Grievance Arbitration Between State Organization of Police Officers v. County of Kauai

FOR PUBLICATION IN WEST’S HAWAI°I REPORTS AND PACIFIC REPORTER

IN THE INTERMEDIATE COURT OF APPEALS

oF THE sTATE oF HAwArI

---oOo---
In the Matter of the Grievance Arbitration Between,

STATE OF HAWAII ORGANIZATION OF POLICE OFFICERS (SHOPO),

exclusive representative for Bargaining Unit l2, Police,

On behalf Of SHELLY L. RODRIGUES, JAMES A. RODRIGUEZ, and
SHANE Y. SOKEl, Grievants-Appellants,

V .

COUNTY OF KAUAI, and KAUAI POLICE DEPARTMENT

l

Employer-Appellee. .; "W

NO. 3003O

APPEAL FRoM THE c:RcUIT.coURT oF run FIFTH cIRcUIT.ff
s (s.P. No. 09-1-0031) 1;§t ~~

(g:j¢-i

MarCh l9, 2010

NAKAMURA, C.J., FOLEY and FUJISE, JJ.

oRDER DIsMIssINc APPEAL
FOR LACK OF APPELLATE JURISDICTION

Per Curiam. In an appeal arising out of an arbitration
matter, Grievants-Appellants State of Hawaii Organization of
Police Officers (SHOPO), exclusive representative for Bargaining
Unit l2, Police, on behalf of Shelly L. Rodrigues, James A.
Rodrigues, and Shane Y. Sokei, (Appellant SHOPO) have asserted an
appeal from the Honorable Kathleen N. A. Watanabe's August 6,
2009 order denying Appellant SHOPO's motion to confirm an
arbitration award against Employer-Appellee County of Kauai and
Kauai Police Department (Appellee Kauai County). Appellee Kauai

County contests our appellate jurisdiction over this matter,

FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER

because the Honorable Kathleen N. A. Watanabe also entered an
August 6, 2009 order that granted in part and denied in part
Appellee Kauai County‘s counter-motion to vacate the arbitration
award and remanded this matter to the arbitrator with
instructions to rehear the issue of what remedy is appropriate.
Based on the remand instructions in the August 6, 2009 order
granting in part and denying in part Appellee Kauai County’s
counter-motion to vacate the arbitration award, Appellee Kauai
County asserts that the appealed order, i;§;, the August 6, 2009
order denying Appellant SHOPO's motion to confirm the arbitration
award, lacks the necessary finality for the purpose of invoking
our appellate jurisdiction pursuant to Hawafi Revised Statutes
(HRS) § 653A-28(a) (supp. 2008>.

The supreme court has acknowledged

the well-settled principle that appellate courts have an

independent obligation to insure they have jurisdiction to

hear and determine each case. . . . This duty arises from

the equally well-settled rule that the legislature may

define and limit the right of appeal because the remedy of

appeal is not a common law right and it exists only by

authority of statutory or constitutional provisions.
Hui Kawdo Aina`Hdopulapulapula v. Bd. of Land & Natural Res.,
ll2 HaWaFi 28, 38-39, l43 P.3d l230, 1240-42 (2006) (CitatiOnS,
internal quotation marks and brackets omitted). HRS § 658A-
28(a)(3) authorizes an appeal from an order that either confirms

or denies an arbitration award:

§ 658A-28. Appeals.

(a) An appeal may be taken from:

(l) 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

FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER

(6) A final judgment entered pursuant to this
chapter.

(b) An appeal under this section shall be taken as from an
order or a judgment in a civil action.

