Court Opinion

ID: 9411833
Source: CourtListenerOpinion
Date Created: 2023-07-28 05:06:04.415781+00
Date Added: 2024-06-11T16:41:15.173291
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

GEOFFREY PAINE, D.D.S.,                                               UNPUBLISHED
                                                                      July 27, 2023
               Plaintiff-Appellee,

v                                                                     No. 363530
                                                                      Manistee Circuit Court
LAYNE GODZINA, D.D.S., and HONEST                                     LC No. 2022-017694-CB
DENTAL SOLUTIONS, P.L.L.C.,

               Defendants-Appellants.

Before: RIORDAN, P.J., and MARKEY and YATES, JJ.

PER CURIAM.

        Defendants Layne Godzina, D.D.S., and Honest Dental Solutions, P.L.L.C., appeal as of
right the trial court’s order denying their motion for summary disposition pursuant to MCR
2.116(C)(7) on the basis that the contractual agreement between defendants and plaintiff Geoffrey
Paine, D.D.S., did not require arbitration in this matter.1 On appeal, defendants argue that the trial
court erred because the plain language of the contractual agreement requires arbitration of the
parties’ instant dispute regarding the non-compete clause therein. We disagree with the appellants
and affirm the trial court.

                                             I. FACTS

       The facts of this case are undisputed and straightforward. Plaintiff is a licensed dentist in
Manistee County, defendant Godzina is a licensed dentist in Manistee County, and defendant

1
  Ordinarily, an order denying a motion for summary disposition is not appealable as of right
because it is not a “final order.” See MCR 7.203(A)(1). However, MCL 691.1708(1)(a) of the
Uniform Arbitration Act, MCL 691.1681 et seq., provides that “[a]n appeal may be taken from . . .
[a]n order denying a motion to compel arbitration.” Arguably, we have jurisdiction over this
appeal pursuant to that statute. In any event, even if we do not, we treat the claim of appeal as an
application for leave to appeal and grant it. See Wardell v Hincka, 297 Mich App 127, 133 n 1;
822 NW2d 278 (2012).

                                                 -1-
Honest Dental Solutions is a Michigan professional limited liability company of which defendant
Godzina is the principal member. On January 2, 2006, defendant Godzina entered into an
“Association Agreement” (“Agreement”) with plaintiff. The Agreement generally provided that
defendant Godzina would be employed by plaintiff as an associate dentist. In relevant part, Section
V of the Agreement set forth a “restrictive covenant” providing that if defendant Godzina
terminated the Agreement and subsequently practiced dentistry within a 10-mile radius of
plaintiff’s current practice, he would be liable for certain monetary compensation to plaintiff
during a 24-month period. In January 2019, defendant Godzina terminated the Agreement and
established a new dental practice, defendant Honest Dental Solutions, about 0.3 miles from
plaintiff’s current practice.2 However, defendant Godzina allegedly refused to comply with
Section V of the Agreement and compensate plaintiff for his loss of some patients to Godzina.
Plaintiff thus sued defendants, seeking damages exceeding $25,000 for breach of contract and
tortious interference with contract.

        On July 27, 2022, defendants moved for summary disposition pursuant to MCR
2.116(C)(7) and (C)(8). In the accompanying brief, defendants did not dispute that defendant
Godzina entered into the Agreement with plaintiff or that he opened a nearby practice competing
with plaintiff in January 2019. However, defendants argued that they were entitled to summary
disposition under MCR 2.116(C)(7) because plaintiff’s claims were subject to an arbitration clause
within the Agreement.3 In particular, Section XIII of the Agreement provided as follows:

                                        XIII. ARBITRATION

                  Any dispute, controversy or claim between the Associate and the Employer
          concerning questions of fact arising under this Agreement and concerning issues
          related to wrongful termination (including but not limited to racial discrimination,
          sexual discrimination, sexual harassment, discrimination with respect to hire,
          tenure, terms, conditions or privileges of employment, or a matter directly or
          indirectly related to employment because of race, color, religion, national origin,
          age, sex, height, weight or marital status) shall be submitted within ninety (90) days
          of the occurrence giving rise to the dispute or claim to the American Arbitration
          Association for resolution pursuant to its Rules of Commercial Arbitration as set
          forth below:

                 A. Arbitration will occur in a location in Manistee, Michigan, to be
          determined by the Employer.

                  B. No law suit or action of law may be maintained prior to the resolution
          of the arbitration.

2
    Both dental practices are in the City of Manistee.
3
  Defendants also argued that defendant Honest Dental Solutions was entitled to summary
disposition for other reasons under MCR 2.116(C)(8), but those issues are not relevant for this
appeal.

