In THE MATTER OF ARBITRATION BETWEEN UNITED PUBLIC WORKERS, AFSCME, LOCAL 646, AFL-CIO v. City and County of Honolulu

NOT FOR PUBLICATION IN WEST’S HAWAII REPORTS OR THE PACIFIC REPORTER

NO. 27945
IN THE INTERMEDIATE COURT OF APPEALS

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In the Matter of the Arbitration Between wW,; §§ §§
UNITED PUBLIC WORKERS, AFSCME, LOCal 646, AFL-CIOjj g3
Union-Appellee, §§ §§ §§

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CITY AND COUNTY OF HONOLULU, BOARD OF WATER SUPP§¥ il

(Griev. of Scot Ouchi); ES-O4~O7; 2006-OO2, w: gp

Employer-Appellant

APPEAL FROM CIRCUIT COURT OF THE FIRST ClRCUIT
(S.P. NO. 06-1-OO63)

MEMORANDUM OPINION

(By: Nakamura, C.J., Foley and Leonard, JJ.)

Employer-Appellant City and County of Honolulu, Board
of water Supply (Employer) appeals from: l) the order granting
the motion of Union-Appellee United Public Workers, AFSCME, Local
646, AFL~CIO (UPW) to confirm the decision and amended decision
of Arbitrator R. Charles Bocken (Confirmation Order), entered by
the Circuit Court of the First Circuit (circuit court) on
April 20, 2006; 2) the circuit court's April 20, 2006, Judgment
that was based on the Confirmation Order; and 3) the circuit
court's June 6, 2006, order denying Employer's motion for
reconsideration and/or clarification of the Confirmation Order.F
The arbitrator's decision and amended decision involved a
grievance filed by UPW which challenged Employer's dismissal of
employee Scot Ouchi (Ouchi).

For the reasons discussed below, we conclude that the
circuit court exceeded its statutory authority in issuing the
Confirmation Order because the circuit court decided matters that
went beyond the arbitration award. We therefore vacate the
portion of the Confirmation Order in which the circuit court
exceeded its authority.

I.
Ouchi was employed by the Board of Water Supply as a

pipefitter. Prior to December 2003, Ouchi possessed a commercial

l/ The Honorable Randal K.O. Lee presided.

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driver's license (CDL), performed safety~sensitive functions, and
was subject to random alcohol and drug testing under the
collective bargaining agreement (CBA) between UPW and Employer.

On December 12, 2003, Ouchi was instructed to take a
random drug test. Ouchi initially provided a urine sample at
7:59 a.m. that was sufficient in volume for testing, but was
outside the acceptable temperature range. Ouchi provided two
more samples at about 10:3O a.m. and l1:OO a.m., both of which
were not sufficient in volume for testing. On December l7, 2003,
Ouchi received a letter from Employer stating that there was
sufficient cause to end Ouchi's employment because his inadequate
urine samples constituted a "refusal to test" under the CBA.
After a pre-termination hearing, Ouchi was discharged effective
January 23, 2004.

On February 20, 2004, UPW filed a grievance which
alleged that Employer violated the CBA by disciplining Ouchi
without just cause. In an arbitration decision dated January 6,
2006, Arbitrator R. Charles Bocken (Bocken) determined that the
drug testing procedure used in Ouchi's case violated United
States Department of Transportation (DOT) rules. Arbitrator
Bocken found that contrary to DOT rules, Employer did not
immediately retest Ouchi under direct supervision after the
initial sample was found to be outside the acceptable temperature
range and did not give Ouchi three hours after the first
inadequate-volume sample to provide a sample with adequate
volume. Arbitrator Bocken set aside Ouchi's discharge and
awarded him back pay for a period of four months, together with
other benefits and seniority for that period. The portion of the

arbitration decision relevant to this appeal stated:

DECISION

Accordingly, I find that the procedural error i[n] not
immediately conducting a test after the 7:59 am collection
and failing to provide three hours after the 10:30 am
collection requires setting aside [Ouchi's] discharqe.
Section 63.12 of the [CBA] provides that “A test which is
not valid as provided in the DOT Rules or violated the
Employee's rights shall not be used for discipline."

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Q@mD

[Ouchi] is awarded back pay for a period of four
months together with other benefits and seniority for that
period. Back pay benefits are to be reduced to the extent
of unemployment benefits received.

