Justia Arbitration & Mediation Opinion SummariesArticles Posted in Michigan Supreme Court
Tyler v. Finding
Plaintiff B. A. Tyler filed suit against David Findling; the Findling Law Firm, PLC; and Mekel Miller, alleging that David Findling published defamatory statements to attorney Anna Wright by telling her that plaintiff and plaintiff’s client (Samir Warda, for whose estate Findling had been appointed as a receiver) might have engaged in inappropriate or illegal activities. Findling made the allegedly defamatory statements to Wright, Warda’s attorney in a personal protection insurance (PIP) lawsuit, who recorded the conversation, in a room reserved for the plaintiffs’ side at the outset of a court-ordered mediation in the PIP matter. Wright subsequently shared this recording with plaintiff. Findling and his law firm (collectively, “defendants”) moved for summary judgment, and plaintiff responded with an affidavit by Wright. Defendants moved to strike Wright’s affidavit and to preclude her testimony at trial. The trial court granted the motion to strike under MCL 2.412(C), which governed the confidentiality of mediation communications, and granted defendants’ motion for summary judgment. Plaintiff’s motion to file an amended complaint was also denied. In an unpublished per curiam opinion, the Court of Appeals vacated the trial court’s order granting defendants’ motion to strike Wright’s affidavit and find her testimony inadmissible, reversed the order granting defendants summary judgment, affirmed the order denying plaintiff’s motion to amend his complaint, and remanded for further proceedings. The Michigan Supreme Court reversed the Court of Appeals in part, finding Findling's statements were indeed "mediation communications" under MCR 2.412(B)(2) and were therefore confidential under MCR 2.412(C). The Supreme Court also determined the appeals court erred in reversing the grant of summary judgment without which, plaintiff had no evidence to support the relevant defamation allegations. In all other respects, the appellate court's judgment was affirmed. View "Tyler v. Finding" on Justia Law
Lichon v. Morse
Two former employees of Michael Morse and his firm, Michael J. Morse, PC, sued Morse for workplace sexual harassment, including sexual assault, intentional infliction of emotional distress; negligence, gross negligence, and wanton and willful misconduct; and civil conspiracy. In both cases, the firm moved to dismiss and compel arbitration on the basis that both women signed the firm’s Mandatory Dispute Resolution Procedure agreement (MDRPA) prior to accepting employment with the firm. The trial court granted defendants' motion in each case, concluding that the arbitration agreement was valid and enforceable and that the claims were related to the employees' employment and therefore subject to arbitration. A majority of the Court of Appeals concluded that plaintiffs’ claims of sexual assault were not subject to arbitration because sexual assault was not “related to” plaintiffs’ employment. Further, the Court of Appeals stated that the fact that the alleged assaults would not have occurred but for plaintiffs’ employment with the firm did not provide a sufficient nexus between the terms of the arbitration agreement and the alleged sexual assaults. "Defendants noted certain facts that supported connections between plaintiffs’ claims and their employment, including that the alleged assaults occurred at work or work-related functions. But those facts did not necessarily make plaintiffs’ claims relative to employment; rather, the facts had to be evaluated under a standard that distinguished claims relative to employment from claims not relative to employment. This analysis prevents the absurdity of an arbitration clause that bars the parties from litigating any matter, regardless of how unrelated to the substance of the agreement, and it ensures that the mere existence of a contract does not mean that every dispute between the parties is arbitrable. Neither the circuit courts nor the Court of Appeals considered this standard when evaluating defendants’ motions to compel arbitration." Rather than apply this newly adopted approach in the first instance, the Michigan Supreme Court vacated the judgments of the Court of Appeals and remanded the cases to the circuit courts so that those courts could analyze defendants’ motions to compel arbitration by determining which of plaintiffs’ claims could be maintained without reference to the contract or employment relationship. View "Lichon v. Morse" on Justia Law
Estate of Nickola v MIC General Ins. Co.
