Justia Arbitration & Mediation Opinion SummariesArticles Posted in Real Estate & Property Law
Larmel v. Metro North Commuter Railroad Co.
The Supreme Court affirmed the judgment of the appellate court remanding this case to the trial court with direction to render judgment in favor of Defendant on Plaintiff's negligence claim that had previously been the subject of mandatory arbitration in a prior civil action, holding that the appellate court's decision was not in error.Plaintiff brought a personal injury action against Defendant in 2015. Before trial, the parties attended arbitration, and the arbitration found in favor of Defendant. The trial court entered judgment in accordance with the arbitrator's decision. Plaintiff then brought the instant action repeating the allegations of negligence in the first action. The trial court granted Defendant's motion to dismiss on the basis of res judicata. The appellate court affirmed on different grounds, concluding that action was not viable because the action had been tried on its merits by the arbitrator and had resulted in a judgment in favor of Defendant. The Supreme Court affirmed, holding that appellate court did not err. View "Larmel v. Metro North Commuter Railroad Co." on Justia Law
Hayslip v. U.S. Home Corp.
The Supreme Court held that a deed covenant requiring the arbitration of any dispute arising from a construction defect runs with the land such that it is binding upon a subsequent purchaser of the real estate who was not a party to the deed.The home in this case was constructed and sold by U.S. Home Corp. to the original purchasers. The original deed contained an arbitration provision and several covenants, conditions and restrictions concerning the home that bound both the original purchasers and subsequent purchasers. The original purchasers later sold the home to Plaintiffs, who brought suit against U.S. Home pursuant to Fla. Stat. 553.84. U.S. Home filed a motion to stay and compel arbitration, which the circuit court granted. The Second District Court of Appeal affirmed, concluding that a valid arbitration agreement existed and that it was a covenant running with the land. The Supreme Court approved the decision below, holding that Plaintiffs were bound by the arbitration provision. View "Hayslip v. U.S. Home Corp." on Justia Law
Wynlake Residential Association, Inc, et al. v. Hulsey et al.
Wynlake Residential Association, Inc. ("the homeowners' association"), Wynlake Development, LLC, SERMA Holdings, LLC, Builder1.com, LLC, J. Michael White, Shandi Nickell, and Mary P. White ("the defendants") appealed a circuit court's judgment on an arbitration award entered against them. Because the defendants' appeal was untimely, the Alabama Supreme Court dismissed the appeal. View "Wynlake Residential Association, Inc, et al. v. Hulsey et al." on Justia Law
Patterson v. Superior Court
In this California Fair Employment and Housing Act (FEHA) case, the Court of Appeal granted the petition for writ of mandate and directed respondent Los Angeles Superior Court to vacate its order awarding attorney fees to Charter and to conduct a new hearing to reconsider Charter's motion for attorney fees. At issue is whether an employer's arbitration agreement authorizes the recovery of attorney fees for a successful motion to compel arbitration of a FEHA lawsuit even if the plaintiff's opposition to arbitration was not frivolous, unreasonable or groundless.The court concluded that, because a fee-shifting clause directed to a motion to compel arbitration, like a general prevailing party fee provision, risks chilling an employee's access to court in a FEHA case absent Government Code section 12965(b)'s asymmetric standard for an award of fees, a prevailing defendant may recover fees in this situation only if it demonstrates the plaintiff's opposition was groundless. In this case, no such finding was made by the superior court in the underlying action before awarding real party in interest Charter its attorney fees after granting Charter's motion to compel petitioner to arbitrate his FEHA claims. View "Patterson v. Superior Court" on Justia Law
Performance Builders, LLC, et al. v. Lopas
Scott and Janet Lopas filed suit against, among others, Performance Builders, LLC, Chris White, Shana Tyler Clark, and DSKAT Holdings, LLC, d/b/a A-Pro Home Inspection Services Birmingham (collectively, "the movants") asserting various causes of actions based on the inspection, appraisal, and sale of a piece of real property purchased by the Lopases. The movants moved to compel arbitration of the Lopases' claims, which the circuit court denied. The movants appealed the circuit court's order. After review, the Alabama Supreme Court concluded the movants met their burden of establishing the existence of an agreement containing an arbitration provision between the parties, and that that agreement involved a transaction affecting interstate commerce. Furthermore, the arbitration provision dictated that the issue of enforceability raised by the Lopases had to be submitted to the arbitrator for determination. Therefore, the circuit court's order denying the movants' motion to compel arbitration was reversed. View "Performance Builders, LLC, et al. v. Lopas" on Justia Law
