Justia Arbitration & Mediation Opinion Summaries

Therese Hood was involved in a three-car accident and subsequently filed multiple lawsuits. Hood's underinsured motorist (UIM) carrier, United Services Automobile Association (USAA), provided her with counsel in a lawsuit filed by the Kucks, who were also involved in the accident. Hood also sued Johnson, the driver who initially hit her, and USAA defended Johnson under Hood's UIM policy. During mediation, USAA offered $200,000, but Hood did not accept it, and the case went to trial, where Hood won. Hood then filed a third lawsuit against USAA, alleging bad faith, negligence, and other claims, arguing that USAA took disparate positions on her headlight use and did not offer its full settlement authority during mediation.The Circuit Court granted summary judgment for USAA on several claims and directed a verdict on others, leaving only the bad faith and negligence claims for the jury. The jury found in favor of USAA on the bad faith claim but in favor of Hood on the negligence claim, awarding her damages. The trial court granted USAA's motion for judgment notwithstanding the verdict (JNOV) on the negligence claim, stating that a first-party insured could only bring a bad faith claim, not a negligence claim. The Court of Appeals affirmed this decision, holding that a first-party insured has no separate cause of action in negligence under the duty of good faith and fair dealing.The South Carolina Supreme Court reviewed the case and affirmed the Court of Appeals' decision. The court held that South Carolina law does not recognize a separate negligence claim between an insured and insurer, only a bad faith claim. The court also found that USAA did not act in bad faith during mediation or by taking a position on Hood's headlight use in the UIM action. The court concluded that USAA's actions were within its rights and that Hood's claims were without merit. View "Hood v. USAA" on Justia Law

Amanda Leigh Huskins and Jay R. Huskins purchased a house from Mungo Homes, LLC, and signed a contract that included an arbitration clause. This clause required any demand for arbitration to be made within ninety days, effectively shortening the statute of limitations for any claims. The Huskins later filed a lawsuit against Mungo Homes, alleging various claims related to the sale. Mungo Homes moved to dismiss the complaint and compel arbitration based on the contract. The Huskins argued that the arbitration clause was unconscionable and unenforceable.The Circuit Court of Richland County granted Mungo Homes' motion to compel arbitration. The Huskins appealed, and the Court of Appeals found the clause limiting the statute of limitations to be unconscionable and unenforceable. However, the Court of Appeals severed this clause from the rest of the arbitration agreement and affirmed the order compelling arbitration.The Supreme Court of South Carolina reviewed the case and reversed the decision of the Court of Appeals. The Supreme Court held that the clause shortening the statute of limitations was void and illegal as a matter of public policy, and therefore unenforceable. The court determined that the absence of a severability clause, the presence of a merger clause, and the fact that the contract was an adhesion contract indicated that the parties did not intend for the arbitration agreement to stand if any part of it fell. Consequently, the entire arbitration agreement was deemed unenforceable. The case was remanded to the circuit court for further proceedings, with the remainder of the contract unaffected by this ruling. View "Huskins v. Mungo Homes, LLC" on Justia Law

The case revolves around a dispute over a real estate commission. Andrew Waldo, a broker in charge of a realty company, represented buyers in the purchase of thirteen golf courses from National Golf Management, LLC (NGM). Michael Cousins, another broker, who had previously represented NGM in an earlier transaction, claimed a commission for the golf course deal despite not having a written representation agreement. Cousins, Waldo, and Waldo's agent agreed to arbitrate their dispute. The arbitration panel ruled in favor of Cousins, awarding him half of the commission earned on the golf course sale.The circuit court initially dismissed the lawsuit, ruling that oral agreements for a commission were unenforceable under South Carolina law. However, the arbitration panel later ruled in favor of Cousins. Waldo petitioned the circuit court to vacate the award, which was referred to the Master-in-Equity. The Master-in-Equity vacated the award, stating that the arbitration panel ignored statutory law regarding real-estate agency. The court of appeals reversed this decision, ruling that there was a "barely colorable" ground for the arbitration award based on a line of cases upholding oral and implied contracts for real estate commissions.The Supreme Court of South Carolina reversed the court of appeals' decision and vacated the award. The court held that the arbitration panel had manifestly disregarded several statutes governing real-estate agency law in awarding Cousins half of the commission. The court noted that the Act, which governs real-estate licensing, requires written agreements for real estate agency and forbids oral or implied ones. The court also rejected Cousins' argument that he was entitled to a commission based on a series of cases that recognized a realtor's right to a commission through an oral or implied contract, as these cases were decided before the Act became law. View "Waldo v. Cousins" on Justia Law

