Colorado's Revised Uniform Arbitration Act

• Publication year: 2004
• Pages: 11
• Citation: Vol. 33 No. 9 Pg. 11

33 Colo.Law. 11 Colorado Lawyer 2004.

2004, September, Pg. 11. Colorado's Revised Uniform Arbitration Act

Vol. 33, No. 9, Pg. 11

The Colorado Lawyer
September 2004
Vol. 33, No. 9 [Page 11]

Articles

Colorado's Revised Uniform Arbitration Act
by James F. Carr, James L Stone, Jonathon Boonin

Jim Carr Jim Stone Jonathan Boonin

Jim Carr, Denver, who is experienced in general civil environmental, and criminal litigation, is a First Assistant Attorney General in the Colorado Attorney General's Office where he represents Professional Licensing Boards and the Division of Insurance - (303) 866-5283 or jim.carr@state.co.us. Carr also is Chair of the CBA Alternative Dispute Resolution Section and a volunteer mediator in the DBA Court-Annexed Mediation Program in Denver County. Jim Stone, Denver, is an experienced full-time arbitrator and mediator with JAMS in Denver - (303) 534-1254 or jstone1672@aol.com. A co-editor of The Colorado Lawyer ADR column, Stone specialized in complex commercial litigation and employment law with Fairfield & Woods P.C. before becoming a principal at JAMS. Jonathan Boonin, Boulder, is a partner with Warren & Boonin LLP, and co-editor of The Colorado Lawyer ADR column - (303) 413-1111 or jboonin@ warren-boonin.com. Boonin engages in a wide-ranging civil litigation practice and has taught a course on ADR as a Visiting Professor and Adjunct Professor at the University of Colorado School of Law

This article provides an overview of Colorado's newly revised Uniform Arbitration Act and discusses many of the important changes it brings to Colorado practicing attorneys and arbitrators. The article also discusses some of the new law's limitations and unresolved issues

The law governing arbitration in Colorado has just changed dramatically and in ways that impact both practicing attorneys and providers of arbitration services. On August 4, 2004, the Colorado Revised Uniform Arbitration Act ("CRUAA")1 took effect, supplanting the prior Colorado Uniform Arbitration Act ("CUAA"),2 which had been on the books largely untouched since 1975.

The CRUAA seeks to modernize and clarify the ambiguities of the prior CUAA and to codify a number of important case-law principles respecting notions of fairness in the arbitral process and maintenance of the distinction between arbitration and traditional litigation in court. As explained below, the new law represents a major step forward in certain respects, but leaves other important questions unanswered and, as a result, may cause concern to some members of the Bar.

This article proceeds in two parts. First, the article discusses the creation of the CRUAA, including an overview of its legislative history and an explanation of how the CRUAA differs in certain respects from the unified law, the Revised Uniform Arbitration Act ("RUAA"), on which it is based. Second, the article highlights a number of important changes the CRUAA will bring to legal professionals and ADR providers in Colorado.

ENACTMENT OF THE CRUAA

The CRUAA is modeled after the Revised Uniform AArbitration Act ("RUAA"),3 which was promulgated in 2000 by the National Conference of Commissioners on Uniform State Laws ("NCCUSL") and approved by the American Bar Association ("ABA") in 2003. Including Colorado, the RUAA has now been enacted, in whole or in part, in ten states.4 Many other states are expected to consider its adoption in the next few years.5

The Uniform Law Process

The uniform law process is an attempt to provide uniformity in state laws without federal action, especially in those areas that are traditionally considered the domain of state law. NCCUSL, which consists of representatives from every state and has been in business for more than 100 years, decides the areas of law in which it will develop uniform state laws. The first step in the process is for NCCUSL to identify an area in which it determines a uniform law is necessary and desirable. Next, a working group of persons and entities with expertise and interest in the area is assembled. This working group recruits a reporter, an expert in the field who is responsible for overseeing the drafting of the uniform act. This process often takes a number of years.

Once the working group has drafted a final proposed uniform law, it is submitted to all members of NCCUSL and, if acceptable, it is adopted by NCCUSL. NCCUSL has an agreement with the ABA that any proposed uniform law also must be approved by the ABA House of Delegates. Once NCCUSL adopts a proposed uniform law and the ABA approves it, the law is sent to the states as a uniform law. All states are then encouraged to adopt the proposed legislation so as to provide predictability and uniformity across the country in certain important areas of the law.

Because NCCUSL has members from every state, usually including legislators, there is a built-in mechanism to get the uniform laws before the state legislatures. Eventually, some uniform laws receive widespread acceptance and become law in most states; others end up going nowhere. Over the years, many uniform state laws have been developed and adopted in most states. Perhaps the best-known example is the Uniform Commercial Code ("UCC").

The original Uniform Arbitration Act ("UAA") was promulgated in 1955. The UAA was ultimately adopted in forty-nine states; Colorado finally adopted it in 1975. NCCUSL decided that the 1955 UAA needed updating and proceeded to develop the RUAA in the 1990s. The RUAA was adopted by NCCUSL in 2000 and approved by the ABA in 2003.

Legislative History of
The CRUAA

The CRUAA was introduced in the Colorado legislature as House Bill 04-1080 ("H.B. 1080") in January 2004. As introduced, the bill had a number of provisions that differed from the RUAA. Soon afterward, H.B.1080 was amended to read exactly the same as the RUAA, with one exception relating to punitive damages - it conformed the amended H.B. 1080 to Colorado law on punitive damages. As the bill progressed through the legislature, however, a number of further changes were made. Many of these changes are technical, but a few are significant.

Effective Date

First, the CRUAA does not apply to an agreement to arbitrate that was made prior to the August 4, 2004 effective date of the CRUAA, unless all parties agree to its applicability.6 The RUAA contains an optional clause that would make the RUAA applicable to any arbitration that takes place after a set date, regardless of when the agreement to arbitrate was made. Colorado chose not to adopt this clause. Thus, the effect of the new CRUAA provisions will only gradually impact arbitration as new arbitration agreements take effect. However, because parties may jointly agree to apply the new law to an existing arbitration agreement, it is imperative for attorneys to understand the impact of the new law immediately so that they can effectively advise their clients whether it makes sense to apply the new CRUAA to existing agreements.

Consolidation

Another significant change under the CRUAA relates to the consolidation of separate arbitration proceedings. Section 10(a) of the RUAA allows the court to consolidate separate arbitration proceedings under specified circumstances. The CRUAA also allows such consolidation, but only if all parties in the arbitration proceedings consent.7 In other words, Colorado's consolidation provision is applicable only if all parties opt in.

Punitive Damages

Significant changes were made to the section regarding punitive damages. RUAA § 21 allows the award of punitive damages if permitted in a civil action for the same claim. This provision was removed from the CRUAA and a new section was added in an effort to clarify and endorse Colorado's existing limitation on the award of punitive damages in arbitration.8

Scope of Relief Available

One of the most significant debates during Colorado's legislative consideration of the new law was whether to adopt the wording in RUAA § 21(c). This provision expressly endorses the right of arbitrators to award remedies "the arbitrator considers just and appropriate under the circumstances of the arbitration proceeding" and would have confirmed that "the fact that such a remedy could not or would not be granted by the court is not a ground for refusing to confirm an award . . . or for vacating an award . . ." This provision was removed from the CRUAA in the state senate, and a...