Articles Posted in Arbitration & Mediation

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Plaintiff filed an action seeking equitable distribution of the parties’ marital assets and child support. Plaintiff and Defendant agreed to arbitrate the action under North Carolina’s Family Law Arbitration Act. Plaintiff and Defendant entered into an equitable distribution arbitration award by consent. The trial court confirmed the award. Plaintiff subsequently filed a motion to vacate arbitration award and set aside order and motion to engage in discovery on the basis of Plaintiff’s alleged fraud. The trial court denied Plaintiff’s motion for leave to engage in discovery. The court of appeals dismissed Plaintiff’s appeal, concluding that Plaintiff had no right to immediately appeal the trial court’s order denying discovery and that the trial court had no discretion to order post-confirmation discovery in this case. The Supreme Court reversed, holding (1) Plaintiff had a right to appeal the trial court’s denial of his motion to engage in discovery; and (2) the trial court had the discretion to order discovery in this case. View "Stokes v. Crumpton" on Justia Law

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Robert King signed an arbitration agreement at the time of his initial appointment with Dr. Michael Bryant, who was to perform a bilateral inguinal hernia repair on King. In the course of the surgery, Bryant injured King’s distal abdominal aorta, resulting in complications. King and his wife, Jo Ann O’Neal (together, Plaintiffs) filed a complaint against Bryant and Village Surgical Associations, P.A. (collectively, Defendants). Defendants filed a motion to stay and enforce the arbitration agreement. The trial court denied Defendants’ motion to enforce the arbitration agreement, concluding that the agreement was too indefinite to be enforced. The court of appeals reversed. On remand, the trial court again declined to enforce the arbitration agreement, concluding that it was the product of constructive fraud and was unconscionable and, therefore, was unenforceable. The court of appeals affirmed on unconscionability grounds. The Supreme Court affirmed as modified, holding that the arbitration agreement was unenforceable on breach of fiduciary duty, as opposed to unconscionability, grounds. View "King v. Bryant" on Justia Law

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Plaintiff and Defendants formed a limited liability company. The operating agreement contained an arbitration provision providing that any dispute arising out of the operating agreement shall be settled by arbitration. Plaintiff later filed suit against Defendants, alleging numerous claims, including breach of good faith and breach of fiduciary duty. Defendants filed a motion to compel arbitration on those two issues under the operating agreement. The trial court denied the motion, concluding (1) the two claims in question did not arise out of the operating agreement or any breach or violation of the agreement, and (2) alternatively, Defendants waived any right they had to arbitration by engaging in discovery that would not have been available as a matter of right during the arbitration process and that Plaintiffs were prejudiced by these actions. The court of appeals affirmed on the basis of waiver. The Supreme Court reversed, holding that Plaintiff failed to establish prejudicial actions inconsistent with arbitration, and therefore, the court of appeals erred in affirming the trial court's order finding waiver of contractual arbitration rights. Remanded. View "HCW Ret. & Fin. Servs., LLC v. HCW Employee Benefit Servs., LLC" on Justia Law