United States District Court, N.D. Illinois, Eastern Division
June 17, 2004.
TRUSTMARK INSURANCE COMPANY, a mutual insurance company organized under the laws of the State of Illinois, Petitioner,
JOHN HANCOCK LIFE INSURANCE COMPANY, a Massachusetts corporation, Respondent. JOHN HANCOCK LIFE INSURANCE COMPANY, f/k/a John Hancock Mutual Life Insurance Company, Respondent/Cross-Petitioner v. TRUSTMARK INSURANCE COMPANY, Petitioner/Cross-Respondent.
The opinion of the court was delivered by: JAMES ZAGEL, District Judge
MEMORANDUM OPINION AND ORDER
Petitioner/Cross-Respondent Trustmark Insurance Company
("Trustmark") is a mutual insurance company organized under the
laws of the State of Illinois with its principal place of
business located in Lake Forest, Illinois. Respondent John
Hancock Life Insurance Company ("Hancock") is a Massachusetts
corporation with its principal place of business in
Massachusetts. The parties entered into a series of Excess of
Loss Reinsurance Agreements, each of which contains a mandatory
arbitration clause for disputes that cannot be resolved by
compromise. Such a dispute arose, and as was required, a
three-member arbitration panel (the "Panel") was convened to resolve the dispute. On February 27, 2003, the Panel
convened an organizational meeting in Chicago, Illinois. After
this meeting, the parties took depositions and obtained documents
from each other. From January 12-23, 2004, an arbitration hearing
was held in New York City. After the conclusion of the hearing,
the Panel issued its Final Award on March 23, 2004. The parties
have now cross-petitioned pursuant to the Federal Arbitration Act
("FAA"), 9 U.S.C. § 9, for a judgment confirming the Award.
The FAA provides that an order confirming an arbitration award
is a "judgment" that should be "docketed" in the same manner "as
if it were rendered" in any other civil action. 9 U.S.C. § 13.
Federal Rule of Civil Procedure 58 governs the entry of judgments
in civil actions, and the Seventh Circuit has noted that such
judgments "should omit reasons and collateral matters and provide
only the relief to which the prevailing party is entitled." TDK
Elecs. Corp. v. Draiman, 321 F.3d 677, 679 (7th Cir. 2003); see
also Otis v. City of Chicago, 29 F.3d 1159, 1163 (7th Cir. 1994)
(a judgment "should be a self-contained document, saying who has
won and what relief has been awarded, but omitting the reasons
for this disposition, which should appear in the court's
opinion"). Put more pointedly, a Rule 58 judgment "says who is
liable for how much, then stops" and does not delve into the
"reasons and legal conclusions" behind a decision. Citizens
Elec. Corp. v. Bituminous Fire & Marine Ins., 68 F.3d 1016, 1021
(7th Cir. 1995).
While both Trustmark and Hancock seek the entry of an Order
confirming the Award, they disagree over its content. Trustmark
seeks the entry of an Order providing that the Award is
confirmed, and that Hancock is required to pay Trustmark $366,330
as ordered by the Panel. Trustmark's proposed order confirming
the Award does exactly what the Seventh Circuit says a judgment
should do it states that Hancock is liable to pay Trustmark the
sum of $366,330 and "then stops" in accordance with the requirements of Rule 58.
Id. The only affirmative action required of either party under
the Award is for Hancock to pay Trustmark $366,330. Just like a
Court's reasoning should appear in an opinion and not an order,
the Panel's reasoning is not included in the Order. Instead, the
proposed Order provides only "the relief to which the prevailing
party is entitled." TDK Elecs. Corp., 321 F.3d at 679.
Hancock's proposed Order, however, includes at least some of the
Panel's reasoning in addition to saying "who is liable for how
much." Citizens Elec. Corp., 68 F.3d at 1021. For example,
Hancock's Order includes the finding that the "[r]einsurance
[c]ontracts" at issue in the arbitration "are valid and binding,"
and that "retrocession business is covered and properly ceded to
the contracts in dispute." Its Order also includes the Panel's
findings concerning premium owed under the contracts, less claims
allowed in the arbitration, that resulted in the Panel's award of
$366,330 to Trustmark.
Hancock's proposed Order is inconsistent with the Seventh
Circuit's admonition that a judgment should omit "reasons and
legal conclusions" behind a decision and should simply state "who
is liable" and for "how much." Id. Hancock apparently believes
that the Order should summarize the Panel's reasoning that
resulted in the Award, but the Seventh Circuit has held that this
approach should not be done in preparing a judgment.*fn1
TDK Elecs. Corp., 321 F.3d at 679; Citizens Elec., 68 F.3d at
1021; Otis, 29 F.3d at 1163. Moreover, Trustmark's proposed
Order is consistent with the Confidentiality Agreement entered
into in the underlying arbitration, wherein the parties agreed
that in the context of a confirmation proceeding, they would seek
to have the Award filed under seal. Trustmark's proposed Order maintains the
confidentiality of the Award by not disclosing its content, but
Hancock's proposed Order discloses some contents of the Award,
contrary to what the parties agreed. In the end, therefore, I
find that Trustmark's proposed Order is more appropriate.
For the reasons above, Trustmark's Petition to Confirm an
Arbitration Award is GRANTED, and Hancock's Cross-Petition to
Confirm Arbitration Award and Motion to Strike Pursuant to
Federal Rule 12(b)(6) Petitioner's Petition to Confirm
Arbitration Award are DENIED.