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An Ohio appellate court refused to vacate a $105,000 award, including over $50,000 in punitive damages and treble actual damages, in favor of a consumer over the purchase of a $6,500 car.
In Samber v. Mullinax Ford East, No. 2007-L-032, 2007 WL 3133804 (Ohio Ct. App.11d Oct 26, 2007), Michael Samber purchased a used vehicle from Mullinax for approximately $6,500. Several express warranties regarding the vehicle were made to Samber, including a money back guarantee.
After Samber had driven the vehicle only 32 miles, a problem caused the steering wheel to lock up while Samber’s wife was driving. Samber attempted to return the vehicle, but Mullinax would not rescind the deal. Mullinax cashed Samber’s check and further, refused to transfer title of the vehicle to Samber.
Samber filed suit and Mullinax moved to compel arbitration. Arbitration ensued and an award was issued in favor of Samber, awarding him approximately $105,000, including over $50,000 in punitive damages and treble actual damages under the Consumer Sales Practices Act.
Mullinax filed for an appeal of the award and an appellate arbitrator was selected in accordance with the parties’ arbitration agreement. Because Mullinax failed to supply a transcript of the arbitration proceedings, the appellate arbitrator confirmed the award based on the facts presented in the award.
Mullinax then moved to vacate the award, claiming that the appellate arbitrator did not allow it to present evidence. The trial court denied Mullinax’s motion. This appeal followed.
Finding the trial court’s judgment well-reasoned, the appellate Court rejected Mullinax’s argument that the arbitrators exceeded their authority by awarding both punitive damages and treble damages.
First, grounds for vacatur of an arbitration award are extremely limited. An award cannot be vacated in the absence of fraud, even where an erroneous decision is made. See Goodyear v. Local Union No. 220, 42 Ohio St.2d 516, 522 (Ohio 1975).
Second, Mullinax did not claim that a material mistake was made or that anything improper occurred during the arbitration. It instead attacked the merits of the arbitrators’ determination. This Court refused to ignore well-settled legal authority by considering the claim on its merits.
Third, there was a rational nexus between the arbitration agreement, which provided for arbitration of any dispute arising from the parties’ business deal and the arbitration award.
Fourth and finally, there was no evidence that the award was “arbitrary, capricious, or unlawful.” Mullinax failed to provide a transcript of the arbitration proceeding, even though it had three months to provide the transcript.
The Court found it reasonable to conclude that Mullinax made a strategic decision not to file the transcript because it contained evidence to substantiate the arbitrator’s decision. In the absence of such a record, the court was required to presume that the arbitrators’ conclusions were supported by evidence.
Moreover, the court found that the arbitrators’ conclusions supporting a finding of actual malice, stating that “[i]t is difficult to imagine a more flagrant case of a complete disregard for the rights and safety of others.”
Accordingly, the judgment of the trial court was affirmed.
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