Court Opinion

ID: 4152548
Source: CourtListenerOpinion
Date Created: 2017-03-15 11:08:19.679106+00
Date Added: 2024-06-11T14:30:17.192595
License: Public Domain

STATE OF MICHIGAN

                           COURT OF APPEALS

JOHN HENRY ROZANSKI, APPLIED POWER                    UNPUBLISHED
AND LIGHT, INC.,                                      March 14, 2017

             Plaintiffs-Appellants,

v                                                     No. 330962
                                                      Oakland Circuit Court
FRED S. FINDLING,                                     LC No. 2015-148324-NM

             Defendant-Appellee,
and

FINDLING, FINDLING & FINDLING,
FINDLING LAW FIRM, DANIEL FINDLING
LAW FIRM, FINDLING LAW,

             Defendants.

JOHN HENRY ROZANSKI, APPLIED POWER
AND LIGHT, INC.,

             Plaintiffs-Appellants,

v                                                     No. 332085
                                                      Oakland Circuit Court
FRED S. FINDLING,                                     LC No. 2015-148324-NM

             Defendant-Appellee,
and

FINDLING, FINDLING & FINDLING,
FINDLING LAW FIRM, DANIEL FINDLING
LAW FIRM, FINDLING LAW,

             Defendants.

Before: RIORDAN, P.J., and METER and FORT HOOD, JJ.

                                          -1-
PER CURIAM.

       In Docket No. 330962, plaintiffs appeal as of right the trial court’s order granting
defendant Fred S. Findling’s1 motion to compel arbitration and for summary disposition pursuant
to MCR 2.116(C)(7) (dismissal appropriate because of an agreement to arbitrate). In Docket No.
332085, plaintiffs appeal as of right the trial court’s judgment in favor of Fred S. Findling
following confirmation of an arbitration award. We affirm in both dockets.

        On appeal in Docket No. 330962, plaintiffs argue that the trial court erred in granting
summary disposition in favor of defendant where the attorney fee agreement that contained the
arbitration provision was invalid. We disagree.

        As a preliminary matter, we observe that the order from which plaintiffs claimed an
appeal as of right does not provide on its face that it is a final order or judgment of the trial court.
Additionally, we note that this order in substance was not a final order, as it did not resolve all
pending matters between the parties. See MCR 7.203(A)(1) (providing that the Court of Appeals
has jurisdiction of an appeal of right filed by an aggrieved party from “[a] final judgment or final
order of the circuit court . . . .” MCR 7.202(6)(a)(i) defines “final judgment” or “final order” as
follows:

       the first judgment or order that disposes of all the claims and adjudicates the
       rights and liabilities of all the parties, including such an order entered after
       reversal of an earlier final judgment or order[.]

Specifically, the trial court’s order did not dispose of all of the claims of the parties and
adjudicate all of their rights and liabilities, given that the proceedings in the trial court continued
for a significant period of time after this order, and, most notably, defendant subsequently sought
to have the trial court confirm the arbitration award. However, plaintiffs could have filed an
application for leave to appeal from the trial court’s order. See MCR 7.203(B)(1). Therefore, in
the interests of finality for the parties, we will exercise our discretion to address plaintiffs’ appeal
as an application for leave to appeal, grant the application, and proceed to resolve the appeal on
the merits. See MCR 7.216(A)(7); Detroit v Michigan, 262 Mich. App. 542, 546; 686 NW2d 514
(2004); Waatti & Sons Electric Co v Dehko, 230 Mich. App. 582, 585; 584 NW2d 372 (1998).

        This Court reviews de novo a trial court’s ruling on a motion for summary disposition
brought pursuant to MCR 2.116(C)(7). Stoudemire v Stoudemire, 248 Mich. App. 325, 332; 639
NW2d 274 (2001). MCR 2.116(C)(7) provides that summary disposition may be granted where
“[e]ntry of judgment, dismissal of the action, or other relief is appropriate because of . . . an
agreement to arbitrate . . . [.]” “This Court must accept all well-pleaded factual allegations as

1
  The trial court entered an order dismissing with prejudice defendants Findling, Findling and
Findling, PLC, The Findling Law Firm, PLC, the Daniel Findling Law Firm, PLC and Findling
Law. These entities are not parties to these appeals. Therefore, any reference to defendant
throughout this opinion will pertain only to defendant Fred S. Findling.

