The scope of review of an arbitration award is extremely narrow, but there are options. The family court must vacate an arbitration award when:
- the award was procured by corruption, fraud, or other undue means;
- there was evident partiality by an arbitrator appointed as a neutral, corruption of an arbitrator, or misconduct prejudicing a party’s rights;
- the arbitrator exceeded his or her powers; or
- the arbitrator refused to postpone the hearing on a showing of sufficient cause, refused to hear evidence material to the controversy, or otherwise conducted the hearing to substantially prejudice a party’s rights.
Domestic Relations Arbitration Act Section 5081, MCL 600.5801(2).
The basis that “the arbitrator exceeded his or her powers” means the arbitrator “acted beyond the material terms of the [arbitration] contract . . . or in contravention of controlling principles of law.” Dohanyos v Detrex Corp (After Remand), 217 Mich App 171, 176; 550 NW2d 608 (1996). Pursuant to MCL 600.5081(2)(c), then, a party seeking to prove that a domestic relations arbitrator exceeded his or her authority must show that the arbitrator either (1) acted beyond the material terms of the arbitration agreement and/or (2) acted contrary to controlling law.
Whether an arbitrator exceeded his authority is reviewed de novo. Miller v Miller, 474 Mich 27, 30; 707 NW2d 341 (2005). A reviewing court, here the family court, may not review the arbitrator’s findings of fact, DAIIE v Gavin, 416 Mich 407, 429; 331 NW2d 418 (1982). Any errors of law must be discernible on the face of the award itself. Id. This means the error is evident in the award, and the family court does not have to “scrutinize the mental indicia” of the arbitrator. Id. To vacate that part of the award the motioning party objects to, the error of law must be “so substantial that, but for the error, the award would have been substantially different.” Collins v Blue Cross Blue Shield of Michigan, 228 Mich App 560, 567; 579 NW2d 435 (1998). In other words, the error must not be harmless. This assumes, of course, you agreed to apply Michigan law.
Parties submitting to arbitration cannot agree to have their dispute “resolved in disregard of controlling principles of constitutional, statutory or judge-made law and expect the court to approve and enforce the result.” DAIIE v Gavin, 416 Mich 407, 429; 331 NW2d 418 (1982).
That is, when the arbitrator misapplies Michigan property division law, the error is not harmless.
Whether this division of property is in contravention of Michigan divorce law requires us to review the controlling principles governing property distribution upon divorce. The goal behind dividing marital property is to reach an equitable distribution in light of all the circumstances. Berger v Berger, 277 Mich App 700, 716-717; 747 NW2d 336 (2008). However, an equitable distribution need not be an equal distribution, as long as there is an adequate explanation for the chosen distribution. Id. at 717, citing McNamara v Horner, 249 Mich App 177, 188; 642 NW2d 385 (2002), and Gates v Gates, 256 Mich App 420, 423; 664 NW2d 231 (2003). See also Ackermanv Ackerman, 163 Mich App 796, 807; 414 NW2d 919 (1987) (A property award “need not be equal, it need only be equitable.”).