Attorney fees & costs in an arbitration proceeding; Harmonizing Pransky v Falcon Group, Inc & Fleet Bus Credit v Krapohl Ford Lincoln Mercury Co; Rule 47(d)(ii) of the American Arbitration Association (AAA) Rules for Commercial Litigation

The court held that the trial court did not abuse its discretion by denying defendants’ renewed motion to reopen the case and for attorney fees and costs following arbitration. Plaintiff sued defendant alleging a variety of claims and seeking the enforcement of the arbitration provision, as well as the trial court’s supervision of a private arbitration proceeding. The trial court entered a stipulated order for dismissal without prejudice, and ordered the parties to proceed in private arbitration. The arbitrator ruled for defendants. The trial court entered a stipulated order reopening the case for entry of a judgment consistent with the arbitrator’s award. “The stipulated order also stated that the parties agreed to proceed in private arbitration in order to determine whether defendants were entitled to recover attorney fees and costs and, if so, in what amount.” The arbitrator denied defendants attorney fees and costs. The trial court then denied their renewed motion “for lack of merit on the grounds presented.” On appeal, the court rejected defendants’ argument that the trial court abused its discretion in doing so. “[I]n order to obtain an award of attorney fees and costs as damages under the arbitration provision, defendants were required to sue to enforce the provision, as would be necessary for any other contractual term. There is no indication that defendants sought attorney fees and costs before the arbitrator issued an opinion and final award in” their favor. Further, although they “were not required to specifically plead attorney fees and costs as special damages, [they] did not sue to enforce the arbitration provision as part of a claim against plaintiff.” Because they did not request an award of attorney fees and costs “prior to entry of the final arbitration award, and the arbitrator did not award” them attorney fees and costs, their motion to reopen the case and for attorney fees and costs “amounted to a request to modify the final arbitration award. The arbitrator was not empowered to award defendants attorney fees and costs after the final arbitration award because defendants requested an award of attorney fees and costs under the arbitration provision in the contract, and the arbitrator had already addressed the merits of plaintiff’s breach of contract claims.” Thus, the AAA “Rules for Commercial Litigation precluded an award of attorney fees and costs after entry of the final arbitration award.” Affirmed.