ADR LAW & POLICY UPDATE

Federal Cases

Arbitration Award Confirmed as Party Filing Untimely Challenge Failed to Establish Doctrine of Equitable Tolling Should Apply
Ford Dealer Computer Services, Inc. v. Highland Lincoln Mercury, Inc., No. 06-X-50344, 2008 WL 895990 (E.D. Mich. Mar. 31, 2008)
3/31/2008

In denying a motion to vacate and granting a motion to confirm an arbitration award, a federal district court in Michigan held that a party's motion to vacate was time-barred under the Federal Arbitration Act's three-month deadline for challenging an arbitration award. The requirements needed to invoke the doctrine of equitable tolling in order to extend the three-month period were not met.

In Ford Dealer Computer Services, Inc. v. Highland Lincoln Mercury, Inc., No. 06-X-50344, 2008 WL 895990 (E.D. Mich. Mar. 31, 2008), a dispute between Dealer Computer Services (DCS) and Highland was arbitrated pursuant to an arbitration agreement, and DCS was awarded its full measure of damages plus attorney fees. About three and a half months later, Highland discovered facts that allegedly proved that DCS perpetrated fraud on the arbitrator in order to obtain the award... Full Story

Federal Court Upholds Class Action Waiver Where Bank Agreed to Pay Arbitration Costs in Excess of $125
Stephens v. Wachovia Corp., No. Civ. 3:06CV246, 2008 WL 686214 (W.D.N.C. Mar. 7, 2008)
3/7/2008

In ordering arbitration of a banking dispute, a federal court in North Carolina rejected the bank customer's argument that the arbitration agreement's class action waiver was unconscionable under Alabama law and therefore unenforceable. The Court rejected this argument because the bank agreed to pay arbitration costs in excess of $125 and there were no contractual limitations on the customer's recovery of damages.

In Stephens v. Wachovia Corp., No. Civ. 3:06CV246, 2008 WL 686214 (W.D.N.C. Mar. 7, 2008), Stephens, a banking customer of Wachovia, filed a class action suit against them, claiming statutory violations in regards to treatment of her Social Security retirement benefits... Full Story

Agreement Invoking Arbitration Rules Reserving All Arbitrability Issues to Arbitrator Defeats Default Presumption that Court Decides Arbitrability
Visa USA, Inc. v. Maritz Inc., No. C 07-05585 JSW, 2008 WL 744832 (N.D. Cal. Mar. 18, 2008)
3/18/2008

Express invocation of arbitration rules that reserve questions of arbitrability for the arbitrator defeats the normal presumption that courts decide questions of arbitrability, according to a federal district court in California.

In Visa USA, Inc. v. Maritz Inc., No. C 07-05585 JSW, 2008 WL 744832 (N.D. Cal. Mar. 18, 2008), Maritz entered into a contract with Visa to provide certain software. After delays and difficulties with implementation, Visa terminated the parties’ contract. This contract did not contain an arbitration agreement... Full Story

Louisiana Federal Court Engages in Expanded Judicial Review of Arbitration Award
Rent-A-Center, Inc. v. Barker, Civ. A. No. 07-1414, 2008 WL 818949 (W.D. La. Mar. 26, 2008)
3/26/2008

Contrary to the U.S. Supreme Court's recent holding in Hall Street Associates, L.L.C. v. Mattel, Inc., a federal district court in Louisiana has engaged in expanded judicial review of an award as specified within an arbitration agreement.

In Rent-A-Center, Inc. v. Barker, Civ. A. No. 07-1414, 2008 WL 818949 (W.D. La. Mar. 26, 2008), Barker and Rent-A-Center arbitrated an employment dispute. The parties' pre-dispute agreement provided for trial court review of any resulting award, applying the standards of appellate court review... Full Story

New York Federal Court Refuses to Compel Arbitration Under Either Direct Estoppel or De Factor Merger Exceptions
Barrack, Rodos & Bacine v. Ballon Stoll Bader & Nadler, P.C., No. 08 Civ. 02152, 2008 WL 759353 (S.D.N.Y. Mar. 20, 2008)
3/20/2008

A federal district court in New York has refused to compel a non-signatory law firm to arbitrate a claim by another firm to share attorney's fees under either the direct estoppel or de facto merger exceptions to the general rule of arbitrability.

