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According to the Philadelphia Common Pleas court, justice delayed isn’t necessarily justice denied when it comes to arbitration. The court has again affirmed that parties who attempt to bypass the step mandated in certain cases won’t get a free pass into the courtroom with their appeals. Last week’s opinion in Nygard v. Cafe Zesty dredged up a court policy the Superior Court addressed in 1998′s Pantoia v. Sprott. According to the court, plaintiffs subjected to compulsory arbitration have historically failed to appear at such hearings in order to obtain a default judgment. They then appeal, taking their cases directly to the court of common pleas. In Philadelphia County, a party who fails to appear at arbitration results in an automatic default judgment for the party who did appear. The absent party must then file an appeal for a trial de novo in common pleas court. Although the appeal may then be dismissed, and the case remanded for further arbitration, it apparently hasn’t stopped a rash of no-shows at mandatory arbitrations. “The policy announced explicitly by the Superior Court in Pantoia applies to this case,” said Judge Genece E. Brinkley. “The compulsory arbitration system was created to alleviate the tremendous case load of the trial courts in Pennsylvania. If parties are allowed to circumvent this system by failing to appear, the system’s purpose is not being served. “To prevent these abuses, the policy at issue has been used to force litigants to fully present cases at the arbitration level before exercising the right to appeal and have a trial de novo.” THE ‘NYGARD’ CASE Plaintiff Charles Nygard invested $80,000 in Cafe Zesty of Manayunk, but later decided to abandon his investment. Although Cafe Zesty signed a note and stock-pledge agreement, it stopped making payments in 1997 and Nygard sued. The complaint was listed for compulsory arbitration because the amount requested did not exceed $50,000. But neither Cafe Zesty nor its attorney, Vincent Melchiorre, appeared at the April 1998 arbitration hearing. The Board of Arbitrators found in favor of Nygard and against Cafe Zesty for $50,000. Cafe Zesty appealed in Common Pleas Court the following month, and the appeal was dismissed and remanded to arbitration in January 1999. Arbitrators again found in Nygard’s favor, this time awarding Nygard $38,161. Nygard appealed to common pleas court, where the parties agreed to a judgment against Cafe Zesty for $57,500. The court noted this amount exceeded what Nygard would have received in arbitration and also exceeded his demand in the original complaint. After a denial of his post-trial motion for relief, Nygard appealed to Superior Court. Both his post-trial motion and appeal addressed his level of frustration with the arbitration policy of the court, which he referred to as an “‘unwritten rule’ used by secretaries, administrators, but rarely judges of the court of common pleas” that delayed his recovery by forcing him to go through two arbitrations and two appeals. Nygard complained the delay racked up substantial attorneys’ fees and costs and that the trial court abused its discretion when it struck his first appeal and remanded it back to arbitration. He also claimed the trial court’s remand was unconstitutional and denied him due process. ANALYSIS Brinkley said the court had not erred in striking Nygard’s first appeal. “The exact behavior the court was trying to prevent was employed.” “Not only was the court’s act within its discretion, it was mandated by the Superior Court’s approval of the policy to be followed. Going forward with a trial court after the first arbitration would have allowed the defendant an immediate trial de novo without having participated in the compulsory arbitration procedure.” The “unwritten rule” to which Nygard referred was not unwritten, but explicitly adopted in Pantoia, Brinkley said. Further, the judge said the policy did not deny Nygard any constitutional right. “As stated by the Superior Court [in Pantoia], the right to appeal is not being denied, it is being delayed.”

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