Chapter 3 - § 3.10 • COMMON LAW OF ARBITRATION

• Jurisdiction: Colorado

§ 3.10 • COMMON LAW OF ARBITRATION

There is a large body of federal and Colorado case law applying the common law of arbitration where the statutes and agreements are silent. The common law fills in the gaps in the statutory law and the agreements of the parties, and interprets both. Much of this law is discussed throughout this book. The state arbitration statute probably does not preempt the state common law, unless in conflict.⁵⁸

§ 3.10.1—Colorado Common Law

Colorado arbitration common law applies when no applicable statutory provision applies to the issue, federal law is not applicable, or state law (or state statutory law) has not been preempted by federal law. State common law generally can be made governing by agreement of the parties. See § 4.5. If state law governs because the FAA does not apply, but the particular state is not identified, then the forum state's choice-of-law rules govern. See § 4.4.

In Sopko v. Clear Channel Satellite Services, Inc.,⁵⁹ the Colorado Court of Appeals acknowledged that Ash Apartments v. Martinez,⁶⁰ decided under the law prior to adoption of the Revised Uniform Arbitration Act, held that the common law defined the status of an award not rendered within a party-established time limitation.

Prior to the adoption of the CUAA, arbitration was governed by Colorado code provisions, and before that, by the common law. In the 1898 decision of McClelland v. Hammond,⁶¹ the plaintiff asserted that his civil action was not barred by an earlier arbitration and award, because the "alleged arbitration was not in accordance with the statutory form." The Colorado Court of Appeals held that the facts established a common law arbitration award. The court held that the arbitration statutes (Code) did not "abolish or ma[ke] ineffective common-law arbitrations simply because it provided a method for the submission and settlement of controversies, which if followed might be more effective and furnish a more conclusive and expeditious remedy."⁶² Therefore, under the common law, the arbitration award was valid and a complete bar to a plaintiff's recovery in the civil action.

§ 3.10.2—Federal Common Law

In Moses H. Cone Memorial Hospital v. Mercury Construction Corp.,⁶³ the U.S. Supreme Court held that "federal substantive law of arbitrability" was created by the FAA. See § 3.7.4. Decisions that implement and define the "substantive" portions of the FAA have created and are creating a federal common law of arbitration. See § 2.4.

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