In Barrack, Rodos & Bacine v. Ballon Stoll Bader & Nadler, P.C., No. 08 Civ. 02152, 2008 WL 759353 (S.D.N.Y. Mar. 20, 2008), law firm Barrack, Rodos & Bacine (BRB) hired attorney Gershon, who had previously been of counsel to another firm, Ballon, Stoll, Bader & Nadler (BSBN). While he was with BSBN, Gershon originated a case that eventually settled after he was hired by BRB. Since BRB had negotiated the settlement, BRB was paid the attorney's fees awarded under the settlement agreement... Full Story

Rescission of Arbitration Agreement Not Warranted When Party Violates Provision Through Filing of Improper Demand
Ewers v. Genuine Motor Cars, Inc., No. 1:07 CV 2799, 2008 WL 755268 (N.D. Ohio, Mar. 19, 2008)
3/19/2008

A federal district court in Ohio has refused a plaintiff’s request to rescind an arbitration agreement that reserved the selection of venue and administrator to the plaintiff, holding that the defendant’s violation of those provisions by filing an improper demand in another venue did not warrant that drastic remedy.

In Ewers v. Genuine Motor Cars, Inc., No. 1:07 CV 2799, 2008 WL 755268 (N.D. Ohio, Mar. 19, 2008), Ewers purchased a vehicle from Genuine through the Ebay website. Ewers traveled from Ohio to Florida to pick up the vehicle. When Ewers arrived in Florida, Genuine presented Ewers with purchase documents, including an arbitration agreement. Ewers signed the agreement... Full Story

State Cases

Under Missouri Law, Wrongful Death Claims Now Arbitrable Under Decedent's Arbitration Agreement
Lawrence v. Beverly Manor, No. WD 67920, 2008 WL 731561 (Mo. Ct. App. Mar. 18, 2008)
3/18/2008

According to the Missouri Court of Appeals, a recent decision of the Missouri Supreme Court has "unquestionably changed Missouri's wrongful death law," characterizing such claims as derivative and therefore subject to an arbitration agreement binding on the decedent.

In Lawrence v. Beverly Manor, No. WD 67920, 2008 WL 731561 (Mo. Ct. App. Mar. 18, 2008), Lawrence filed a wrongful death action against Beverly Manor after his mother died while in the facility's care. Beverly Manor moved to compel arbitration of the claims, alleging that Lawrence was bound to arbitrate his claims pursuant to an arbitration agreement signed by his mother's representative at admission. Beverly Manor characterized the wrongful death claim as derivative, and therefore, arbitrable... Full Story

Nursing Home Resident Must Arbitrate As an Intended Third-Party Beneficiary of Agreement She Didn't Sign
Forest Hill Nursing Center, Inc. v. McFarlan, No. 2007-CA-00327-COA, 2008 WL 852581 (Miss. Ct. App. Apr. 1, 2008)
4/1/2008

The Mississippi Court of Appeals has compelled a non-signatory nursing home resident to arbitrate her claims against the home, holding that the resident was an intended third-party beneficiary of the admission contract and its arbitration agreement.

In Forest Hill Nursing Center, Inc. v. McFarlan, No. 2007-CA-00327-COA, 2008 WL 852581 (Miss. Ct. App. Apr. 1, 2008), McFarlan was admitted to Forest Hill's nursing home facility. Upon admission, McFarlan's granddaughter, Mathews, signed the admission contract, which included an arbitration agreement... Full Story

Montana Supreme Court Finds Extensive Pretrial Litigation Constitutes Waiver of Right to Arbitrate
Signal Perfection LTD. v. Blackhawk, Inc., No. DA 07-0293, 2008 WL 852173 (Mont. Apr. 1, 2008)
4/1/2008

In affirming a court order denying a motion to compel arbitration, the Montana Supreme Court held that a party waived its contractual right to arbitration by answering the complaint and filing several motions without ever raising arbitration as a defense.