HRS § 658A-28 (emphases added). However, the language in HRS

§ 658A-28(a)(5) appears to preclude appellate jurisdiction when a
circuit court directs a rehearing, because HRS § 658A-28(a)(5)
authorizes an appeal from an order vacating an arbitration award
only when such an order does so "without directing a
rehearing[.]" HRS § 658A~28(a)(5). v

An appealable order is generally "an order ending the
proceedings, leaving nothing further to be accomplished."
Familian Northwest, Inc. v. Cent. Pacific Boiler & Pipinq, Ltd.,
63 Haw. 368, 370, 714 P.2d 936j 937 (1986> <citations and
internal quotation marks omitted). "[A]n order is not final if
the rights of a party involved remain undetermined or if the
matter is retained for further action." Cho v. State, 115
Hawafi 373, 383, 382, 168 P.3d l7, 27 (2007) (citation and
internal quotation marks omitted). Although one August 6, 2009
order denies confirmation of the arbitration award, the other
August 6, 2009 order directs the arbitrator to rehear the remedy
issue and possibly modify the remedy for the prevailing party in
the arbitration. 1n light of the existence of these two orders,
it appears that the August 6, 2009 order denying confirmation of
the arbitration award lacks finality because (a) it does not end
the proceedings, (b) the rights of the parties remain
undetermined, and (c) on remand, the arbitrator will have
retained this matter for further action, namely a rehearing
regarding the appropriate remedy.
HRS § 658A-28 is part of a Uniform Arbitration Act

(UAA) that the HawaFi Legislature adopted in 2001. §§§ 2001

Haw. Sess. Laws Act 265 § 1. Appellate courts in a majority of

FOR PUBLICATION IN WEST'S HAWAI‘I REP()RTS AND PACIFIC REPORTER

jurisdictions that have adopted the UAA and have addressed the
issue of appellate jurisdiction under the circumstances of this
case have held that appellate jurisdiction was lacking. Karcher
Firestopping v. Meadow valley Contractors, lnc., 204 P.3d 1262
(Nev. 2009) (citing cases holding the appellate court lacked
jurisdiction over the appeal).

Similar to HRS § 658A-28(a)(3), the corresponding
section of Nevada's version of the UAA, "NRS.38.247(l)(c)[j
provides that an appeal may be taken from an order confirming or
denying confirmation of an arbitration award." Karcher
Firestopping, 204 P.3d at 1263 (internal quotation marks and
brackets omitted). Similar to HRS § 658A-2S(a)(5), Nevada's
corresponding statute, “NRS 38.247(l)(e)[,] provides that an
appeal may be taken from an order vacating an arbitration award
without directing a rehearing." Karcher Firestopping, 204 P.3d
at 1263 (internal quotation marks, brackets and footnote
omitted). Confronted with an appeal in a case involving the same
two orders as the instant case, the Supreme Court of Nevada

summarized the existing majority and minority views as follows:

Decisions concluding that no jurisdiction exists

The majority of courts that have considered this
jurisdictional issue regarding orders that deny confirmation
of an arbitration award and also vacate the award while
directing rehearing have determined that such orders are not
appealable. See Connerton, Ray & Simon v. Simon, 791 A.2d 86
(D.C. Cir.2002); Kowler Associates v. Ross, 544 N.W.2d 800
(Minn. Ct. App.1996); Thrivent Financial for Lutherans v.
Brock, 251 S.W.3d 621 (Tex. App. 2007); Prudential
Securities, Inc. v. Vondergoltz, 14 S.W.3d 329 (Tex. App.
2000). The primary approach taken by courts concluding that
such orders are not appealable is to focus on the plain
language of their statute providing that orders vacating an
arbitration award without directing a rehearing are
appealable. §§§, e.g., Simon, 791 A.2d at 87-88
(interpreting a statute that provides for appeals from
orders "confirming or denying confirmation of an arbitration
award" and orders "vacating an award without directing a
rehearing"); Ross, 544 N.W.2d at 801-02 (same); Vondergoltz,
14 S.W.3d at 330-31 (same). Because these statutes provide
for appeals only from orders vacating arbitration awards
that do not also direct a rehearing, these courts concluded

FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REP()RTER

that the plain language of the statutes provide that orders
vacating an award and directing a rehearing cannot be
appealed. §§§ Simon, 791 A.2d at 87~88; Ross, 544 N.W 2d at
801; Vondergoltz, 14 S.W.3d at 331.