Rehoboth Bay Homeowners’ Assoc, et al. v. Hometown Rehoboth Bay
Appeals consolidated for the Delaware Supreme Court’s review centered on the Rent Increase Justification Act, which governed rent increases in manufactured home communities. The Rehoboth Bay Manufactured Home Community (the “Community”) was owned/managed by Hometown Rehoboth Bay, LLC (“Hometown”). The Appellant in Case No. 139, 2020 was Rehoboth Bay Homeowners’ Association (the “HOA”), the homeowners’ association. The Appellants in Case No. 296, 2020 were two individual tenants, John Iacona and Robert Weymouth. Hometown sought to raise the rents in both cases: in case No. 296, 2020, rents would be raised an amount in excess of the Consumer Price Index for this area (the “CPI-U”), for the calendar year 2017; in case No. 139, 2020, for the calendar year 2018. Under the Act, proposed rent increases that exceed the CPI-U must be justified by certain factors. Separate arbitrators in both cases found that a Bulkhead Stabilization project performed by Hometown in phases over more than one year was a capital improvement or rehabilitation work, which, along with other capital improvements and other expenses, justified rent increases in excess of the CPI-U in both years. The Appellants claimed the Superior Court erred by affirming the arbitrators’ decisions that the Bulkhead Stabilization project was a “capital improvement or rehabilitation work” and not “ordinary repair, replacement, and maintenance.” They also claimed the Superior Court should have ruled that the Act did not permit Hometown to incorporate the capital improvement component of the rent increases into each lot’s base rent so as to carry those increases forward into ensuing years. The Delaware Supreme Court concluded the Superior Court’s rulings on the Bulkhead Stabilization project as a capital improvement or rehabilitation work was correct, however, the Act did not permit Hometown to incorporate the capital improvement component of the 2017 and 2018 rent increases into a lot’s base rent for succeeding years after recovering that lot’s full, proportionate share of those costs in those years. Therefore, the Superior Court’s judgment was affirmed in part, reversed in part, and the cases remanded for further proceedings. View "Rehoboth Bay Homeowners' Assoc, et al. v. Hometown Rehoboth Bay" on Justia Law
Wild Meadows MHC, LLC v. Weidman
Appellant Wild Meadows MHC, LLC challenged the Superior Court’s dismissal of its petition for a writ of prohibition. The Wild Meadows manufactured home community (the “Community”) owned by Appellant, was located in Dover, Delaware. The Community was governed by the Manufactured Home Owners and Community Owners Act and its subsection commonly known as the Rent Justification Act (the “Act”). Appellee Intervenor/Respondent Wild Meadows Homeowners’ Association (the “HOA”) represented these homeowners. Multiple homeowners rejected Wild Meadows’ rent increase and, through the HOA, filed a petition with the Delaware Manufactured Home Relocation Authority (the “Authority”). The Authority appointed Appellee David J. Weidman, Esquire as the arbitrator under the Act. Before the scheduled arbitration, the HOA requested financial information from Wild Meadows relating to the Community’s recent revenue and costs. Wild Meadows refused to provide this information. The HOA moved to compel discovery and a motion for summary judgment with Weidman. In his initial decision, Weidman granted discovery of any financial documents that Wild Meadows intended to rely upon at arbitration, but he denied the HOA’s motion to compel the production of additional financial documents from Wild Meadows. Determining he could compel discover, Weidman ordered Wild Meadows to submit a proposed confidentiality agreement, and ordered the HOA to submit any comments on the draft. After taking both parties' comments into consideration, Weidman issued a final confidentiality agreement, rejecting many of the changes the HOA proposed. Wild Meadows refused to sign the confidentiality agreement and filed the underlying application for a writ of prohibition in the Superior Court. Wild Meadows argued to the Delaware Supreme Court that the Superior Court erroneously held that the arbitrator appointed under Delaware’s Rent Justification Act had authority to compel discovery and impose a confidentiality agreement upon parties concerning discovery material. Finding no reversible error in the Superior Court's judgment, the Supreme Court affirmed. View "Wild Meadows MHC, LLC v. Weidman" on Justia Law
Cabatit v. Sunnova Energy Corporation