In Signal Perfection LTD. v. Blackhawk, Inc., No. DA 07-0293, 2008 WL 852173 (Mont. Apr. 1, 2008), Blackhawk and Signal entered into a service contract containing an arbitration agreement. Signal later sued for breach of contract. In answering the complaint, Blackhawk raised several affirmative defenses, but never raised arbitration as an affirmative defense... Full Story

Arbitration Agreement Unenforceable Because Form Did Not Comply with California Law
Burks v. Kaiser Foundation Health Plan, Inc., No. C054374, 2008 WL 590872 (Cal. Ct. App. Mar. 5, 2008)
4/5/2008

A California appellate court determined that a health plan provider’s arbitration agreement was unenforceable because the form failed to comply with the California Health and Safety code.

In Burks v. Kaiser Foundation Health Plan, Inc., No. C054374, 2008 WL 590872 (Cal. Ct. App. Mar. 5, 2008), Burks sued Kaiser for alleged egregious treatment he received from Kaiser while suffering from renal failure and awaiting a kidney transplant... Full Story

California Court Finds That FAA Does Not Preempt California Law Allowing Courts to Deny Arbitration Based on Possibility of Conflicting Rulings
Best Interiors, Inc. v. Millie and Severson, Inc., No. B195253, 2008 WL 651018 (Cal. Ct. App. Mar. 12, 2008)
4/12/2008

A California appellate court determined that the goals of the Federal Arbitration Act (FAA) are not undermined by allowing courts to apply a California statute authorizing denial of arbitration where a party to the arbitration is subject to risk of conflicting rulings from a different forum.

In Best Interiors, Inc. v. Millie and Severson, Inc., No. B195253, 2008 WL 651018 (Cal. Ct. App. Mar. 12, 2008), Presbyterian Intercommunity Hospital (Presbyterian) contracted with general contractor Millie and Severson (M&S) to construct a healthcare facility in California. M&S subcontracted some of the work to Best Interiors (Best)... Full Story

Under California Law, a Petition to Compel Arbitration Must Affirmatively Allege the Existence of a Written Agreement to Arbitrate
Brodke v. Alphatec Spine Inc., No. G038591, 2008 WL 740379 (Cal. Ct. App. Mar. 20, 2008)
4/20/2008

A California appellate court determined that a medical device company’s argument to arbitrate a contract dispute lacked merit, because the company simultaneously denied the existence of the underlying contract.

In Brodke v. Alphatec Spine Inc., No. G038591, 2008 WL 740379 (Cal. Ct. App. Mar. 20, 2008), Brodke, a surgeon, brought suit against Alphatec, a medical device company, for breach of contract and fraud. Brodke alleged that Alphatec filed a patent application for a product created by Brodke, and began selling the product without paying Brodke the royalties due under the contract... Full Story

Illinois Court Finds Arbitration Affordable for Consumer and Upholds TV Provider’s Arbitration Agreement
Bess v. DirecTV, Inc., No. 5-05-0394, 2008 WL 740344 (Ill. App. Ct. Mar. 18, 2008)
4/18/2008

An Illinois appellate court determined that a television service provider’s arbitration agreement was neither procedurally nor substantively unconscionable. The Court held that because of a provision requiring the service provider to pay arbitration fees in excess of $125, there was no merit to the claim that arbitration would be cost-prohibitive.

