Bill Text: PA HB1956 | 2009-2010 | Regular Session | Amended

---

Bill Title: Extensively revising the Uniform Arbitration Act; and making editorial changes.

Spectrum: Partisan Bill (Republican 10-0)

Status: (Introduced - Dead) 2010-09-14 - Re-committed to APPROPRIATIONS [HB1956 Detail]

Download: Pennsylvania-2009-HB1956-Amended.html

---

PRIOR PRINTER'S NO. 2623 PRINTER'S NO. 3992
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 1956 Session of2009
INTRODUCED BY GRELL, CUTLER, DALLY, GINGRICH, MILLER, MOUL, PYLE, RAPP, SONNEY AND TALLMAN, SEPTEMBER 1, 2009
AS REPORTED FROM COMMITTEE ON JUDICIARY, HOUSE OF REPRESENTATIVES, AS AMENDED, JUNE 24, 2010
AN ACT
Amending Title 42 (Judiciary and Judicial Procedure) of the
Pennsylvania Consolidated Statutes, extensively revising the
Uniform Arbitration Act; and making editorial changes.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Sections 7302, 7303, 7304, 7305, 7306, 7307,
7308, 7309, 7310, 7311, 7312, 7313, 7314, 7315, 7316, 7317,
7318, 7319 and 7320 of Title 42 of the Pennsylvania Consolidated
Statutes are repealed:
[§ 7302. Scope of subchapter.
(a) General rule.--An agreement to arbitrate a controversy
on a nonjudicial basis shall be conclusively presumed to be an
agreement to arbitrate pursuant to Subchapter B (relating to
common law arbitration) unless the agreement to arbitrate is in
writing and expressly provides for arbitration pursuant to this
subchapter or any other similar statute, in which case the
arbitration shall be governed by this subchapter.
(b) Collective bargaining agreements.--This subchapter shall
apply to a collective bargaining agreement to arbitrate
controversies between employers and employees or their
respective representatives only where the arbitration pursuant
to this subchapter is consistent with any statute regulating
labor and management relations.
(c) Government contracts.--This subchapter shall apply to
any written contract to which a government unit of this
Commonwealth is a party to the same extent as if the government
unit were a private person, except that where a contract to
which the Commonwealth government is a party provides for
arbitration of controversies but does not provide for
arbitration pursuant to any specified statutory provision, the
arbitration shall be governed by this subchapter.
(d) Special application.--
(1) Paragraph (2) shall be applicable where:
(i) The Commonwealth government submits a
controversy to arbitration.
(ii) A political subdivision submits a controversy
with an employee or a representative of employees to
arbitration.
(iii) Any person has been required by law to submit
or to agree to submit a controversy to arbitration
pursuant to this subchapter.
(2) Where this paragraph is applicable a court in
reviewing an arbitration award pursuant to this subchapter
shall, notwithstanding any other provision of this
subchapter, modify or correct the award where the award is
contrary to law and is such that had it been a verdict of a
jury the court would have entered a different judgment or a
judgment notwithstanding the verdict.
20090HB1956PN3992 - 2 -
§ 7303. Validity of agreement to arbitrate.
A written agreement to subject any existing controversy to
arbitration or a provision in a written agreement to submit to
arbitration any controversy thereafter arising between the
parties is valid, enforceable and irrevocable, save upon such
grounds as exist at law or in equity relating to the validity,
enforceability or revocation of any contract.
§ 7304. Court proceedings to compel or stay arbitration.
(a) Compelling arbitration.--On application to a court to
compel arbitration made by a party showing an agreement
described in section 7303 (relating to validity of agreement to
arbitrate) and a showing that an opposing party refused to
arbitrate, the court shall order the parties to proceed with
arbitration. If the opposing party denies the existence of an
agreement to arbitrate, the court shall proceed summarily to
determine the issue so raised and shall order the parties to
proceed with arbitration if it finds for the moving party.
Otherwise, the application shall be denied.
(b) Stay of arbitration.--On application of a party to a
court to stay an arbitration proceeding threatened or commenced
the court may stay an arbitration on a showing that there is no
agreement to arbitrate. When in substantial and bona fide
dispute, such an issue shall be forthwith and summarily tried
and determined and a stay of the arbitration proceedings shall
be ordered if the court finds for the moving party. If the court
finds for the opposing party, the court shall order the parties
to proceed with arbitration.
(c) Venue.--If a controversy alleged to be or not to be
referable to arbitration under the agreement is also involved in
an action or proceeding pending in a court having jurisdiction
20090HB1956PN3992 - 3 -
to hear applications to compel or stay arbitration, the
application shall be made to that court. Otherwise, subject to
section 7319 (relating to venue of court proceedings), the
application may be made in any court of competent jurisdiction.
(d) Stay of judicial proceedings.--An action or proceeding,
allegedly involving an issue subject to arbitration, shall be
stayed if a court order to proceed with arbitration has been
made or an application for such an order has been made under
this section. If the issue allegedly subject to arbitration is
severable, the stay of the court action or proceeding may be
made with respect to the severable issue only. If the
application for an order to proceed with arbitration is made in
such action or proceeding and is granted, the court order to
proceed with arbitration shall include a stay of the action or
proceeding.
(e) No examination of merits.--An application for a court
order to proceed with arbitration shall not be refused, nor
shall an application to stay arbitration be granted, by the
court on the ground that the controversy lacks merit or bona
fides or on the ground that no fault or basis for the
controversy sought to be arbitrated has been shown.
§ 7305. Appointment of arbitrators by court.
If the agreement to arbitrate prescribes a method of
appointment of arbitrators, the prescribed method shall be
followed. In the absence of a prescribed method or if the
prescribed method fails or for any reason cannot be followed, or
when an arbitrator appointed fails to act or is unable to act
and his successor has not been appointed, the court on
application of a party shall appoint one or more arbitrators. An
arbitrator so appointed has all the powers of an arbitrator
20090HB1956PN3992 - 4 -
specifically named in the agreement.
§ 7306. Action by arbitrators.
The powers of the arbitrators shall be exercised by a
majority unless otherwise prescribed by the agreement or
provided by this subchapter.
§ 7307. Hearing before arbitrators.
