By Lee Hornberger, Arbitrator and Mediator
This update reviews Michigan appellate decisions issued since January 6, 2023, concerning arbitration and mediation.
ARBITRATION
Supreme Court Decisions
Supreme Court reverses COA concerning shortened limitations period.
McMillon v City of Kalamazoo, ___ Mich ___, MSC 162680 (January 11, 2023). Plaintiff applied for job with City of Kalamazoo in 2004. She completed application, but did not get job. In 2005, City contacted her about job as Public Safety Officer, and she was hired. She did not fill out another application. In 2019, Plaintiff sued City, alleging employment issues. City moved for summary disposition, relying on provision in 2004 application that had nine-month limitations period. Circuit Court granted motion. COA affirmed. Supreme Court ordered oral argument to address whether Timko v Oakwood Custom Coating, Inc, 244 Mich App 234 (2001), correctly held limitations clauses in employment applications are binding. After hearing oral argument, in lieu of granting leave, Supreme Court reversed that part of COA judgment affirming summary disposition based on shortened nine months limitations period in application and remanded case to Circuit Court. Supreme Court held genuine issue of material fact whether plaintiff had notice of use of 2004 application materials and whether she agreed to be bound by those materials. Justice Welch, concurring, would have ruled on whether Timko correctly held limitations clauses are part of binding employment contract.
COA Published Decisions
Circuit Court should stay case instead of dismissal when orders arbitration.
Legacy Custom Builders, Inc v Rogers, ___ Mich App ___, 359213 (Feb 9, 2023). COA held Circuit Court correctly enforced agreement to arbitrate, but should have stayed proceedings pending arbitration. MCL 691.1687; MCR 3.602(C).
COA Unpublished Decisions
COA reverses Circuit Court order not to arbitrate.
Payne-Charley v Team Wellness Ctr, Inc, 361380 (April 13, 2023). Defendant appealed Circuit Court decision employment agreement did not require parties to arbitrate. According to defendant, parties required to resolve dispute in arbitration under terms of employment agreement. COA agreed and reversed.
COA affirms Circuit Court on arbitration waiver issue.
Renu Right, Inc v Shango, 359976 (March 23, 2023). Shango argued he did not have knowledge of his right to arbitration and Circuit Court erred in concluding he waived his right to arbitration. COA disagreed and affirmed Circuit Court not ordering arbitration.
COA affirms confirmation of employment arbitration award.
Waller v Blue Cross Blue Shield of Michigan, 360392 (March 23, 2023). MCL 691.1683(1) states MUAA governs agreements to arbitrate made after July 1, 2013, and MCR 3.602(A) confines court rules to forms of arbitration that are not governed by MUAA.
COA affirms order to arbitrate.
Barada v Am Premium Lubricants, LLC, 359625 (March 23, 2023). Plaintiffs argued defendants waived right to arbitration because they were participating in the litigation. Circuit Court held arbitration clause plainly stated arbitration was exclusive remedy to disputes under contract and there was no carve out for injunctive relief. Plaintiffs appealed. COA affirmed.
COA partially affirms Circuit Court concerning ordering arbitration.
Vascular Management Services of Novi, LLC v EMG Partners, LLC, 360368 (March 9, 2023). Plaintiffs appealed order compelling parties to arbitrate. COA affirmed but remanded for further proceedings regarding arbitrability.
COA affirms Circuit Court confirming award.
Yaffa v Williams, 360732 (March 2, 2023). In disclosure statement, Yaffa represented septic tank and drain field in working order. Later inspection report indicated drainage system not adequately functioning. Inspector suggested further investigation needed. No further inspection occurred. After Williamses took possession, they discovered septic system not operational. Matter submitted to arbitration. Arbitrator found Yaffa fraudulently misrepresented septic system in working order. Arbitrator awarded exemplary damages and costs. Circuit Court confirmed award. COA affirmed.
COA affirms Circuit Court confirming award.
Clancy v Entertainment Managers, LLC, 357990 (February 2, 2023). AAA administered arbitration under Commercial Arbitration Rules expedited proceedings. According to COA, defendant did not explain how it was prejudiced by use of expedited procedures such that award would have been “substantially otherwise” had arbitration been conducted differently. COA affirmed Circuit Court confirmation of award.