                                                   -2-
               C. Judgment upon the award rendered by the arbitrator(s) may be entered
       in any court having competent jurisdiction thereof.

        Defendants argued that under Section XIII of the Agreement, “[a]ny dispute, controversy
or claim . . . concerning questions of fact arising under this Agreement” must be submitted to an
arbitrator within 90 days, and because plaintiff did not do so within 90 days—or at all—his claims
must be dismissed.

        On August 22, 2022, plaintiff filed his response, arguing that arbitration was not required
for the claims in this matter. Specifically, plaintiff contended that the language of Section XIII of
the Agreement, “[a]ny dispute, controversy or claim between the Associate and the Employer
concerning questions of fact arising under this Agreement and concerning issues related to
wrongful termination . . . shall be submitted . . . to the American Arbitration Association,” means
that arbitration is only required for claims that involve both “questions of fact arising under this
Agreement” and “issues related to wrongful termination.” According to plaintiff, because this
matter does not involve “issues related to wrongful termination,” arbitration is not required.

        On August 29, 2022, the trial court held a motion hearing, during which the parties argued
consistent with their respective briefs. On September 19, 2022, the trial court entered its opinion,
concluding that arbitration was not required under the Agreement with the following reasoning:

               When looking to the plain and ordinary meaning, in light of the use of the
       word “and” between “concerning questions or [sic] fact arising under this
       Agreement and concerning issues related to wrongful termination,” this Court finds
       merit in Plaintiff’s argument that this limitation establishes two requirements that
       must be satisfied before a dispute is subject to arbitration under the agreement. The
       dispute must (1) concern questions of fact arising under the agreement, and (2)
       concern issues related to wrongful termination, to fall within the scope of the
       arbitration agreement. Accordingly, this Court finds that as written, the arbitration
       clause is inapplicable to the Plaintiff’s claims. Therefore, the Defendants’ motion
       for summary disposition pursuant to MCR 2.116(C)(7) is denied.[4]

       On October 20, 2022, the trial court entered a stipulated order in accordance with its
opinion. Defendants now appeal that order.

                                  II. STANDARD OF REVIEW

       MCR 2.116(C)(7) provides that summary disposition is appropriate when there is “an
agreement to arbitrate.” This Court reviews de novo a trial court’s decision on a motion for
summary disposition under MCR 2.116(C)(7). See Trentadue v Buckler Lawn Sprinkler, 479 Mich
378, 386; 738 NW2d 664 (2007). “Whether a particular issue is subject to arbitration is also

4
  Moreover, while not relevant for this appeal, the trial court also ruled that defendant Honest
Dental Solutions was entitled to summary disposition of the tortious interference with contract
claim pursuant to MCR 2.116(C)(8).

                                                -3-
reviewed de novo, as is the interpretation of contractual language.” Altobelli v Hartmann, 499
Mich 284, 295; 884 NW2d 537 (2016) (citations omitted).

                                         III. DISCUSSION

        Defendants argue that the arbitration clause, which provides that “[a]ny dispute,
controversy or claim between the Associate and the Employer concerning questions of fact arising
under this Agreement and concerning issues related to wrongful termination” must be submitted
to arbitration, means that arbitration is required for either “questions of fact arising under this
Agreement” or “issues related to wrongful termination.” We disagree.

        “Arbitration is a matter of contract.” Altobelli, 499 Mich at 295 (quotation marks and
citation omitted). “Accordingly, when interpreting an arbitration agreement, we apply the same
legal principles that govern contract interpretation.” Id. “The cardinal rule in the interpretation of
contracts is to ascertain the intention of the parties.” Fromm v Meemic Ins Co, 264 Mich App 302,
305; 690 NW2d 528 (2004) (quotation marks and citation omitted). “Our primary task is to
ascertain the intent of the parties at the time they entered into the agreement, which we determine
by examining the language of the agreement according to its plain and ordinary meaning.”
Altobelli, 499 Mich at 295.

        “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 arguably within the
arbitration clause, and whether the dispute is expressly exempt from arbitration by the terms of the
contract.” Fromm, 264 Mich App at 305-306 (cleaned up). “The court should resolve all conflicts
in favor of arbitration.” Id. at 306. “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.” Id.