(Emphases added.) An amended arbitration decision correcting
typographical errors was issued on January 26, 2006.

After the arbitration decision, as amended, was issued,
Ouchi met with Employer on February 2l, 2006, and informed
Employer that he did not have a valid HawaFi driver's license.
Employer paid Ouchi retroactive back pay in accordance with the
arbitration award. Employer also reinstated Ouchi to his
pipefitter position, but Ouchi was prohibited from performing
safety-sensitive functions. Employer maintained that Ouchi could
not perform safety-sensitive functions until he complied with
federal requirements, including the possession of a valid CDL.
Employer also required Ouchi to enroll in a substance abuse
program (SAP). UPW objected to Employer's failure to permit
Ouchi to perform safety-sensitive duties.

On February 23, 2006, UPW filed a motion with the
circuit court 1) to confirm the January 6, 2006, arbitration
decision and award and the January 26, 2006, amended arbitration
decision and award; 2) to obtain a judgment in favor of UPW
pursuant to these decisions and awards; and 3) for other relief,
as the circuit court deemed appropriate. Employer opposed the
motion, arguing that the January 6, 2006, award could not be
confirmed because it had been amended on January 26, 2006,
Employer also objected to UPW's request that other relief be
awarded as appropriate. UPW filed a reply brief, requesting that
the circuit court l) specifically order Employer to return Ouchi
to the "status quo ante" by reinstating Ouchi to a safety-
sensitive pipefitter position and not requiring him to
participate in any SAP; and 2) award attorney's fees and costs in
favor of UPW and against Employer.

On April 20, 2006, the circuit court issued the
Confirmation Order and the Judgment in favor of UPW. In the
portion of the Confirmation Order pertinent to this appeal, the

circuit court stated:n

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4. [Employer] has failed to fully comply with the
remedial terms of the January 6, 2006 and January 26, 2006
arbitration awards. Although Scot Ouchi, the grievant, has
received back pay as ordered, he has not been fully
reinstated to perform safety sensitive functions as a
pipefitter, and the status quo ante which preceded his
discharge (which the Arbitrator Bocken ordered be "set
aside") has not been entirely restored. . . . Under the
circumstances, Employer shall pay to [UPW] . . . costs in
the amount of $378.60 and attorney's fees in the amount of
$948.6O . . . in accordance with Section 658A-25, HRS
[(Hawaii Revised Statutes)]. . . . Employer is hereby
ordered forthwith to fully abide by the remedial terms of
the January 6, 2006 and January 26, 2006 awards.

Employer filed a motion for reconsideration and/or clarification
of the Confirmation Order, which was denied on June 6, 2006.
II.

On appeal, Employer argues that: 1) the circuit court
exceeded its jurisdiction and authority when it concluded that
Employer failed to comply with the remedial terms of the
arbitration award by not fully reinstating Ouchi to perform
safety-sensitive functions as a pipefitter;W 2) to the extent
that the arbitration award was ambiguous, the circuit court
should have remanded the matter back to the arbitrator for
clarification; 3) the circuit court erred in ordering Employer to
pay attorney's fees; and 4) the circuit court erred in denying
Employer's motion for reconsideration and/or clarification of the
Confirmation_Order.F

III.

"We review the circuit court's ruling on an arbitration
award de novo, but we also are mindful that the circuit court's
review of arbitral awards must be extremely narrow and
exceedingly deferential." Tatibouet v. Ellsworth, 99 HawaiU.

226, 233, 54 P.3d 397, 404 (2002) (internal quotation marks,

brackets, and citations omitted). "Although formulated under the

3/ Although Employer argued to the circuit court that the circuit court

could not confirm the January 6, 2006, award because an amended decision
correcting typographical errors was issued on January 26, 2006, Employer has
not raised this claim on appeal. For simplicity, we will refer to the January
6, 2006, arbitration decision and award, as amended by the January 26, 2006,
arbitration decision, as a single decision and award,

5/ Employer also summarily asserts that the circuit court exceeded its

jurisdiction when it ordered Employer to fully abide by the remedial terms of
the arbitration award, Employer offers no specific argument or authority for
this contention, and we therefore deem it to have been waived. §§§ Hawafi
Rules of Appellate Procedure Rule 28(b)(7).

