The Doctrine of Arbitral Immunity Applied to an Arbitral Organization Absent a Showing of Clear Lack of Jurisdiction

Univ. of Iowa Bd. of Regents v. Am. Arbitration Ass’n, No. 17-0949, 2019 BL 7069 (Iowa Ct. App. Jan. 09, 2019)

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Michelle Beth Rosenberg

Modern Piping, Inc. (“Modern Piping”) and the University of Iowa, Board of Regents, and State of Iowa (“University”) entered into two construction contracts, both containing arbitration provisions.  Disputes arose related to each contract and Modern Piping filed a demand for arbitration with the American Arbitration Association (AAA).  The University filed an action against AAA, seeking to enjoin it from arbitrating the disputes.  AAA filed a motion for summary judgment on the grounds that arbitral immunity doctrine applied.  The district court granted AAA’s motion and the University appealed.

The doctrine of arbitral immunity provides that arbitrators are immune from liability for acts performed in their arbitral capacity and generally shields all functions which are integrally related to the arbitral process.  The doctrine applies to a claim against an arbitrator where the claim effectively seeks to challenge the decisional act of an arbitrator or arbitration panel.  The immunity extends to associations administering arbitration procedures.

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West Virginia Supreme Court Applies Doctrine of Severability to Enforce Lease’s Arbitration Provision, Despite Other Provisions Contemplating Litigation in Court

SWN Prod. Co., LLC v. Long, 2017 W. Va. LEXIS 892 (W. Va. Oct. 18, 2017)

Respondents Richard and Mary Long (“Respondents” or “Lessors”) brought a state court action against Petitioner SWN Production Company, LLC (“Petitioner” or “Lessee”) seeking to recover alleged payments owed pursuant to an oil and gas lease (the “Lease”) entered into between Petitioner and Respondent.

Petitioner filed a motion to compel arbitration, relying on the Lease’s arbitration provision, which reads:  “In the event of a disagreement between Lessor and Lessee concerning this Lease, performance thereunder, or damages caused by Lessee’s operations, the resolution of all such disputes shall be determined by arbitration in accordance with the rules of the American Arbitration Association.” Continue reading “West Virginia Supreme Court Applies Doctrine of Severability to Enforce Lease’s Arbitration Provision, Despite Other Provisions Contemplating Litigation in Court”

Michigan Appellate Court Rules That, Absent Proof of Prejudice, Defendant’s Filing of a Cross-Complaint Does Not Constitute a Waiver of Arbitration

Universal Acad. v. Berkshire Dev., 2017 Mich. App. LEXIS 975 (Ct. App. June 20, 2017)

The dispute arose out of an agreement between Universal Academy (“Universal”) and Berkshire Development (“Berkshire”), under which Berkshire agreed to provide demolition services to Universal and Hamadeh Education Services (“HES”).  The agreement also contained an arbitration provision which provided in part:

In the event of a dispute between Contractor and the Owner that cannot be resolved, the parties agree to binding arbitration with the American Arbitration Association in accordance with the Construction Industry’s Rules of the American Arbitration Association in effect as of the date of this Agreement.

The agreement was terminated by Universal, alleging material breaches by Berkshire.  Following termination, subcontractors for the project filed a complaint against Berkshire, Universal, and HES, requesting foreclosure of construction liens and payment for services.  In response, Berkshire filed a cross-complaint against Universal and HES, requesting foreclosure of its lien and asserting claims of promissory estoppel and fraudulent inducement.  Five months after it filed the cross-complaint, Berkshire filed a motion to enforce the arbitration agreement between it and Universal. Continue reading “Michigan Appellate Court Rules That, Absent Proof of Prejudice, Defendant’s Filing of a Cross-Complaint Does Not Constitute a Waiver of Arbitration”