dissenting:
I take no issue with the facts of this case as set out in the majority opinion. The basis of my disagreement is the conclusion that the majority has reached based upon those facts.
In Drinane v. State Farm Mutual Automobile Insurance Co. (1992), 153 Ill. 2d 207, 606 N.E.2d 1181, our supreme court addressed the circumstances under which an arbitrator’s failure to disclose information as to a relationship that might create an impression of bias can constitute grounds to vacate an arbitration award under section 12(a)(2) of the Uniform Arbitration Act (Ill. Rev. Stat. 1989, ch. 10, par. 112(a)(2)). In formulating its position on the issue, the Drinane court relied heavily upon the decision in Commonwealth Coatings Corp. v. Continental Casualty Co. (1968), 393 U.S. 145, 21 L. Ed. 2d 301, 89 S. Ct. 337, and concurred with Justice Black’s statement that “ ‘[w]e can perceive no way in which the effectiveness of the arbitration process will be hampered by the simple requirement that arbitrators disclose to the parties any dealings that might create an impression of possible bias.’ ” Drinane, 153 Ill. 2d at 214, 606 N.E.2d at 1184, quoting Commonwealth Coatings, 393 U.S. at 149, 21 L. Ed. 2d at 305, 89 S. Ct. at 339.
The majority has correctly quoted the provisions of the Commercial Arbitration Rules and the Code of Ethics for Arbitrators. Taken in conjunction, these provisions mandate that an arbitrator disclose any circumstance likely to affect his impartiality, including relationships with witnesses which might reasonably create an appearance of partiality or bias; and, the arbitrator’s obligation in this regard is stated in terms of a continuing duty without regard to the stage of the arbitration when the relationship is discovered or recalled. Commercial Arbitration Rules, R. 19 (1988); Code of Ethics for Arbitrators in Commercial Disputes, Canon II, §§(A)(2), (C).
At the very latest, the arbitrator in the case became aware on August 10, 1989, when he received the correspondence from appellant’s attorneys, that Alan Barry, one of appellant’s other attorneys, was a potential witness in the arbitration proceeding. All that is known about the relationship between the arbitrator and Barry or his parents is that which was revealed in Barry’s letter of August 17, 1989. The record in this case fails to reveal any disclosure on the part of the arbitrator.
The majority states that it can find no rule which requires that the arbitrator be the first person to reveal a potentially disqualifying relationship with a potential witness; nor do I find such a rule. However, that is not the issue. The rules of arbitration and the canons of ethics cited by the majority mandate that the arbitrator make a disclosure, and in this case, none was made. The question is not who should disclose first; the question is whether the arbitrator must disclose.
The majority has found that the arbitrator’s relationship with Barry’s parents was significant based upon Barry’s version of it. I concur in that assessment. The significance of that relationship, in my mind, reasonably creates an appearance of partiality. This is especially true when, as in this case, the witness, Barry, is an attorney who represented one of the parties to the arbitration in the transaction which gave rise to the arbitration proceeding and acted as not only an occurrence witness but also an expert witness on behalf of his client. What more evidence of the reasonableness of an appearance of partiality is necessary than the fact that Barry found the relationship between the arbitrator, himself, and his parents significant enough to disclose? Unlike the majority, I am of the view that the “significant” relationship that the majority has found existed between Barry’s parents and the arbitrator, so long as it remained undisclosed and unexplained by the arbitrator himself, gave rise to a presumption of bias of the type found by the supreme court in Drinane (153 Ill. 2d at 216, 606 N.E.2d at 1185).
The majority’s rationale in this case is reminiscent of that used by a majority of this court to support its decision in Drinane v. State Farm Mutual Automobile Insurance Co. (1991), 222 Ill. App. 3d 805, 584 N.E.2d 410, reasoning with which our supreme court did not concur. (Drinane, 153 Ill. 2d at 215, 606 N.E.2d at 1184-85.) The majority seems to say that the decision of the trial judge must be reversed because the appellee failed to meet its burden of establishing that the arbitrator was in fact biased. The appellee had no such burden.
In Commonwealth Coatings Corp., the Court stated at the beginning of its opinion that the arbitrator involved had never been accused of fraud or bias in deciding the case before him and that the court itself had no reason, apart from his undisclosed relationship, to suspect him of any improper motives; but, in reversing the arbitrator’s award, the Court went on to hold that arbitrators must not only be unbiased, but must avoid even the appearance of bias, since litigants are not required to arbitrate their disputes before a person that might reasonably be thought to be biased against them. (Commonwealth Coatings, 393 U.S. 145, 21 L. Ed. 2d 301, 89 S. Ct. 337.) While this court in its opinion in Drinane disregarded the standards set out in Commonwealth Coatings and found them unworkable, our supreme court embraced them. Drinane, 153 Ill. 2d at 215.
In the case at bar, the appellee established: (1) a significant relationship between the arbitrator and the parents of one of its opponent’s critical witnesses giving rise to a reasonable appearance of partiality and the presumption of bias; and (2) the fact that the arbitrator made no disclosure of that relationship at any point in the arbitration proceeding. Unlike the facts in Drinane, the arbitrator in this case has never explained the circumstances of the relationship giving rise to the presumption of bias. Having established facts giving rise to a presumption of bias on the part of the arbitrator which was unrebutted, the appellee established its right to a vacation of the arbitration award as a matter of law.
It is essential to the continued viability of the arbitration process that arbitrators, unlike the arbitrator in this case, follow the rules of arbitration and the Code of Ethics for Arbitrators and make full disclosure of any relationship they might have with any party or witness that could reasonably give rise to an appearance of partiality. Parties to an arbitration proceeding are entitled to a full disclosure of such relationships from the arbitrator himself and should not be put in a position of having to rely upon their opponent’s rendition of the scope of any such relationship as was the appellee in this case.
“[C]ourts should be ‘more scrupulous to safeguard the impartiality of arbitrators ***, since [they] have completely free rein to decide the law as well as the facts and are not subject to appellate review.’ ” Drinane, 153 Ill. 2d at 213, 606 N.E.2d at 1184, quoting Commonwealth Coatings, 393 U.S. at 149, 21 L. Ed. 2d at 305, 89 S. Ct. at 339.
I would affirm.