In Bess v. DirecTV, Inc., No. 5-05-0394, 2008 WL 740344 (Ill. App. Ct. Mar. 18, 2008), Bess entered into a customer agreement with DirecTV for satellite television service. The agreement provided for arbitration all disputes... Full Story

Modification of Arbitration Awards Not Reviewable in New Jersey Appellate Courts When Modification Is Properly Granted On Statutory Grounds
New Jersey Citizens Underwriting Reciprocal Exchange v. Collins, No. A-3705-06T1, 2008 WL 704399 (N.J. Super. Ct. App. Div. Mar. 18, 2008)
4/18/2008

A New Jersey state appellate court has determined that it lacks the authority to review trial court orders modifying arbitration awards, if the modification is properly granted based on statutory grounds.

In New Jersey Citizens Underwriting Reciprocal Exchange v. Collins, No. A-3705-06T1, 2008 WL 704399 (N.J. Super. Ct. App. Div. Mar. 18, 2008), insurer Exchange denied coverage of certain Personal Injury Protection (PIP) reimbursement claims to Collins for treatment provided to individuals involved in an auto accident. Exchange alleged that the injured insured made misrepresentations in his policy application that warranted refusing all reimbursements... Full Story

ADR Legislation & Regulation

LEGISLATION

AZ S 1233
AUTHOR: Waring [R]
TITLE: Revised Uniform Arbitration Act
DISPOSITION: Withdrawn from House Commerce 4/10/08
LOCATION: House Rules Committee
Commentary: Enacts the Revised Uniform Arbitration Act; relates to applicability of the act, effect and validity of agreements to arbitrate, application for judicial relief, motions to compel or stay arbitration, interim remedies, initiation of arbitration, consolidation of separate arbitration proceedings, appointment of an arbitrator, service as a neutral arbitrator, disclosures, immunity of arbitrators, attorney fees and litigation expenses, witnesses, subpoenas, depositions, discovery, and awards.

CA A 2359
AUTHOR: Jones [D]
TITLE: Loans
DISPOSITION: Pending
Commentary: A bill to prohibit most forms of arbitration in nontradition, subprime, and high cost mortgage agreements. The bill, which previously contained no ADR provisions, was amended March 28, 2008 to include: "The Legislature finds and declares that involuntary contractual waiver provisions with respect to a high cost loan, subprime loan, or nontraditional mortgage, including, but not limited to, an agreement to arbitrate a dispute, that limit or purport to limit a borrower's or applicant's access to any administrative complaint or dispute resolution procedure of the State of California or any other public agency, including, but not limited to, the right to file and pursue a complaint against a licensed person or entity, to file and pursue a civil action, or to limit the authority of the State of California or other public agency to investigate and pursue claims alleging violation of law or regulations, imposed as a condition of a loan, are against the public policy of this state."

CA A 2611
AUTHOR: Lieu [D]
TITLE: Debt Management and Settlement: Credit Counselors
DISPOSITION: Pending
Commentary: Enacts the Debt Settlement Services Act. Provides for regulation of persons who provide debt settlement services. As it relates to arbitration, an agreement may not, "[e]xcept as permitted by the California Arbitration Act (Title 9 (commencing with Section 1280) of Part 3 of the Code of Civil Procedure), contain a provision that modifies or limits otherwise available forums or procedural rights, including the right to trial by jury, that are generally available to the individual under law other than as provided in this division", nor may it "[c]ontain a provision that restricts the individual's remedies under this division or under another law of this state."

CA A 2947
AUTHOR: Eng [D]
TITLE: Elder and Dependent Adult Abuse: Waiver of Rights
DISPOSITION: Pending
Commentary: Amends "existing law which provides that a written agreement to submit to arbitration an existing controversy or a controversy thereafter is valid, enforceable, and irrevocable, except for those grounds that exist for the revocation of any contract." Notable amendments include: "(b) Subdivision (a) shall not apply to any arbitration agreement applicable to a future controversy entered into between a long term care facility, as defined in Section 15610.47 of the Welfare and Institutions Code, and an elder, as defined in Section 15610.47 of the Welfare and Institutions Code, or dependent adult, as defined in Section 15610.47 of the Welfare and Institutions Code, or his or her representative, that is entered into in violation of Section 15657 of the Welfare and Institutions Code." Further, "This bill would prohibit a long term care facility, as defined, that provides care to an elder or dependent adult from requiring, as a condition of admission to, or of continued care at, the facility that an elder or dependent adult, or his or her representative waive any right afforded under the act, including the right to file a complaint with the State Department of Public Health, or a law enforcement agency, or to pursue a civil action."