                                                  -2-
true and construe them in favor of the plaintiff, unless the evidence contradicts them.” Dextrom
v Wexford Co, 287 Mich. App. 406, 428; 789 NW2d 211 (2010) (footnote and citations omitted).

       If any affidavits, depositions, admissions, or other documentary evidence are
       submitted, the court must consider them to determine whether there is a genuine
       issue of material fact. If no facts are in dispute, and if reasonable minds could not
       differ regarding the legal effect of those facts, the question whether the claim is
       barred is an issue of law for the court. However, if a question of fact exists to the
       extent that factual development could provide a basis for recovery, dismissal is
       inappropriate. [Id. (Footnotes and citations omitted.)

       “Michigan public policy favors arbitration to resolve disputes[.]” Rooyakker & Sitz,
PLLC v Plante & Moran, PLLC, 276 Mich. App. 146, 155; 742 NW2d 409 (2007) (citation
omitted).

               A three-part test applies for ascertaining the arbitrability of a particular
       issue: 1) is there an arbitration agreement in a contract between the parties; 2) is
       the disputed issue on its face or arguably within the contract’s arbitration clause;
       and 3) is the dispute expressly exempted from arbitration by the terms of the
       contract? [In re Nestorovski Estate, 283 Mich. App. 177, 203; 769 NW2d 720
       (2009).]

This Court has also recognized that any doubts concerning whether an issue is subject to
arbitration must be resolved in favor of arbitration. Watts v Polaczyk, 242 Mich. App. 600, 608;
619 NW2d 714 (2000).

        Plaintiffs’ primary challenges to the arbitration agreement on appeal pertain to the
validity of the underlying attorney fee agreement. Plaintiffs do not challenge the validity of the
arbitration clause itself. Put simply, plaintiffs contend that there are factual issues concerning
whether plaintiff John Henry Rozanski read and signed the attorney fee agreement containing the
arbitration agreement where there were clerical mistakes with regard to the pagination of the
agreement. Plaintiffs also challenge the validity of the attorney fee agreement where entities
named as parties to the agreement, The Findling Law Firm, PLC, and Findling Law were
ultimately dismissed from the lawsuit during the lower court proceedings.

      In Innovation Ventures v Liquid Mfg, 499 Mich. 491, 508; 885 NW2d 861 (2016), the
Michigan Supreme Court recently set forth the requirements of a valid contract:

       A valid contract requires five elements: (1) parties competent to contract, (2) a
       proper subject matter, (3) legal consideration, (4) mutuality of agreement, and (5)
       mutuality of obligation. [Citation and quotation marks omitted.]

Plaintiffs’ argument concerning the clerical errors in the pagination of the attorney fee agreement
implicates the necessary element for a contract of mutual assent. “In order for there to be an
enforceable agreement between the parties, there must be “mutual assent” to be bound—that is,
the parties must have a ‘meeting of the minds’ on all the essential elements of the agreement.”
Huntington Nat’l Bank v Daniel J. Aronoff Living Trust, 305 Mich. App. 496, 508; 853 NW2d
481 (2014). However, the record evidence does not support plaintiffs’ assertion that they did not
                                                -3-
intend to be bound by the provision in the attorney fee agreement regarding arbitration. In
support of their response to defendant’s motion for summary disposition, plaintiffs submitted
two affidavits executed by Rozanski that we have closely reviewed. Notably, Rozanski did not
aver that he did not read the agreement or that he did not sign it. Rozanski also did not contend
that he did not see the provision regarding arbitration in the attorney fee agreement. Therefore,
while plaintiffs raise issues concerning the pagination of the agreement, the record does not
support plaintiffs’ assertion that factual disputes existed with regard to whether Rozanski signed
the attorney fee agreement containing the arbitration clause. Additionally, to the extent that
plaintiffs challenge the attorney fee agreement on the basis that they mistakenly believed that
other entities were parties to the attorney fee agreement, any unilateral mistake with regard to
this issue would not serve as a basis for voiding the contract. See, e.g. Meyer v Rosenbaum, 71
Mich. App. 388, 394; 248 NW2d 558 (1976) (recognizing that a unilateral mistake of fact will not
vitiate a written contract); see also In re Lett Estate, 314 Mich. App. 587, 602; 887 NW2d 807
(2016) (recognizing that unilateral mistake will not warrant reformation of a contract).
Accordingly, where the underlying attorney fee agreement was valid, the trial court properly
granted defendant’s motion for summary disposition pursuant to MCR 2.116(C)(7) and to
compel arbitration.

