Court Opinion

ID: 4377298
Source: CourtListenerOpinion
Date Created: 2019-03-15 09:04:59.191113+00
Date Added: 2024-06-11T14:22:17.249604
License: Public Domain

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
                revision until final publication in the Michigan Appeals Reports.

                        STATE OF MICHIGAN

                         COURT OF APPEALS

SAMANTHA LICHON,                                                 FOR PUBLICATION
                                                                 March 14, 2019
             Plaintiff-Appellant,

v                                                                No. 339972
                                                                 Oakland Circuit Court
MICHAEL MORSE, and MICHAEL J. MORSE,                             LC No. 17-158919-CZ
PC,

             Defendant-Appellees.

JORDAN SMITS,

             Plaintiff-Appellant,

v                                                                No. 340513
                                                                 Wayne Circuit Court
MICHAEL MORSE,                                                   LC No. 17-011128-CZ

             Defendant-Appellee.

JORDAN SMITS,

             Plaintiff-Appellant,

v                                                                No. 341082
                                                                 Wayne Circuit Court
MICHAEL MORSE, and MICHAEL J. MORSE,                             LC No. 17-008068-CZ
PC,

             Defendant-Appellees.

Before: JANSEN, P.J., and BECKERING and O’BRIEN, JJ.

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O’BRIEN, J. (dissenting).

       The parties agreed to arbitrate “any claim against another employee” for “discriminatory
conduct.” Based on this language, I would hold that plaintiffs’ claims arguably fall within the
scope of the arbitration agreement, and therefore I respectfully dissent.

       In Docket No. 341082, Smits’ complaint alleged that defendant Michael Morse (Morse)
approached Smits from behind at a company party and intentionally “groped [her] breasts
without . . . permission” for purposes of sexual gratification. In Docket No. 339972, Lichon’s
complaint alleged in pertinent part that Morse, “on multiple occasions,” approached her “from
behind, groped her breasts, and touched his groin to her rear while audibly stating sexual
comments[.]” The complaint also alleged that Morse “stated sexually motivated comments” to
Lichon, and that he “made intentional and unlawful threats to physically and inappropriately
touch [Lichon’s] body in a sexual manner . . . .” Plaintiffs, individually, filed claims against
Morse and defendant Michael J. Morse, PC (the Morse Firm) as described by the majority. Both
complaints included claims for sex discrimination under the Elliot Larsen Civil Rights Act
(ELCRA), MCL 37.2101 et seq., and sexual assault and battery against Morse.

       Both Smits and Lichon signed an arbitration agreement—the Mandatory Dispute
Resolution Procedure Agreement (MDRPA)—with the Morse Firm, which states in pertinent
part:

       This Mandatory Dispute Resolution Procedure shall apply to all concerns you
       have over the application or interpretation of the Firm’s Policies and Procedures
       relative to your employment, including, but not limited to, any disagreements
       regarding discipline, termination, discrimination or violation of other state or
       federal employment or labor laws. This includes any claim over the denial of
       hire. This Procedure includes any claim against another employee of the Firm for
       violation of the Firm’s Policies, discriminatory conduct or violation of other state
       or federal employment or labor laws. Similarly, should the Firm have any claims
       against you arising out of the employment relationship, the Firm also agrees to
       submit them to final and binding arbitration pursuant to this Procedure.

The trial courts ruled that, based on this language, Smits and Lichon agreed to arbitrate their
claims. The question on appeal is whether those decisions were proper.

       “Arbitration is a matter of contract.” Altobelli v Hartmann, 499 Mich. 284, 295; 884
NW2d 537 (2016). The interpretation of contractual language is reviewed de novo. VHS Huron
Valley Sinai Hosp v Sentinel Ins Co, 322 Mich. App. 707, 715; 916 NW2d 218 (2018).

