Baker v. Detroit Automobile Inter-Insurance Exchange
Baker v. Detroit Automobile Inter-Insurance Exchange
Opinion of the Court
Defendant appeals as of right the trial court’s denial of its motion to vacate an arbitration award on the ground that the arbitrators exceeded their power by making a clear error of law. GCR 1963, 769.9(l)(c). We affirm.
Plaintiff, with his sister’s permission, had driven her car to Cookville, Tennessee. He was struck by a truck while filling the car with gasoline at a self-serve station. The truck was not insured. Plaintiff’s sister’s car was insured with defendant. Plaintiff also owned two cars at the time, both of which were insured under separate policies with
Plaintiff filed a demand for arbitration as provided in the policies. The arbitrators allowed plaintiff to "stack” coverage under the three policies and awarded plaintiff $27,500. Defendant sought to vacate the award contending that the arbitrators exceeded their power in allowing plaintiff to stack the coverage. The trial court initially refused to vacate the award under the impression that defendant had failed to raise the issue of stacking before the arbitrators. Subsequent to the court’s ruling, the Supreme Court held that uninsured motorist coverage cannot be stacked if the policy of insurance contains an unambiguous clause precluding the same. Bradley v Mid-Century Ins Co, 409 Mich 1; 294 NW2d 141 (1980). Thereafter, defendant moved for a rehearing. The trial court then determined that the arbitrators had not exceeded their power, had not made a clear error of law and that Bradley should not be given retroactive effect to the case at bar.
This Court is split on the issue of what standard should be applied in determining whether legal errors committed by arbitrators are reviewable pursuant to GCR 1963, 769.9(l)(c). Some decisions state that where the arbitrators have made a "clear error of law”, the award is outside their scope of power. Other decisions indicate that errors of law are not reviewable unless the arbitrators acted with "manifest disregard of the law”. See Farr v Michigan Mutual Liability Co, 100 Mich App 190, 192-193; 298 NW2d 708 (1980), and the cases cited therein. We need not decide which is the more appropriate standard to apply because under either standard we conclude that the arbitrators did not exceed their power. In this case,
Defendant urges this Court, however, to apply Bradley retrospectively and determine that the arbitrators exceeded their authority. The case at bar comes before this Court to review a judgment confirming an arbitration award. Under those circumstances, our review is extremely limited in scope. Detroit Automobile Inter-Ins Exchange v McMillan, supra, 690-691, and authorities cited therein. In the case at bar, we may only determine whether the arbitrators exceeded their power. The Supreme Court’s decision in Bradley notwithstanding, at the time the arbitrators issued their award, the law was unsettled. Under these circumstances, it cannot be said that the arbitrators exceeded their power. Detroti Automobile Inter-Ins Exchange v McMillan, supra, 693.
Affirmed.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.