        Plaintiffs next argue that the trial court erred in granting defendant’s motion to confirm
the arbitration award. We disagree.

        This Court is required to review de novo a trial court’s decision to confirm an arbitration
award. City of Ann Arbor v American Federation of State, Co & Muni Employees (AFSCME)
Local 369, 284 Mich. App. 126, 144; 771 NW2d 843 (2009). However, “[j]udicial review of an
arbitrator’s decision is narrowly circumscribed.” Id. (Citation omitted.) To the extent that
plaintiffs claim that the trial court did not have jurisdiction, this is an issue that this Court
reviews de novo. Wyoming Chiropractic Health Clinic, PC v Auto-Owners Ins Co, 308 Mich
App 389, 393; 864 NW2d 598 (2014). This Court also reviews de novo the proper interpretation
of the court rules, as well as the language and application of the pertinent statutes. Lech v
Huntmore Estates Condominium Ass’n (On Remand), 315 Mich. App. 288, 290; ___ NW2d ___
(2016).

        Michigan’s Uniform Arbitration Act, MCL 691.1681 et seq., contains several provisions
relevant to these proceedings. Initially, MCL 691.1706 provides guidance regarding a trial
court’s jurisdiction in a case where arbitration is at issue, and provides, in pertinent part, as
follows:

       (1) A court of this state that has jurisdiction over the controversy and the parties
       may enforce an agreement to arbitrate.

       (2) An agreement to arbitrate that provides for arbitration in this state confers
       exclusive jurisdiction on the court to enter judgment on an award under this act.

If a party seeks to vacate an arbitration award, MCL 691.1703 governs the procedure and
statutory grounds for doing so, and provides in pertinent part, as follows:

                                                -4-
      (1) On motion to the court by a party to an arbitration proceeding, the court shall
      vacate an award made in the arbitration proceeding if any of the following apply:

      (a) The award was procured by corruption, fraud, or other undue means.

      (b) There was any of the following:

      (i) Evident partiality by an arbitrator appointed as a neutral arbitrator.

      (ii) Corruption by an arbitrator.

      (iii) Misconduct by an arbitrator prejudicing the rights of a party to the arbitration
      proceeding.

      (c) An arbitrator refused to postpone the hearing upon showing of sufficient cause
      for postponement, refused to consider evidence material to the controversy, or
      otherwise conducted the hearing contrary to [MCL 691.1695], so as to prejudice
      substantially the rights of a party to the arbitration proceeding.

      (d) An arbitrator exceeded the arbitrator’s powers.

      (e) There was no agreement to arbitrate, unless the person participated in the
      arbitration proceeding without raising the objection under [MCL 691.1695(3)] not
      later than the beginning of the arbitration hearing.

      (f) The arbitration was conducted without proper notice of the initiation of an
      arbitration as required in [MCL 691.1699] so as to prejudice substantially the
      rights of a party to the arbitration proceeding.

      (2) A motion under this section must be filed within 90 days after the moving
      party receives notice of the award under [MCL 691.1699] or within 90 days after
      the moving party receives notice of a modified or corrected award under [MCL
      691.1700], unless the moving party alleges that the award was procured by
      corruption, fraud, or other undue means, in which case the motion must be made
      within 90 days after the ground is known or by the exercise of reasonable care
      would have been known by the moving party.