       “Michigan jurisprudence favors arbitration, and the employment context is no exception.”
Rembert v Ryan’s Family Steak Houses, Inc, 235 Mich. App. 118, 130; 596 NW2d 208 (1999).
The parties’ agreement determines the scope of the arbitration. Rooyakker & Sitz, PLLC v
Plante & Moran, PLLC, 276 Mich. App. 146, 163; 742 NW2d 409 (2007). As explained by this
Court:

       To ascertain the arbitrability of an issue, [a] court must consider whether there is
       an arbitration provision in the parties’ contract, whether the disputed issue is
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       arguably within the arbitration clause, and whether the dispute is expressly
       exempt from arbitration by the terms of the contract. The court should resolve all
       conflicts in favor of arbitration. However, a court should not interpret a contract’s
       language beyond determining whether arbitration applies and should not allow the
       parties to divide their disputes between the court and an arbitrator. Dispute
       bifurcation defeats the efficiency of arbitration and considerably undermines its
       value as an acceptable alternative to litigation. [Id. (quotation marks and citations
       omitted).]

        There is no dispute about the existence of the arbitration agreement, nor do the parties
contend that the issues to be arbitrated are exempted by the terms of the agreement. The only
issue is whether the claims to be arbitrated—which include claims that plaintiffs were sexually
assaulted at the hands of their superior—are arguably within the scope of the parties’ arbitration
agreement.

        The majority concludes that we must decide “whether the sexual assault and battery of an
employee at the hands of a superior is conduct related to employment.” If that were the question
before this Court, I would agree that sexual assault is not conduct related to employment. But I
would more broadly frame the question before us as whether plaintiffs’ claims arguably fall
within the scope of the arbitration agreement.

        Arbitration agreements are treated as ordinary contracts, and so we apply general
principles of contract to their interpretation. Oakland-Macomb Interceptor Drain Drainage Dist
v Ric-Man Constr, Inc, 304 Mich. App. 46, 55-56; 850 NW2d 498 (2014). Unambiguous
contracts are not open to interpretation and must be enforced as written. Rory v Continental Ins
Co, 473 Mich. 457, 468; 703 NW2d 23 (2005).

        The majority focuses on the phrase “relative to your employment” in the first sentence of
the MDRPA. In so doing, I believe that the majority overlooks other portions of the contract that
explain what claims the parties intended—and therefore arguably agreed—to arbitrate. Most
relevant here, the parties agreed to arbitrate “any claim against another employee of the Firm for
violation of the Firm’s Policies, discriminatory conduct or violation of other state or federal
employment or labor laws.” Thus, the parties unambiguously agreed to arbitrate “any claim
against another employee of the Firm for . . . discriminatory conduct.”

        Under the ELCRA—which both plaintiffs filed claims under—“[d]iscrimination because
of sex includes sexual harassment.” MCL 37.2103(i). The ELCRA has a broad definition for
conduct constituting sexual harassment:

       Sexual harassment means unwelcome sexual advances, requests for sexual favors,
       and other verbal or physical conduct or communication of a sexual nature under
       the following conditions:

              (i) Submission to the conduct or communication is made a term or
       condition either explicitly or implicitly to obtain employment, public
       accommodations or public services, education, or housing.

                                                -3-
               (ii) Submission to or rejection of the conduct or communication by an
       individual is used as a factor in decisions affecting the individual’s employment,
       public accommodations or public services, education, or housing.

              (iii) The conduct or communication has the purpose or effect of
       substantially interfering with an individual’s employment, public
       accommodations or public services, education, or housing, or creating an
       intimidating, hostile, or offensive employment, public accommodations, public
       services, educational, or housing environment. [MCL 37.2103(i).]

       Based on this definition, sexual assault is sexual harassment.1 See Radtke v Everett, 442
Mich. 368, 394-395; 501 NW2d 155 (1993) (acknowledging that sexual assault is a form of
sexual harassment that can form the basis for a claim for sex discrimination under the ELCRA).

