## Facts

- Elizabeth Smaligo, age 37, had been institutionalized for schizophrenia since 1962 but previously worked nearly 20 years as a secretary.
- While on a weekend home visit on March 27, 1967, she was killed by an unidentified hit-and-run driver.
- Her parents, Michael and Mary Smaligo, sought recovery under the uninsured motorist clause of their auto policy, which promised to pay damages the insured was legally entitled to recover from an uninsured motorist.
- The coverage dispute went to common-law arbitration.
- During arbitration, the Smaligos requested a brief recess/continuance to secure testimony from Dr. Parsons, the decedent’s attending physician, on her future work expectancy and earning capacity; the arbitrator refused, stating the testimony was not necessary.
- The arbitrator awarded $243, described as one-third of the cost of a family memorial monument.
- The Smaligos moved to vacate, alleging irregularities including (1) proceeding despite their assertion that an earlier settlement offer had been accepted and remained open, and (2) denial of the recess needed to present key damages evidence.
- The trial court vacated the award and ordered a de novo arbitration before a different arbitrator selected from the American Arbitration Association panel; the insurer appealed.

## Issues

1. Under Pennsylvania common-law arbitration review, did the arbitrator commit an “irregularity” justifying vacatur by refusing a brief continuance to obtain the attending physician’s testimony on future earning capacity, resulting in an allegedly unjust and unconscionable award?
2. Did the trial court have authority to vacate the common-law award and order a de novo hearing before a different arbitrator?

## Decision

- The Pennsylvania Supreme Court affirmed the trial court’s order.
- The Court held that denying a brief continuance to obtain readily available, material damages testimony constituted an “irregularity” sufficient to vacate a common-law arbitration award when it produced an unjust, inequitable, and unconscionable result.
- The $243 award, in context, supported the conclusion that the irregularity affected the outcome.
- The trial court properly ordered a de novo arbitration before a different arbitrator once the irregularity was established.

## Legal Principles

- A common-law arbitration award may be vacated only on clear, precise, and indubitable proof of denial of a hearing, fraud, misconduct, corruption, or a comparable procedural irregularity that causes an unjust, inequitable, and unconscionable award; mere mistakes of law or fact are not grounds for vacatur.
- An arbitrator is generally the final judge of law and fact in common-law arbitration, but the process must still provide a fundamentally fair opportunity to present material evidence.
- Refusal to allow reasonable time to secure crucial evidence bearing directly on core damages (such as future earning capacity in a wrongful-death claim) can constitute the type of irregularity permitting judicial intervention, especially where the resulting award is nominal.

## Conclusion

The court upheld vacatur of a common-law uninsured-motorist arbitration award because the arbitrator’s refusal to grant a brief continuance for essential medical testimony deprived the claimants of a fair hearing on damages and contributed to an unconscionably low award, warranting a new arbitration before a different arbitrator.


Smaligo v. Fireman's Fund Ins. Co., 432 Pa. 133, 247 A.2d 577 (Pa. 1968)