In 2004, George and Thelma Nickola, were injured in a car accident. The driver of the other car was insured with a no-fault insurance policy provided the minimum liability coverage allowed by law: $20,000 per person, up to $40,000 per accident. The Nickolas’ (acting through their attorney) wrote to their insurer, defendant MIC General Insurance Company, explaining that the no-fault liability insurance policy was insufficient to cover the Nickolas' injuries. The letter also advised MIC that the Nickolas were claiming UIM benefits under their automobile policy. The Nickolas’ policy provided for UIM limits of $100,000 per person, up to $300,000 per accident, and they sought payment of UIM benefits in the amount of $160,000; $80,000 for each insured. An adjuster for defendant MIC denied the claim, asserting that the Nickolas could not establish a threshold injury for noneconomic tort recovery. The matter was ultimately ordered to arbitration, the outcome of which resulted in an award of $80,000 for George’s injuries and $33,000 for Thelma’s. The award specified that the amounts were “inclusive of interest, if any, as an element of damage from the date of injury to the date of suit, but not inclusive of other interest, fees or costs that may otherwise be allowable.” The trial court affirmed the arbitration awards but declined to award penalty interest under the UTPA, finding that penalty interest did not apply because the UIM claim was “reasonably in dispute” for purposes of MCL 500.2006(4). The Court of Appeals affirmed the trial court, holding that the “reasonably in dispute” language applied to plaintiff’s UIM claim because a UIM claim “essentially” places the insured in the shoes of a third-party claimant. The Michigan Supreme Court held that an insured making a claim under his or her own insurance policy for UIM benefits cannot be considered a “third party tort claimant” under MCL 500.2006(4). The Court reversed the Court of Appeals denying plaintiff penalty interest under the UTPA, and remanded this case back to the trial court for further proceedings. View "Estate of Nickola v MIC General Ins. Co." on Justia Law
Altobelli v. Hartmann
In 1993, plaintiff Dean Altobelli began working as an attorney for Miller, Canfield, Paddock and Stone, P.L.C. (“the Firm”). Upon joining the Firm, plaintiff signed the “Miller Canfield Operating Agreement” (“Operating Agreement”), a document governing the Firm’s internal affairs. By January 2006, plaintiff had become a senior principal at the Firm. However, in late May or early June 2010, plaintiff decided he wanted to pursue a new opportunity as an assistant coach for the University of Alabama football team. Plaintiff proposed a 7- to 12-month leave of absence from the Firm to defendant Michael Hartmann, the Firm’s CEO, and defendant Michael Coakley, who was the head of the Firm’s litigation group but was not a managing director. Plaintiff suggested that the Firm permit him to maintain his ownership interest and return to the Firm as a senior principal any time before June 1, 2011. Plaintiff avers that Hartmann initially promised plaintiff that he could spend as much time at the University of Alabama as he wanted and still receive certain allocated income from his clients. Hartmann disputed this, claiming that plaintiff voluntarily withdrew from the partnership. Plaintiff claimed he was improperly terminated, and that the Firm shorted plaintiff's income as a result. Plaintiff's attempt to resolve the matter through the direct settlement and mediation process, as outlined in the arbitration clause of the Operating Agreement, was unsuccessful. In November 2011, plaintiff filed a demand for arbitration as provided for in the arbitration clause. Despite having made the demand for arbitration, he filed suit alleging that the seven individuals named as defendants were responsible for engaging in tortious conduct with regard to plaintiff's request for a leave of absence and retention of his equity ownership in the Firm. Defendants moved for summary judgment and a motion to compel arbitration as required by the arbitration clause. Plaintiff moved for summary judgment too. The circuit court denied defendants’ motions and granted plaintiff's motion for partial summary judgment, finding as a matter of law that plaintiff did not voluntarily withdraw from the Firm. Rather, the circuit court concluded that defendants had improperly terminated plaintiff's ownership interest without authority. The Court of Appeals affirmed. The Supreme Court reversed the part of the Court of Appeals’ opinion regarding the motion to compel arbitration and instead held that this case was subject to binding arbitration under the arbitration clause of the Operating Agreement. Accordingly, the lower courts should not have reached the merits of plaintiff’s motion for partial summary disposition, as the motion addressed substantive contractual matters that should have been resolved by the arbitrator. The case was remanded back to the trial court for further proceedings. View "Altobelli v. Hartmann" on Justia Law
Beck v. Park West Galleries, Inc.
Brian Beck, Audrey Mahoney, David and Felice Oppenheim, Patty Brown, and others brought an action in the Oakland Circuit Court against Park West Galleries, Inc., and others, alleging, inter alia, breach of contract and fraud. Defendant Park West Galleries, Inc. (Park West) sold art on various cruise ships traversing international waters. Plaintiffs purchased art from Park West on multiple occasions over the course of several years while on different cruise ships in different locations. The issue this case presented for the Michigan Supreme Court's review centered on whether an arbitration clause included in invoices for plaintiffs’ artwork purchases applied to disputes arising from plaintiffs’ previous artwork purchases when the invoices for the previous purchases did not refer to arbitration. The Court agreed with plaintiffs that the arbitration clause contained in the later invoices could not be applied to disputes arising from prior sales with invoices that did not contain the clause. Each transaction involved a separate and distinct contract, and the facts did not reasonably support a conclusion that the parties intended for the arbitration clause to retroactively apply to the previous contracts. Accordingly, the Supreme Court reversed that part of the Court of Appeals judgment that extended the arbitration clause to the parties’ prior transactions that did not refer to arbitration. The case was remanded back to the Court of Appeals for consideration of the issues raised in plaintiffs’ appeal that the Court did not address to the extent those issues relate to claims that are not subject to arbitration. In all other respects, leave to appeal was denied because the Court was not persuaded that it needed to review the remaining questions presented. View "Beck v. Park West Galleries, Inc." on Justia Law
Macomb County v. AFSCME Council 25 Locals 411 & 893
Several union groups filed unfair labor practice complaints against Macomb County and the Macomb County Road Commission over a change in the method for calculating pension benefits. The groups argued the County lowered benefits without bargaining on the issue as required by Michigan labor law. Upon review, the Supreme Court found that disputes over terms or conditions of employment covered by a collective bargaining agreement (CBA) are subject to arbitration through a grievance process. When the CBA grants the retirement commission discretion to use actuarial tables to establish pension benefits, the decision to change a long-standing method of calculating those benefits does not (by itself) constitute the clear and unmistakable evidence needed to overcome the CBA's coverage, nor does it create a new condition of employment that would trigger the need to bargain. As a result, none of the unfair labor practices alleged in this case could be sustained, and the remedy for this dispute should have gone through the grievance process called for in the CBA. View "Macomb County v. AFSCME Council 25 Locals 411 & 893 " on Justia Law