1
  I base my reasoning solely on the language in the parties’ agreement. I believe that the
majority highlights an interesting, yet potentially problematic, national trend. When courts label
an instance of “sexual harassment” as “sexual assault,” they generally find that the conduct is
unrelated to employment. See the cases listed in footnote 1 of the majority opinion. But see
Barker v Halliburton Co, 541 F Supp 2d 879, 889 (SD Tex, 2008) (holding that the parties
agreed to arbitrate the plaintiff’s claim of sexual assault where the parties agreed to arbitrate all
claims “related to . . . employment”). Yet when courts use the term “sexual harassment,” they
generally find that the conduct is related to employment. See Lyster v Ryan’s Family Steak
Houses, Inc, 239 F3d 943, 946-94747 (CA 8, 2001) (holding that the plaintiff agreed to arbitrate
her “claim of sexual harassment . . . which arose during [the plaintiff’s] employment with
[defendant]” based on her agreement to arbitrate “any and all employment-related disputes”);
Cruise v Kroger Co, 233 Cal App 4th 390, 397 (2015) (holding that the plaintiff’s claims “for
retaliation, sexual harassment, sexual and racial discrimination, failure to investigate and prevent
harassment and retaliation, as well as her common law claims for wrongful termination in
violation of public policy, intentional infliction of emotional distress and defamation, are all
‘employment-related disputes’ within the meaning of the above arbitration clause, and therefore
clearly are covered disputes subject to the arbitration agreement”); Kindred v Second Judicial
Dist Court, 116 Nev 405, 411 (2000) (holding that the plaintiff agreed to arbitrate her sexual
harassment claim based on language in the agreement that “any controversy or dispute arising
between [the plaintiff] and [the defendant] in any respect to this agreement or your employment
by [the defendant] shall be submitted for arbitration”); Freeman v Minolta Bus Sys, Inc, 699 So
2d 1182, 1187 (La Ct App, 1997) (holding that the plaintiff’s sexual harassment claim
“involve[d] violation of a term or condition of her employment” and therefore was “included in
the scope of the arbitration clause of her employment contract”); Arakawa v Japan Network
Group, 56 F Supp 2d 349, 353 (SDNY, 1999) (“All of [the plaintiff’s] claims—sexual
harassment, wrongful discharge and discrimination—arise out of or relate to her employment
and are therefore claims that are subject to binding arbitration pursuant to the agreement.”).
While it is clear from the majority’s holding that sexual assault is conduct unrelated to
employment, it is unclear whether the majority is bucking the national trend and holding that all
sexual harassment is conduct unrelated to employment.

                                                -4-
And sexual harassment is, under the ELCRA, discrimination because of sex. MCL 37.2103(i).
The parties agreed to arbitrate any claim for discriminatory conduct against another employee.
Thus, based on the unambiguous language in the parties’ arbitration agreement, I believe that
plaintiffs’ claims arguably fall within the scope of the agreement.

         Although I do not believe that an employee should be required to arbitrate allegations of
sexual assault, I am constrained by the law and the terms of the employment contract to dissent
in this case. I believe that our Legislature is the appropriate forum for addressing this policy
matter. See Gilmer v Interstate/Johnson Lane Corp, 500 U.S. 20, 26; 111 S. Ct. 1647; 114 L. Ed. 2d
26 (1991) (“[h]aving made the bargain to arbitrate, the party should be held to it unless Congress
itself has evinced an intention to preclude a waiver of judicial remedies for the statutory rights at
issue”) (quotation marks and citation omitted; alteration in Gilmer). 2

       For these reasons, I respectfully dissent.

                                                              /s/ Colleen A. O’Brien

2
  I offer no opinion on the majority’s policy reasoning, though it appears to run counter to this
Court’s extensive reasoning in Rembert, 235 Mich. App. at 135-159, for why civil rights claims in
general are arbitrable. Among other things, the Rembert Court acknowledged arguments that
“the public policy advanced by [civil rights] statutes would be undermined if these disputes were
addressed in the relatively private forum of arbitration,” but rejected those arguments in part
because they “were thoroughly considered and rejected by the United States Supreme Court in a
trio of cases known as the Mitsubishi trilogy and, later, in Gilmer[, 500 U.S. 20].” Id. at 135
(footnote omitted).

                                                -5-