Opinion
No. CV 04 0197986 S
August 24, 2004
MEMORANDUM OF DECISION
FACTS
The Plaintiff Springdale Fire Company, Inc., a volunteer fire department, brings this action against the City of Stamford and Mayor Daniel Malloy.
Its complaint, returnable January 6, 2004, is brought in five counts, and seeks both money damages, and various forms of equitable relief.
The Springdale Fire Company is one of five volunteer fire companies, operating within the City of Stamford.
In 1997, the Plaintiff entered into a Memorandum of Agreement (Agreement) with the City of Stamford, concerning the delivery of fire protection services in the Springdale Fire District.
Prior to November 13, 1997, the date on which the Agreement was signed, Springdale had supplemented its volunteer fire force with paid personnel.
Consistent with the Charter of the City of Stamford, the city provided assistance to the fire district, including the appropriation of monies in the annual municipal budget.
The eleven-page Agreement, signed by officials of the city and the fire company, contains provisions outlining the rights and authority of the volunteer fire company, as well as the status of paid fire personnel.
The Agreement, by its express terms, continues "indefinitely," but contains a provision for terminating the Agreement, based on not less than one hundred and eighty (180) days written notice (Paragraph 15).
Paragraph 15 "This agreement shall continue indefinitely provided that either Springdale or the City may terminate it by providing not less than one hundred and eighty (180) days advance written notice to the other. In the event that Springdale terminates this Agreement, Springdale shall not provide paid fire protection services within Stamford following such termination, but shall have the right to provide such services through the use of volunteers."
The Agreement contains detailed provisions (Paragraphs 16 through 20), concerning the resolution of disputes and controversies between the volunteer fire company, and the City.
Either party is permitted to originate mediation through written notice to the other.
If mediation is not successful, either party may submit the dispute to binding arbitration, in accordance with the provisions of the Agreement (Paragraph 17).
If the request to participate in non-binding arbitration is refused, the party making the request is given recourse to litigation (Paragraph 18).
The Agreement provides for the appointment of an arbitrator by each side, and for the designation of a third arbitrator. (Paragraph 19).
The process set forth in the Agreement is applicable to "any dispute arising out of or related to this Agreement" (Paragraph 19).
According to the Plaintiff, Springdale Fire Company, relations between the Springdale volunteer fire fighters and the paid municipal personnel, deteriorated, and are not amicable.
The history of relations since the 1997 Agreement was signed, includes a mediation proceeding, where the authority to transfer paid employees by the company became an issue.
Count one of the complaint claims that the City has breached its agreement with the Plaintiff, and that it failed to satisfy various contingencies in the Agreement, including ratification by the recognized collective bargaining unit, Local 786.
Counts two, three and four involve tortious claims of fraudulent concealment, fraudulent misrepresentation, and negligent misrepresentation.
The fifth count, labeled promissory estoppel, concerns representations allegedly made to Springdale, by agents of the City of Stamford.
The Defendant City of Stamford, has moved to dismiss this action, or, in the alternative, to stay the proceedings, until administrative remedies provided in the body of the Agreement are exhausted.
The plaintiff argues that the motion to dismiss should be denied, because this action challenges the validity of the Agreement, based upon the alleged failure of the City of Stamford to satisfy various conditions precedent to a valid agreement.
The defendant's motion to dismiss claims that the Agreement's provisions relating to mediation, followed by arbitration are valid, pursuant to § 52-408 of the General Statutes.
Section 52-408, C.G.S. "An agreement in any written contract . . . to settle by arbitration any controversy thereafter arising out of such contract or out of failure or refusal to perform the whole or any part thereof . . . shall be valid, irrevocable and enforceable, except where there exists sufficient cause at law or in equity for the avoidance of written contracts generally."
In the alternative, the City of Stamford requests a stay of the proceedings, pursuant to General Statutes § 52-409.
Section 52-409 C.G.S. — "If any action for legal or equitable relief . . . is brought by any party to a written agreement to arbitrate, the court in which the action is pending, upon being satisfied that any issue involved in the action or proceeding is referable to arbitration under the agreement, shall, by motion of any party to the arbitration agreement, stay the action or proceeding until an arbitration has been had in compliance with the agreement, provided the person making application for the stay shall be ready and willing to proceed with the arbitration."
