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Michigan Supreme Court Lansing, Michigan

Opinion
DEBRA LEA MILLER, Plaintiff-Appellee, v JOHN THOMAS MILLER, Defendant-Appellant. _______________________________ PER CURIAM.

Chief Justice:

Justices:

Clifford W. Taylor

Michael F. Cavanagh Elizabeth A. Weaver Marilyn Kelly Maura D. Corrigan Robert P. Young, Jr. Stephen J. Markman

FILED DECEMBER 28, 2005

No. 127767

This case presents the question whether the domestic relations arbitration act (DRAA)1 requires a formal hearing during arbitration comparable to that which occurs in

traditional trial proceedings. not.

We conclude that it does

Also at issue is whether a court order to which the parties have stipulated in writing can satisfy the act's requirement of a written agreement to arbitrate. We

conclude that it can.

Therefore, we reverse the judgment

of the Court of Appeals, which ruled to the contrary on
1

MCL 600.5070  et seq.

both issues, and we reinstate the arbitration award and the judgment of divorce. THE FACTUAL
AND

PROCEDURAL HISTORY After on

Plaintiff filed for divorce in January 2001. failed settlement conferences in the circuit

court,

December 4, 2001, both parties stipulated in writing to entry of an order sending all issues in the case to binding arbitration. The arbitrator put the parties in separate rooms

during the arbitration proceedings.

He shuttled between

them, gathering the necessary information and hearing the respective procedure. At the end of the day, plaintiff asked the arbitrator for additional sessions. He denied the request, expressly arguments. Both parties agreed to this

noting in his written award that plaintiff had failed to raise anything new to justify further proceedings. When

plaintiff made a second request, the arbitrator gave her three days to provide an outline of what she would present at the additional proceedings. She supplied, instead,

voluminous material.

Rather than schedule more hearings,

the arbitrator reviewed plaintiff's material, modified the award, and issued the final binding arbitration award.

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Plaintiff filed a motion in court to set aside the arbitration award on the basis that the arbitrator had She The

failed to conduct a "hearing" as required by the DRAA. also claimed that no arbitration agreement existed.

court rejected plaintiff's claims and entered a judgment of divorce. Appeals vacated In a split the published judgment award. of decision, the It the Court court the of and DRAA

reversed the

circuit that

arbitration

held

required a formal hearing and that none occurred during the arbitration. 788 (2004). THE APPROPRIATE STANDARD The two issues on appeal are
OF

Miller v Miller, 264 Mich App 497; 691 NW2d

REVIEW of statutory

matters

interpretation that we review de novo. 470 Mich 305, 308-309; 684 NW2d 669

People v Kimble, (2004). When

interpreting a statute, our goal is to give effect to the Legislature's intent as determined from a review of the language of the statute. 518; 648 NW2d 153 (2002). Defendant asks us to review the Court of Appeals People v Koonce, 466 Mich 515,

decision not to enforce the arbitration award.

We review

such decisions de novo to determine whether the arbitrators exceeded their powers. Bros, Inc, 438 Mich See Gordon Sel-Way, Inc v Spence 496-497; 475 NW2d 704 (1991).

488,

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Arbitrators exceed their powers whenever they act beyond the material terms of the contract from which they draw their authority or in contravention of controlling law.

DAIIE v Gavin, 416 Mich 407, 433-434; 331 NW2d 418 (1982). WHAT CONSTITUTES
A

HEARING

UNDER THE

DRAA

MCL 600.5081 is the statutory provision that governs vacation and modification of arbitration awards under the DRAA. MCL 600.5081(2) provides: If a party applies under this section, the court shall vacate an award under any of the following circumstances: (a) The award was procured fraud, or other undue means. by corruption,

(b) There was evident partiality by an arbitrator appointed as a neutral, corruption of an arbitrator, or misconduct prejudicing a party's rights. (c) powers. The arbitrator exceeded his or her

(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 violated Court MCL of Appeals concluded It that the arbitrator that the

600.5081(2)(d).

reasoned

informality of the hearing prejudiced plaintiff's rights. The question is whether, in proceedings under the DRAA, the statute precludes hearings being conducted as the hearing was conducted in this case. 4


In majority provides:

reaching relied

its

decision, on

the MCL

Court

of

Appeals which

primarily

600.5074(1),

An arbitrator appointed under this chapter shall hear and make an award on each issue submitted for arbitration under the arbitration agreement subject to the provisions of the agreement. [Emphasis added.] The DRAA does not define the term "hear" or "hearing." Moreover, arbitration. example, MCL it sets no procedural requirements for For

Rather, it specifically eschews them. 600.5077 requires, with certain

exceptions,

that the arbitrator not make an official record of most arbitration proceedings.2 This purposeful requirement of

little or no record shows that the Legislature intended not to require specific procedures in arbitration proceedings.
2

MCL 600.5077 provides:

(1) Except as provided by this section, court rule, or the arbitration agreement, a record shall not be made of an arbitration hearing under this chapter. If a record is not required, an arbitrator may make a record to be used only by the arbitrator to aid in reaching the decision. The parties may provide in the arbitration agreement that a record be made of those portions of a hearing related to 1 or more issues subject to arbitration. (2) A record shall be made of that portion of a hearing that concerns child support, custody, or parenting time in the same manner required by the Michigan court rules for the record of a witness's testimony in a deposition.

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Without

a

record,

reviewing

courts

cannot

assess

what

procedures have been followed. The Legislature's failure to provide specific

arbitration procedures is consistent also with tradition. Historically, judicial review of arbitration awards is

highly limited. characterized

Gavin, 416 Mich 433-434. arbitration procedures as

This Court has "informal and

sometimes unorthodox . . . ."

Id. at 429.

Consequently,

courts should not speculate why an arbitrator ruled in one particular manner. Id.

Rather than employ the formality required in courts, parties in arbitration are able to shape the parameters and procedures of the proceeding. The DRAA requires that they

first sign an agreement for binding arbitration delineating the powers and duties of the arbitrator. MCL

600.5072(1)(e). The act also contemplates that the parties will

discuss with the arbitrator the scope of the issues and how information produced. necessary for their resolution will be

MCL 600.5076.

The act contemplates that the Nowhere that

parties will decide what is best for their case. in the DRAA are procedural formalities

imposed

restrict this freedom.

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This Court has consistently held that arbitration is a matter of contract. "It is the agreement that dictates the Rowry v Univ of Michigan, In this case, the on the parties'

authority of the arbitrators[.]"

441 Mich 1, 10; 490 NW2d 305 (1992). Court of Appeals decision infringes

recognized freedom to contract for binding arbitration. It restricts the parties' freedom to decide how the arbitration presents no hearing should be conducted.3 that the Plaintiff Legislature

convincing

argument

intended all DRAA hearings to approximate traditional court hearings. court to We know of none.4 read into a statute It is inappropriate for a something that was not

The language in US Const, art I,

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