Petitioners Rick Hendrick Dodge Chrysler Jeep Ram (Rick Hendrick Dodge) and Isiah White argued an arbitrator had to decide whether they could enforce an arbitration provision in a contract even after that contract had been assigned to a third party. The court of appeals rejected this argument and affirmed the circuit court's determinations that: (1) the circuit court was the proper forum for deciding the gateway question of whether the dispute is arbitrable; and (2) Petitioners could not compel arbitration because Rick Hendrick Dodge assigned the contract to a third party. The South Carolina Supreme Court held that the doctrine announced in Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395 (1967) required the arbitrator to decide whether the assignment extinguished Petitioners' right to compel arbitration. Therefore, the Court reversed the court of appeals' decision and vacated the circuit court's discovery order. View "Sanders v. Savannah Highway Automotive Company" on Justia Law

Hicks Unlimited, Inc. contracted to rent uniforms for its employees from UniFirst Corporation. The contract contained an arbitration provision stating all disputes between them would be decided by binding arbitration to be conducted "pursuant to the Expedited Procedures of the Commercial Arbitration Rules of the American Arbitration Association [AAA] and shall be governed by the Federal Arbitration Act [FAA]." A dispute arose; UniFirst moved to compel arbitration. Hicks contended the arbitration agreement was unenforceable because it did not comply with the notice requirements of South Carolina's Arbitration Act (SCAA). The circuit court denied the motion to compel arbitration, ruling the contract did not implicate interstate commerce and, therefore, the FAA did not apply. The circuit court further ruled the arbitration provision was not enforceable because it did not meet the SCAA's notice requirements. UniFirst appealed. The court of appeals reversed, holding arbitration should have been compelled because the contract involved interstate commerce and, therefore, the FAA preempted the SCAA. The South Carolina Supreme Court found that because the contract between Hicks and UniFirst did not involve interstate commerce in fact, the order of the circuit court denying UniFirst's motion to compel arbitration was affirmed, and the court of appeals' opinion was reversed. View "Hicks Unlimited v. UniFirst" on Justia Law

Respondent Simran Singh (Mother) and Petitioner Gunjit Singh (Father) separated in January of 2012. They entered into a settlement agreement which resolved all issues arising from their marriage, including custody and visitation matters involving their two children, then aged eleven and two. Pursuant to that agreement, Mother received primary custody, and the parties consented to submit any future disputes regarding child support or visitation to a mutually agreed-upon arbitrator, specifically providing that his or her decision would "be binding and non-appealable." The family court approved the agreement and granted the parties a divorce in February of 2013. Approximately nine months later, Father filed an action in family court seeking modification of custody, visitation, and child support, alleging Mother had violated a provision of the agreement when she failed to return to South Carolina with the children after embarking on a cross-country tour as a motivational speaker. From January through August of 2014, four family court judges issued decisions— one dismissing Father’s complaint due to the parties' decision to arbitrate; a second issuing a consent order to arbitrate; and two approving amended agreements to arbitrate. The arbitrator issued a "partial" arbitration award finding a substantial and material change of circumstance affecting the welfare and custody of the minor children, and awarding Father temporary custody. A thirty-two-page final arbitration award was issued the next month, awarding custody to Father. A fifth family court judge issued an order in January 2015 confirming both the partial and final arbitration awards. Thereafter, Mother filed five separate Rule 60(b)(4), SCRCP, motions to vacate all the orders approving the parties' agreements to arbitrate. The court of appeals issued its unanimous decision in December of 2019, holding that the parties could not divest the family court of jurisdiction to determine issues relating to custody, visitation, and child support. One month prior, another panel of the court of appeals issued a decision in Kosciusko v. Parham, 836 S.E.2d 362 (Ct. App. 2019), holding the family court did not have subject-matter jurisdiction to approve the binding arbitration of children's issues. The South Carolina Supreme Court granted certiorari, and affirmed as modified, the appellate court's order. View "Singh v. Singh" on Justia Law

At issue in this appeal was a civil action to collect a debt under a contract that contained an arbitration provision. The defendants appealed the master in equity's order refusing to set aside the entry of their default. The court of appeals dismissed the appeal on the basis that an order refusing to set aside an entry of default was not immediately appealable. The defendants filed a petition for a writ of certiorari claiming the order was immediately appealable because it had the effect of precluding their motion to compel arbitration, and in fact, the order states, "Defendants' motion to stay and compel arbitration is denied as [the defendants are] in default." Finding no reversible error, the South Carolina Supreme Court affirmed the court of appeals. View "Palmetto Construction Group, LLC v. Restoration Specialists, LLC" on Justia Law

