Construction Law

Specificity is required in arbitration demands

By Brett Hill

In Westcott Homes, LLC v. Chamness, __ Wn. App.__, 192 P.3d. 394 (September 15, 2008), the Court of Appeals addressed the issue of whether a series of emails satisfied the statutory requirements for initiating an arbitration. The Court of Appeals held that they did not.

The technical requirements of arbitration demands are governed by statute, RCW 7.04A.090. The statute provides that a party initiating an arbitration must give the notice in accordance with the parties' agreement. If there is none, the notice must be sent via certified or registered mail, return receipt requested and obtained, or by service authorized for initiation of a lawsuit (i.e. via process server). The notice must describe the nature of the controversy and the remedies sought. In this case, the developer, Westcott Homes, LLC, sought to initiate an arbitration against homeowners, the Chamnesses. Westcott requested arbitration by email stating that "Westcott is going to want to proceed to arbitrate this dispute between it and the Chamnesses." The email notice did not describe the nature of the controversy or the remedies sought by Westcott. The Court of Appeals held that the email notice did not satisfy the statute, and dismissed Westcott's claim because it did not timely initiate arbitration within the period specified in the parties' agreement.

The lesson to attorneys and clients is that although arbitrations are a less formal procedure for dispute resolution, specificity and proper service is nonetheless required for arbitration demands. It is recommended that you consult an attorney before demanding arbitration.

Full post as published by Construction Law Blog on October 16, 2008 (boomark / email).