KELLER WILLIAMS REALTY V MLP ENTERPRISES INC
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STATE OF MICHIGAN
COURT OF APPEALS
KELLER WILLIAMS REALTY and LOU
RONAYNE,
UNPUBLISHED
June 17, 2010
Plaintiffs-Appellants,
v
MLP ENTERPRISES, INC., d/b/a REMERICA
PRESTIGE REALTORS, and LYNN MILLER,
No. 289598
Wayne Circuit Court
LC No. 07-708811-CZ
Defendants-Appellees.
Before: ZAHRA, P.J., and CAVANAGH and FITZGERALD, JJ.
PER CURIAM.
Plaintiffs, Keller Williams Realty (“KW Realty”) and Lou Ronayne, appeal as of right a
judgment confirming an arbitration award with respect to defendant MLP Enterprises, Inc., d/b/a
Remerica Prestige Realtors (“Remerica Prestige Realtors”), but refusing to confirm the award
with respect to defendant Lynn Miller. We affirm in part, reverse in part, and remand for further
proceedings.
This case arises from a business dispute regarding real estate commissions. The dispute
was submitted to arbitration before a three-member panel of the Western Wayne Oakland
County Association of Realtors (“WWOCAR”), which issued an arbitration award, dated
September 23, 2005, finding that Ronayne, the complainant, was owed $4,870.50 from Miller,
the respondent. The award specified that it was to become final 20 days “from the day the award
is mailed absent a procedural review request being filed.” A procedural review requested by
Miller was forwarded by the WWOCAR to the Michigan Association of Realtors for handling.
After the Michigan Association of Realtors closed the matter in 2007, plaintiffs Ronayne
and KW Realty filed this action to confirm the arbitration award, and requested that both named
defendants, Miller and Remerica Prestige Realtors, be held responsible for the award. Miller,
acting in propria persona, filed an answer in which she denied that she was a party to the
arbitration proceeding in an individual capacity. Miller, along with another alleged officer of
Remerica Prestige Realtors, alleged that the parties to the arbitration proceeding were Keller
Williams Northville (not KW Realty) and Remerica Prestige Realtors. After plaintiffs filed a
motion to confirm the arbitration award, Miller claimed that she was representing Remerica
Hometown II, a company in which she previously had an ownership interest, in the arbitration
proceeding.
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The trial court initially attempted to obtain clarification of the proper respondents from
WWOCAR, but was informed at a status conference in November 2008 that WWOCAR would
not consider the matter. The court also heard additional arguments from Miller, who asserted
that Remerica Prestige Realtors had gone out of business. The trial court granted plaintiffs’
motion to confirm the arbitration award with respect to Remerica Prestige Realtors, but
determined that plaintiffs’ motion to confirm the award with respect to Miller should be denied
because “the circumstances here would point to a substantial injustice if we have her included in
this judgment.” The trial court’s judgment states that its refusal to enter a judgment against
Miller was based on her oral statements in open court.
Plaintiffs argue on appeal that the trial court erred by refusing to confirm the arbitration
award as to all defendants, and acted contrary to MCR 3.602 by effectively vacating the
arbitration award with respect to defendant Miller.
We review de novo issues regarding a circuit court’s order enforcing, vacating, or
modifying an arbitration award. Saveski v Tiseo Architects, Inc, 261 Mich App 553, 554; 682
NW2d 542 (2004). But, because our review is limited to the record presented to the trial court,
Amorello v Monsanto Corp, 186 Mich App 324, 330; 463 NW2d 487 (1990); see also MCR
7.210(A), we decline to consider the various documents submitted by the parties that were not
presented to the trial court below.
Where, as here, a complaint to confirm an arbitration award arises out of proceedings
governed by the arbitration act, MCL 600.5001 et seq., MCR 3.602(I) provides:
An arbitration award filed with the clerk of the court designated in the
agreement or statute within one year after the award was rendered may be
confirmed by the court, unless it is vacated, corrected, or modified, or a decision
is postponed, as provided in this rule.
Although the trial court did not indicate which provision of MCR 3.602 it applied to deny
plaintiffs’ motion to confirm the award with respect to Miller, the only circumstance that was
considered by the court was its concern about whether Miller was a party to the arbitration
agreement in an individual capacity. We disagree with plaintiffs that MCR 3.602(J) provides the
proper framework for this determination. The trial court did not effectively vacate the arbitration
award, but rather acted to modify the parties subject to the arbitration award. This type of
modification is encompassed by MCR 3.602(K)(2)(a), formerly MCR 3.602(K)(1)(a), which
permits a trial court to correct or modify an award where there is “an evident mistake in the
description of a person.”1 Cf. Western Cas & Surety Co v City of Garden City, 151 Mich App
83, 87-88; 390 NW2d 687 (1986) (arbitration award modified to reflect that the proper recipient
was not the entity named in the caption of the award, but rather an assignee who demanded and
prosecuted the arbitration proceeding pursuant to the assignment).
