No. 1080 Philadelphia 1981, Appeal from the Order of the Court of Common Pleas of Lackawanna County, No. 81-Civil-843.
Francis P. Devine, III, Philadelphia, for appellant.
Thomas P. Kennedy, Scranton, for appellees.
McEwen, Johnson and Watkins, JJ. McEwen, J., files a dissenting opinion.
[ 313 Pa. Super. Page 118]
This is an appeal from the order of a trial court en banc vacating the award of an arbitrator rendered as a result of a common law arbitration of a contract dispute between Sigma Marketing, Inc. (appellant) and Giant Markets, Inc. (appellee). The trial court en banc concluded that appellant breached the terms of a stipulation entered into by both parties on January 22, 1980. Since we conclude that the stipulation was not breached, and more fundamentally, we
[ 313 Pa. Super. Page 119]
believe that the trial court en banc erroneously exceeded the limited scope of review applicable to common law arbitration, we reverse.
On August 2, 1977, in settlement of prior litigation, not relevant here, the parties concluded an agreement which included the following arbitration clause:
"In the event of any dispute between the parties under this Agreement, the same may be submitted to arbitration by either party in accordance with the rules of the American Arbitration Association."
The clause was later supplemented on January 22, 1980 by the following written stipulation entered into by the parties:
"MR. DEVINE: This will be for the benefit of the Arbitrator. We had extensive settlement discussions during the depositions here today. We both agreed as counsel and the parties agreed that no mention of settlement was to be made to the Arbitrator; and in the event that one of the parties broach the subject to the Arbitrator without the knowledge of the other party, we are in agreement that the Arbitrator shall immediately discontinue the hearing, remove himself as an Arbitrator, and ask that the matter be reassigned to someone else; is that what we agreed to?
Subsequently, the parties commenced an arbitration proceeding pursuant to the above-quoted arbitration provision as modified by the stipulation. Several days of testimony had been taken when the incident that precipitated this appeal occurred. During a break from the hearing, a Mr. Roth, an officer of appellant corporation, who knew of the stipulation between the parties, made mention of the subject of settlement in response to a question from the arbitrator. More specifically, it is alleged that Mr. Roth stated to the arbitrator that "no reasonable cash settlement had been offered." Since this occurred ...