ADR and Mediation

Why Commercial Landlords Should Stop Worrying and Learn to Love Arbitration

By Shorge Sato
March
2011
Article
, Page 144
The Illinois Supreme Court's Carter decision holds that arbitration provisions can trump the statutory right to a jury trial contained in the Forcible Entry and Detainer Act, this author argues.

Fahlstrom v. Jones

Illinois Appellate Court
Civil Court
Arbitration
Citation
Case Number: 
No. 1-10-3318
Decision Date: 
Friday, June 10, 2011
District: 
1st Dist.
Division/County: 
Cook Co., 2d Div.
Holding: 
Reversed and remanded with directions.
Justice: 
HARRIS
Plaintiff filed declaratory judgment action as to dispute over alleged sale of his interest in restuarant group to individual Defendant. Court erred in denying motion to compel arbitration. Operating agreement and membership assignment concern same subject matter, so dispute over validity of membership assignment is within scope of arbitration clause in operating agreement. As Plaintiff is challenging validity of membership assignment, and not the existence of arbitration clause in operating agreement, issue is a question for the arbitrator, not the court. (CUNNINGHAM and KARNEZIS, concurring.)

Nonparty Discovery Under the Federal Arbitration Act

By Mitchell L. Marinello & John Haarlow Jr.
September
2010
Article
, Page 476
The Federal Arbitration Act places sharp limits on a party's ability to obtain information from a nonparty, but it can be done. Here's a guide.

Valent Biosciences Corp. v. KIM-CI, LLC

Illinois Appellate Court
Civil Court
Arbitration
Citation
Case Number: 
No. 1-10-2073
Decision Date: 
Wednesday, June 1, 2011
District: 
1st Dist.
Division/County: 
Cook Co., 3d Div.
Holding: 
Affirmed.
Justice: 
STEELE
Plaintiff, a company with its principal place of business in Illinois, sued Defendant, a California LLC with registered offices in California, to vacate arbitration award and for declaratory judgment as to jurisdiction to enforce or vacate arbitration award. Parties had twice submitted disputes to arbitration, per clause in license agreement, and arbitrations took place in California. Plain language of Illinois Uniform Arbitration Act vests circuit court with subject matter jurisdiction, but parties agreed to conduct arbitration in California with no other specific location indicated in license agreement. Thus, Illinois courts are not the proper tribunal to adjudicate dispute about award, absent parties' express agreement to arbitrate in Illinois. (NEVILLE and MURPHY, concurring.)

LRN Holding, Inc. v. Windlake Capital Advisors, LLC

Illinois Appellate Court
Civil Court
Arbitration
Citation
Case Number: 
No. 3-10-0194
Decision Date: 
Monday, May 9, 2011
District: 
3d Dist.
Division/County: 
Peoria Co.
Holding: 
Affirmed.
Justice: 
SCHMIDT
Plaintiffs filed declaratory judgment action seeking declaration that contract entered into by parties, to secure purchaser of assets or stock of corporation, is void on grounds that Defendant failed to properly register its services with State of Illinois. Court granted motion to compel arbitration based on contract provision for binding arbitration. The presence of a generic state choice-of-law clause in a contract which incorporates the AAA rules of arbitration does not indicate that the parties explicity intended that disputes encompassed by the arbitration agreement be settled pursuant to Arbitration Act. Whether the contract is void ab initio is a controversy between the parties relating to the agreement, which issue must be arbitrated. (WRIGHT, specially concurring; HOLDRIDGE, dissenting.)

Trimble v. Graves

Illinois Appellate Court
Civil Court
Arbitration
Citation
Case Number: 
No. 5-10-0075
Decision Date: 
Thursday, April 14, 2011
District: 
5th Dist.
Division/County: 
Richland Co.
Holding: 
Reversed and remanded with directions.
Justice: 
GOLDENHERSH
Parties entered into agreement to lease registered Jersey cows, and eight years later signed "Arbitration Agreement" for arbitrators to decide dispute over delivery of cows. Arbitrators improperly inquired what Defendants thought would be a fair result, and improperly made a motion to delegate to Defendants the duty to determine amount of award, which was outside the powers of arbitrators listed in Agreement. Arbitrators exceeded their powers by failing to adhere to terms of Agreement, and violated the settled principle of arbitration to decide the merits of the matter before them. (WELCH and WEXSTTEN, concurring.)