(a) General rule.--Unless otherwise prescribed by the
agreement:
(1) The arbitrators shall appoint a time and place for
the arbitration hearing and cause written notice thereof to
be served personally or by registered or certified mail on
all parties not less than ten days before the hearing.
Appearance at the hearing constitutes a waiver of such
notice.
(2) The arbitrators may adjourn the hearing from time to
time as necessary and, on request of a party and for good
cause, or upon their own motion, may postpone the hearing to
a time not later than the date fixed by the agreement for
making the award unless the parties consent to a later date.
(3) The arbitrators may hear and determine the
controversy upon the evidence produced at the arbitration
hearing notwithstanding the failure of a duly notified party
to appear. On application by a party the court may direct the
arbitrators to proceed promptly with the hearing and
determination of the controversy.
(4) The parties and their attorneys have the right to be
heard, to present evidence material to the controversy and to
cross-examine witnesses appearing at the hearing.
(5) The hearing shall be conducted by all the
arbitrators but a majority may determine any issue and render
20090HB1956PN3992 - 5 -
a final award. If, during the course of the hearing, an
arbitrator for any reason ceases to act, the remaining
arbitrator or arbitrators appointed to act as neutrals may
continue with the hearing and determine the controversy.
(b) Record.--On request of a party who shall pay the fees
therefor all testimony shall be taken stenographically and a
transcript thereof made a part of the record.
§ 7308. Representation by attorney.
A party has the right to be represented by an attorney at any
proceeding or hearing under this subchapter. A waiver thereof
prior to the proceeding or hearing is ineffective.
§ 7309. Witnesses, subpoenas, oaths and depositions.
(a) General rule.--The arbitrators may issue subpoenas in
the form prescribed by general rules for the attendance of
witnesses and for the production of books, records, documents
and other evidence. Subpoenas so issued shall be served and,
upon application to the court by a party or by the arbitrators,
shall be enforced in the manner provided or prescribed by law
for the service and enforcement of subpoenas in a civil action.
(b) Depositions.--On application of a party and for use as
evidence the arbitrators, in the manner and upon the terms
designated by them, may permit a deposition to be taken of a
witness who cannot be served with a subpoena or who is unable to
attend the hearing.
(c) Compulsory testimony.--The arbitrators shall have power
to administer oaths. All provisions of law compelling a person
under subpoena to testify are applicable.
(d) Fees.--Fees and expenses for attendance as a witness
shall be governed by the provisions of section 5903 (relating to
compensation and expenses of witnesses).
20090HB1956PN3992 - 6 -
§ 7310. Award of arbitrators.
(a) General rule.--The award of the arbitrators shall be in
writing and signed by the arbitrators joining in the award. The
arbitrators shall deliver a copy of the award to each party
personally or by registered or certified mail, or as prescribed
in the agreement to arbitrate.
(b) Time limitation.--The award shall be made within the
time fixed by the agreement or, if not fixed by the agreement,
within such time as is ordered by the court on application of a
party. The parties by written stipulation may extend the time
either before or after the expiration thereof. A party waives
the objection that an award was not made within the time
required unless he notifies the arbitrators of his objection
prior to delivery of the award to him.
§ 7311. Change of award by arbitrators.
(a) General rule.--On application of a party to the
arbitrators, or on submission to the arbitrators by the court
under such conditions as the court may order if an application
to the court is pending under section 7313 (relating to
confirmation of award by court), section 7314 (relating to
vacating award by court) or section 7315 (relating to
modification or correction of award by court), the arbitrators
may modify or correct the award upon the grounds stated in
section 7315(a)(1) and (2), or for the purpose of clarifying the
award.
(b) Time limitation.--An application to the arbitrators
under subsection (a) shall be made within ten days after
delivery of the award to the applicant. Written notice of
presentation of the application shall be given forthwith by the
applicant to all other parties stating that they must serve
20090HB1956PN3992 - 7 -
objections thereto within ten days from the date of the notice.
The award as modified or corrected is subject to the provisions
of sections 7313, 7314 and 7315.
§ 7312. Fees and expenses of arbitration.
Unless otherwise prescribed in the agreement to arbitrate,
the expenses and fees of the arbitrators and other expenses (but
not including counsel fees) incurred in the conduct of the
arbitration shall be paid as prescribed in the award.
§ 7313. Confirmation of award by court.
On application of a party, the court shall confirm an award,
unless within the time limits imposed by this subchapter,
grounds are urged for vacating or modifying or correcting the
award, in which case the court shall proceed as provided in
section 7314 (relating to vacating award by court) or section
7315 (relating to modification or correction of award by court).
§ 7314. Vacating award by court.
(a) General rule.--
(1) On application of a party, the court shall vacate an
award where:
(i) the court would vacate the award under section
7341 (relating to common law arbitration) if this
subchapter were not applicable;
(ii) there was evident partiality by an arbitrator
appointed as a neutral or corruption or misconduct in any
of the arbitrators prejudicing the rights of any party;
(iii) the arbitrators exceeded their powers;
(iv) the arbitrators refused to postpone the hearing
upon good cause being shown therefor or refused to hear
evidence material to the controversy or otherwise so
conducted the hearing, contrary to the provisions of
20090HB1956PN3992 - 8 -
section 7307 (relating to hearing before arbitrators), as
to prejudice substantially the rights of a party; or
(v) there was no agreement to arbitrate and the
issue of the existence of an agreement to arbitrate was
not adversely determined in proceedings under section
7304 (relating to court proceedings to compel or stay
arbitration) and the applicant-party raised the issue of
the existence of an agreement to arbitrate at the
hearing.
(2) The fact that the relief awarded by the arbitrators
was such that it could not or would not be granted by a court
of law or equity is not a ground for vacating or refusing to
confirm the award.
(b) Time limitation.--An application under this section
shall be made within 30 days after delivery of a copy of the
award to the applicant, except that, if predicated upon
corruption, fraud, misconduct or other improper means, it shall
be made within 30 days after such grounds are known or should
have been known to the applicant.
