COURT OF APPEALS OF OHIO, EIGHTH DISTRICT COUNTY OF CUYAHOGA NO. 74123 ENVIRONMENTAL CONSULTING : ACCELERATED DOCKET GROUP, INC. : : JOURNAL ENTRY Plaintiff-Appellee : : AND -vs- : : OPINION FREEMAN SWANK : : Defendant-Appellant : PER CURIAM Date of Announcement of Decision: SEPTEMBER 17, 1998 Character of Proceeding: Civil appeal from Court of Common Pleas Case No. 348117 Judgment: Affirmed Date of Journalization: Appearances: For Plaintiff-Appellee: ROBERT T. ROSENFELD, ESQ. 31853 Cedar Road Mayfield Hts., Ohio 44124-4445 For Defendant-Appellant: CHARLES M. HYMAN, ESQ. Hyman & Hyman 614 E.S.T. Building Elyria, Ohio 44035 -2- PER CURIAM: This appeal is before the Court on the accelerated docket pursuant to App.R. 11.1 and Loc. App.R. 25. Defendant-appellant Freeman Swank appeals from the judgment of the Common Pleas Court confirming an AAA arbitration award of $29,610.21 in favor of plaintiff-appellee Environmental Consulting Group, Inc. (ECG). Defendant claims the trial court erred in not finding that defendant did not receive notice of the AAA hearing and in not providing defendant a hearing pursuant to R.C. 2711.09. We find no error and affirm. Swank owned former gas station property in Elyria. Swank contracted with ECG to perform certain environmental services in de-contaminating the property. These contracts, dated February 20 and May 22, 1997, each provided for arbitration under the rules of the American Arbitration Association (AAA). Swank does not dispute the contracts called for AAA arbitration. Swank paid for all but $712.00 on the February contract, but failed to pay anything on the May contract, after the work was completed. ECG, through its counsel, sent a demand for arbitration to Swank, which he admits receiving. The demand was sent to Swank's Wellington, Ohio address as well as his Florida address. It is not known whether he received the demand addressed to Ohio or the one to Florida, or both, but he acknowledged notice of the arbitration demand. Neither Swank nor his counsel attempted to contact the AAA, even though he received a copy of the transmittal of the demand to the AAA. Following receipt of the demand and the -3- fee, AAA sent out several letters addressed to Swank at the Wellington, Ohio address pursuant to AAA Rule 40, which states: Each party shall be deemed to have consented that any papers, notices, or process necessary or proper for the initiation or continuation of an arbitration under these rules; *** may be served on a party by mail addressed to the party or its representative at the last known address ***. Arbitrator George found that none of the correspondence from AAA was returned. On December 8, 1997, a notice of hearing for December 19 was sent by AAA to Swank at the Wellington, Ohio address. He did not appear. The award of the arbitrator was made in the sum of $28,978, and thereafter, an application to confirm was filed in Common Pleas Court by ECG. The sole ground opposing same raised by Swank was that he did not receive a copy of the notice of the arbitration hearing, even though he did receive the original demand for arbitration. Swank failed to request a hearing on the application to confirm. We will address defendant's assignments of error in the order presented. I. THE TRIAL COURT ERRED IN NOT FINDING THAT APPELLANT DID NOT RECEIVE NOTICE OF THE ARBITRATION HEARING BEFORE THE AMERICAN ARBITRATION ASSOCIATION UPON WHICH THE APPLICATION TO CONFIRM ARBITRATION AWARD WAS GRANTED. A presumption of regularity accompanies an arbitration award as stated in Cleveland v. Fraternal Order of Police (1991), 76 Ohio App.3d 755, 758: -4- The arbitrator's award is presumed valid. Findlay City School Dist. Bd. of Edn. v. Findlay Edn. Assn. (1990), 49 Ohio St.3d 129, 551 N.E.2d 186. When parties agree to submit their dispute to binding arbitration, they agree to accept the result, regardless of its legal or factual accuracy. Goodyear, supra; Huffman v. Valletto (1984), 15 Ohio App.3d 61, 15 OBR 90, 472 N.E.2d 740. Appellate review does not extend to the merits of such an award absent evidence of material mistake or extensive impropriety. Goodyear, supra; Lynch v. Halcomb (1984), 16 Ohio App.3d 223, 16 OBR 238, 475 N.E.2d 181; Lockhart v. Am. Res. Ins. Co. (1981), 2 Ohio App.3d 99, 2 OBR 112, 440 N.E.2d 1210. As no such evidence appears in the record, this court is limited to a review of the order of the trial court. Goodyear, supra; Lockhart, supra. Swank does not contend that the arbitrator's finding that notices were properly mailed and that mail addressed to him was not returned, was either a material mistake or an extensive impropriety. A comparison of Swank's address that he used on the second contract with ECG, with that shown on the correspondence from AAA to Swank and ECG, supports the arbitrator's finding. Swank admits he received the demand for arbitration. He did not claim that he or his counsel entered an appearance with the AAA and then gave a different address to AAA which was ignored. R.C. 2711.10 sets forth the grounds for vacating an arbitration