Justia Arbitration & Mediation Opinion Summaries

SSC Selma Operating Company, LLC, doing business as Warren Manor Health and Rehabilitation Center, and SavaSeniorCare Administrative Services, LLC, appealed a circuit court order denying their motion to compel arbitration of a retaliatory-discharge claim filed against them by Jackie Fikes. Fikes sued the companies, seeking to recover worker's compensation benefits pursuant to the Alabama Workers' Compensation Act, and alleging that the companies had discharged her from her employment in violation of Ala. Code 1975, sec. 25–5–11.1, solely because she had filed a claim for worker's compensation benefits. Fikes alleged that in 2013, she suffered a work-related injury when she attempted to lift a patient while working for the companies as a certified nurse assistant; that she underwent medical treatment for her work-related injury; and that she returned to work under light-duty restrictions until Spring 2014, at which time, she says, the companies wrongfully terminated her employment. Fikes requested in the complaint that the worker's compensation claim and the retaliatory-discharge claim be severed in order for the retaliatory discharge claim to be tried by a jury. The companies moved to compel arbitration of the retaliatory discharge claim pursuant to their employment-dispute resolution program ("the EDR program") under which Fikes had agreed to be bound. Fikes responded, arguing that the retaliatory-discharge claim was not covered by the EDR program. After review, the Alabama Supreme Court concluded Fikes failed to demonstrate her retaliatory-discharge claim was not covered by the EDR program. Accordingly, the Court reversed the trial court's order denying the companies' motion to compel arbitration of that claim. View "SSC Selma Operating Company, LLC v. Fikes" on Justia Law

Robert Newell’s wife Lisa passed away at their home in 2013. Newell requested that Lisa's body be transported to Mobile Memorial Gardens Funeral Home. However, unbeknownst to Newell, Lisa's body was transported to Radney Funeral Home. The following day Newell, accompanied by his sister, two daughters, and a son-in-law, went to Mobile Memorial Gardens Funeral Home to make the final arrangements for Lisa. Richard Johnson III, an employee of Mobile Memorial Gardens, informed Newell at that time that Lisa's body had been transported to Radney Funeral Home instead of Mobile Memorial Gardens. According to Newell, Johnson informed him that Lisa's body had been transported to Radney because Radney was now a part of the Dignity Memorial Company (both a part of SCI Alabama Funeral Services, LLC) and because Mobile Memorial Gardens did not have a crematory service. Newell informed Johnson during the meeting that he wanted Lisa's remains cremated and that he wanted to conclude the process as soon as possible. Newell executed a contract providing for the disposition of Lisa's remains by cremation. Newell contended that after Lisa's memorial service, SCI did not return any of his telephone calls or e-mails inquiring as to the status of Lisa's remains. Newell eventually went to Radney Funeral Home, learning at that time that Lisa had not yet been cremated because the funeral home had not yet received the death certificate. Newell alleged that he was emotionally distraught over the state of Lisa’s remains, and ultimately sued SCI for negligence, wantonness, the tort of outrage, and fraud. SCI moved to compel arbitration, but Newell resisted, arguing the terms of the arbitration provision at issue were grossly favorable to SCI and that SCI had overwhelming bargaining power over a grieving husband. The trial court granted the motion. Newell appealed. Finding no error in the judgment granting SCI’s motion to compel arbitration, the Supreme Court affirmed. View "Newell v. SCI Alabama Funeral Services, LLC" on Justia Law

Timothy Bevel appeals from an order granting a motion to compel arbitration. In March 2015, Bevel financed the purchase of a used Bennington brand boat and a Yamaha brand boat motor from Guntersville Boat Mart, Inc., and he rented a boat slip on Lake Guntersville to dock the boat. The sale and boat-slip rental were documented by a one-page bill of sale, which contained an arbitration provision. According to Bevel, the boat was seized several months after the transaction for allegedly defaulting on payments on the boat and boat-slip rental. Bevel disputed that he owed those payments. The matter was submitted to arbitration. The Supreme Court found, however, that the arbitration provision at issue here did not become part of the contract between the parties, and, thus, it could not be enforced against Bevel. Accordingly, the Court reversed the trial court's order compelling arbitration, and the case remanded the case for further proceedings. View "Bevel v. Marine Group, LLC" on Justia Law

