Federal Cases
Limitation on Injunctive Relief Renders Employee Arbitration Agreement Unenforceable
Gelow v. Central Pacific Mortgage Corp., No. CIV. S-07-1988 LKK/KJM, 2008 WL 2357024 (E.D. Cal. June 3, 2008)
6/3/2008 12:00:00 AM
A federal court in California held that an arbitration agreement that places a limitation on the possible remedies available to an employee, and also requires the employee to pay half of the fees and expenses of the arbitrator, is unconscionable and thus unenforceable.
In Gelow v. Central Pacific Mortgage Corp., No. CIV. S-07-1988 LKK/KJM, 2008 WL 2357024 (E.D. Cal. June 3, 2008), Gelow and ten other former employees sued Central Pacific Mortgage Corporation (CPM). CPM moved to compel arbitration based on arbitration agreements in the employment contracts... Full Story
Arbitration Agreement Signed Two Years After Employee's Injury Does Not Apply Retroactively
Azevedo v. Carnival Corp., No. 08-20518-CIV, 2008 WL 2261195 (S.D. Fla. May 30, 2008)
5/30/2008 12:00:00 AM
A federal court in Florida held that an employment contract that contains an arbitration agreement does not apply retroactively to injuries sustained two years prior to the formation of the contract.
In Azevedo v. Carnival Corp., No. 08-20518-CIV, 2008 WL 2261195 (S.D. Fla. May 30, 2008), Azevedo was working for Carnival aboard the cruise ship "Celebration," and her employment contract did not contain an arbitration agreement. Azevedo complained of abdominal pain to the Celebration medical staff for ten days before getting an appendectomy at a shoreside hospital in November 2004... Full Story
Signature Not Required for Enforcement of Employment Arbitration Agreement
Brown v. The St. Paul Travelers Companies, No. 06-CV-688C(SC), 2008 WL 2331052 (W.D. N.Y. June 3, 2008)
6/3/2008 12:00:00 AM
A New York federal district court held an agreement to arbitrate between an employee and employer valid and enforceable even though the employee did not sign the agreement.
In Brown v. The St. Paul Travelers Companies, No. 06-CV-688C(SC), 2008 WL 2331052 (W.D. N.Y. June 3, 2008), Brown was a Travelers employee. Travelers periodically issued an employee handbook to all employees, which included an agreement to arbitrate. Over the course of Brown's employment, the handbook was revised and reissued five times, with the most recent update in 2004... Full Story
State Cases
Under California Law, Court, Not Arbitrator, Decides Issues of Insurance Coverage
Bouton v. USAA Casualty Insurance Co., 43 Cal.4th 1190 (Cal. June 9, 2008)
6/9/2008 12:00:00 AM
The Supreme Court of California determined that an insured's coverage is not a question of the underinsured tortfeasor's liability or damages owed to the insured and is therefore not subject to arbitration under California Insurance Code section 11580.2(f).
In Bouton v. USAA Casualty Insurance Co., 43 Cal.4th 1190 (Cal. June 9, 2008), Bouton was injured in an automobile accident, and settled his claim against Daniels, the driver of the other vehicle, for Daniels' automobile insurance policy limit. Bouton demanded arbitration with USAA, his sister's insurer, seeking damages exceeding the policy limit payment he received from Daniels' insurer... Full Story
Public Policy Challenges to Arbitration Awards Under Connecticut Law Must Comply with 30-Day Vacatur Deadline
Asselin & Connolly, Attorneys, LLC v. Heath, No. 28459, 2008 WL 2278637 (Conn. App. Ct. June 10, 2008)
6/10/2008 12:00:00 AM
A party challenging an arbitration award on public policy grounds must file his or her motion to vacate within 30 days of notice of the award, according to the Connecticut Court of Appeals.