award: Legal and/or factual conclusions reached by arbitrators are not reviewable in the common pleas courts, which, under R.C. 2711.10, are confined to a review of claims of fraud, corruption, or misconduct on the part of the arbitrators. Goodyear v. Local Union No. 200 (1975), 42 Ohio St.2d 516, 71 O.O.2d 509, 330 N.E.2d 703; Russo v. Chittick (1988), 48 Ohio App.3d 101, 104, 548 N.E.2d 314, 317. -5- Geist v. Ohio Dept. of Commerce (1992), 78 Ohio App.3d 404, 408. This Court held in Cleveland Police Patrolmen's Assn. v. Cleveland (1995), 107 Ohio App.3d 248, 256: With regard to the basis that R.C. 2711.10 provides for vacating an arbitrator's award, this court has cautioned that judicial review of the matter must be very narrow. Cuyahoga Community College v. Dist. 925, Serv. Emp. Internatl. Union AFL-CIO (1988), 42 Ohio App.3d 166, 170, 537 N.E.2d 717, 720-721. The Federal Arbitration Act, 9 U.S.C. S1 et seq., provides virtually identical grounds as the comparable Ohio statute for vacating an award. 9 U.S.C. S10. In Gingiss International, Inc. v. Bormet (C.A.7, 1995), 58 F.3d 328, the court was faced with the same issue as in the case at bar. Gingiss, a franchiser, brought an action against one of its franchisees under Section 9 of the Federal Act to confirm an arbitration award, which is also virtually identical to R.C. 2711.10. The Seventh Circuit stated (at p. 331) that a copy of the arbitration demand was sent by regular mail to the post office box where correspondence had previously been sent and the AAA also sent a letter by regular mail to the same address notifying the franchisees of the arbitration proceeding. The AAA also sent three other letters to that address, none of the mail was ever returned as undeliverable. The franchisees contended in defense of the motion to confirm the resulting award that they did not receive proper notice of the arbitration proceedings. -6- The court held that 9 U.S.C. S10 provides the exclusive means for setting aside an arbitration award, and Inadequate notice is not one of these grounds ***. The court held the following: Under the AAA's Commercial Arbitration Rule 40, notice may be served on a party by mail addressed to the party or its representative at the last known address. *** None of these notices was ever returned as undelivered. The [franchisees]nevertheless claim that they did not receive any of these notices. The [franchisees] had no right under the franchise agreement to receive actual notice of the arbitration. Rule 40 does not require that notice be served by certified or registered mail. *** The parties expressly agreed in the arbitration clause that the AAA's Rules would govern in the arbitration proceeding. Id., at 332-333. Obviously, the facts in the Gingiss case are identical to those at hand. The controlling issue is not that notice of the proceeding must actually be received, but rather, whether the procedures of the AAA were followed. There is no evidence by Swank that they were not. Defendant's Assignment of Error I is overruled. II. THE TRIAL COURT ERRED IN NOT PROVIDING APPELLANT WITH A HEARING PURSUANT TO ORC 2711.09. Contrary to Swank's assertion that R.C. 2711.09 requires a hearing, that section is a notice section, setting forth the minimum time within which notice of the filing of the application to confirm must be given. Notice in writing of the application shall be served upon the adverse party or his attorney five days before the hearing thereof. -7- Loc.R. 11(A) of the Rules of the Cuyahoga County Common Pleas Court provides as follows: Motions, in general, shall be submitted and determined upon the motion papers. Oral arguments of motions may be permitted on application and proper showing. Swank did not request oral argument in the trial court, but rather, as provided in Loc.R. 11(C), filed a response to the motion to confirm within the seven days as set forth in the rule. Civ.R. 7(B)(2) provides: To expedite its business the court may make provision by rule or order for the submission and determination of motions without oral hearing upon brief written statements of reasons in support and opposition. The Ohio Supreme Court has held that: The Civil Rules became effective July 1, 1970. They were intended to supersede all laws in conflict with them. Section 5(B), Article IV, Ohio Constitution. (Fn. 8) [omitted] Civ.R. 7(B)(2) provides that a *** court may make provision by rule or order for the submission and determination of motions without oral hearing upon brief written statements of reasons in support and opposition. The Court of Common Pleas of Wood County has by rule specifically made provision for the hearing ex parte of the motion for confirmation of sale. Pursuant to the Ohio Constitution, Local Rule 5(C)(1) superseded Citizens Loan Savings Co., supra. Union Bank Co. v. Brumbaugh (1982), 69 Ohio St.2d 202, 206. In 1988, this Court held in Russo v. Chittick (1988), 48 Ohio App.3d 101, 104, The statute [R.C. S2711.09] causes an arbitration award to become a judgment through a summary proceeding by filing