Justia Maryland Supreme Court Opinion Summaries

Articles Posted in Arbitration & Mediation
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A collection of Dutch and Luxembourgish energy companies invested in solar power projects in Spain, relying on promised economic subsidies. Following the 2008 financial crisis, Spain withdrew these subsidies, prompting the companies to challenge Spain's actions through arbitration under the Energy Charter Treaty (ECT). The companies prevailed in arbitration, securing multi-million-euro awards. However, the European Union (EU) argued that the ECT's arbitration provision does not apply to disputes between EU Member States, rendering the awards invalid under EU law.The United States District Court for the District of Columbia reviewed the cases. In NextEra Energy Global Holdings B.V. v. Kingdom of Spain and 9REN Holding S.A.R.L. v. Kingdom of Spain, the court held it had jurisdiction under the Foreign Sovereign Immunities Act (FSIA) arbitration exception and denied Spain's motion to dismiss. The court also granted anti-anti-suit injunctions to prevent Spain from seeking anti-suit relief in foreign courts. Conversely, in Blasket Renewable Investments LLC v. Kingdom of Spain, the district court deemed Spain immune under the FSIA and denied the companies' requested injunction.The United States Court of Appeals for the District of Columbia Circuit reviewed the cases. The court held that the district courts have jurisdiction under the FSIA’s arbitration exception to confirm the arbitration awards against Spain. However, it found that the district court in NextEra and 9REN abused its discretion by enjoining Spain from pursuing anti-suit relief in Dutch and Luxembourgish courts. The court emphasized that anti-suit injunctions against a foreign sovereign raise significant comity concerns and that the domestic interests identified were insufficient to justify such extraordinary relief. Consequently, the court affirmed in part and reversed in part in NextEra, reversed in 9REN and Blasket, and remanded for further proceedings. View "Turenne v. State" on Justia Law

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In this appeal centering on the existence of a valid arbitration agreement the Court of Appeals affirmed the decision of the court of appeals reversing the judgment of the circuit court, holding that the circuit court erred in compelling arbitration of the question of whether the arbitration clause in the agreements at issue was valid.The arbitration clause in this case stemmed from transactions between lead paint tort plaintiffs who received structured settlements and affiliated factoring companies that specialize in purchasing structured settlement rights. Defendants filed motions to compel arbitration and stay the case, but Plaintiffs challenged the existence of a valid agreement to arbitrate. The trial court granted the motion to compel arbitration, finding that the arbitrator was to determine the issue of arbitrability. The Court of Special Appeals reversed. The Court of Appeals affirmed, holding that the circuit court erroneously compelled arbitration and that the issue of whether a valid arbitration agreement exists is an issue for the court to determine. View "Access Funding, LLC v. Linton" on Justia Law

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The Court of Appeals affirmed the judgment of the court of special appeals affirming the decision of the circuit court ordering the parties to arbitrate their dispute, holding that the lower courts did not err.The arbitration agreement at issue in this case did not specify an arbitration service. When Respondent refused to cooperate to start the arbitration proceedings, Petitioner petitioned to compel arbitration. The circuit court ordered the parties to arbitrate their dispute, thus denying Respondent's argument that the petition was barred by the statute of limitations. The court of special appeals affirmed. The Court of Appeals affirmed, holding (1) when the contract is silent on the issue, a petition to compel arbitration under Md. Code Cts. & Jud. Proc. (CJ) 3-207 is not subject to a defense under CJ 5-101; (2) the court of special appeals did not err in applying Gannett Fleming in affirming the circuit court; and (3) a petition to compel arbitration under CJ 3-207 is not subject to the limitations period set forth in CJ 5-101. View "Park Plus v. Palisades of Towson, LLC" on Justia Law

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At issue was whether a court may vacate an arbitrator’s decision for manifest disregard of applicable law even though such a ground is not listed in Md. Code Cts. & Jud. Proc. 3-224(b).Petitioners sought to vacate the arbitration award in this case, arguing that the arbitrator manifestly disregarded well-established Maryland law. The circuit court dismissed the petition but denied Respondents’ request for attorney’s fees. The court of special appeals affirmed. The Court of Appeals affirmed, holding that the arbitrator’s award did not demonstrate manifest disregard of applicable law and that the circuit court did not abuse its discretion in refusing to award attorney’s fees.Specifically, the Court held (1) the General Assembly did not preempt the common-law ground of manifest disregard of the law when it enacted the Maryland Uniform Arbitration Act; (2) because the arbitrator did not make a palpable mistake of law or fact appearing on the face of the award, the lower courts correctly concluded that the arbitrator’s award did not demonstrate a manifest disregard; and (3) the circuit court did not err in declining to award attorney’s fees to Respondent. View "WSC/2005 LLC v. Trio Ventures Associates" on Justia Law

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A surety who issued a performance bond on a subcontract was not bound by that contract’s arbitration clause when the surety was jointly and severally liable for the “performance of” the subcontract and the entire subcontract was incorporated into the bond by reference.Petitioner entered into a contract with an electrical subcontractor pursuant to a master subcontract agreement that included a mandatory arbitration clause. Petitioner later entered into a subcontract with the electrical subcontractor to perform work on a project. The subcontract incorporated the entire master subcontract agreement by reference. The subcontractor obtained a performance bond from Respondent stating that Respondent was jointly and severally liable for the performance of the construction contract, which was incorporated into the bond by reference. Petitioner terminated the subcontract after a dispute with the electrical subcontractor and filed a demand for arbitration that included Respondent. Respondent requested a declaratory judgment that it was not bound by the arbitration clause. The circuit court granted partial summary judgment in favor of Respondent. The court of special appeals affirmed, ruling that Respondent could not be compelled to participate in the pending arbitration proceedings between Petitioner and the electrical subcontractor. The Court of Appeals affirmed for the reasons stated above. View "Schneider Electric Buildings Critical Systems, Inc. v. Western Surety Co." on Justia Law