        “‘And’ is a conjunctive, used to denote a joinder, a union. ‘Or’ is the opposite, a
disjunctive, used to indicate a disunion, a separation, an alternative.” Mich Pub Serv Comm’n v
City of Cheboygan, 324 Mich 309, 341; 37 NW2d 116 (1949). Nonetheless, “[w]henever it is
reasonably necessary to accomplish the obvious purpose of a statute the word ‘and’ may be read
not only in the conjunctive but also in the disjunctive.” Elliott Grocer Co v Field’s Pure Food
Market, 286 Mich 112, 115; 281 NW 557 (1938).5

               The popular use of “or” and “and” is so loose and so frequently inaccurate
       that it has infected statutory enactments. While they are not treated as
       interchangeable, and should be followed when their accurate reading does not
       render the sense dubious, their strict meaning is more readily departed from than
       that of other words, and one read in place of the other in deference to the meaning

5
 Courts may apply principles of statutory interpretation to contract interpretation. See Klapp v
United Ins Group Agency, Inc, 468 Mich 459, 468; 663 NW2d 447 (2003); Mason Co Civ
Research Council v Mason Co, 343 Mich 313, 329; 72 NW2d 292 (1955).

                                                 -4-
       of the context. [Root v Ins Co of N Am, 214 Mich App 106, 109; 542 NW2d 318
       (1995) (quotation marks and citation omitted).]

       “Therefore, when it is clear that the Legislature intended to have the clauses read in the
conjunctive, the word ‘and’ can be substituted for the disjunctive ‘or.’ ” Id. (citations omitted).

       To illustrate, in People v Allen, 507 Mich 597, 608 n 16; 968 NW2d 532 (2021), our
Supreme Court interpreted MCL 791.239, which provides that a parole officer “may arrest without
a warrant and detain in any jail of this state” a parole violator. The Court explained that MCL
791.239 does not require “both a warrantless arrest and a detention” because other statutes
contemplate “detention irrespective of the issuance of a warrant.” Allen, 507 Mich at 608 n 16. In
other words, the Court interpreted the word “and” in MCL 791.239 to authorize arresting without
a warrant or detention in any jail of this state, given the context provided by other statutes. See id.

         We agree with the trial court that the language, “[a]ny dispute, controversy or claim
between the Associate and the Employer concerning questions of fact arising under this Agreement
and concerning issues related to wrongful termination . . . shall be submitted . . . to the American
Arbitration Association,” means that arbitration is required for cases that involve both questions
of fact arising under the Agreement and issues related to wrongful termination. The general rule
is that the word “and” is used to “join[] a conjunctive list to combine items.” People v Bylsma,
315 Mich App 363, 383; 889 NW2d 729 (2016) (quotation marks and citation omitted).6
Applying that general rule here, the word “and” in the arbitration clause combines the item
“questions of fact arising under this Agreement” with the item “concerning issues related to
wrongful termination,” such that both items must be present to require arbitration.

        Further, there are no other provisions in the Agreement that add context to the arbitration
clause, such that the word “and” should be interpreted as the word “or.” Thus, this case is
fundamentally distinguishable from the Allen case discussed above, in which our Supreme Court
explained that other provisions provided context to the statute in question indicating that the word
“and” should be interpreted as the word “or.”7

       To avoid the general rule regarding the word “and,” defendants offer five distinct
arguments. First, defendants argue that such an interpretation would mean that an exceedingly
limited set of controversies—those involving both disputes under the Agreement and wrongful
termination—would be subject to arbitration. Defendants observe that it would be peculiar to

6
  For example, with the Eighth Amendment phrase “cruel and unusual” punishment, the “and”
signals that cruelty or unusualness alone is not violative of the clause. The punishment must meet
both standards to be constitutionally prohibited. See Harmelin v Mich, 501 US 957, 967; 111 S
Ct 2680; 115 L Ed 2d 836 (1991) (opinion by Scalia, J.).
7
  As another example, in Barr v Atlantic Coast Pipeline, LLC, 295 Va 522; 815 SE2d 783 (2018),
the Virginia Supreme Court concluded that the word “and” in a particular statute is disjunctive
because “reading this language in the conjunctive would render certain portions of the statute
meaningless.” Id. at 534. In this case, in contrast, there is no language in the arbitration clause or
elsewhere in the Agreement that would be meaningless if the word “and” is conjunctive.

                                                 -5-
include such a limited arbitration clause in the Agreement. Second, defendants argue that the
arbitration clause begins with the word “any,” which is a broad word that suggests a list of
alternatives. Third, defendants argue that accepting plaintiff’s position would rewrite the
arbitration clause as follows: “Only those disputes, controversies or claims between the Associate
and the Employer that concern both questions of fact arising under this Agreement and issues
related to wrongful termination . . . .” (Emphasis in original.) Fourth, defendants argue that the
general policy in favor of arbitration requires resolving this dispute in favor of arbitration. Fifth,
defendants argue that Dessart v Burak, 470 Mich 37; 678 NW2d 615 (2004), supports their
argument that the word “and” means the word “or” in this context. None of these arguments have
merit.