Daniel and Indiana Cabatit entered into a solar power lease agreement (the agreement) with Sunnova Energy Corporation. After a solar power system was installed on the Cabatits’ residence, the Cabatits sued Sunnova, alleging damage to their roof. Sunnova moved to compel arbitration based on an arbitration clause in the agreement, but the trial court found the arbitration clause unconscionable and denied the motion. On appeal, Sunnova contended: (1) the arbitration clause required the Cabatits to submit to an arbitrator the question whether the clause was enforceable; (2) the trial court erred in finding the arbitration clause unconscionable, and (3) despite the trial court’s conclusion to the contrary, the rule announced in McGill v. Citibank, N.A. 2 Cal.5th 945 (2017), did not apply to the circumstances of this case. The Court of Appeal determined: (1) Sunnova did not raise at trial the issue of whether the arbitration clause was itself had to be decided by an arbitration, thus not addressed on appeal; (2) the arbitration clause was procedurally and substantively unconscionable and therefore unenforceable, and (3) the Court did not consider whether the McGill rule applied here because general considerations of unconscionability, independent of the McGill rule, supported the trial court’s determination. Thus, the Court affirmed the trial court's denial of Sunnova's motion to compel arbitration. View "Cabatit v. Sunnova Energy Corporation" on Justia Law
West Pleasant-CPGT, Inc. v. U.S. Home Corporation
In 2005, U.S. Home Corporation entered into a contract to purchase two contiguous tracts of land, one of which was owned by West Pleasant-CPGT, Inc. Under the contract, West Pleasant and the other landowner were to gain certain approvals permitting development of the properties. Pursuant to the contract, U.S. Home paid advances to the landowners totaling over $1.5 million. As security for the advances, West Pleasant executed a mortgage and note on its property; the other landowner did not. When a contract dispute arose in 2006, U.S. Home sought to terminate the contract and get a return of its total advance. U.S. Home prevailed in arbitration and was awarded a judgment in the full amount of the advance, plus interest. The Appellate Division affirmed the judgment in 2009. When the judgment was not satisfied, U.S. Home commenced foreclosure actions against the properties. The foreclosure proceedings were stayed when West Pleasant and the other property owner filed for bankruptcy. In West Pleasant’s bankruptcy action, U.S. Home moved to dismiss and for relief from the automatic stay. West Pleasant and U.S. Home executed a Consent Order, in which West Pleasant dismissed its bankruptcy proceeding, waived a fair market valuation and its right to object to a sheriff’s sale of its property, and released U.S. Home from any claims in law or equity. U.S. Home never proceeded with any deficiency action against either landowner. Nonetheless, the landowners commenced the affirmative litigation that gave rise to this appeal, seeking a declaration that the arbitration award was fully satisfied, as well as compensation “in the amount of the excess fair market value of the properties obtained by defendant U.S. Home over the amount of its outstanding judgment.” The second property owner then assigned its rights to West Pleasant. After trial, the court valued the second property as worth almost $2.4 million and West Pleasant’s property as worth almost $2 million. The court ordered U.S. Home to pay the fair market value of the West Pleasant property, plus interest, and extinguished the arbitration award on the second property. On appeal, the Appellate Division determined that West Pleasant had waived its right to a fair market valuation on its property but that it was owed a fair market value credit for the second property. The Appellate Division remanded the matter to the trial court for recalculation of damages. The New Jersey Supreme Court reversed, finding use of fair market value credit by this debtor to obtain a money judgment against a creditor, in the absence of a deficiency claim threatened or pursued or any objection being raised at the time of the sheriff’s sales, was "inconsistent with sound foreclosure processes and, moreover, inequitable in the circumstances presented." The judgment of the Appellate Division was reversed and the matter remanded for further proceedings. View "West Pleasant-CPGT, Inc. v. U.S. Home Corporation" on Justia Law
Yamamoto v. Chee
The Supreme Court reversed the judgment of the intermediate court of appeals (ICA) affirming the judgment of the circuit court granting Defendants' motion to compel arbitration of Plaintiff's complaint against a partnership and a partner after concluding that Plaintiff's claims arose out of the agreement founding the partnership, signed by Plaintiff, that contained an arbitration clause, holding that the claims in Plaintiff's complaint were not subject to the arbitration clause in the partnership agreement.Plaintiff, a founding partner of the partnership, brought claims alleging conversion, fraudulent conversion, and punitive damages. The lower courts concluded that Plaintiff's claims arose out of the partnership agreement, and therefore the arbitration clause applied. The Supreme Court reversed, holding that because Defendants failed to initiate arbitration pursuant to Haw. Rev. Stat. 658A-9 before filing a motion to compel arbitration and because the arbitration clause did not encompass Plaintiff's claims for conversion, the ICA erred in affirming the circuit court's order granting Defendants' motion to compel arbitration. View "Yamamoto v. Chee" on Justia Law