Michigan Passes the Uniform Arbitration Act
After many years of efforts by ADR Practitioners in the State, and extensive championing of the measure by the State Bar ADR Section Council, on December 14, 2012 Governor Snyder signed into law the Revised Uniform Arbitration Act. It takes effect on July 1, 2013.
The RUAA modernizes the 1961 Michigan Arbitration Act which had not been amended since its adoption. The previous statute was "bare bones". The new law is designed to preserve the efficiencies of arbitration, incorporate pertinent law and facilitate the use of arbitration by offering some predictability. It is important to note that the RUAA does not make arbitration mandatory. Rather, it only provides a contemporary framework where arbitration is utilized. Some of the key protections include:
- notice requirements for initiating arbitration;
- strengthening the disclosure process by requiring arbitrators to disclose known financial interests or personal relationships which could affect their impartiality;
- authorizing the arbitrator to limit or permit discovery and issue subpoenas;
- clarifying the role of courts and arbitrators in determining arbitrability;
- providing immunity from civil liability similar to that enjoyed by judges; and
- clarifying whether or not punitive damages are awardable and if so, when and how.
This statute is a major improvement offering arbitration participants enhanced predictability, lower costs, shorter proceedings, and, over time, increased uniformity with arbitration law in other states. The impact on arbitration in Michigan should be very positive.