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The circuit court’s order denying Appellant’s petition to compel arbitration was not a final, appealable judgment under Md. Code Ann. Cts. & Jud. Proc. 12-301.Appellees were individuals who each purchased vehicles from the automobile dealership operated by Appellant. Appellees filed a class action lawsuit against Appellant, challenging Appellant’s practice of providing customers with an alleged free lifetime limited warranty for their vehicles conditioned on the consumer’s continued use of and payment for other services provided by Appellant. Appellant filed an independent action seeking to compel arbitration in the class action case. The circuit court concluded that Appellees’ claims were not subject to binding arbitration. Appellant appealed. Appellees filed a motion to dismiss on the basis that the order denying arbitration was not an appealable final judgment. The court of special appeals denied the motion. The Court of Appeals vacated the judgment of the court of special appeals and remanded to that court with instructions to dismiss the appeal, holding that the circuit court’s order denying Appellant’s petition to compel arbitration was not a final, appealable judgment, depriving the court of special appeals of jurisdiction to hear an appeal of that order. View "Deer Automotive Group, LLC v. Brown" on Justia Law

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Lender’s assignee (Assignee), while operating as an unlicensed debt collector, obtained a judgment against a credit card debtor (Debtor) in district court. Debtor’s contract with Lender included an arbitration provision. Debtor then filed a class action suit collaterally attacking the judgment based on violations of Maryland consumer protection laws. Assignee filed a motion to arbitrate the class action suit pursuant to an arbitration clause between Lender and Debtor. Assignee moved to compel arbitration. The circuit court granted the motion to compel, thus rejecting Debtor’s argument that Assignee waived its right to arbitrate when it brought its collection action against Debtor. The Court of Special Appeals affirmed. The Court of Appeals reversed, holding that because Assignee’s collection action was related to Debtor’s claims, Assignee waived its contractual right to arbitrate Debtor’s claims when it chose to litigate the collection action. View "Cain v. Midland Funding, LLC" on Justia Law

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Prince George’s County terminated the employment of Marlon Ford, a member of the County Police Civilian Employees Association, after a criminal investigation during which Ford was questioned regarding alleged crimes. The Association filed a grievance on Ford’s behalf. An arbitrator vacated the termination of Ford’s employment, determining that the County had violated a collective bargaining agreement (CBA) between the County and the Association because officers of the county police department failed to advise Ford of his right to have a representative from the Association present during the criminal investigative interview. The Court of Special Appeals vacated the arbitration award. The Court of Appeals affirmed in part and reversed in part, holding (1) under the County’s code, the County lacked the authority to enter into a CBA that requires a Weingarten advisement before a criminal investigative interview of one of the County’s police civilian employees; and (2) therefore, the arbitrator the arbitrator exceeded his authority by basing the arbitration award on the determination that the County violated the CBA because its police officers failed to make a Weingarten advisement. View "Police Civ. Empl. Ass'n. v. Prince George's Co." on Justia Law

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Respondents filed a complaint for accounting against Petitioner, their employer, after a dispute over the terms of their employment agreement. In response, Petitioner filed a petition to compel arbitration, asserting that, because Respondents’ claims arose out of their employment agreements, the circuit court was required to compel arbitration under an arbitration clause contained in the employment agreement. The circuit court denied Petitioner’s petition. The intermediate appellate court dismissed Petitioner's appeal, concluding that the denial of Petitioner’s motion to compel arbitration did not constitute a final judgment. The Supreme Court affirmed, holding that an order denying a request to compel arbitration filed in an existing action is not a final judgment because the denial of the petition does not put the parties out of court or otherwise terminate the proceedings and does not deny the party requesting arbitration the means of further prosecuting or defending rights and interests in the subject matter of the proceeding. View "Am. Bank Holdings, Inc. v. Kavanaugh" on Justia Law

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A collective-bargaining agreement between Baltimore County and Baltimore County Fraternal Order of Police, Lodge 4 (FOP) contained an arbitration clause and a retiree health-insurance provision. FOP believed the provision locked in place the health-insurance subsidy as it existed at the time of an officer's retirement. After the agreement expired and the County decreased the health-insurance subsidy, FOP initiated arbitration. The County protested, arguing (1) it had no duty to arbitrate because the collective-bargaining agreement had expired, and (2) the health-insurance subsidy was not locked in place but was subject to change from year to year. FOP was successful in arbitration and on appeal before the circuit court, but the court of special appeals vacated the arbitration award. The Court of Appeals reversed, holding (1) an arbitration clause may survive the expiration of a collective bargaining agreement when it concerns rights that vested during the life of the agreement; and (2) when deciding the issue of arbitrability requires interpretation of the underlying agreement and consideration of the merits of the dispute, the issue of arbitrability should initially be determined by the arbitrator. View "Baltimore County Fraternal Order of Police Lodge v. Baltimore County" on Justia Law