COA affirms Circuit Court confirming arbitration award.
Domestic Uniform Rental v Bronson’s, 359297 (Jan 19, 2023). Defendants appealed order confirming award. COA affirmed. According to Circuit Court and COA, arbitrator did not make errors of law by enforcing contract terms. COA agreed with appellant that award reflected error of law concerning attorney fee award, but Circuit Court did not err by confirming award because appellants cannot demonstrate substantially different award would have been rendered but for error.
COA holds court case stayed rather than dismissed when case sent to arbitration.
SP v Lakelands Golf and Country Club, 359710 (January 12, 2023). COA affirmed Circuit Court determination hostile work environment allegations subject to arbitration. COA affirmed Circuit Court decision to stay proceedings pending arbitration.
MEDIATION
Supreme Court Decisions
Supreme Court reverses COA concerning oral agreement.
Rieman v Rieman, ___ Mich ___, MSC 164081 (March 10, 2023). In lieu of granting leave to appeal, Supreme Court reversed that part of COA judgment which found plaintiff’s claims barred by statute of frauds. Alleged oral agreement only addressed profits from sale proceeds from real estate transactions, as opposed to creating or transferring interest in real estate. Case remanded for consideration of whether question of fact exists as to whether parties had post-sale oral agreement. Justices Viviano and Zahra would have denied leave, agreeing with COA that statute of frauds barred plaintiff’s claim.
COA Published Decisions
COA affirms Circuit Court modification of consent JOD
Brendal v Morris, ___ Mich App ___, 359226 (January 12, 2023). Courts permitted to modify child support orders when changed circumstances demand, even if child support award negotiated as part of consent JOD. Parties agreed to one-time lump-sum child support payment in consent JOD. Before payment made, recipient stopped exercising most of his parenting time. This change of circumstances warranted review of child support award. COA affirmed.
COA Unpublished Decisions
COA reverses Circuit Court not applying consent JOD.
Fox v Sims, 360165 (March 30, 2023). Plaintiff appealed Circuit Court divorce JOD. COA held Circuit Court abused discretion by failing to enter signed consent JOD as written, and instead altering its terms without a sufficient basis.
COA affirms Circuit Court enforcement of settlement agreement.
International Union Security Police & Fire Professionals of Am v Maritas, 359846 (March 16, 2023). Circuit Court determined that lack of plaintiff’s signature on agreement was not dispositive because stipulated order was signed by defendant’s attorney and order referenced parties had entered into settlement agreement.
COA affirms enforcement of settlement agreement.
McNay v McNay, 361186 (March 2, 2023). Parties married for 24 years before they started divorce action that resulted in consent JOD. “The following issues will be submitted to arbitration in lieu of a Court trial: Content and language disputes regarding the Judgment of Divorce[;] . . . [and a]ny issues inadvertently left unsolved … at mediation.” Arbitrator issued opinion regarding JOD. Defendant moved to modify JOD. Circuit Court denied motion. COA affirmed. Ambiguity surrounding how defendant was to pay plaintiff for interest in marital home was within arbitrator’s authority.
COA affirms Probate Court enforcement of MSA.
Estate of Terry Broemer, 360571 (February 9, 2023). Appellant did not appear at hearing regarding her objection to a probate mediation MSA. V___ presented argument on behalf of appellant under purported power of attorney. Probate Court found V___ engaging in unauthorized practice of law. Probate Court found objection untimely. Probate Court denied appellant’s objection. COA affirmed.
About the Author
Lee Hornberger is a former Chair of SBM ADR Section, Editor Emeritus of The Michigan Dispute Resolution Journal, former SBM Representative Assembly member, former President of Grand Traverse-Leelanau-Antrim Bar Association, and former Chair of Traverse City Human Rights Commission. He is member of Professional Resolution Experts of Michigan and Diplomate Member of The National Academy of Distinguished Neutrals. He has received Distinguished Service Award and George Bashara Award from ADR Section.