(c) Further hearing.--If the court vacates the award on
grounds other than stated in subsection (a)(1)(v), the court may
order a rehearing before new arbitrators chosen as prescribed in
the agreement to arbitrate. Absent a method prescribed in the
agreement to arbitrate, the court shall choose new arbitrators
in accordance with section 7305 (relating to appointment of
arbitrators by court). If the award is vacated on grounds not
affecting the competency of the arbitrators under subsection (a)
(1)(i) through (iv), the court may order a rehearing before the
arbitrators who made the award or their successors appointed in
accordance with section 7305. The time period within which the
20090HB1956PN3992 - 9 -
agreement requires the original award to be made is applicable
to the rehearing and commences from the date of the court order
directing a rehearing.
(d) Confirmation of award.--If an application to vacate the
award is denied and no application to modify or correct the
award is pending, the court shall confirm the award.
§ 7315. Modification or correction of award by court.
(a) General rule.--On application to the court made within
30 days after delivery of a copy of the award to the applicant,
the court shall modify or correct the award where:
(1) there was an evident miscalculation of figures or an
evident mistake in the description of any person, thing or
property referred to in the award;
(2) the arbitrators awarded upon a matter not submitted
to them and the award may be corrected without affecting the
merits of the decision upon the issues submitted; or
(3) the award is deficient in a matter of form, not
affecting the merits of the controversy.
(b) Confirmation of award.--If an application to modify or
correct the award is granted, the court shall modify and correct
the award so as to effect its intent and shall confirm the award
as so modified and corrected. Otherwise, the court shall confirm
the award as made by the arbitrators.
(c) Alternative applications.--An application to modify or
correct an award may be joined in the alternative with an
application to vacate the award.
§ 7316. Judgment or decree on award.
Upon the granting of an order of court confirming, modifying
or correcting an award, a judgment or decree shall be entered in
conformity with the order. The judgment or decree may be
20090HB1956PN3992 - 10 -
enforced as any other judgment or decree. Subject to general
rules, costs of any application to the court and of the
proceedings subsequent thereto, and disbursements may be imposed
by the court.
§ 7317. Form and service of applications to court.
Except as otherwise prescribed by general rules, an
application to the court under this subchapter shall be by
petition and shall be heard in the manner and upon the notice
provided or prescribed by law for the making and hearing of
petitions in civil matters. Unless the parties otherwise agree,
notice of an initial application for an order of court shall be
served in the manner provided or prescribed by law for the
service of a writ of summons in a civil action.
§ 7318. Court and jurisdiction.
The following words and phrases when used in this subchapter
shall have, unless the context clearly indicates otherwise, the
meanings given to them in this section:
"Court." As used in this subchapter means any court of
competent jurisdiction of this Commonwealth.
"Jurisdiction." The making of an agreement described in
section 7303 (relating to validity of agreement to arbitrate)
providing for arbitration in this Commonwealth confers
jurisdiction on the courts of this Commonwealth to enforce the
agreement under this subchapter and to enter judgment on an
award made thereunder.
§ 7319. Venue of court proceedings.
Except as otherwise prescribed by general rules:
(1) An initial application to a court under this
subchapter shall be made to the court of the county in which
the agreement prescribes that the arbitration hearing shall
20090HB1956PN3992 - 11 -
be held or, if the hearing has been held, in the county in
which the hearing was held.
(2) If an application to a court cannot be made under
paragraph (1) the application shall be made to the court in
the county where the adverse party resides or has a place of
business or, if he has no residence or place of business in
this Commonwealth, to the court of any county.
(3) All subsequent applications to a court shall be made
to the court hearing the initial application unless that
court otherwise directs.
§ 7320. Appeals from court orders.
(a) General rule.--An appeal may be taken from:
(1) A court order denying an application to compel
arbitration made under section 7304 (relating to proceedings
to compel or stay arbitration).
(2) A court order granting an application to stay
arbitration made under section 7304(b).
(3) A court order confirming or denying confirmation of
an award.
(4) A court order modifying or correcting an award.
(5) A court order vacating an award without directing a
rehearing.
(6) A final judgment or decree of a court entered
pursuant to the provisions of this subchapter.
(b) Procedure.--The appeal shall be taken in the manner,
within the time and to the same extent as an appeal from a final
order of court in a civil action.]
Section 2. Title 42 is amended by adding sections to read:
§ 7301.1. Definitions.
The following words and phrases when used in this subchapter
20090HB1956PN3992 - 12 -
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Arbitration organization." Any association, agency, board,
commission or other entity, that is neutral and initiates,
sponsors or administers an arbitration proceeding or is involved
in the appointment of an arbitrator.
"Arbitrator." An individual appointed to render an award,
alone or with others, in a controversy that is subject to an
agreement to arbitrate.
"Court." A court of competent jurisdiction in this
Commonwealth.
"Knowledge." Actual knowledge.
"Person." Any individual, corporation, business trust,
estate, trust, partnership, limited liability company,
association, joint venture; a government; a governmental
subdivision, agency or instrumentality; a public corporation; or
any other legal or commercial entity.
"Record." Information that is inscribed on a tangible medium
or that is stored in an electronic or other medium and is
retrievable in perceivable form.
§ 7302. Notice.
(a) Giving notice.--Except as otherwise provided in this
subchapter, a person gives notice to another person by taking
action that is reasonably necessary to inform the other person
in ordinary course, whether or not the other person acquires
knowledge of the notice.
(b) Having notice.--A person has notice if the person has
knowledge of the notice or has received notice.
(c) Receiving notice.--A person receives notice when it
comes to the person's attention or the notice is delivered at:
20090HB1956PN3992 - 13 -
(1) the person's place of residence or place of
business; or
(2) another location held out by the person as a place
of delivery of such communications.
§ 7303. When subchapter applies.
(a) Subsequent agreements.--This subchapter governs an
agreement to arbitrate made on or after the effective date of
this subchapter unless the parties have expressly provided in
writing to the contrary.
(b) Prior agreements.--Except as set forth in subsection (c) <--
subsections (c) and (d), this subchapter governs an agreement to <--
arbitrate made before the effective date of this subchapter if
all the parties to the agreement or to the arbitration
proceeding so agree in a record.
(c) Absolute date.--On or after January 1, 2009 2012, this <--
subchapter governs an agreement to arbitrate whenever made
unless the parties have expressly provided in writing to the
contrary.