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prior arbitration statute, this standard of review is equally
applicable to arbitrations conducted under [(Hawaii Revised
Statutes (HRS)] Chapter 658A." Kona village Realtv, Inc. v.
Sunstone Realtv Partners, 121 Hawafi 110, 113, 214 P.3d 1100,
1103 <App. 2009>.1‘-/

IV.

we resolve the arguments raised by Employer in this
appeal as follows:

A.

Employer frames the issue as whether the circuit court
exceeded its jurisdiction in issuing the Confirmation Order. The
circuit court had jurisdiction to decide UPw's confirmation
motion pursuant to HRS Chapter 658A. The pertinent question is
whether the circuit court exceeded its statutory authority in
issuing the Confirmation Order. we conclude that the circuit
court exceeded its statutory authority in issuing the
Confirmation Order because it decided matters that went beyond
confirming the arbitration award,

"It is well established that [the HawaFi Supreme
Court] has confined judicial review of arbitration awards to the
strictest possible limits. This is because of the legislative
policy encouraging arbitration and thereby discouraging
litigation." Gepava v. State Farm Mut. Auto. Ins. Co., 94
Hawafi 362, 365, 14 P.3d 1043, 1046 (2000) (internal quotations
marks, brackets, ellipsis points, and citations omitted). with
respect to arbitration awards, "[t]he circuit court cannot act
except as allowed by . . . [statute]." United Pub. workers,
AFSCME, Local 646, AFL-CIO v. Dawson Int'l, Inc., 113 HawaiT_
127, 145, 149 P.3d 495, 513 (2006) (referring to HRS Chapter 658)
(internal quotation marks, brackets, and citation omitted).
"[w]hen faced with a motion to confirm an arbitration award, the
circuit court is limited to whether the arbitration award was

correctly rendered as measured against specific standards."

i/ In 2001, Hawaii Revised Statutes (HRS) Chapter 658 was repealed and

replaced with the Uniform Arbitration Act, codified in HRS Chapter 658A. HRS
Chapter 658A is similar in many respects to the repealed HRS Chapter 658, and
therefore certain decisions under HRS Chapter 658 remain instructive.

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Labrador v. Liberty Mut. Group, 103 HawaiE.206, 212, 81 P.3d

386, 392 (2003).

Under HRS Chapter 658A, the circuit court may vacate an
arbitration award "only on the six grounds specified in HRS
§ 658A=23(a)"W and may modify or correct an arbitration award
"only on the three grounds specified in HRS § 658A-24."-‘i/ I_<Q_r@

§/ HRS § 658A-23(a) (Supp. 2009) provides:

(a) 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:
(A) Evident partiality by an arbitrator appointed as a
neutral arbitrator;
(B) Corruption by an arbitrator; or
(C) 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 658A-15, 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 658A~15(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 658A-9
so as to prejudice substantially the rights of a party to
the arbitration proceeding.

§/ HRs § 653A~24 (supp. 2009) provides, in relevant part¢

(a) Upon motion . . . 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
(continued...)

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village Realty, 121 Hawafi at 113, 214 P.3d at 1103. "The
supreme court has made it clear that the courts have no business
weighing the merits of an arbitration award." ld;

In this case, Employer did not move to vacate the
arbitration award. Thus, the grounds for vacating the award were
inapplicable. The circuit court could only modify or correct the
award on the limited grounds set forth in HRS § 658A~24.

The arbitration decision only "set aside" Ouchi's
discharge and awarded Ouchi four months of back pay, other
benefits, and seniority for that period. The decision did not
address whether Ouchi was to be unconditionally reinstated to
perform safety-sensitive functions. The effect of Ouchi's lack
of a valid Hawafi driver's license or CDL, which presumably
disqualified him from performing safety~sensitive functions, was
not discussed in the arbitrator's decision.W 1ndeed, it appears
that Ouchi did not advise Employer about his lack of a valid
driver's license until after the arbitrator's decision was
issued.

The circuit court's Confirmation Order, however,
concluded that Employer failed to fully comply with the
arbitration award because Employer failed to fully reinstate
Ouchi to perform safety-sensitive functions as a pipefitter.