University Toyota and University Chevrolet Buick GMC (collectively referred to as "the University dealerships") appealed a circuit court order allowing Beverly Hardeman and Vivian Roberts to pursue their claims against the University dealerships in arbitration proceedings. conducted by the American Arbitration Association ("the AAA") instead of the Better Business Bureau of North Alabama ("the BBB"), the entity identified in the controlling arbitration agreements. In conjunction with their purchases of new vehicles from the University dealerships’ predecessor, Jim Bishop, Hardeman and Roberts purchased service contracts entitling them to no-cost oil changes for as long as they owned their respective vehicles. When the Jim Bishop dealerships were sold and rebranded as the University dealerships, initially the University dealerships honored the no-cost oil-change service contracts sold by the Jim Bishop dealerships. However, they eventually stopped providing no-cost oil changes to customers who held those contracts. On October 29, 2015, Hardeman and Roberts filed a demand for arbitration with the BBB, the dispute-resolution entity identified in arbitration agreements they had executed when they purchased their vehicles, on behalf of themselves and all similarly situated individuals, based on the University dealerships' refusal to honor the service contracts. Because a trial court can compel arbitration only in a manner consistent with the terms of the applicable arbitration agreement, the Supreme Court reversed the trial court's order compelling arbitration and remanded the case for the entry of a new order compelling Hardeman and Roberts to arbitrate their claims against the University dealerships before the BBB if they chose to pursue those claims. View "University Toyota v. Hardeman" on Justia Law

FMR Corp. n/k/a FMR LLC, Fidelity Management Trust Company, and Fidelity Brokerage Services LLC (collectively, "Fidelity") appealed a circuit court order denying their motion asking the court to compel Elizabeth Howard n/k/a Elizabeth Hart ("Hart") to arbitrate Fidelity's dispute with her regarding her responsibility to indemnify Fidelity for losses it might suffer if Hart's stepchildren prevailed on claims they asserted against Fidelity that were the subject of a separate pending arbitration proceeding. In 2006, Hart's husband, Frederick Howard, opened an individual retirement account with Fidelity ("the Fidelity IRA"), funding it with money previously been held in a retirement account administered by Howard's former employer. Although Howard had previously designated his three children from a prior marriage as beneficiaries of the employer's retirement account, he did not designate any beneficiary for the Fidelity IRA at the time it was opened or at anytime thereafter. Howard died in 2011. His will left all his personal property to the children, explaining that Hart "has a sizeable separate estate of her own." However, because Howard never designated a beneficiary for the Fidelity IRA, Fidelity distributed the money held in that account to Hart in accordance with the terms of the Fidelity IRA, which provided that any assets in the account would become the property of a surviving spouse when the account holder died if no beneficiary had been named. The Howard children unsuccessfully challenged that distribution in Probate Court. Then the Howard children sued Fidelity and Hart, asserting claims of undue influence, fraud, and conversion against Hart and a claim of negligence against Fidelity, contending their father was incompetent at the time the Fidelity IRA was opened and that Hart was the impetus behind the opening of the Fidelity IRA, Fidelity was negligent for failing to implement adequate procedures governing its online-account-opening process that would prevent either fraudulent activity or invalid actions by incompetent individuals. Fidelity moved the Circuit Court to compel arbitration, noting in its motion that Howard, Hart, and the Howard children had all executed documents related to accounts with Fidelity that contained arbitration provisions. The Supreme Court reversed, finding that the circuit court denied Fidelity's motion notwithstanding the submission of competent evidence establishing Fidelity had a right to arbitrate these claims. View "FMR Corp. n/k/a FMR LLC, et al. v. Howard n/k/a Hart" on Justia Law

Bugs “R” Us, LLC (BRU) appealed the denial of its motion to compel arbitration in an action filed by Autumn McCants for negligent and/or wanton termite inspection of a house she purchased. After review, the Supreme Court concluded that BRU met its burden of establishing the existence of an arbitration contract between the parties. Furthermore, the arbitration provision dictated that the issues McCants raised about the applicability of the Federal Arbitration Act to this dispute, whether her claims were subsumed under the arbitration provision, and whether she was bound by the arbitration provision had to be submitted to an arbitrator for determination. Therefore, the trial court's order denying RU's motion to compel arbitration was reversed and the matter remanded for further proceedings. View "Bugs "R" Us, LLC v. McCants" on Justia Law