(d) Collective bargaining agreements.--This subchapter shall <--
apply to collective bargaining agreements to arbitrate
controversies between employers and employees or their
respective representatives only to the extent that the
arbitration pursuant to this subchapter is consistent with any
other statute regulating labor and management relations.
§ 7304. Effect of agreement to arbitrate; nonwaivable
provisions.
(a) Waiver or variance.--Except as otherwise provided in
subsections (b) and (c), a party to an agreement to arbitrate or
to an arbitration proceeding may waive, or the parties may vary
the effect of, the requirements of this subchapter to the extent
20090HB1956PN3992 - 14 -
permitted by law.
(b) Prior to controversy.--Before a controversy arises that
is subject to an agreement to arbitrate, a party to the
agreement may not do any of the following:
(1) Waive or agree to vary the effect of the
requirements of section 7305(a) (relating to application for
judicial relief), 7306(a) (relating to validity of agreement
to arbitrate), 7308 (relating to provisional remedies),
7317(a) or (b) (relating to witnesses; subpoenas;
depositions; discovery), 7326 (relating to jurisdiction) or
7328 (relating to appeals).
(2) Agree to unreasonably restrict the right under
section 7309 (relating to initiation of arbitration) to
notice of the initiation of an arbitration proceeding.
(3) Agree to unreasonably restrict the right under
section 7312 (relating to disclosure by arbitrator) to
disclosure of any facts by a neutral arbitrator.
(4) Waive the right under section 7316 (relating to
representation by lawyer) of a party to an agreement to
arbitrate to be represented by a lawyer at any proceeding or
hearing under this subchapter, but an employer and a labor
organization may waive the right to representation by a
lawyer in a labor arbitration.
(c) Absolute prohibition.--A party to an agreement to
arbitrate or an arbitration proceeding may not waive, or the
parties may not vary the effect of, the requirements of this
section or section 7303(a) or (c) (relating to when subchapter
applies), 7307 (relating to motion to compel or stay
arbitration), 7314 (relating to immunity of arbitrator;
competency to testify; attorney fees and costs), 7318 (relating
20090HB1956PN3992 - 15 -
to judicial enforcement of preaward ruling by arbitrator),
7320(d) or (e) (relating to change of award by arbitrator), 7322
(relating to confirmation of award), 7323 (relating to vacating
award), 7324 (relating to modification or correction of award),
7325(a) or (b) (relating to judgment on award; attorney fees and
litigation expenses), 7329 (relating to uniformity of
application and construction) or 7330 (relating to relationship
to Electronic Signatures in Global and National Commerce Act).
§ 7305. Application for judicial relief.
(a) Procedure.--Except as otherwise provided in section 7328
(relating to appeals), an application for judicial relief under
this subchapter must be made by motion to the court and heard in
the manner provided by law or rule of court for making and
hearing motions.
(b) Service.--Unless a civil action involving the agreement
to arbitrate is pending, notice of an initial motion to the
court under this subchapter must be served in the manner
provided by law for the service of a summons in a civil action.
Otherwise, notice of the motion must be given in the manner
provided by law or rule of court for serving motions in pending
cases.
§ 7306. Validity of agreement to arbitrate.
(a) General rule.--An agreement contained in a record to
submit to arbitration any existing or subsequent controversy
arising between the parties to the agreement is valid,
enforceable, and irrevocable except upon a ground that exists at
law or in equity for the revocation of a contract.
(b) Court decision.--The court shall decide whether an
agreement to arbitrate exists or a controversy is subject to an
agreement to arbitrate.
20090HB1956PN3992 - 16 -
(c) Arbitrator decision.--An arbitrator shall decide whether
a condition precedent to arbitrability has been fulfilled and
whether a contract containing a valid agreement to arbitrate is
enforceable.
(d) Challenge to arbitration.--If a party to a judicial
proceeding challenges the existence of, or claims that a
controversy is not subject to, an agreement to arbitrate, the
arbitration proceeding may continue pending final resolution of
the issue by the court, unless the court otherwise orders.
§ 7307. Motion to compel or stay arbitration.
(a) Refusal to arbitrate under agreement.--On motion of a
person showing an agreement to arbitrate and alleging another
person's refusal to arbitrate pursuant to the agreement:
(1) if the refusing party does not appear or does not
oppose the motion, the court shall order the parties to
arbitrate; and
(2) if the refusing party opposes the motion, the court
shall proceed summarily to decide the issue and order the
parties to arbitrate unless it finds that there is no
enforceable agreement to arbitrate.
(b) Agreement challenged.--On motion of a person alleging
that an arbitration proceeding has been initiated or threatened
but that there is no agreement to arbitrate, the court shall
proceed summarily to decide the issue. If the court finds that
there is an enforceable agreement to arbitrate, it shall order
the parties to arbitrate.
(c) Enforceable agreement required.--If the court finds that
there is no enforceable agreement, it may not pursuant to
subsection (a) or (b) order the parties to arbitrate.
(d) Court refusal.--The court may not refuse to order
20090HB1956PN3992 - 17 -
arbitration because the claim subject to arbitration lacks merit
or grounds for the claim have not been established.
(e) Appropriate court.--If a proceeding involving a claim
referable to arbitration under an alleged agreement to arbitrate
is pending in court, a motion under this section must be made in
that court. Otherwise a motion under this section may be made in
any court as provided in section 7327 (relating to venue).
(f) Stay of claims alleged subject to arbitration.--If a
party makes a motion to the court to order arbitration, the
court on just terms shall stay any judicial proceeding that
involves a claim alleged to be subject to the arbitration until
the court renders a final decision under this section.
(g) Stay of claims subject to arbitration.--If the court
orders arbitration, the court on just terms shall stay any
judicial proceeding that involves a claim subject to the
arbitration. If a claim subject to the arbitration is severable,
the court may limit the stay to that claim.
§ 7308. Provisional remedies.
(a) Court.--Before an arbitrator is appointed and is
authorized and able to act, the court, upon motion of a party to
an arbitration proceeding and for good cause shown, may enter an
order for provisional remedies to protect the effectiveness of
the arbitration proceeding to the same extent and under the same
conditions as if the controversy were the subject of a civil
action.