Roughneck Concrete Drilling & Sawing Co. v. Plumbers' Pension Fund, Local 130, UA

Federal 7th Circuit Court
Civil Court
Arbitration
Citation
Case Number: 
Nos. 09-3670 & 09-3685 Cons.
Decision Date: 
April 7, 2011
Federal District: 
N.D. Ill., E. Div.
Holding: 
Reversed and remanded
In action by plaintiff-employer seeking reversal of arbitration board's order finding that plaintiff owed defendants-pension funds $3.3 million in delinquent contributions arising out of plaintiff's use of improper workers on work project that should have gone to workers associated with instant pension funds, Dist. Ct. erred in finding that plaintiff had waived any objection to arbitration board's jurisdiction to rule on delinquency question, and that plaintiff was bound by said board's order. While plaintiff had submitted arbitration request to instant arbitration board to resolve delinquency question, plaintiff had not waived objection to board's jurisdiction to resolve said question since plaintiff had essentially withdrawn said arbitration request when it also submitted same delinquency question to different arbitrator, who had earlier enjoined arbitration board from resolving delinquency dispute. Moreover, Ct. found that where, as here, record showed existence of inconsistent arbitration awards, appropriate remedy required that plaintiff and defendants submit matter to single arbitrator for new arbitration to resolve which category of worker should have done work at work site.

Sabo v. Dennis

Illinois Appellate Court
Civil Court
Arbitration
Citation
Case Number: 
No. 5-09-0568
Decision Date: 
Tuesday, March 8, 2011
District: 
5th Dist.
Division/County: 
Madison Co.
Holding: 
Affirmed.
Justice: 
STEWART
Court properly granted motion to compel arbitration and staying the underlying trial court proceedings in contract and employment dispute. Court properly concluded that all but two third-party defendants were covered by the contract term "affiliates". Court properly stayed proceedings, thus furthering goal of judicial economy and strong policy favoring arbitration, and otherwise parties would duplicate their efforts in litigating and arbitrating similar legal issues. (CHAPMAN and WEXSTTEN, concurring.)

Trustmark Insurance Co. v. John Hancock Life Ins. Co.

Federal 7th Circuit Court
Civil Court
Arbitration
Citation
Case Number: 
No. 09-3682
Decision Date: 
January 31, 2011
Federal District: 
N.D. Ill., E. Div.
Holding: 
Reversed
Dist. Ct. erred in issuing injunction that prevented parties from participating in second arbitration of re-insurance coverage dispute, even though one member of second arbitration panel had been member of first arbitration panel that also considered instant coverage question, and even though second arbitration panel was set to construe confidentiality agreement obtained during first arbitration proceeding. While Dist. Ct. believed that member of prior arbitration panel could not properly be member of second arbitration panel because he was not disinterested, said member did not have prohibited interest in second arbitration proceeding merely because he had information regarding first arbitration proceeding. Moreover, said member did not otherwise have either financial or personal stake in outcome of second arbitration proceeding. Also, second arbitration panel had authority to construe confidentiality agreement obtained at first arbitration proceeding even though confidentiality agreement did not have separate arbitration clause since substance of confidentiality agreement was closely related to substance of first arbitration proceeding.

Lumbermens Mutual Casualty Co. v. Broadspire Management Services, Inc.

Federal 7th Circuit Court
Civil Court
Arbitration
Citation
Case Number: 
No. 09-4051
Decision Date: 
October 13, 2010
Federal District: 
N.D. Ill., E. Div.
Holding: 
Affirmed
In action seeking resolution of purchase price on sale of insurance administration business, Dist. Ct. did not err in finding that arbitrator, as opposed to Dist. Ct., was proper person to determine whether plaintiff had provided sufficiently detailed disagreement notices so as to satisfy precondition requiring that parties arbitrate instant price dispute. Adequacy of disagreement notices was procedural question about condition precedent to arbitration, which was issue for arbitrator to resolve.