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SIXTH DIVISION

January 19, 2001

No. 1-00-2850

JUSTICE GALLAGHER delivered the opinion of the court:

On August 9, 1995, plaintiff, Federal Signal Corporation (Federal Signal), and defendant,SLC Technologies, Inc. (SLC), entered into a distributor agreement (the Agreement). TheAgreement contains a broad arbitration clause which states, in pertinent part, as follows: "Anydispute arising out of or relating to this Agreement or its breach shall be settled by arbitrationunder and in accordance with the rules of the American Arbitration Association." TheAgreement also contains the following provision: "If any litigation or arbitration is commencedby either party to enforce or interpret any of the provisions of this Agreement, the prevailingparty shall be entitled to cover [sic] reasonable costs and attorneys' fees at trial, on appeal, and onany petition for review."

When a dispute arose between the parties regarding Federal Signal's alleged breach of theAgreement, SLC submitted a demand for arbitration with the American Arbitration Association,pursuant to the terms of the Agreement. The arbitrator presided over a full evidentiary hearingon November 16, 1999.

On February 2, 2000, the arbitrator issued his award, which stated it was "in fullsettlement of all claims submitted to this arbitration." SLC was awarded the sum of $230,750.37plus interest. The award further provided that $1,750 for administrative fees and expenses was tobe paid by Federal Signal to SLC. The award also provided that Federal Signal shall pay to SLCall reasonable attorney fees incurred by SLC on the resolution of this matter beginning onJanuary 17, 1999, until the award entered shall have been paid. The award did not include theamount of attorney fees or expressly reserve jurisdiction to determine the amount.

On February 8, 2000, counsel for SLC wrote a letter to counsel for Federal Signal, notingthat it was enclosing "a print-out of its fees and costs for this matter in order to permit your clientto satisfy the Arbitrator's award."⁽¹⁾ Enclosed was a print-out for attorney fees from January 20,1999, through January 11, 2000, in the amount of $105,636.30.

On or about February 9, 2000, Federal Signal paid SLC $230,750.37 (plus interest) tocover the damage portion of the award. On February 23, 2000, Federal Signal filed a complaintto vacate the arbitrator's award and later, on March 23, 2000, filed an amended complaint tovacate or modify the arbitrator's award.

On April 28, 2000, SLC filed a motion to dismiss, a motion to compel arbitration and amotion to stay proceedings. On or about May 11, 2000, Federal Signal paid $1,750, which wasthe remaining portion of the award that covered its share of the American ArbitrationAssociation's administrative fees.

On July 13, 2000, the circuit court heard oral argument on SLC's motions and, on thesame date, entered an order denying both the motion to dismiss and the motion to compel. OnJuly 31, 2000, SLC filed a motion for clarification to ascertain whether it should further defendthe action in the circuit court or exercise its right to appellate review. In particular, SLC soughtclarification of the following:

"What is the basis for the court's denial of SLC'S motion to compelarbitration and stay proceedings?

Did the Court determine that the arbitration award is subject tomodification or vacation pursuant to 710 ILCS 5/12 or 710 ILCS 5/13?

If the court determined that the arbitration award was subject tomodification or vacation, how has the court substantively modified or vacated theaward?

If the Court has modified or vacated the arbitration award, what is thelegal basis for that modification or vacation?"

The record before us contains no court orders subsequent to that of July 13, 1999. Thus, themotion for clarification apparently remains pending before the circuit court. On August 14,2000, SLC filed this interlocutory appeal within the 30-day limit.

The denial of a motion to compel arbitration is analogous to a denial of injunctive reliefand is appealable under Supreme Court Rule 307(a)(1)(166 Ill. 2d R. 307(a)(1)). Notaro v.Nor-Evan Corp., 98 Ill. 2d 268, 456 N.E.2d 93 (1983). Generally, the standard of review of anorder granting or denying a motion to compel arbitration is whether the trial court abused itsdiscretion. Brooks v. Cigna Property & Casualty Cos, 299 Ill. App. 3d 68, 71, 700 N.E.2d 1052,1054 (1998). In the instant case, however, no evidentiary hearing was had or needed, since thefacts were not in dispute. Our review of the record, including the transcript of the combinedhearing on SLC's motion to dismiss and motion to compel arbitration, confirms that the decisiondenying SLC's motion to compel arbitration was made without making any findings as to anyfactual issues. The trial court's decision to deny SLC's motion to compel was made inconjunction with its decision to deny SLC's motion to dismiss pursuant to section 2-615 of theCode of Civil Procedure. 735 ILCS 5/2-615 (West 1998). Accordingly, the trial court's findingthat the grievance at issue was not arbitrable was made as a matter of law and is reviewable denovo. Amalgamated Transit Union, Local 900 v. Suburban Bus Division of the RegionalTransportation Authority, 262 Ill. App. 3d 334, 337, 634 N.E.2d 469, 472 (1994); see also In reLawrence M., 172 Ill. 2d 523, 526, 670 N.E.2d 710, 712-13 (1996)(Although the scope of reviewin an interlocutory appeal "is normally limited to an examination of whether or not the trial courtabused its discretion in granting or refusing the requested interlocutory relief,""where thequestion presented is one of law, a reviewing court determines it independently of the trial court'sjudgment"). Although Amalgamated Transit Union involved the review of an order granting amotion to compel arbitration and the present case involves the review of an order denying amotion to compel arbitration, we believe this is a distinction without a difference. But seeComdisco, Inc. v. Dun & Bradstreet Corp., 285 Ill. App. 3d 796, 800-01, 674 N.E.2d 902, 904(1996). Nevertheless, even were we to accord the more deferential review required by an abuseof discretion standard of review, the result would be the same. We conclude that the trial courtabused its discretion in denying SLC's motion to compel arbitration.

We recognize in this interlocutory appeal that the portion of the order denying SLC'smotion to dismiss is not before us. The sole issue before a court in an interlocutory appeal suchas this is "whether there was a showing sufficient to sustain the order of the trial court denyingthe motion to compel arbitration." See, e.g., Comdisco, Inc. v. Dun & Bradstreet Corp., 285 Ill.App. 3d 796, 799, 674 N.E.2d 902, 904 (1996). Nonetheless, as we have noted, both the motionto dismiss and the motion to compel were argued and decided during one combined hearing. Asthe transcript shows, the trial court stated that its order denying the motion to compel was basedentirely upon its analysis and decision to deny SLC's motion to dismiss Federal Signal'scomplaint pursuant to section 2-615 of the Code of Civil Procedure. 735 ILCS 5/2-615 (West1998). Thus, we must consider whether the reasoning there supports a determination that SLCfailed to make a showing sufficient to compel arbitration.

Federal Signal's amended complaint to vacate or modify the arbitrator's award wasbrought pursuant to sections 12 and 13 of the Uniform Arbitration Act (the Act)(710 ILCS5/12,13 (West 1998). Section 12 provides as follows:

"