Relying on this conclusion, these courts have held
that the addition of a ruling denying a motion to confirm
the award to an order vacating the award and directing a
rehearing does not render that order appealable even though
the denial of a motion to confirm an arbitration award is
independently appealable under their applicable statutes.
Simon, 791 A.2d at 88; Ross, 544 N.W.2d at 801-02;
Vondergoltz, 14 S.W.3d at 331. The rationale behind this
conclusion is that allowing such orders to be appealed
simply because a portion of the order denies confirmation of
an arbitration award renders the "without directing a
rehearing" language of these states‘ versions of
NRS 38.247(l)(e) superfluous. §§§ Simon, 791 A.2d at
87-88; Ross, 544 N.W.2d at 801; Vondergoltz, 14 S.W.3d at 331.
Thus, in order to give full effect to each of the statutory
provisions governing appeals from arbitration-related orders,
these courts concluded that orders vacating an arbitration award
while directing rehearing, and that also deny confirmation of the
award, may not be appealed.

Several courts have further concluded that the uniform
language set forth in their version of NRS 38.247(1), when
read as a whole, implicitly contains a policy choice of
permitting appellate review only when there is a sufficient
'degree of finality to the arbitration proceedings. §§§
Simon, 791 A.2d at 88; Ross, 544 N.W.2d at 802; Thrivent
Financial for Lutherans v. Brock, 251 S.W.3d 621, 622, 627
(Tex. App. 2007) (interpreting a statute that provides for
appeals from orders "confirming or denying confirmation of
an award" and orders "vacating an award without directing a
rehearing"); see also Dept. of Transp. v. State Employ.
Ass'n, 581 A.2d 813, 814-15 (Me. 1990) (same, and
determining that the court lacked jurisdiction to consider
an order that vacated an arbitration award and directed
rehearing but discussing in dicta an approach to an order
similar to the one at issue here); Nebraska Dept. of Health
V. S'CruSS, 261 Neb. 435, 623 N.W.2d 308, 313-14 (200l)
(interpreting a statute that provides for appeals from
orders "confirming or denying confirmation of an award" and
orders "vacating an award without directing a rehearing,"
and concluding that the court lacked jurisdiction over an
appeal that challenged an order vacating an award and
directing rehearing). Indeed, the Nebraska Supreme Court
commented in Struss that the purpose of Nebraska's version
of NRS 38.247(1) is to distinguish between orders that
conclude the arbitration process, and are thus suitable for
appellate review, and those that do not conclude the
arbitration process, rendering appellate review premature.
623 N.W.2d at 314-15.

FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER

Decisions concluding that jurisdiction exists

Only two courts have interpreted language similar to
that of NRS 38.247(1) as permitting appellate jurisdiction
over orders that both deny confirmation of an arbitration
award and vacate the award while directing rehearing.
National Ave. Bldg. Co. v. Stewart, 910 S.W.2d 334, 337-41
(Mo. Ct. App. 1995) (interpreting a statute that provides
for appeals from orders "confirming or denying confirmation
of an award" and orders "vacating an award without directing
a rehearing"); Werline v. East Texas Salt Water Disp. Co.,
209 S.W.3d 888, 893-96 (Tex. App. 2006) (same). In reaching
this result, these courts emphasize the fact that their
version of NRS 38.247(l)(c) expressly permits appeals from
orders denying confirmation of an arbitration award.
Stewart, 910 S.W.2d at 340-41; Werline, 209 S W.3d at 895-
96. Additionally, the Stewart court also noted that no
subsection of the applicable statutes explicitly acts to bar
the appealability of an order made appealable under another
subsection when that order also contains a ruling that would
not otherwise be independently appealable. 910 S.W.2d at
341. In Stewart, the court further noted that if their
state's legislature had intended an order, such as the one
at issue here, not to be appealable, it would have added the
qualifier "without directing a rehearing" to their statute
providing for appeals from orders denying confirmation of an
award. ;Q; at 341. Emphasis is also placed on the
conclusion that interpreting the language of their versions
of NRS 38.247(1) as not allowing appeals from orders that
deny confirmation and vacate the award while directing
rehearing could allow the arbitration process to continue
indefinitely. Stewart, 910 S.W.2d at 340; Werline, 209
S.W.3d at 896. Further, the Werline court asserted that not
reading Texas's version of NRS 38.247(l)(c) as allowing an
appeal from an order that both denies confirmation and
vacates the award while directing rehearing renders the
second half of subsection (c), which authorizes appeals from
orders denying confirmation, almost meaningless. 209 S.W.3d
at 895. The Werline court based this conclusion on its
belief that if such orders could not be appealed, appellate
jurisdiction would only exist "in the rare situation when
the trial court denies a motion to confirm, but fails to
vacate the award." ;Q;