This was clearly a "modification" of the arbitration award that
went beyond the three grounds authorized under HRS

§ 658A-24. The circuit court thus exceeded its statutory
authority and erred in issuing the Confirmation Order. §§g
Gepaya, 94 HawaiU_at 362, 366, 14 P.3d at 1043, 1047 (holding
that in a proceeding to confirm an arbitration award, "the court
was mandated to confirm the award according to its terms" and was

not permitted to decide a question which was not decided by the

|<7\
\

(...continued)
affecting the merits of the decision on the claims
submitted.
(b) 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.

l/ UPW does not dispute that upon his return to work, Ouchi lacked a
valid CDL that was necessary for him to perform safety~sensitive functions.

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arbitrator); Inlandboatmen's Union of the Pacific v. Sause
Brothers Inc., 77 HawaFi 187, 192, 881 P.2d 1255, 1260 (App.
1994) (concluding that because the respondent's request to modify

the arbitration award did not come within any of the specified
statutory grounds, "the circuit court had no power to modify the
award").

we therefore vacate the portion of the Confirmation
Order that went beyond confirming the arbitration award and
concluded that Employer failed to fully comply with the terms of
the arbitration award.

B.

Although the circuit court is only authorized to modify
or correct an arbitration award on the grounds set forth in HRS
§ 658A-24, the circuit court may, pursuant to HRS § 658A-20(d)(3)
(Supp. 2009), remand the case back to the arbitrator to clarify
the award. §g§ Dawson Int'l, 113 Hawafi at 147 n.22, 149 P.3d
at 515 n.22 ("[I]t is well-recognized that courts are authorized
to remand matters to the arbitrators for clarification where the
award is ambiguous."); see also Hanford Atomic Metal Trades
Council, AFL-CIO v. General Elec. Co., 353 F.2d 302, 307-08 (9th
Cir. 1965); Bakerv, Confectionery and Tobacco workers Local Union
Number 362-T, AFL-CIO-CLC v. Brown and williamson Tobacco Corp.,
971 F.2d 652, 654-55 (11th Cir. 1992). On remand, the circuit
court may consider whether a remand to the arbitrator to clarify
the arbitration award is appropriate.

C.

Under HRS § 658A-25(b) (Supp. 2009), a court may allow
reasonable costs of a motion to confirm an arbitration award.
Employer does not provide any argument against the circuit
court's award of costs to UPw. we therefore affirm the circuit
court's award of costs to UPw.

Under HRS § 658A-25(c) (Supp. 2009), the circuit court
may award reasonable attorney's fees on the application of a
prevailing party to a contested judicial proceeding on a motion
brought to confirm an arbitration award. with regard to the
circuit court's award of attorney's fees under HRS § 658A-25(c),

we disagree with Employer's argument that UPw's motion to confirm

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was uncontested. Employer opposed UPw's motion to confirm on the
ground that the January 6, 2006, award could not be confirmed
because it had been amended, and Employer contested other aspects
of UPw's motion. UPw's motion was a "contested“ proceeding
within the meaning of HRS § 658A-25(c).

However, given our decision to vacate the portion of
the Confirmation Order in which the circuit court exceeded its
authority, we find it necessary to vacate the circuit court's
award of attorney's fees in favor of UPw. we remand the case to
permit the circuit court to reevaluate its award of attorney's
fees in light of our decision.

V.

For the foregoing reasons, we vacate the portions of
the circuit court's April 20, 2006, Confirmation Order that 1)
went beyond confirming the arbitration award and concluded that
Employer failed to fully comply with the terms of the arbitration
award and 2) awarded attorney's fees. we affirm the Confirmation
Order in all other respects. Because we are vacating portions of
the Confirmation Order, we also vacate the circuit court's April
20, 2006, Judgment and its June 6, 2006, order denying Employer's
motion for reconsideration and/or clarification of the
Confirmation Order, to the extent that they were based on the
portions of the Confirmation Order that we are vacating. we
remand the case for further proceedings consistent with this
Memorandum Opinion.

DATED= Honolulu, Hawai‘i, February 25, 2010.

On the briefs: ` #

Paul K.w. Au, Chief Judge
Deputy Corporation Counsel,

,,_
City & County of Honolulu, . é9MQA%€V? §
for Employer-Appellant. '

’ /

Associate Judge

Herbert R. Takahashi and
Rebecca L. Covert
(Takahashi Vasconcellos &
Covert)

for Union-Appellee.