August 21, 2019

Colorado Court of Appeals: Arbitration Provision in Separation Agreement Covered Dispute Over Husband’s Payment Credits

The Colorado Court of Appeals issued its opinion in In re Marriage of Dorsey on Thursday, February 27, 2014.

Post-Dissolution of Marriage—Arbitration Provision.

The parties’ marriage ended in 2007. They entered into a separation agreement dividing their marital property and debt, and resolving maintenance and attorney fees. Under the property division, husband agreed to pay wife $4 million, in installment payments of no less than $40,000 a month for fifty-nine months, and the balance by December 20, 2011. Husband was entitled to reimbursement for certain expenses incurred in selling their properties and in facilitating wife’s purchase of her new home, and was entitled to apply any proceeds from the sale of property that was awarded to him to the amount owed to wife.

The separation agreement had a dispute resolution provision providing for mediation and then arbitration, if mediation was unsuccessful. The parties could not agree on the expenses for which husband was entitled to a credit, and wife refused to mediate/arbitrate. Husband requested the court order the parties to mediate/arbitrate pursuant to the agreement. Wife objected, arguing that the governing law provision should be read to mean that the courts should decide any disputes between the parties.

The district court ordered the parties to mediate/arbitrate. The arbitrator entered an award resolving their dispute concerning the final amount owed based on the credits. Wife moved to vacate the arbitrator’s award under CRS § 13-22-223(1)(d), contending that the arbitrator exceeded her authority by interpreting the separation agreement. The court denied the motion and confirmed the award. Wife appealed, and the Colorado Court of Appeals affirmed.

The arbitration provision in the separation agreement was extremely broad in scope, covering “any claim or controversy arising out of or as a result of [the parties’] dissolution of marriage.” The dispute regarding the credit due husband was clearly encompassed by this language. Wife’s argument regarding the “governing law and jurisdiction” provision does not supersede the arbitration clause. Because the dispute was subject to arbitration, the Court did not need to address wife’s contentions concerning the merits of the arbitrator’s award.

Summary and full case available here.

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