FL S 1012
COMPARE: FL H 405
AUTHOR: Banking and Insurance Cmt
TITLE: Health Insurance Claims Payments
DISPOSITION: Pending
LOCATION: Senate Appropriations General Government Committee
Commentary: Relates to health insurance claims payments; amendments include: in regard to a "Leasing, renting, or granting access to a preferred provider or exclusive provider...(7) A health care contract may provide for arbitration of disputes arising under this section."

GA H 470
AUTHOR: Parrish [D]
TITLE: Lemon Law
DISPOSITION: To Governor
LOCATION: Eligible for Governor
Commentary: Substitute for Georgia Lemon Law, creates motor vehicle arbitration panel, empowers administrator to contract with "public or private entities" to conduct arbitrations.

GA S 433
AUTHOR: Williams [R]
TITLE: State Health Planning
DISPOSITION: Enacted
LOCATION: Signed by Governor
Commentary: Enacted bill regarding State Health Planning. As it relates to ADR, in regards to destination cancer hospitals: "Hospitals shall not unreasonably deny a transfer agreement with the destination cancer hospital. In the event that a destination cancer hospital and another hospital cannot agree to the terms of a transfer agreement as required by this paragraph, the department shall mediate between such parties for a period of no more than 45 days. If an agreement is still not reached within such 45 day period, the parties shall enter into binding arbitration conducted by the department;"

IA H 2653
AUTHOR: Commerce, Regulation and Labor Cmt
TITLE: Foreclosure Consultants
LOCATION: Eligible for Governor
Commentary: Relates to foreclosure consultants and foreclosure reconveyances. The bill provides that any provision of a foreclosure consultant contract that attempts or purports to require arbitration of a dispute that arises under the bill is void at the option of the homeowner.

LA S 664
AUTHOR: Michot [R]
TITLE: Malpractice
DISPOSITION: Pending
LOCATION: Senate Judiciary A Committee
Commentary: Establishes a medical review panel to hear medical malpractice claims, except those subject to a valid arbitration procedure. Restricted to those filed as provided under the act on or before 12/31/08.

MD H 577
AUTHOR: Simmons [D]
TITLE: Right to Jury Trial Act
DISPOSITION: To Governor
LOCATION: Eligible for Governor
Commentary: Amends the Right to Jury Trial Act. Provides that any provision in an insurance contract with a consumer that requires the waiver of a trial by jury is void and unenforceable unless preempted by federal law. Amendments include the provision of a new definition for consumer, and provides for the nullity of a written arbitration agreement in consumer contracts except where preempted by federal law and except where limited elsewhere in the act.

MD S 412
AUTHOR: Forehand [D]
TITLE: Task Force
DISPOSITION: Failed Adjourned
LOCATION: Concurrence
Commentary: A bill to create a task force to determine, in part, whether a State run arbitration program should be created to resolve disputes under the Automotive Warranty Enforcement Act.

ME H 1559 LD: 2189
AUTHOR: Priest [D]
TITLE: Equity Stripping
DISPOSITION: Enacted
LOCATION: Signed by Governor
Commentary: Enacts measures designed to protect homeowners from equity stripping during foreclosures. As it relates to arbitration, the bill states that "Any provision in a contract entered into on or after the effective date of this chapter that attempts or purports to require arbitration of any dispute arising under this chapter is void at the option of the foreclosed homeowner."

