A.R.S. 12-1512 Interpretation

In Arizona, parties opposing the confirmation of an arbitration award can challenge the award only on the grounds enumerated in A.R.S. § 12-1512. Heinig, 177 Ariz. at 73, 865 P.2d at 117.

Subsection (A)(5) of § 12-1512 reads as follows:

A. Upon filing of a pleading in opposition to an award, and upon an adequate showing in support thereof, the court shall decline to confirm and award and enter judgment thereon where:

5. There was no arbitration agreement and the issue was not adversely determined in proceedings under § 12-1502 and the adverse party did not participate in the arbitration hearing without raising the objection; but the fact that the relief was such that it could not or would not be granted by a court of law or equity is not ground for vacating or refusing to confirm the award.

In Migneault v. United Services Automobile Ass'n, 21 Ariz. App. 397, 399-400, 519 P.2d 1162, 1164-65 (1974) the Court construed § 12-1512(A)(5) and held the appellant could not seek to vacate the arbitration award in opposing confirmation because he participated in the arbitration without objection.

Although the statutory language of § 12-1512(A)(5) is somewhat convoluted, it provides that one who consents to arbitration without objection -- even when there is no binding contract, Verdex Steel, 19 Ariz. App. at 550, 509 P.2d at 243, or when issues beyond the scope of a binding arbitration clause are arbitrated, Migneault, 21 Ariz. App. at 399, 519 P.2d at 1164 -- must abide by the arbitrator's decision and cannot seek to vacate it at confirmation.

Because Pinnamaneni did not participate in the arbitration, he retained his right to assert he had not agreed to arbitrate with W Inc., A.R.S. § 12-1512(A)(5), and to have a court decide whether as a nonsignatory he was nevertheless required to arbitrate. See Parekh Constr., Inc. v. Pitt Constr. Corp., 31 Mass. App. Ct. 354, 577 N.E.2d 632, 635-36 (Mass. App. Ct. 1991) (contractor who did not appear in arbitration still allowed to raise argument in court that no contract existed).