(b) Arbitrator.--After an arbitrator is appointed and is
authorized and able to act:
(1) the arbitrator may issue such orders for provisional
remedies, including interim awards, as the arbitrator finds
necessary to protect the effectiveness of the arbitration
20090HB1956PN3992 - 18 -
proceeding and to promote the fair and expeditious resolution
of the controversy, to the same extent and under the same
conditions as if the controversy were the subject of a civil
action; and
(2) a party to an arbitration proceeding may move the
court for a provisional remedy only if the matter is urgent
and the arbitrator is not able to act timely or the
arbitrator cannot provide an adequate remedy.
(c) Effect.--A party does not waive a right of arbitration
by making a motion under subsection (a) or (b).
§ 7309. Initiation of arbitration.
(a) Notice.--A person initiates an arbitration proceeding by
giving notice in a record to the other parties to the agreement
to arbitrate in the agreed manner between the parties or, in the
absence of agreement, by certified or registered mail, return
receipt requested and obtained, or by service as authorized for
the commencement of a civil action. The notice must describe the
nature of the controversy and the remedy sought.
(b) Lack of notice.--Unless a person objects for lack or
insufficiency of notice under section 7315(c) (relating to
arbitration process) not later than at the beginning of the
arbitration hearing, the person by appearing at the hearing
waives any objection to lack of or insufficiency of notice.
§ 7310. Consolidation of separate arbitration proceedings.
(a) Conditions.--Except as otherwise provided in subsection
(c), upon motion of a party to an agreement to arbitrate or to
an arbitration proceeding, the court may order consolidation of
separate arbitration proceedings as to all or some of the claims
if:
(1) there are separate agreements to arbitrate or
20090HB1956PN3992 - 19 -
separate arbitration proceedings between the same persons, or
one of them is a party to a separate agreement to arbitrate
or a separate arbitration proceeding with a third person;
(2) the claims subject to the agreements to arbitrate
arise in substantial part from the same transaction or series
of related transactions;
(3) the existence of a common issue of law or fact
creates the possibility of conflicting decisions in the
separate arbitration proceedings; and
(4) prejudice resulting from a failure to consolidate is
not outweighed by the risk of undue delay or prejudice to the
rights of or hardship to parties opposing consolidation.
(b) Partial consolidation.--The court may order
consolidation of separate arbitration proceedings as to some
claims and allow other claims to be resolved in separate
arbitration proceedings.
(c) Agreement governs.--The court may not order
consolidation of the claims of a party to an agreement to
arbitrate if the agreement prohibits consolidation.
§ 7311. Appointment of arbitrator; service as a neutral
arbitrator.
(a) Appointment.--If the parties to an agreement to
arbitrate agree on a method for appointing an arbitrator, that
method must be followed, unless the method fails. If the parties
have not agreed on a method, the agreed method fails or an
arbitrator appointed fails or is unable to act and a successor
has not been appointed, the court, on motion of a party to the
arbitration proceeding, shall appoint the arbitrator. An
arbitrator appointed by the court has all the powers of an
arbitrator designated in the agreement to arbitrate or appointed
20090HB1956PN3992 - 20 -
pursuant to the agreed method.
(b) Neutral service.--An individual who has a known, direct
and material interest in the outcome of the arbitration
proceeding or a known, existing and substantial relationship
with a party may not serve as an arbitrator required by an
agreement to be neutral.
§ 7312. Disclosure by arbitrator.
(a) Preappointment.--Before accepting appointment, an
individual who is requested to serve as an arbitrator, after
making a reasonable inquiry, shall disclose to all parties to
the agreement to arbitrate and the arbitration proceeding and to
any other arbitrators any known facts that a reasonable person
would consider likely to affect the impartiality of the
arbitrator in the arbitration proceeding, including:
(1) a financial or personal interest in the outcome of
the arbitration proceeding; and
(2) an existing or past relationship with any of the
parties to the agreement to arbitrate or the arbitration
proceeding, their counsel or representatives, a witness or
another arbitrator.
(b) Continuing.--An arbitrator has a continuing obligation
to disclose to all parties to the agreement to arbitrate and the
arbitration proceeding and to any other arbitrators any facts
that the arbitrator learns after accepting appointment which a
reasonable person would consider likely to affect the
impartiality of the arbitrator.
(c) Objection.--If an arbitrator discloses a fact required
by subsection (a) or (b) to be disclosed and a party timely
objects to the appointment or continued service of the
arbitrator based upon the fact disclosed, the objection may be a
20090HB1956PN3992 - 21 -
ground under section 7323(a)(2) (relating to vacating award) for
vacating an award made by the arbitrator.
(d) Nondisclosure.--If the arbitrator does not disclose a
fact as required by subsection (a) or (b), upon timely objection
by a party, the court under section 7323(a)(2) may vacate an
award.
(e) Presumption of neutrality.--An arbitrator appointed as a
neutral arbitrator who does not disclose a known, direct and
material interest in the outcome of the arbitration proceeding
or a known, existing and substantial relationship with a party
is presumed to act with evident partiality under section 7323(a)
(2).
(f) Procedure to challenge arbitrator.--If the parties to an
arbitration proceeding agree to the procedures of an arbitration
organization or any other procedures for challenges to
arbitrators before an award is made, substantial compliance with
those procedures is a condition precedent to a motion to vacate
an award on that ground under section 7323(a)(2).
§ 7313. Action by majority.
If there is more than one arbitrator, the powers of an
arbitrator must be exercised by a majority of the arbitrators;
but all of them shall conduct the hearing under section 7315(c)
(relating to arbitration process).
§ 7314. Immunity of arbitrator; competency to testify; attorney
fees and costs.
(a) Immunity.--An arbitrator or an arbitration organization
acting in that capacity is immune from civil liability to the
same extent as a judge of a court of this Commonwealth acting in
a judicial capacity.
(b) Other immunity.--The immunity afforded by this section
20090HB1956PN3992 - 22 -
supplements any immunity under other law.
(c) Failure to disclose.--The failure of an arbitrator to
make a disclosure required by section 7312 (relating to
disclosure by arbitrator) does not cause any loss of immunity
under this section.