MN H 3800
COMPANION: MN S 3223
AUTHOR: Hornstein [DFL]
TITLE: Motor Vehicles
DISPOSITION: Pending
LOCATION: House Ways and Means Committee
Commentary: Relates to motor vehicles. Amendments include a requirement for household goods motor carriers to have an arbitration program and compliance with arbitration awards: "(c) The commissioner may suspend or cancel the registration of a household goods motor carrier who fails to maintain an arbitration program or comply with a binding arbitration decision under section 221.0255, subdivision 1."

NY A 10504
SPONSOR: Gantt [D]
TITLE: Limitation Motor Vehicle Dealers
DISPOSITION: Pending
LOCATION: Assembly Transportation Committee
Commentary: Limits the conditions which a motor vehicle franchisor may impose upon motor vehicle dealers, including: "2. WHENEVER A FRANCHISE PROVIDES FOR THE USE OF ARBITRATION TO RESOLVE A CONTROVERSY ARISING OUT OF OR RELATING TO SUCH CONTRACT, ARBITRATION MAY BE USED TO SETTLE SUCH CONTROVERSY ONLY IF AFTER SUCH CONTROVERSY ARISES ALL PARTIES TO SUCH CONTROVERSY CONSENT IN WRITING TO USE ARBITRATION TO SETTLE SUCH CONTROVERSY."

OH H 125
SPONSOR: Huffman [R]
TITLE: Health Care Provider Contract ProvisionsDISPOSITION: Enacted
LOCATION: Chaptered
Commentary: Adds ADR provisions for health care provider (third party payer) contract disputes, which are "subject to a mutually agreed upon arbitration mechanism, which is binding on all parties. The arbitrator may award reasonable attorney's fees and costs for arbitration relating to the enforcement of this section to the prevailing party. The limitation to reasonable attorney's fees and costs shall not apply to disputes regarding breach of contract."

PA S 1063 PN: 1875
AUTHOR: Earll [R
TITLE: Local Tax Enabling Act of 1965
DISPOSITION: Pending
LOCATION: Senate Bills on Second Consideration Re Reported from Committee as Amended
Commentary: Would eliminate arbitration as an option to settle local tax disputes.

RI H 7867
AUTHOR: Kennedy [D]
TITLE: Insurance
DISPOSITION: Pending
Commentary: Creates "the Market Conduct Surveillance Act in order to establish a framework for insurance market conduct actions." Requires the establishment and utilization of "a dispute resolution or arbitration mechanism to resolve conflicts with insurers regarding examination costs and fees".

RI H 8150
AUTHOR: Fox [D]
TITLE: Commercial Law General Regulatory Provisions
DISPOSITION: Pending
LOCATION: House Corporations Committee
Commentary: Amends provisions of the Rhode Island fair dealership act, including the REPEAL of "6 50 6. Application to arbitration agreements. This chapter shall not apply to provisions for the binding arbitration of disputes contained in a dealership agreement, if the criteria for determining whether good cause existed for a termination, cancellation, nonrenewal or substantial change of competitive circumstances, and the relief provided is no less than that provided for in this chapter."

RI S 2446
AUTHOR: Walaska [D]
TITLE: Insurance
DISPOSITION: Pending
LOCATION: Senate Corporations Committee
Commentary: Creates the Market Conduct Surveillance Act in order to establish a framework for insurance market conduct actions. Includes a requirement that there be written protocol to: "(iv) Establish and utilize a dispute resolution or arbitration mechanism to resolve conflicts with insurers regarding examination costs and fees".

US S 2136
SPONSOR: Durbin [D]
TITLE: Treatment of Primary Mortgages in Bankruptcy
DISPOSITION: Pending
LOCATION: Senate Judiciary Committee- Report as Amended
Commentary: Would enact the the `Helping Families Save Their Homes in Bankruptcy Act of 2007'. Makes a number of amendments to foreclosure and bankruptcy law. As it relates to arbitration, the bill would amend Section 1334 of title 28, United States Code, to provide: "Notwithstanding any agreement for arbitration that is subject to chapter 1 of title 9, in any core proceeding under section 157(b) of this title involving an individual debtor whose debts are primarily consumer debts, the court may hear and determine the proceeding, and enter appropriate orders and judgments, in lieu of referral to arbitration."