In Asselin & Connolly, Attorneys, LLC v. Heath, No. 28459, 2008 WL 2278637 (Conn. App. Ct. June 10, 2008), Heath hired Asselin to represent her in a family law matter. The parties' retainer contract contained an arbitration agreement. Heath failed to pay attorney fees and Asselin submitted a claim for arbitration. Heath argued to the arbitrator that the agreement was invalid because the governing rules were inapplicable to attorney-client disputes. Heath did not attend the proceedings. The arbitrator issued an award on the merits in favor of Asselin... Full Story
Non-Participating Party May Move to Vacate Award After 90-Day Limit If Alleging No Agreement to Arbitrate
Helton v. MBNA America Bank, N.A., No. CA07-759, 2008 WL 2266340 (Ark. Ct. App. June 4, 2008)
6/4/2008 12:00:00 AM
The Arkansas Court of Appeals has held that an aggrieved party may move to vacate an arbitration award by alleging that no agreement ever existed, even if the statutory time for such challenges has passed, provided that the party did not participate in the arbitration proceedings.
In Helton v. MBNA America Bank, N.A., No. CA07-759, 2008 WL 2266340 (Ark. Ct. App. June 4, 2008), MBNA filed an arbitration claim against Helton for an alleged credit card debt. Helton did not participate in the arbitration proceedings. The arbitrator issued an award against Helton, which MBNA sought to confirm. The trial court granted the motion for confirmation, holding that the 90-day time limit for challenges to awards in the state’s arbitration act barred any consideration of Helton’s argument that the debts were invalid and that an arbitration agreement did not exist between the parties... Full Story
Written Memorial of Oral Agreement to Arbitrate Not Enforceable Written Arbitration Agreement Where Parties Have Not Agreed to Details of Arbitration
Paley v. PMC Design Builders, No. CV040491201, 2008 WL 2313309 (Conn. Super. Ct. May 15, 2008)
5/15/2008 12:00:00 AM
A Connecticut Superior Court held that a letter from one party to another confirming an oral agreement to arbitrate upon failure to settle the dispute did not constitute an enforceable written agreement where the parties did not agree to details of the arbitration process.
In Paley v. PMC Design Builders, No. CV040491201, 2008 WL 2313309 (Conn. Super. Ct. May 15, 2008), Denise Paley and Eric Tibere (“the Plaintiffs”) filed a complaint against PMC regarding alleged defective construction of the Plaintiffs’ home. The parties orally agreed to arbitrate the matter during a mediation session, assuming they were unable to reach a settlement... Full Story
Courts Must Defer to Arbitrator’s Findings of Fact When Conducting “Public Policy” Review of Arbitration Award
HH East Parcel, LLC v. Handy & Harman, Inc., No. 18055, 2008 WL 2185484 (Conn. June 3, 2008)
6/3/2008 12:00:00 AM
Even when considering public policy grounds for vacatur, a court must defer to the arbitrator’s finding of fact when conducting its de novo review, according to the Connecticut Supreme Court.
In HH East Parcel, LLC v. Handy & Harman, Inc., No. 18055, 2008 WL 2185484 (Conn. June 3, 2008), HH East purchased real property from Handy. The contract required the demolition of buildings and cleanup of the property. The contract provided a per diem fee of $5,000 per day for every day the cleanup was not completed after the deadline had passed. Handy did not have the required work completed by the deadline. Full Story
ADR Legislation & Regulation
LEGISLATION
CA A 523
AUTHOR: De La Torre [D]
TITLE: Alcoholic Beverage Licenses: Self Service Checkouts
DISPOSITION: Pending
LOCATION: Senate Governmental Organization Committee
Commentary:
The bill had provided for specific procedures allowing and in some cases mandating arbitration between the Regents of the University of California and contractors. The bill was gutted on 6/30/08 and replaced with a bill prohibiting the sale of alcohol through self-service checkout.
CA A 2484
AUTHOR: Caballero [D]
TITLE: Local Government: Special Districts
DISPOSITION: To Governor
LOCATION: Enrolled
Commentary:
Amends the Cortese Knox Hertzberg Local Government Reorganization Act. Removed mediation and arbitration references in regards to property tax issues.