a motion to confirm if made within one year of the arbitrators' decision. *** Merely filing the motion ensures the confirmation -8- occurs by motion rather than suit on the award. See, also, Davis v. Bd. of Educ. of the Cleveland City School Dist. (Dec. 20, 1984), Cuyahoga App. No. 48373, unreported (trial court did not err in confirming arbitration award without a hearing). Based on the foregoing, the trial court, under the Civil Rules and the Local Rules, properly decided the motion to confirm the award on the motion itself together with its exhibits, and the briefs submitted. This is particularly true where Swank failed to request or apply for a hearing under the local rule. Defendant's Assignment of Error II is overruled. ECG argues that pursuant to the contract provisions in both contracts it entered into with Swank, that it should be awarded attorney fees incurred in defending the trial court's judgment on appeal before this Court. We find the February 20, 1997 and May 22, 1997 contract provisions regarding attorney fees and costs being awarded to the prevailing party only apply to the arbitration proceedings. The provision in both contracts states in pertinent part: All disputes pertaining to this proposal/contract shall be resolved by binding arbitration conducted under the auspices of the American Arbitration Association (AAA), in Cuyahoga County, Ohio, where any hearings shall be held. ***. The prevailing party shall be reimbursed by the other for the prevailing party's legal costs in addition to whatever other settlement sums, if any, may be determined by the Arbitrators. Such legal costs shall include, but not be limited, to reasonable attorney's fees, arbitration costs including the fees of the AAA, expert witness fees, and other documented expenses, as well as the value of -9- time spent by the prevailing party and its employees preparing its case for arbitration. *** For purposes of this paragraph, the Arbitrator's decision shall designate which party is the prevailing party. In the event that a dispute concerning unpaid invoice or interest charge amounts is brought to arbitration by Environmental Consulting Group, Inc., against the Client, then attorney's fees, arbitration costs including fees of the AAA, and other related expenses shall be borne by the parties in inverse proportion to the extent that they prevail. ***. No where in the contract does it state that such fees and costs should also be awarded for defending appeals from the arbitrator's award to the courts. We therefore find, based on the plain language of the contract, that ECG is not entitled to fees incurred as the result of defending against the appeal before this Court. The cases cited by Swank in support of its argument that fees should be awarded based on the contracts, all involved contract clauses which clearly stated that fees incurred in court were recoverable or involved actions which originate in the trial court: Nottingdale Homeowner's Assn. v. Darby (1987), 33 Ohio St.3d 32, 37 ( *** costs and reasonable attorney fees involved in the collection thereof *** shall be personal obligation of *** owner of such property. ); Gaul v. Olympia Fitness Center, Inc. (1993), 88 Ohio App.3d 310, 324 ( *** Borrower agrees to pay all costs, expenses and fees, including to the extent permitted by law, all reasonable attorney fees. ); Goldfarb v. The Robb Report, Inc. (1995), 101 Ohio App.3d 134, 147 ( *** the prevailing party shall be entitled, without limitation, to recover such reasonable attorney fees, court -10- costs *** at both trial and appellate levels. ); Hutchinson v. J.C. Penney Cas. Ins. Co. (1985) 17 Ohio St.3d 195, 200 (attorney fees awarded based on plaintiff's contract with attorney in which attorney to receive 1/3 of what recovered in uninsured motorist case); Gingiss (agreement authorized prevailing party to recover fees incurred to enforce this agreement in any judicial or arbitration proceedings. ). We find these authorities inapplicable. Accordingly, we find no contractual authority for an award of attorney fees on this appeal. Judgment affirmed. -11- It is ordered that appellee recover of appellant its costs herein taxed. The Court finds there were reasonable grounds for this appeal. It is ordered that a special mandate issue out of this Court directing the Court of Common Pleas to carry this judgment into execution. A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of the Rules of Appellate Procedure. JAMES M. PORTER, PRESIDING JUDGE DIANE KARPINSKI, JUDGE JOHN T. PATTON, JUDGE N.B. This entry is an announcement of the court's decision. See App.R. 22(B), 22(D) and 26(A); Loc.App.R. 27. This decision will be journalized and will become the judgment and order of the court pursuant to App.R. 22(E) unless a motion for reconsideration with supporting brief, per App.R. 26(A), is filed within ten (10) days of the announcement of the court's decision. The time period for review by the Supreme Court of Ohio shall begin to run upon the journalization of this court's announcement of decision by the .