(d) Competence to testify.--In a judicial, administrative or
similar proceeding, an arbitrator or representative of an
arbitration organization is not competent to testify and may not
be required to produce records as to any statement, conduct,
decision or ruling occurring during the arbitration proceeding,
to the same extent as a judge of a court of this Commonwealth
acting in a judicial capacity. This subsection does not apply:
(1) to the extent necessary to determine the claim of an
arbitrator, arbitration organization or representative of the
arbitration organization against a party to the arbitration
proceeding; or
(2) to a hearing on a motion to vacate an award under
section 7323(a)(1) or (2) (relating to vacating award) if the
movant establishes prima facie that a ground for vacating the
award exists.
(e) Attorney fees and costs.--If a person commences a civil
action against an arbitrator, arbitration organization or
representative of an arbitration organization arising from the
services of the arbitrator, organization or representative or if
a person seeks to compel an arbitrator or a representative of an
arbitration organization to testify or produce records in
violation of subsection (d) and the court decides that the
arbitrator, arbitration organization or representative of an
arbitration organization is immune from civil liability or that
the arbitrator or representative of the organization is not
20090HB1956PN3992 - 23 -
competent to testify, the court shall award to the arbitrator,
organization or representative reasonable attorney fees and
other reasonable expenses of litigation.
§ 7315. Arbitration process.
(a) Discretion of arbitrator.--An arbitrator may conduct an
arbitration in such manner as the arbitrator considers
appropriate for a fair and expeditious disposition of the
proceeding. The authority conferred upon the arbitrator includes
the power to hold conferences with the parties to the
arbitration proceeding before the hearing and, among other
matters, determine the admissibility, relevance, materiality and
weight of any evidence.
(b) Summary disposition.--An arbitrator may decide a request
for summary disposition of a claim or particular issue:
(1) if all interested parties agree; or
(2) upon request of one party to the arbitration
proceeding if that party gives notice to all other parties to
the proceeding and if the other parties have a reasonable
opportunity to respond.
(c) Notice and hearing.--If an arbitrator orders a hearing,
the arbitrator shall set a time and place and give notice of the
hearing not less than five days before the hearing begins.
Unless a party to the arbitration proceeding makes an objection
to lack or insufficiency of notice not later than the beginning
of the hearing, the party's appearance at the hearing waives the
objection. Upon request of a party to the arbitration proceeding
and for good cause shown, or upon the arbitrator's own
initiative, the arbitrator may adjourn the hearing as necessary
but may not postpone the hearing to a time later than that fixed
by the agreement to arbitrate for making the award unless the
20090HB1956PN3992 - 24 -
parties to the arbitration proceeding consent to a later date.
The arbitrator may hear and decide the controversy upon the
evidence produced although a party who was notified of the
arbitration proceeding did not appear. The court, on request,
may direct the arbitrator to conduct the hearing promptly and
render a timely decision.
(d) Procedure.--At a hearing under subsection (c), a party
to the arbitration proceeding has a right to be heard, to
present evidence material to the controversy and to cross-
examine witnesses appearing at the hearing.
(e) Replacement.--If an arbitrator ceases or is unable to
act during the arbitration proceeding, a replacement arbitrator
must be appointed in accordance with section 7311 (relating to
appointment of arbitrator; service as a neutral arbitrator) to
continue the proceeding and to resolve the controversy.
§ 7316. Representation by lawyer.
A party to an arbitration proceeding may be represented by a
lawyer.
§ 7317. Witnesses; subpoenas; depositions; discovery.
(a) Subpoenas.--An arbitrator may issue a subpoena for the
attendance of a witness and for the production of records and
other evidence at any hearing and may administer oaths. A
subpoena must be served in the manner for service of subpoenas
in a civil action and, upon motion to the court by a party to
the arbitration proceeding or the arbitrator, may be enforced in
the manner for enforcement of subpoenas in a civil action.
(b) Depositions.--In order to make the proceedings fair,
expeditious and cost effective, upon request of a party to or a
witness in an arbitration proceeding, an arbitrator may permit a
deposition of any witness to be taken for use as evidence at the
20090HB1956PN3992 - 25 -
hearing, including a witness who cannot be subpoenaed for or is
unable to attend a hearing. The arbitrator shall determine the
conditions under which the deposition is taken.
(c) Discovery.--An arbitrator may permit discovery as the
arbitrator decides is appropriate in the circumstances, taking
into account the needs of the parties to the arbitration
proceeding and other affected persons and the desirability of
making the proceeding fair, expeditious and cost effective.
(d) Compliance with discovery.--If an arbitrator permits
discovery under subsection (c), the arbitrator may order a party
to the arbitration proceeding to comply with the arbitrator's
discovery-related orders, issue subpoenas for the attendance of
a witness and for the production of records and other evidence
at a discovery proceeding and take action against a noncomplying
party to the extent a court could if the controversy were the
subject of a civil action in this Commonwealth.
(e) Protective orders.--An arbitrator may issue a protective
order to prevent the disclosure of privileged information,
confidential information, trade secrets and other information
protected from disclosure to the extent a court could if the
controversy were the subject of a civil action in this
Commonwealth.
(f) Compulsory laws.--All laws compelling a person under
subpoena to testify and all fees for attending a judicial
proceeding, a deposition or a discovery proceeding as a witness
apply to an arbitration proceeding as if the controversy were
the subject of a civil action in this Commonwealth.
(g) Enforcement.--The court may enforce a subpoena or
discovery-related order for the attendance of a witness within
this Commonwealth and for the production of records and other
20090HB1956PN3992 - 26 -
evidence issued by an arbitrator in connection with an
arbitration proceeding in another state upon conditions
determined by the court so as to make the arbitration proceeding
fair, expeditious and cost effective. A subpoena or discovery-
related order issued by an arbitrator in another state must be
served in the manner provided by law for service of subpoenas in
a civil action in this Commonwealth and, upon motion to the
court by a party to the arbitration proceeding or the
arbitrator, may be enforced in the manner provided by law for
enforcement of subpoenas in a civil action in this Commonwealth.
§ 7318. Judicial enforcement of preaward ruling by arbitrator.