CA S 1432
AUTHOR: Margett [R]
TITLE: Contractors
DISPOSITION: To Governor
LOCATION: Enrolled
Commentary:
Amends the code regarding contractors. "SEC. 4. Section 116.220 of the Code of Civil Procedure is amended to read: 116.220. (a) The small claims court has jurisdiction in the following actions: 4) To confirm, correct, or vacate a fee arbitration award not exceeding five thousand dollars ($5,000) between an attorney and client that is binding or has become binding, or to conduct a hearing de novo between an attorney and client after nonbinding arbitration of a fee dispute involving no more than five thousand dollars ($5,000) in controversy, pursuant to Article 13 (commencing with Section 6200) of Chapter 4 of Division 3 of the Business and Professions Code."
DE S 273
PRIMARY SPONSOR: Amick [R]
TITLE: Common Interest Ownership Act
DISPOSITION: To Governor
LOCATION: Eligible for Governor
Commentary:
Creates the Uniform Common Interest Ownership Act; generally regulates common interest communities and ownership by establishing provisions related to titles and taxation, applicability of local ordinances and building codes, unit owners' associations, and various other topics. As it relates to ADR, the bill mentions arbitration on par with litigation.
FL H 601
COMPARE: FL H 415, FL H 1249, FL H 1349, FL S 996, FL S 2086, FL S 2470
AUTHOR: Jobs and Entrepreneurship Council Cmt
TITLE: Condominium Associations
DISPOSITION: Enacted
LOCATION: Chaptered
Commentary:
Relates to the Department of Business and Professional Regulation. Provides for mediation and non binding arbitration of disputes by the Department of Business and Professional Regulation; Division of Florida Land Sales, Condominiums, and Mobile Homes to the Division of Florida Condominiums, Timeshares, and Mobile Homes.
FL H 679
COMPARE: FL H 963, FL H 1185, FL S 1580, FL S 2330
SIMILAR: FL S 2504
AUTHOR: Policy and Budget Council Cmt
TITLE: Community Associations
DISPOSITION: Vetoed
LOCATION: Vetoed by Governor
Commentary:
Provides for presuit mediation and arbitration of certain disputes regarding homeowner association swimming pools. Indicates cost sharing provisions, service requirements, etc.
LA H 374
AUTHOR: Chandler [D]
TITLE: Child Custody Mediators
DISPOSITION: Enacted
LOCATION: Chaptered
Commentary:
Provides for the qualifications of child custody mediators.
MO S 711
SPONSOR: Gibbons [R]
TITLE: Tax Rate Roll Back Mandate
DISPOSITION: Enacted
LOCATION: Signed by Governor
Commentary:
Relates to mandatory tax rate rollback. As it relates to ADR, "[u]pon agreement of the parties, [a] matter may be stayed while the parties proceed with mediation or arbitration upon terms agreed to by the parties. The final decision of the administrative hearing commission shall be subject to judicial review in the circuit court of the county involved."
PA S 1063
PN: 2229
AUTHOR: Earll [R]
TITLE: Local Tax Enabling Act of 1965
DISPOSITION: Enacted
LOCATION: Chapter
Commentary:
Eliminates arbitration as an option to settle local tax disputes.
RI H 7800
AUTHOR: Ehrhardt [R]
TITLE: Department of Revenue
DISPOSITION: Enacted
LOCATION: Chaptered
Commentary:
Amends "Consumer Enforcement of Motor Vehicle Warranties". Amendments require that "the department of the attorney general shall provide an independent arbitration procedure for the settlement of disputes between consumers or lessees and manufacturers concerning motor vehicles which do not conform to all applicable express or implied warranties. There shall be established the motor vehicle arbitration board which shall consist of five (5) members." The amendments further provide for the procedure to be followed by the arbitration panel.
REGULATIONS
No new regulations.
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