Karcher Firestopping, 204 P.3d at 1264-65 (footnote omitted).

The Supreme Court of Nevada followed the majority of
jurisdictions and concluded that appellate jurisdiction under the
Nevada equivalent of HRS § 658A-28 was lacking under these

circumstances:

Having reviewed these alternative interpretations of
analogous versions of NRS 38.247(1), we find the decisions
concluding that appellate courts lack jurisdiction to review
orders denying confirmation of an arbitration award and
vacating the award while directing a rehearing better

6

FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REP()RTER

reasoned and more persuasive. In particular, we agree with
the various courts that have concluded that the plain
language of their version of NRS 38.247(l)(e), which
provides for an appeal from orders vacating an arbitration
award without directing a rehearing, bars appellate review
of orders vacating an award while directing a rehearing,
even if the order also denies confirmation of the award,
which, on its own, would be appealable under a statute
analogous to NRS 38.247(l)(c). §§§, e.g., Connerton¢ Ray &
Simon v. Simon, 791 A.2d 86, 87-88 (D.C. Cir. 2002); Kowler
Associates v. Ross, 544 N w.2d 800, 801-02 (Minn. Ct. `
App.1996); Prudential Securities, Inc. v. Vondergoltz, 14
S.W.3d 329, 331 (Tex. App. 2000). As noted in these
decisions, because in this matter the district court
directed a rehearing, permitting appellate review at this
point would render NRS 38.247(l)(e)’s "without directing a
rehearing" language superfluous.

Further, we agree with the conclusion reached by
several courts that the statutory structure providing for
appeals from arbitration~related orders, when read as a `
whole, is designed to permit appeals only from orders that
bring an element of finality to the arbitration process,

§e§ Simon, 791 A.2d at 88; Dept. of Transp. v. State Employ.
Ass'n, 581 A.2d 813, 814-15 (Me. 1990); Nebraska Dept. of
Health v. Struss, 261 Neb. 435, 623 N.W.2d 308, 314 (2001);
Thrivent Financial for Lutherans v. Brock, 251 S.W.3d 621,
627 (Tex. App. 2007). Here, the district court's order
vacating the arbitration award and remanding for
supplemental proceedings extended, rather than concluded,
the arbitration process, and has not been identified by NRS
38.247(l) as sufficiently final to be suitable for appellate
review. Accordingly, finding no statutory basis for an
appeal from the district court order, we conclude that this
court lacks jurisdiction over this appeal.

CONCLUSIQN

After reviewing the plain text of NRS 38.247(1)(e), as

well as the implicit policy contained in NRS 38.247(l) favoring
finality of the arbitration proceedings prior to appellate review,
we conclude that this court lacks jurisdiction to review a
district court order that vacates an arbitration award, directs
rehearing, and denies a motion to confirm the award. Accordingly,
we dismiss this appeal. _

Karcher FirestODpinQ, 204 P.3d at 1265-66.

we choose to follow the majority of jurisdictions, and
we therefore hold that under the circumstances of the instant
case, the August 6, 2009 order denying Appellant SHOP0's motion

to confirm the arbitration award is not an appealable order.

FOR PUBLICATI()N IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPOR'I`ER

Absent an appealable order, we lack appellate jurisdiction and
Appellant SHOPO's appeal is premature. Accordingly,
IT IS HEREBY ORDERED that appellate court case number

3003O is dismissed for lack of appellate jurisdiction.

Chief Judge

CI@a/”d?

Associate Judge

@at¢//@é¢ "

Associate Judge