This appeal concerned the enforceability of an arbitration agreement executed between Ashley River Plantation, an assisted-living facility, and Thayer Arredondo, the attorney-in-fact under two powers of attorney executed by Hubert Whaley, a facility resident. When Whaley was admitted into the facility, Arredondo held two valid powers of attorney, a General Durable Power of Attorney (GDPOA) and a Health Care Power of Attorney (HCPOA). Arredondo met with a facility representative and signed various documents in connection with Whaley's admission. During that meeting, the facility representative did not mention or present an arbitration agreement to Arredondo. Later that day, after Whaley was admitted, Arredondo met with a different facility representative who, according to Arredondo, told her she "needed to sign additional documents related to [her] father's admission to the facility." Included among those documents was the arbitration agreement, which Arredondo signed. The arbitration agreement contained a mutual waiver of the right to a trial by judge or jury, and required arbitration of all claims involving potential damages exceeding $25,000. The agreement barred either party from appealing the arbitrators' decision, prohibited an award of punitive damages, limited discovery, and provided Respondents the unilateral right to amend the agreement. Two years into his stay at the facility, Whaley was admitted to the hospital, where he died six years later. Arredondo, as Personal Representative of Whaley's estate, brought this action alleging claims for wrongful death and survival against Respondents. The complaint alleged that during his residency at the facility, Whaley suffered serious physical injuries and died as a result of Respondents' negligence and recklessness. In an unpublished opinion, the court of appeals held the arbitration agreement was enforceable. The South Carolina Supreme Court held neither power of attorney gave Arredondo the authority to sign the arbitration agreement. Therefore, the court of appeals was reversed. View "Arredondo v. SNH SE Ashley River Tenant, LLC" on Justia Law

This appeal arose from fourteen lawsuits brought by various plaintiffs against (1) Laura Willis, an insurance agent; (2) Jesse Dantice, the insurance broker who hired Willis and made her the agent in charge of the insurance office; (3) their insurance agency, Southern Risk Insurance Services, LLC (Southern Risk), and (4) six insurance companies for which their office sold policies (the Insurers). The plaintiffs in the lawsuits were Willis's customers (the Insureds) and other insurance agents (the Agents) in competition with Willis and Southern Risk. The Insureds filed twelve of the lawsuits, asserting claims against Willis, Dantice, and Southern Risk for, inter alia, violations of the Unfair Trade Practices Act (UTPA), common law unfair trade practices, fraud, and conversion. They also named the Insurers as defendants on a respondeat superior theory of liability for failing to adequately supervise or audit Willis and Southern Risk. The question before the South Carolina Supreme Court was whether arbitration should have been enforced against nonsignatories to a contract containing an arbitration clause. The circuit court denied the motion to compel arbitration. The court of appeals reversed and remanded, holding equitable estoppel was applicable to enforce arbitration against the nonsignatories. The Supreme Court reversed and remanded, finding the circuit court properly denied the motion to compel arbitration. View "Wilson v. Willis" on Justia Law

The South Carolina Supreme Court granted certiorari to review a Court of Appeals' decision affirming a circuit court order denying petitioner's John Wieland Homes and Neighborhoods of the Carolinas, Inc.'s ("JWH") motion to compel arbitration. JWH sold lots and "spec" homes on a sixty-five acre residential subdivision. In 2007, respondents ("the Parsons") executed a purchase agreement to buy a home built and sold by JWH ("the Property"). In 2008, the Parsons discovered PVC pipes and a metal lined concrete box buried on their Property. The PVC pipes and box contained "black sludge," which tested positive as a hazardous substance. JWH entered a cleanup contract with the South Carolina Department of Health and Environmental Control. JWH completed and paid for the cleanup per the cleanup contract. The Parsons claim they were unaware the Property was previously an industrial site and contained hazardous substances. In 2011, the Parsons filed the present lawsuit alleging JWH breached the purchase agreement by failing to disclose defects with the Property, selling property that was contaminated, and selling property with known underground pipes. The Parsons further alleged breach of contract, breach of implied warranties, unfair trade practices, negligent misrepresentation, negligence and gross negligence, and fraud. JWH moved to compel arbitration and dismiss the complaint. The motion asserted that all of the Parsons' claims arose out of the purchase agreement, and the Parsons clearly agreed that all such disputes would be decided by arbitration. The circuit court denied the motion and found the arbitration clause was unenforceable. The Court of Appeals affirmed the circuit court's finding that the scope of the arbitration clause was restricted to Warranty claims and declined to address the circuit court's application of the outrageous torts exception doctrine. The Supreme Court disagreed with the appellate court's conclusion and reversed. View "Parsons v. John Wieland Homes" on Justia Law