        As to the first argument, we certainly acknowledge that such a limited arbitration clause is
unusual and that the prototypical arbitration clause is far broader. However, in the context of the
parties’ “Association Agreement,” interpreting the arbitration clause in such a limited manner does
not appear to be so egregious or peculiar that it would warrant ignoring the plain meaning of the
word “and.” Moreover, the arbitration clause is not as limited as defendants suggest. Within the
arbitration clause of the Agreement, in a non-exhaustive list of potential grievances, it specifically
defines the term “wrongful termination” as including discrimination as to “a matter directly or
indirectly related to employment.” Consequently, an alleged discriminatory practice about the
number of vacation days would qualify as a “wrongful termination” issue subject to arbitration.
In addition, Section IV of the Agreement provides that “Employer may terminate this Agreement
immediately . . . [i]f Associate shall engage in personal misconduct, or a breach of this contract of
such a serious nature as to render his continued presence in the practice personally or
professionally detrimental to Employer.” Thus, if a dispute arises as to whether the Employer
(plaintiff) had justification to immediately terminate the Associate (defendant Godzina) under
Section IV, that dispute would be subject to arbitration—notwithstanding that termination in such
an instance would not be a classic “civil rights” issue.

        With regard to the second argument, the word “[a]ny” precedes the list “dispute,
controversy or claim.” It applies to the list of terms in that provision of the Agreement. It is not
a straightforward reading of the arbitration clause to apply the word “[a]ny” to modify the word
“and” between the term “questions of fact arising under this Agreement” and the term “concerning
issues related to wrongful discrimination.”

        As to the third argument, it is true that including the word “both” in the arbitration clause
would have more clearly established that arbitration is required for both “questions of fact arising
under this Agreement” and “issues related to wrongful discrimination.” But by the same measure,
including the word “or” in the arbitration clause instead of the word “and” would have more clearly
established that arbitration is required for either one of the two specifically listed instances. Thus,
the fact that the arbitration clause is not as clear as it could be does not compel an outcome in
defendants’ favor.

        With regard to the fourth argument, “Michigan’s public policy favors arbitration.” Lichon
v Morse, 507 Mich 424, 437; 968 NW2d 461 (2021). “But this general position favoring
arbitration does not go so far as to override foundational principles of contractual interpretation.”

                                                 -6-
Id. Consequently, it would be unwarranted to change the meaning of the word “and” to the word
“or” in this case simply on the basis of public policy.8

        Finally, as to the fifth argument, in Dessart, our Supreme Court interpreted the language
of a court rule referring to “assessable costs and interest on the amount of the verdict from the
filing of the complaint to the date of the case evaluation.” Dessart, 470 Mich at 39. The Court
concluded that “the phrase ‘assessable costs and interest’ is to be thought of as a single term, and,
as a unit, is modified by ‘from the filing of the complaint to the date of the case evaluation.’ ” Id.
at 42-43. Dessart is a case about the last-antecedent rule and is irrelevant to the instant case.9

                                        IV. CONCLUSION

        The trial court correctly concluded that the instant matter is not subject to arbitration under
the arbitration clause of the Agreement. We affirm. Having prevailed on appeal, plaintiff may tax
costs under MCR 7.219.

                                                               /s/ Michael J. Riordan
                                                               /s/ Jane E. Markey
                                                               /s/ Christopher P. Yates

8
 Relatedly, defendants cite a handful of cases from this Court indicating that arbitration is required
whenever the dispute “arguably” is within the terms of the arbitration clause. See, e.g., Detroit
Auto Inter-Ins Ex v Reck, 90 Mich App 286, 290; 282 NW2d 292 (1979). However, our Supreme
Court recently clarified that the “arguably” arbitration principle only applies within “the context
of collective bargaining agreements.” Lichon, 507 Mich at 438. This case does not involve a
collective bargaining agreement.
9
 The last-antecedent syntactic canon states that “ ‘[a] pronoun, relative pronoun, or demonstrative
adjective generally refers to the nearest reasonable antecedent.’ ” United States v Nishiie, 421 F
Supp 3d 958, 966 (D Hawaii, 2019), quoting Antonin Scalia & Bryan Garner, Reading Law: The
Interpretation of Legal Texts 144 (Thomson/West 2012).

                                                 -7-