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The Kansas Court of Appeals rejected a party’s argument that an arbitrator exceeded his powers in rendering an award for fraud when fraud was not specifically alleged because the claimant’s arbitration filings gave sufficient notice of the fraud allegations.
In Frebar, Inc. v. Sanctum, LLC, No. 95,568, 2006 WL 2595307 (Kan. Ct. App. Sep. 8, 2006), Frebar initiated arbitration, claiming that Sanctum, a contractor, had misappropriated funds and falsified documents. The arbitrator awarded Frebar $478,379.69, based partly on his finding that Sanctum committed fraud.
Nine months after the award was issued, Sanctum moved to vacate the award, arguing that the arbitrator exceeded his powers by rendering an award for fraud when Frebar did not specifically allege fraud in its statement of claim. The trial court rejected this argument and confirmed the award.
The Court affirmed confirmation of the award for two reasons. First, the Court found that the Frebar’s arbitration filings gave facts sufficient to put Sanctum on notice of the fraud allegations. Second, the Court ruled that Sanctum’s motion to vacate was untimely because it was not filed within the 90-day deadline imposed by the Kansas Uniform Arbitration Act.
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