US H 5679
SPONSOR: Waters [D]
TITLE: Loss Mitigation Activities
DISPOSITION: Pending
LOCATION: House Financial Services Committee
Commentary: Amends bill relating to mortgages: Amendments include: `(j) Prohibition on Waiver of Rights A mortgagee for a covered federally related mortgage loan may not ... `(2) require the borrower to agree to arbitration as a condition of receiving loan modification activities. Any waiver or arbitration provision in a written agreement prohibited under this".

US S 2838
SPONSOR: Martinez [R]
TITLE: Arbitration
DISPOSITION: Pending
LOCATION: Senate Judiciary Committee
Commentary: Amends chapter 1 of title 9 of United States Code with respect to arbitration by enacting the "Fairness in Nursing Home Arbitration Act." This legislation would ban pre-dispute arbitration clauses in nursing home contracts.

UT H 79
AUTHOR: Clark D [R]
TITLE: Sunset Reauthorizations and Amendments
DISPOSITION: Enacted
LOCATION: Chaptered
Commentary: Reauthorizes state entities and programs that would otherwise sunset before the 2009 Annual General Session of the Utah Legislature. Section 78 14 17, regarding medical malpractice arbitration agreements, is repealed July 1, 2009. This section lists many requirements that need to be fulfilled to create a valid medical malpractice arbitration agreement.

VA H 408
AUTHOR: Oder [R]
TITLE: Foreclosure Rescue Services
DISPOSITION: Enacted
LOCATION: Chaptered
Commentary: Amends law relating to foreclosure. Amendments include: "[a]ny provision in an agreement with the owner of such residential real property that requires the owner to submit to mandatory arbitration shall be null and void, and notwithstanding any such provisions, the owner of such residential real property shall have the rights and remedies under this chapter."

WA H 2791
COMPANION: WA S 6131
AUTHOR: Lantz [D]
TITLE: Distressed Property Conveyances
DISPOSITION: Enacted
LOCATION: Chaptered
Commentary: Concerns distressed property conveyances. The bill provides: (1) Any provision in a contract that attempts or purports to require arbitration of any dispute arising under this chapter is void at the option of the distressed homeowner.

WA S 6776
COMPANION: WA H 3193
AUTHOR: Kline [D]
TITLE: State Whistleblower Protections
DISPOSITION: Enacted
LOCATION: Chaptered
Commentary: Modifies state whistleblower protections. As it relates to arbitration, "(11) Instead of filing with the commission, a complainant may pursue arbitration conducted by the American arbitration association or another arbitrator mutually agreed by the parties, with the cost of arbitration shared equally by the complainant and the respondent.

REGULATIONS

FL 33105 2008
AGENCY: Department of Financial Services/Division of Consumer Services
TITLE: Mediation Procedures for Disputed Personal Lines Claims
Commentary: Amends rules relating to the mediation procedures for resolution of disputed personal lines insurance claims resulting from 2004 and 2005 Hurricanes and Tropical Storms. Provides definitions of terms and makes revisions to existing rules.

NJ 18296 2008, STATE ID: 40 NJR 1741
AGENCY: Department of Banking and Insurance/Office of Solvency Regulation
TITLE: Annual Audited Financial Reports
Commentary: Proposes rule requiring an annual examination by independent certified public accountants of the financial statements that report the financial position and the results of operations of insurers. A new subsection (c) is proposed to provide that a qualified CPA may enter into an agreement with an insurer to have disputes related to an audit resolved by mediation or arbitration. However, the proposed amendment further provides that in the event that a delinquency proceeding is commenced against the insurer under N.J.S.A. 17:3C-1 et seq. or 17B:32-31 et seq., as applicable, the mediation or arbitration provisions shall operate at the option of the Commissioner, who is the statutory successor. This also reflects the NAIC model and continues the effect of mediation or arbitration clauses, except in cases of delinquency proceeding.