1
MCR 3.602 was amended, effective January 1, 2008. See 480 Mich cxlv. Although the
amended rule changes the time limits and procedures for a party to request correction or
modification, the requirement of an “evident mistake” has not changed.
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Plaintiffs have also failed to show that the trial court was precluded from considering the
proper parties to the arbitration award, especially where plaintiffs’ own complaint raised a
question regarding whether the award applied to parties who were not named in the arbitration
award. Although a court may not engage in contract interpretation because that is a question for
the arbitrator to decide, Konal v Forlini, 235 Mich App 69, 74; 596 NW2d 630 (1999), a court
may determine whether the award is derived from the arbitration agreement, Police Officers
Ass’n of Mich v Manistee Co, 250 Mich App 339, 343; 645 NW2d 713 (2002). The arbitration
agreement must be in writing pursuant to MCL 600.5001(1), but need not be signed so long as
mutual assent is established. Ehresman v Bultynck & Co, PC, 203 Mich App 350, 354; 511
NW2d 724 (1994). “[A] party may not be required to arbitrate when it is not legally or factually
a party to the agreement,” St Clair Prosecutor v AFSCME, 425 Mich 204, 223; 388 NW2d 231
(1986), although, as indicated in Western Cas & Surety Co, 151 Mich App at 88, there are
circumstances where a party may step into the shoes of a contracting party. The existence of an
arbitration agreement may be raised as a defense to an action to confirm an arbitration award.
See Arrow Overall Supply Co, v Peloquin Enterprises, 414 Mich 95, 98-101; 323 NW2d 1
(1982); see also Detroit Auto Inter-Ins Exch v Gavin, 416 Mich 407, 423; 331 NW2d 418 (1982);
Western Cas & Surety Co, 151 Mich App at 88.
Nonetheless, there must be sufficient facts for the trial court to render judgment. Cf.
Boulton v Fenton Twp, 272 Mich App 456, 462; 726 NW2d 733 (2006). The pleadings must
show that a party is entitled to judgment as a matter of law, or that there is no genuine issue of
material fact. Id. at 463.
In this case, the trial court acted under a misconception of the law when it determined at
the status conference that Miller should be excluded from the judgment. The question was not
whether substantial injustice would occur if the arbitration award were confirmed but, rather,
whether Miller had individual responsibility for the outcome of the arbitration proceeding as a
party or by stepping into the shoes of a party. The trial court appropriately recognized before the
status conference that there were insufficient facts to determine if Miller was a proper party, and
WWOCAR declined to clarify the matter. It was improper for the court to decide the matter on
the basis of Miller’s pro se arguments at the hearing because a court reviews an arbitration award
based on the record:
The scope of judicial review of an arbitration award is necessarily dictated
in large measure by the procedural form the arbitration proceedings take.
Reviewing courts can only act upon a written record. There is no requirement
that a verbatim record be made of private arbitration proceedings, there are no
formal requirements of procedure and practice beyond those assuring impartiality,
and no findings of fact or conclusions of law are required. Thus, from the
perspective of the record alone, a reviewing court’s ability to review an award is
restricted to cases in which an error of law appears from the face of the award, or
the terms of the contract of submission, or such documentation as the parties
agree will constitute the record. [Detroit Automobile Inter-Ins Exch v Gavin, 416
Mich at 428-429.]
In some circumstances, such as where a party voluntarily participates in an arbitration
proceeding without objection, the party may be deemed to have waived the issue whether the
participation was pursuant to a valid contract. In re Nestorovski Estate, 283 Mich App 177, 183;
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769 NW2d 720 (2009). Here, the documentation submitted to the trial court raised an issue
regarding whether Miller had participated in the arbitration proceeding in an individual or
representative capacity. Accordingly, we remand this case to the trial court for further
proceedings at which the parties should be given an opportunity to present further evidence to
establish the basis of Miller’s participation in the arbitration proceeding, consistent with Detroit
Auto Inter-Ins Exch, 416 Mich at 428-429. If the trial court determines on remand that there was
no evident mistake in naming Miller in the arbitration award as the respondent responsible for
paying it, plaintiffs’ motion to confirm the arbitration award with respect to Miller should again
be considered consistent with MCR 3.602(I).
Affirmed in part, reversed in part, and remanded for further proceedings consistent with
this opinion. We do not retain jurisdiction.
/s/ Brian K. Zahra
/s/ Mark J. Cavanagh
/s/ E. Thomas Fitzgerald
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