                                             * * *

      (4) If the court denies a motion to vacate an award, it shall confirm the award
      unless a motion to modify or correct the award is pending. [Emphasis added.]

Likewise, MCL 691.1702 governs the confirmation of arbitration awards and provides, in
pertinent part, as follows:

             After a party to an arbitration proceeding receives notice of an award, the
      party may move the court for an order confirming the award at which time the
      court shall issue a confirming order unless the award is modified or corrected

                                                -5-
       under [MCL 691.1700] or [MCL 691.1704] or is vacated under [MCL 691.1703].
       [Footnotes omitted; emphasis added.]

MCL 691.1708 governs appeals in the arbitration context, and provides as follows:

       (1) An appeal may be taken from any of the following:

       (a) An order denying a motion to compel arbitration.

       (b) An order granting a motion to stay arbitration.

       (c) An order confirming or denying confirmation of an award.

       (d) An order modifying or correcting an award.

       (e) An order vacating an award without directing a rehearing.

       (f) A final judgment entered under this act.

       (2) An appeal under this section shall be taken as from an order or a judgment in a
       civil action.

The pertinent companion court rule is MCR 3.602, which provides, in pertinent part, as follows:

       (B) Proceedings Regarding Arbitration

       (1) A request for an order to compel or to stay arbitration or for another order
       under this rule must be by motion, which shall be heard in the manner and on the
       notice provided by these rules for motions. If there is not a pending action
       between the parties, the party seeking the requested relief must first file a
       complaint as in other civil actions.

                                             * * *

       (I) Award; Confirmation by Court. A party may move for confirmation of an
       arbitration award within one year after the award was rendered. The court may
       confirm the award, unless it is vacated, corrected, or modified, or a decision is
       postponed, as provided in this rule.

       (J) Vacating Award.

       (1) A request for an order to vacate an arbitration award under this rule must be
       made by motion. If there is not a pending action between the parties, the party
       seeking the requested relief must first file a complaint as in other civil actions. A
       complaint or motion to vacate an arbitration award must be filed no later than 21
       days after the date of the arbitration award.

       (2) On motion of a party, the court shall vacate an award if:

                                               -6-
       (a) the award was procured by corruption, fraud, or other undue means;

       (b) there was evident partiality by an arbitrator appointed as a neutral, corruption
       of an arbitrator, or misconduct prejudicing a party’s rights;

       (c) the arbitrator exceeded his or her powers; or

       (d) the arbitrator refused to postpone the hearing on a showing of sufficient cause,
       refused to hear evidence material to the controversy, or otherwise conducted the
       hearing to prejudice substantially a party’s rights.

       The fact that the relief could not or would not be granted by a court of law or
       equity is not ground for vacating or refusing to confirm the award.

       (3) A motion to vacate an award must be filed within 91 days after the date of the
       award. However, if the motion is predicated on corruption, fraud, or other undue
       means, it must be filed within 21 days after the grounds are known or should have
       been known. A motion to vacate an award in a domestic relations case must be
       filed within 21 days after the date of the award.

       (4) In vacating the award, the court may order a rehearing before a new arbitrator
       chosen as provided in the agreement, or, if there is no such provision, by the
       court. If the award is vacated on grounds stated in subrule (J)(1)(c) or (d), the
       court may order a rehearing before the arbitrator who made the award. The time
       within which the agreement requires the award to be made is applicable to the
       rehearing and commences from the date of the order.

       (5) If the motion to vacate is denied and there is no motion to modify or correct
       the award pending, the court shall confirm the award.

                                              * * *

       (L) Judgment. The court shall render judgment giving effect to the award as
       corrected, confirmed, or modified. The judgment has the same force and effect,
       and may be enforced in the same manner, as other judgments.

                                              * * *

       (N) Appeals. Appeals may be taken as from orders or judgments in other civil
       actions.