If an arbitrator makes a preaward ruling in favor of a party
to the arbitration proceeding, the party may request the
arbitrator to incorporate the ruling into an award under section
7319 (relating to award). A prevailing party may make a motion
to the court for an expedited order to confirm the award under
section 7322 (relating to confirmation of award), in which case
the court shall summarily decide the motion. The court shall
issue an order to confirm the award unless the court vacates,
modifies or corrects the award under section 7323 (relating to
vacating award) or 7324 (relating to modification or correction
of award).
§ 7319. Award.
(a) Record.--An arbitrator shall make a record of an award.
The record must be signed or otherwise authenticated by any
arbitrator who concurs with the award. The arbitrator or the
arbitration organization shall give notice of the award,
including a copy of the award, to each party to the arbitration
proceeding.
(b) Time.--An award must be made within the time specified
20090HB1956PN3992 - 27 -
by the agreement to arbitrate or, if not specified in the
agreement, within the time ordered by the court. The court may
extend or the parties to the arbitration proceeding may agree in
a record to extend the time. The court or the parties may do so
within or after the time specified or ordered. A party waives
any objection that an award was not timely made unless the party
gives notice of the objection to the arbitrator before receiving
notice of the award.
§ 7320. Change of award by arbitrator.
(a) Motion.--On motion to an arbitrator by a party to an
arbitration proceeding, the arbitrator may modify or correct an
award:
(1) upon a ground stated in section 7324(a)(1) or (3)
(relating to modification or correction of award);
(2) because the arbitrator has not made a final and
definite award upon a claim submitted by the parties to the
arbitration proceeding; or
(3) to clarify the award.
(b) Time for motion.--A motion under subsection (a) must be
made and notice given to all parties within 20 days after the
movant receives notice of the award.
(c) Time for objection to motion.--A party to the
arbitration proceeding must give notice of any objection to the
motion within ten days after receipt of the notice.
(d) Pending motion to court.--If a motion to the court is
pending under section 7322 (relating to confirmation of award),
7323 (relating to vacating award) or 7324, the court may submit
the claim to the arbitrator to consider whether to modify or
correct the award:
(1) upon a ground stated in section 7324(a)(1) or (3);
20090HB1956PN3992 - 28 -
(2) because the arbitrator has not made a final and
definite award upon a claim submitted by the parties to the
arbitration proceeding; or
(3) to clarify the award.
(e) Other provisions applicable.--An award modified or
corrected pursuant to this section is subject to sections
7319(a) (relating to award), 7322, 7323 and 7324.
§ 7321. Remedies; fees and expenses of arbitration proceeding.
(a) Punitive damages.--An arbitrator may award punitive
damages or other exemplary relief if such an award is authorized
by law in a civil action involving the same claim and the
evidence produced at the hearing justifies the award under the
legal standards otherwise applicable to the claim.
(b) Attorney fees and costs.--An arbitrator may award
reasonable attorney fees and other reasonable expenses of
arbitration if such an award is authorized by law in a civil
action involving the same claim or by the agreement of the
parties to the arbitration proceeding.
(c) Additional remedies.--As to all remedies other than
those authorized by subsections (a) and (b), an arbitrator may
order remedies as the arbitrator considers just and appropriate
under the circumstances of the arbitration proceeding. The fact
that a remedy could not or would not be granted by the court is
not a ground for refusing to confirm an award under section 7322
(relating to confirmation of award) or for vacating an award
under section 7323 (relating to vacating award).
(d) Arbitrator costs and fees.--An arbitrator's expenses and
fees, together with other expenses, must be paid as provided in
the award.
(e) Justification for punitive damages.--If an arbitrator
20090HB1956PN3992 - 29 -
awards punitive damages or other exemplary relief under
subsection (a), the arbitrator shall specify in the award the
basis in fact justifying and the basis in law authorizing the
award and state separately the amount of the punitive damages or
other exemplary relief.
§ 7322. Confirmation of award.
After a party to an arbitration proceeding receives notice of
an award, the party must make a motion to the court for an order
confirming the award, at which time the court shall issue a
confirming order unless the award is modified or corrected
pursuant to section 7320 (relating to change of award by
arbitrator) or 7324 (relating to modification or correction of
award) or is vacated pursuant to section 7323 (relating to
vacating award).
§ 7323. Vacating award.
(a) Grounds.--Upon motion to the court by a party to an
arbitration proceeding, the court shall vacate an award made in
the arbitration proceeding if:
(1) the award was procured by corruption, fraud or other
undue means;
(2) there was:
(i) evident partiality by an arbitrator appointed as
a neutral arbitrator;
(ii) corruption by an arbitrator; or
(iii) misconduct by an arbitrator prejudicing the
rights of a party to the arbitration proceeding;
(3) an arbitrator refused to postpone the hearing upon
showing of sufficient cause for postponement, refused to
consider evidence material to the controversy or otherwise
conducted the hearing contrary to section 7315 (relating to
20090HB1956PN3992 - 30 -
arbitration process), so as to prejudice substantially the
rights of a party to the arbitration proceeding;
(4) an arbitrator exceeded the arbitrator's powers;
(5) there was no agreement to arbitrate, unless the
person participated in the arbitration proceeding without
raising the objection under section 7315(c) not later than
the beginning of the arbitration hearing; or
(6) the arbitration was conducted without proper notice
of the initiation of an arbitration as required in section
7309 (relating to initiation of arbitration) so as to
prejudice substantially the rights of a party to the
arbitration proceeding.
(b) Time.--A motion under this section must be filed within
30 days after the movant receives notice of the award pursuant
to section 7319 (relating to award) or within 30 days after the
movant receives notice of a modified or corrected award pursuant
to section 7320 (relating to change of award by arbitrator),
unless the movant alleges that the award was procured by
corruption, fraud or other undue means, in which case the motion
must be made within 30 days after the ground is known or by the
exercise of reasonable care would have been known by the movant.
(c) Rehearing.--If the court vacates an award on a ground
other than that set forth in subsection (a)(5), it may order a
rehearing. If the award is vacated on a ground stated in
subsection (a)(1) or (2), the rehearing shall be before a new
arbitrator. If the award is vacated on a ground stated in
subsection (a)(3), (4) or (6), the rehearing may be before the
arbitrator who made the award or the arbitrator's successor. The
arbitrator shall render the decision in the rehearing within the
same time as that provided in section 7319(b) for an award.
