affecting the general policy of the Company (other than the incurring of indebtedness by the Company, which shall not be subject to the provisions of this section 10(4)) that would, in the judgment of either general partner, materially and adversely affect the business or prospects of the Company, such matter may be submitted to arbitration . . .."
The arbitration clause appears to be a unique one, since neither party found any authority interpreting the provision. United and Northwest agree that this provision contains three separate requirements, all of which need to be met before a dispute must be submitted to arbitration. The requirements are:
(1) the matter involved in the dispute must be one "affecting the general policy of the Company";
(2) the matter must be one which "would, in the judgment of either general partner, materially and adversely affect the business or prospects of the Company"; and
(3) the dispute must involve a matter on which the "agreement [of the general partners] is required."
Three disputes are at issue between United and Northwest. The three disputes involve (1) the amount of profits to be distributed and or profits to be retained, (2) the proper allocation of investment tax credit, and (3) the maintenance of ...