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DiSano v. Argonaut Insurance Co.

Supreme Court of Rhode Island

February 28, 2018

David DiSano
v.
Argonaut Insurance Company.

         Providence County No. (PM 14-4568) Superior Court Jeffrey A. Lanphear Associate Justice.

          For Plaintiff: Thomas R. Ricci, Esq. Michael S. Pezzulo, Esq.

          For Defendant: John J. Cloherty, Esq.

          Present: Suttell, C.J., Goldberg, Flaherty, Robinson, and Indeglia, JJ.

          OPINION

          Suttell, Chief Justice.

         The plaintiff, David DiSano (DiSano), appeals from a Superior Court order that denied his petition to vacate an arbitration award; granted the petition of the defendant, Argonaut Insurance Company (Argonaut), to confirm the arbitration award; and granted Argonaut's motion to quash the deposition subpoena of the dissenting arbitrator. This case came before the Supreme Court pursuant to an order directing the parties to appear and show cause why the issues raised in this appeal should not be summarily decided. After considering the parties' written and oral submissions and reviewing the record, we conclude that cause has not been shown and that this case may be decided without further briefing or argument. For the reasons set forth in this opinion, we affirm the order of the Superior Court.

         I Facts and Travel

         This case concerns an automobile accident that occurred on April 14, 2010, involving DiSano and an individual named Justin Lorello. At the time of the accident, DiSano was employed by the Providence Water Supply Board (PWSB) and was operating a PWSB-owned vehicle. DiSano sought underinsured-motorist coverage through an insurance policy issued by Argonaut to PWSB.[1] Because the policy contained an arbitration provision, the parties executed an arbitration-submission agreement in which they agreed that the Superior Court Rules Governing Arbitration of Civil Actions would apply.

         A two-day hearing was conducted before a panel of three arbitrators. On August 25, 2014, a majority of the arbitrators issued a decision that found in favor of Argonaut; one arbitrator dissented from the decision. The majority found Lorello liable for the April 14, 2010 accident. The majority also found that: (1) Lorello's insurer, Liberty Insurance Company, had paid DiSano $25, 000, the policy limit; (2) DiSano's insurer, Metropolitan Property and Casualty Insurance Company, had paid DiSano $25, 000, the underinsured-motorist coverage policy limit; and (3) the workers' compensation insurer for PWSB, Liberty Mutual, had paid DiSano $258, 303 in workers' compensation benefits. Consequently, the majority determined that Argonaut was entitled to an offset of $308, 303 from any damages awarded to DiSano in the arbitration, which it calculated by adding the aforementioned insurance payments and workers' compensation benefits received by DiSano.

         The majority further found that DiSano "had significant pre-existing hip and low back conditions which pre-dated the subject accident[, ]" and that the accident marginally aggravated these conditions. The majority determined that the medical testimony demonstrated that the accident exacerbated DiSano's low-back condition for approximately three months, but that hip replacement surgery that he underwent on February 23, 2011, after the accident, "was not causally related to the accident." The majority concluded that DiSano was entitled to damages for three months with respect to reasonable pain and suffering, medical expenses, and lost wages. However, because the majority also found that DiSano's damages were less than the $308, 303 offset amount to which it had determined Argonaut was entitled, "judgment" was entered in favor of Argonaut.

         On September 16, 2014, DiSano filed a petition in the Superior Court to vacate the arbitration award, pursuant to G.L. 1956 § 10-3-12. Argonaut objected to DiSano's petition and brought a cross-petition to confirm the arbitration award, pursuant to § 10-3-11. On November 13, 2015, DiSano filed a notice to depose the dissenting arbitrator. Argonaut moved to quash the deposition subpoena pursuant to Rules 26(c) and 45(c)(3) of the Superior Court Rules of Civil Procedure. It maintained that: (1) Superior Court Arbitration Rule 5(f) prohibits the deposition of an arbitrator; (2) common law provides arbitrators with quasi-judicial immunity; and (3) there is no factual or legal basis to depose the dissenting arbitrator. DiSano objected to the motion to quash.

         On January 21, 2016, a hearing was held before a justice of the Superior Court on the parties' pending petitions and Argonaut's motion to quash. DiSano explained, in support of his petition to vacate the arbitration award, that he was relying on the fourth ground provided in § 10-3-12, which mandates that an arbitration award must be vacated "[w]here the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made." Section 10-3-12(4). DiSano noted that he was not disputing that Argonaut was entitled to an offset; however, he maintained that the majority had miscalculated the offset amount. Specifically, DiSano asserted that the arbitrators miscalculated the amount because they did not subtract from his workers' compensation benefits the amount that was attributable to his hip replacement. DiSano argued that "a substantial portion of that $308, [303] * * * included the hip replacement surgery [and] the lost wages incurred as a result of the hip replacement surgery."

         In response, Argonaut first noted the limited review of arbitration awards and the "strong public policy in favor of arbitration awards." It asserted that, although DiSano was attempting to challenge the adequacy of the award by arguing that the award was miscalculated, the purported inadequacy of an arbitration award is not a ground upon which the courts can vacate an arbitration award.

         With respect to Argonaut's motion to quash the deposition subpoena, DiSano explained that he sought to depose the dissenting arbitrator to ascertain why the majority, in calculating the offset, had included certain amounts that he had received. However, Argonaut argued that DiSano's attempt to depose the dissenting arbitrator violated ...


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