20090HB1956PN3992 - 31 -
(d) Confirmation.--If the court denies a motion to vacate an
award, it shall confirm the award unless a motion to modify or
correct the award is pending.
§ 7324. Modification or correction of award.
(a) Grounds.--Upon motion made within 90 days after the
movant receives notice of the award pursuant to section 7319
(relating to award) or within 90 days after the movant receives
notice of a modified or corrected award pursuant to section 7320
(relating to change of award by arbitrator), the court shall
modify or correct the award if:
(1) there was an evident mathematical miscalculation or
an evident mistake in the description of a person, thing or
property referred to in the award;
(2) the arbitrator has made an award on a claim not
submitted to the arbitrator and the award may be corrected
without affecting the merits of the decision upon the claims
submitted; or
(3) the award is imperfect in a matter of form not
affecting the merits of the decision on the claims submitted.
(b) Court action.--If a motion made under subsection (a) is
granted, the court shall modify or correct and confirm the award
as modified or corrected. Otherwise, unless a motion to vacate
is pending, the court shall confirm the award.
(c) Joinder.--A motion to modify or correct an award
pursuant to this section may be joined with a motion to vacate
the award under section 7323 (relating to vacating award).
§ 7325. Judgment on award; attorney fees and litigation
expenses.
(a) Judgment.--Upon granting an order confirming, vacating
without directing a rehearing, modifying or correcting an award,
20090HB1956PN3992 - 32 -
the court shall enter a judgment in conformity with the order.
The judgment may be recorded, docketed and enforced as any other
judgment in a civil action.
(b) Court costs.--A court may allow reasonable costs of the
motion and subsequent judicial proceedings.
(c) Attorney fees and costs.--On application of a prevailing
party to a contested judicial proceeding under section 7322
(relating to confirmation of award), 7323 (relating to vacating
award) or 7324 (relating to modification or correction of
award), the court may add reasonable attorney fees and other
reasonable expenses of litigation incurred in a judicial
proceeding after the award is made to a judgment confirming,
vacating without directing a rehearing, modifying or correcting
an award.
§ 7326. Jurisdiction.
(a) Enforcement.--A court having jurisdiction over the
controversy and the parties may enforce an agreement to
arbitrate.
(b) Exclusivity.--An agreement to arbitrate providing for
arbitration in this Commonwealth confers exclusive jurisdiction
on the court to enter judgment on an award under this
subchapter.
§ 7327. Venue.
A motion pursuant to section 7305 (relating to application
for judicial relief) must be made in the court of the county in
which the agreement to arbitrate specifies the arbitration
hearing is to be held or, if the hearing has been held, in the
court of the county in which it was held. Otherwise, the motion
may be made in the court of any county in which an adverse party
resides or has a place of business or, if no adverse party has a
20090HB1956PN3992 - 33 -
residence or place of business in this Commonwealth, in the
court of any county in this Commonwealth. All subsequent motions
must be made in the court hearing the initial motion unless the
court otherwise directs.
§ 7328. Appeals.
(a) Appealable orders.--An appeal may be taken from:
(1) an order denying a motion to compel arbitration;
(2) an order granting a motion to stay arbitration;
(3) an order confirming or denying confirmation of an
award;
(4) an order modifying or correcting an award;
(5) an order vacating an award without directing a
rehearing; or
(6) a final judgment entered pursuant to this
subchapter.
(b) Procedure.--An appeal under this section must be taken
as from an order or a judgment in a civil action and must be
taken within 30 days of the order or judgment.
§ 7329. Uniformity of application and construction.
In applying and construing this subchapter, consideration
shall be given to the need to promote uniformity of the law with
respect to its subject matter among states that enact it.
§ 7330. Relationship to Electronic Signatures in Global and
National Commerce Act.
The provisions of this subchapter governing the legal effect,
validity and enforceability of electronic records or electronic
signatures and of contracts performed with the use of such
records or signatures conform to the requirements of section 102
of the Electronic Signatures in Global and National Commerce Act
(Public Law 106-229, 15 U.S.C. § 7002).
20090HB1956PN3992 - 34 -
Section 3. Section 7342 of Title 42 is amended to read:
§ 7342. Procedure.
(a) General rule.--The following provisions of Subchapter A
(relating to statutory arbitration) shall be applicable to
arbitration conducted pursuant to this subchapter:
[Section 7303 (relating to validity of agreement to
arbitrate).
Section 7304 (relating to court proceedings to compel or stay
arbitration).
Section 7305 (relating to appointment of arbitrators by
court).
Section 7309 (relating to witnesses, subpoenas, oaths and
depositions).
Section 7317 (relating to form and service of applications to
court).
Section 7318 (relating to court and jurisdiction).
Section 7319 (relating to venue of court proceedings).
Section 7320 (relating to appeals from court orders), except
subsection (a)(4).]
Section 7305 (relating to application for judicial relief).
Section 7306(a) (relating to validity of agreement to
arbitrate).
Section 7307 (relating to motion to compel or stay
arbitration).
Section 7311(a) (relating to appointment of arbitrator;
service as a neutral arbitrator).
Section 7317 (relating to witnesses; subpoenas; depositions;
discovery).
Section 7326 (relating to jurisdiction).
Section 7327 (relating to venue).
20090HB1956PN3992 - 35 -
Section 7328 (relating to appeals), except subsection (a)(4).
(b) Confirmation and judgment.--On application of a party
made more than 30 days after an award is made by an arbitrator
under section 7341 (relating to common law arbitration), the
court shall enter an order confirming the award and shall enter
a judgment or decree in conformity with the order. [Section
7302(d)(2) (relating to special application) shall not be
applicable to proceedings under this subchapter.]
Section 4. This act does not affect an action or proceeding
commenced or right accrued before the effective date of this
section. Subject to 42 Pa.C.S. § 7303, as added by section 2 of
this act, an arbitration agreement made before the effective
date of this section is governed by the former provisions of 42
Pa.C.S. §§ 7302 through 7320, as set forth in section 1 of this
act.
Section 5. This act shall take effect January 1, 2011.
20090HB1956PN3992 - 36 -