Justia Arbitration & Mediation Opinion Summaries

This case arose from a construction contract dispute between homeowners Ramon Romero and Cassie Romero and contractor Noel Madamba Contracting LLC (Madamba). The case proceeded to arbitration. Arbitrator Patrick K.S.L. Yim issued a partial final arbitration award concluding that Madamba breached the construction contract and that the Romeros were entitled to compensatory damages. Following the issuance of the partial final award, the parties learned that the law firm representing the Romeros throughout the arbitration had been retained by the administrator of Yim’s personal retirement accounts. Madamba moved to vacate the arbitration award based on this previously undisclosed information. The circuit court denied the motion, determining that Yim’s failure to disclose this information did not constitute evident partiality. The Intermediate Court of Appeals affirmed. The Supreme Court vacated the judgments of the lower courts, holding that Yim’s failure to disclose his relationship with the Romeros’ counsel’s law firm constituted evident partiality requiring vacatur of the arbitration award. Remanded with instructions to vacate the arbitration award. View "Noel Madamba Contracting, LLC v. Romero" on Justia Law

Defendant Westlake Services LLC appealed a trial court order denying its motion to compel arbitration. Alfredo Ramos, and coplaintiffs (who are not parties to this appeal) sued Defendant Westlake Services LLC for causes of actions arising out of their purchase of used automobiles. Ramos alleged that negotiations for his purchase of a car were conducted primarily in Spanish. Defendant charged Ramos money for a “guaranteed auto protection” (GAP) contract to cover the vehicle he purchased. A copy of the GAP contract was not provided to him in Spanish. In exchange for the payment of a premium by the consumer and/or purchaser of the automobile, the ‘GAP’ insurance policy contract, which identifies the respective rights and liabilities of the parties to the contract, is purportedly intended to pay the difference between the actual cash value of the financed automobile and the then-current outstanding balance on the loan for the automobile should the financed automobile be destroyed or ‘totaled’ in an accident. Ramos asserted three causes of action based on Westlake’s failure to provide a translation of the GAP contract: (1) violation of the Consumers Legal Remedies Act (CLRA); (2) violation of section 1632; and (3) violation of the unfair competition law (UCL). Westlake moved to compel arbitration of Ramos’s and his coplaintiffs’ claims, relying on the arbitration provisions contained in the underlying sales contracts they each had signed. Upon review, the Court of Appeal concluded that Ramos reasonably relied on a Spanish translation of the English contract that Pena Motors (as Westlake’s agent) provided him that did not include the arbitration. The Court concluded that mutual assent to the arbitration agreement was lacking, void and that the trial court correctly denied Westlake’s motion to compel arbitration. View "Ramos v. Westlake Services" on Justia Law

Plaintiff filed a putative class action against defendant, asserting statutory violations arising from defendant unlawfully recording and/or monitoring her telephone conversations with defendant's representatives. On appeal, plaintiff challenged the trial court's order compelling arbitration of plaintiff's individual claims and dismissing her class claims. The court concluded that plaintiff's claims fall within the scope of the arbitration agreement and that the arbitration agreement is enforceable, with the exception of one provision that the court found to be unconscionable under the applicable jurisdiction's law. The court concluded that it is possible to sever the unconscionable provision from the remainder of the arbitration agreement and from the contract as a whole. Therefore, the court affirmed the trial court's order compelling arbitration. However, the court reversed the portion of the trial court's order compelling the arbitration of plaintiff's individual claims and dismissing plaintiff's class claims because the parties' agreement delegates to the arbitrator the question whether class arbitration is available under the contract. View "Brinkley v. Monterey Fin. Serv." on Justia Law

The administrator of the Pearl River County Hospital entered into a contract with Wellness, Inc., for Wellness to provide furnishings, fixtures, equipment, and systems for the Hospital’s renovation. The Hospital subsequently sued Wellness (and other defendants not party to this appeal) alleging fraud, conspiracy, breach of contract, and other causes of action. Before trial commenced, Wellness moved to compel mediation and arbitration and to stay proceedings. After a hearing on the motion, the circuit court denied the motion in its entirety. Wellness appealed. Finding no reversible error, the Supreme Court affirmed. View "Wellness, Inc. v. Pearl River County Hospital" on Justia Law

This appeal involved three different leases negotiated by Defendant between plaintiff-landowners and an oil and gas company. Each of the three leases engendered a different lawsuit against Defendant. In each case, Plaintiffs claimed that the nature of the services provided by Defendant constituted the unauthorized practice of law. Defendant moved to dismiss Plaintiffs’ lawsuits and sought to compel Plaintiffs to participate in arbitration pursuant to the arbitration clause in each lease. Plaintiffs challenged the arbitration clauses as void on the grounds that the arbitration clauses were contrary to public policy because they were procured through the unauthorized practice of law. In all three suits, the circuit court concluded that a plaintiff’s claim that a defendant engaged in the unauthorized practice of law can never, as a matter of matter of state law, be referred to arbitration. The Supreme Court reversed, holding that any state-based rule that prohibits outright the arbitration of a particular type of claim is preempted by the Federal Arbitration Act. View "Geological Assessment & Leasing v. O'Hara" on Justia Law

