## Facts

- A landscape contractor and a real-estate development enterprise entered two contracts (1974) for installation of trees, shrubs, and sod at a development site.
- Performance disputes arose early, with the developer complaining that trees died and grass failed, allegedly due to the contractor’s negligence and breach of contractual guarantees.
- In 1975, the developer replaced the contractor; the contractor claimed unpaid sums for work performed, and the developer counterclaimed for damages for defective work.
- The parties submitted the dispute to arbitration before a three-member panel; arbitrability was not contested.
- After hearing testimony over multiple days, the parties agreed on September 8, 1977 to continue the proceedings to October 27, 1977.
- On October 5, 1977, the contractor requested a further continuance into late November and additional discovery, asserting surprise testimony from the developer’s witnesses.
- The panel denied the request and later issued an award for the developer of $83,258.35 (Feb. 6, 1978).
- The contractor sought to vacate the award, claiming unfair surprise and that the arbitrators refused to hear material evidence by denying a continuance and discovery.

## Issues

1. Whether the arbitrators’ denial of a continuance and additional discovery amounted to misconduct warranting vacatur under 9 U.S.C. § 10.
2. Whether the arbitrators “refus[ed] to hear evidence pertinent and material to the controversy” so as to prejudice the contractor’s rights under 9 U.S.C. § 10.

## Decision

- The Fourth Circuit affirmed the district court’s confirmation of the arbitration award.
- The court held the contractor failed to show misconduct or a denial of a fundamentally fair hearing within the meaning of 9 U.S.C. § 10.
- The court concluded that denying additional postponement and discovery, on these facts, did not constitute a refusal to hear pertinent and material evidence.

## Legal Principles

- Judicial review of arbitration awards under the Federal Arbitration Act is narrowly confined to the statutory grounds in 9 U.S.C. § 10 and does not permit reconsideration of the merits.
- Vacatur for “misconduct” under § 10 requires a showing such as an unjustified refusal to postpone upon sufficient cause shown or an actual refusal to hear pertinent and material evidence, coupled with prejudice.
- Arbitrators have substantial discretion over scheduling and procedural management, including whether to allow postponements and the scope of discovery; denial of added discovery or delay, without more, is generally insufficient to vacate an award.
- A refusal to permit further discovery is not, by itself, a refusal to hear material evidence where the parties had a meaningful opportunity to present testimony and proof during the scheduled proceedings.

## Conclusion

The Fourth Circuit upheld the arbitration award because the contractor did not establish statutory grounds for vacatur under the FAA; the arbitrators’ denial of an additional continuance and discovery did not amount to misconduct or an improper refusal to hear material evidence.


Burton v. Bush, 614 F.2d 389 (4th Cir. 1980)