Stamford has expressed its willingness to proceed to arbitration (see affidavit of William Callion dated January 6, 2004).
ARBITRATION PROCEDURE IN AGREEMENT IS VALID AND ENFORCEABLE
Any determination of whether a motion to dismiss should be granted or a stay should be ordered, in a case involving an arbitration clause, must begin with an examination of the actual language of the Agreement.
Whether a particular dispute is arbitrable is a question for the court, unless, by appropriate language, the parties have agreed to arbitrate that question. Whether the parties intended an issue to be arbitrated, may be determined from an express provision to that effect, or from the use of broad terms. Carlin Possi Architects, PC, Bethel 62 Conn.App. 483, 488 (2001).
Courts must look to the plain language of the contract, and construe the language as a whole when determining the intent of the parties. Weitz Co. v. Shoreline Cae Ltd. Partnership, 36 Conn.App. 641, 644-45 (1995). All relevant provisions of an agreement must be considered when determining the intent of the parties. White v. Kampner, 229 Conn. 465, 473 (1994); Bialowans v. Minor, 209 Conn. 212, 217 (1988).
As a matter of policy, arbitration is favored, because it is designed to secure prompt settlement of disputes, Hartford v. American Arbitration Association, 174 Conn. 472, 480 (1978); Webster v. UDV North America, Inc., 75 Conn.App. 538, 543 (2003).
The mediation and arbitration procedure in the Agreement applies to "any dispute arising out of, or related to this Agreement."
Language such as "any controversy" or "any dispute" is considered broad, and all encompassing. Connecticut United Telephone Workers, Inc. v. Southern New England Telephone Co., 148 Conn. 192, 197 (1961); Gary Excavating, Inc. v. North Haven, 164 Conn. 119, 123 (1972). Tort claims are included within such broad language. Fink v. Goldenbock, 238 Conn. 83, 196-97 (1996).
Based upon the language of a particular agreement, broad language within an arbitration clause can permit arbitration of public policy issues, including whether a contract is void or illegal. Success Centers, Inc. v. Huntington Learning Center, Inc., 223 Conn. 761, 772-73 (1992).
Connecticut has adopted the "positive assurance test," concerning decisions of arbitrability. Under this test, judicial inquiry is confined to whether the party opposing arbitration can show with positive assurance that the arbitration clause is not susceptible of any interpretation that covers the assigned dispute. Board of Education v. Frey, 174 Conn. 578, 582 (1978); John A. Errichetti Associates v. Boutin, 183 Conn. 481, 489 (1981). Doubts should be resolved in favor of coverage. Board of Police Commissioners v. Maher, 171 Conn. 613, 621 (1976).
In this case, many factors mitigate in favor of resort to arbitration rather than litigation.
The Agreement's language is broad, and all of the issues raised in the Plaintiff's complaint are encompassed within the very wide umbrella of issues "arising out of or related to the agreement."
The decision concerning whether any contingencies in the agreement have not been met, involves questions of both law and fact, which should be resolved in the first instance in the manner provided in the Agreement.
An arbitrator may determine, consistent with the Agreement's language, whether the contingencies were met, as well as such issues as whether the conduct of the parties since 1997 has waived any claim that the agreement is invalid.
The Plaintiff, in its memorandum in opposition to the motion to dismiss or stay, (p. 6), acknowledges that Local 786, the collective bargaining unit, agreed to most, if not all, of the terms which it claims were conditions precedent to a valid Agreement.
The elaborate procedure provided in the Agreement, demonstrates that litigation is a recognized option, only where attempts at mediation have been obstructed, and only the aggrieved party is permitted to pursue litigation.
It is further found, based upon an examination of the Agreement, that the party opposing arbitrations, the Plaintiff Springdale Fire Company, has not shown with positive assurance that the issue of whether the claimed conditions precedent have been met, is outside the broad language of the Agreement.
It is therefore found, that the Defendant City of Stamford, is ready and willing to proceed with arbitration.
Because one of the issues subject to arbitration is the existence of a valid agreement, based upon the conditional language of the Agreement, it is found that a stay of the proceedings, pending exhaustion of administrative remedies, is appropriate.
Pursuant to § 52-409 of the General Statutes, a stay of these proceedings is therefore ordered.
RADCLIFFE, J.