The complex issues at issue in these three consolidated appeals revolved around four overlapping leases to extract oil and gas from land owned by Plaintiff. Each lease contained an arbitration clause. Plaintiff filed the instant case against Defendants seeking a declaration as to which lease was controlling as to which defendants and seeking damages from Defendants. The circuit court entered an order voiding two of the four leases, addressing the substantive terms of two other leases, and compelling the parties to arbitrate any remaining claims by Plaintiff. The Supreme Court affirmed in part and reversed in part, holding that the circuit court (1) properly found the arbitration clause in one lease to be unenforceable and correctly ruled that the entire lease was unenforceable; (2) erred in compelling certain defendants to participate in arbitration under the terms of a second lease but did not err when it made findings of fact and conclusions of law that addressed the substance of Plaintiff’s claims regarding that lease; (3) erred in voiding a third lease, and its included arbitration clause, in violation the doctrine of severability; and (4) erred in its substantive rulings interpreting a fourth lease, as the court should have referred questions about the lease to arbitration. View "Chesapeake Appalachia, LLC v. Hickman" on Justia Law

White Oak Corporation and the Department of Transportation entered into a contract for the reconstruction of a bridge and a portion of Interstate 95 in the City of Bridgeport. The project experienced significant delays such that the Department and White Oak reassigned the contract to another contractor for completion. White Oak subsequently filed a notice of claim and demand for arbitration seeking compensation for money wrongfully withheld by the Department, as liquidated damages, for delays in the project. An arbitration panel concluded that the liquidated damages clause in the parties’ contract was unenforceable, and therefore, White Oak was entitled to a return of nearly $5 million withheld by the Department. The trial court granted White Oak’s application to confirm the arbitration award. The Appellate Court reversed, concluding that the arbitration panel exceeded its authority in rendering an award on White Oak’s claim. The Supreme Court reversed, holding that the Appellate Court incorrectly determined that, in a prior action brought by the Department to enjoin the arbitration, the trial court limited the scope of the arbitrable issues in the present case to a claim of wrongful termination such that the arbitration panel lacked jurisdiction to decide White Oak’s liquidated damages claim. View "Dep’t of Transp. v. White Oak Corp." on Justia Law

Respondent brought an action against Appellant for professional negligence relating to services that Appellant performed for Respondent. After Respondent filed a demand for arbitration, Appellant submitted what it claimed to be two statutory offers of judgment. Respondent did not accept either offer. A panel of arbitrators subsequently ruled in favor of Appellant. The order stated that each party would bear its own fees and costs. Appellant filed a motion in the district court to correct the arbitration award to order Respondent to pay Appellant’s attorney fees. The district court denied the motion. The Supreme Court affirmed, holding that because the award of fees and costs by an arbitrator is discretionary even after an offer of judgment is made, Appellant did not demonstrate that the arbitrator manifestly disregarded Nevada law by refusing to award it fees and costs. View "WPH Architecture, Inc. v. Vegas VP, LP" on Justia Law

Celeste Grynberg, individually and as trustee on behalf of the Rachel Susan Trust, Stephen Mark Trust, and Miriam Zela Trust, and Jack J. Grynberg, petitioned the federal district court to vacate an arbitration award that had been entered against them and in favor of Kinder Morgan Energy Partners, L.P. (“KMEP”) and Kinder Morgan CO2 Company, L.P. (“KMCO2”). The Grynbergs invoked the court’s diversity jurisdiction. When they filed the action, the Grynbergs were citizens of Colorado, KMEP was a Delaware master limited partnership, and KMCO2 was a Texas limited partnership with one partner, KMEP. The district court dismissed the action for lack of jurisdiction. It concluded that under "Carden v. Arkoma Associates," (494 U.S. 185, 195 (1990)), KMEP’s citizenship was the citizenship of all its unitholders, and because KMEP had at least one Colorado unitholder, its citizenship was not completely diverse from the Grynbergs’. The Grynbergs appealed, arguing the district court improperly applied "Carden." Finding no reversible error, the Tenth Circuit affirmed. View "Grynberg v. Kinder Morgan Energy" on Justia Law

After the individual respondents, truck drivers, filed wage claims against Performance, Performance petitioned to compel arbitration based on the arbitration agreements in the "Independent Contractor Agreements" with respondents. The trial court denied the petition, concluding that the agreements were exempt from the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq. The court concluded, however, that respondents presented no evidence supporting their argument that the agreements were exempt from the FAA, and the court found that the arbitration provisions were broad enough to cover the claims asserted. The court also concluded that respondents failed to submit any evidence in support of their additional argument that the agreements were unconscionable. Because the trial court erred by denying the petition to compel arbitration, the court reversed the judgment and remanded with directions to grant the petition. View "Performance Team Freight Sys. v. Aleman" on Justia Law