Kiva Lodge Condominium Owners' Association, Inc. ("Kiva Lodge") was an Alabama nonprofit corporation formed for the purpose of administering and maintaining the Kiva Dunes Clubhouse and Condominium ("Kiva Dunes") located in Gulf Shores. In 2009, Kiva Lodge contracted with Hudak & Dawson Construction Co., Inc. ("Hudak") to be the general contractor for the remediation of deficiencies in Kiva Dunes buildings that were allowing water to enter the buildings. Hudak subcontracted the stucco and/or sealant portion of the work to Don Colvin d/b/a Colvin Plastering ("Colvin"). The Hanover Insurance Company ("Hanover"), as surety for Hudak, issued to Kiva Lodge a performance bond ensuring and/or securing the full performance of Hudak's contractual obligations. In September 2012, Kiva Lodge informed Hudak and Colvin of leaks and bubbling in the stucco exterior of the buildings at Kiva Dunes caused by water intrusion. Kiva Lodge alleged that Hudak and Colvin failed to determine and/or disclose the course of the problems and the proper scope of repairs necessary. It also alleged that Hanover breached the terms of its performance bond by failing to promptly remedy the default, complete the work within the scope of the contract in accordance with the terms and conditions, or arrange for payment of an alternative contractor to complete the work. Hanover filed a motion to dismiss Kiva Lodge's claims against Hanover on the ground that, under its performance bond, its claims were time-barred, falling outside of a two-year statute of limitations. In 2015, the circuit court heard arguments concerning Kiva Lodge's motion to compel arbitration, eventually granting the stay and ordering the parties to arbitration. The court also denied Hanover's motion to dismiss. Hudak, Colvin, and Hanover timely appealed the circuit court's order. After review, the Supreme Court found no reversible error in the trial court's order and affirmed. View "Hanover Insurance Co. v. Kiva Lodge Condominium Owners' Association, Inc." on Justia Law

Kurtrina Smith and Rickey Levins separately initiated actions against defendants the African Methodist Episcopal Church, Inc. ("the AME Church"); James L. Davis, bishop and presiding officer of the AME Church's Ninth Episcopal District (collectively, "the Ninth District"); and Lincoln National Life Insurance Company ("Lincoln National") after Lincoln National denied their respective claims for benefits filed pursuant to a group life-insurance policy Davis had purchased from Lincoln National on behalf of the Ninth District. Smith and Levins alleged the group policy provided coverage for Smith's mother and Levins's father. The defendants moved the trial court hearing each action to compel arbitration pursuant to arbitration provisions that were allegedly part of the group policy and certificates. The trial court denied those motions, and defendants appealed. Finding that the trial court erred in denying the motion, the Supreme Court reversed and remanded for arbitration proceedings. View "African Methodist Episcopal Church, Inc. v. Levins" on Justia Law

Regions Bank appealed a circuit court order denying its motion to compel arbitration. In October 2011, Mary Rice opened both a savings account and a checking account with Regions. Rice opened each account by signing a one-page signature card indicating that she was agreeing to certain terms. Among other things, the signature cards referred to a Deposit Agreement, the terms of which contained the arbitration clause at issue here. In March 2015, Rice sued Regions, alleging that Regions was liable for a fall she suffered on Regions' premises. Regions filed a motion to compel arbitration, citing the arbitration provision in the deposit agreement. Rice opposed the motion to compel arbitration, arguing that her claim was beyond the scope of the arbitration provision in the Deposit Agreement. The Supreme Court reversed and remanded, finding that the arbitration clause at issue clearly and unmistakably delegated questions of substantive arbitrability of matters between the parties to the arbitrator. Pursuant to the delegation provision, the arbitrator had to resolve the disputed issue whether Rice's claim is arbitrable under the arbitration provision. View "Regions Bank v. Rice" on Justia Law

PNC Bank, National Association, and Sonja Moore-Dennis separately appealed a Circuit Court order denying their motion to compel arbitration as to Joseph Franklin's claims against them. Franklin had three bank accounts with the predecessor bank to PNC Bank, RBC Bank (USA), before RBC Bank merged with PNC Bank. Shortly before the merger, PNC Bank, in January 2012, allegedly mailed a welcome letter and a PNC Bank Account Agreement. The account agreement did not contain an arbitration provision. Tamara Franklin, Franklin's niece came to to visit one day. Tamara noticed a document that she thought was a bank statement from PNC Bank. After looking at the document, Tamara was concerned that Franklin owed money to PNC Bank. Franklin said he did not owe PNC Bank any money but that Tamara could call his financial advisor, Sonja Moore-Dennis, if she had any concerns. Franklin alleged that Moore-Dennis was a PNC Bank agent or employee at this time; PNC Bank denies that it had ever employed Moore-Dennis. After investigating the matter, Franklin and Tamara came to the conclusion that Moore-Dennis had been stealing funds from Franklin's accounts. Additionally, it appeared to Franklin and Tamara that Moore-Dennis had created an online banking profile for Franklin but had set up the profile so that account notifications were sent to her e-mail address. Franklin, who is elderly, did not have Internet access or an e-mail address and did not know how to use online banking. Franklin sued PNC Bank and Moore-Dennis alleging fraud, suppression, breach of fiduciary duty, and various forms of negligence and wantonness. PNC Bank moved to compel arbitration, raising the terms of the account agreement as grounds for its motion. The Alabama Supreme Court affirmed the circuit court’s order, finding that the Bank and Moore-Dennis failed to prove that Franklin received the account agreement or accessed a specific web page that contained the arbitration provision as described in the account agreement. View "Moore-Dennis v. Franklin" on Justia Law