        On appeal, the gravamen of plaintiffs’ argument is that where the trial court declined to
hear and decide their motion to reopen the case and to compel defendant to comply with the
arbitration provision on the basis that it lacked jurisdiction, the trial court erred in subsequently
confirming the arbitration award in favor of defendant. According to plaintiffs, where they had
subsequently filed a motion to vacate the arbitration award and to compel defendant to comply
with the arbitration provision in this Court, the trial court was then divested of jurisdiction, and
therefore did not have authority to decide defendant’s motion seeking to confirm the arbitration

                                                -7-
award. In support of their argument, plaintiffs point to MCR 7.208, a court rule that the trial
court relied on when declining to address plaintiffs’ motion to reopen the case and to compel
defendant to comply with the arbitration provision. MCR 7.208(A) provides:

       (A) Limitations. After a claim of appeal is filed or leave to appeal is granted, the
       trial court or tribunal may not set aside or amend the judgment or order appealed
       from except

       (1) by order of the Court of Appeals,

       (2) by stipulation of the parties,

       (3) after a decision on the merits in an action in which a preliminary injunction
       was granted, or

       (4) as otherwise provided by law.

        After a close review of the applicable statutes and court rules, we are not persuaded by
plaintiffs’ assertion that the trial court incorrectly confirmed the arbitration award. Instead, a
review of the applicable statutes and court rules lead us to conclude that the trial court had
jurisdiction to decide defendant’s motion to confirm the arbitration award. For example, as
noted above, MCL 691.1703 sets forth the proper procedure for a party to file a motion seeking
to vacate an arbitration award. Specifically, MCL 691.1703(1) clearly provides that “[o]n
motion to the court by a party to an arbitration proceeding, the court shall vacate an award made
in the arbitration proceeding if any of the following [circumstances] apply[.]” (Emphasis
supplied.) MCL 691.1681 defines “court” in the following manner:

       (2) As used in this act:

                                               * * *

       (c) “Court” means the circuit court. [Emphasis added.]

        A review of the record confirms that plaintiffs did not advance their motion to vacate the
arbitration award in the trial court. Accordingly, while plaintiffs undertook creative steps to
effectively bypass the trial court’s authority to decide a motion to vacate an arbitration award, the
plain statutory language of MCL 691.1681 and MCL 691.1703 clearly provides that plaintiffs
ought to have proceeded with their motion to vacate the arbitration award in the trial court.
Further buttressing our analysis is the fact that MCL 691.1708(1) provides that “[a]n appeal may
be taken from any of the following: (e) [a]n order vacating an [arbitration] award without
directing a rehearing.” Additionally, MCR 3.602(J)(1) clearly contemplates the filing of a
motion to vacate an arbitration award in the trial court, as it states that if a proceeding is not
already pending between the parties, “the party seeking the requested relief must first file a
complaint as in other civil actions.” Similarly, MCR 3.602(N) delineates how appeals arising
from arbitration proceedings should proceed to this Court, stating “[a]ppeals may be taken as
from orders or judgments in other civil actions[,]” and there is nothing in this subsection of the
court rule allowing a party to directly proceed to this Court to seek a vacating of an arbitration
award. Finally, while the trial court noted that it did not have jurisdiction to address plaintiffs’

                                                -8-
motion seeking to compel arbitration and to reopen the case, it made that statement referring to
plaintiffs’ appeal of its order granting defendant’s motion for summary disposition and to compel
arbitration, which we have concluded was not a final order as contemplated by the court rules.
The trial court correctly recognized that where plaintiffs had pursued an appeal from the trial
court’s order, it could not act to set aside or amend that order. MCR 7.208(A). Accordingly, the
trial court properly granted defendant’s motion seeking confirmation of the arbitration award.

        Affirmed in both Docket No. 330962 and Docket No. 332085.             Defendant, as the
prevailing party, may tax costs pursuant to MCR 7.219.

                                                           /s/ Michael J. Riordan
                                                           /s/ Patrick M. Meter
                                                           /s/ Karen M. Fort Hood

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