Opinion
Docket No. 131445.
Decided July 14, 1992. Approved of publication September 17, 1992, at 9:00 A.M.
Shifman Carlson (by Burton P. Shifman and Lisa Taylor), for the plaintiff.
Ralls Urban Rosier, P.C. (by William Reid Ralls, James J. Urban, and Bruce H. Edwards), for the defendant.
AFTER REMAND
The City of Huntington Woods appeals as of right an order of the Oakland Circuit Court dismissing its complaint against Ajax Paving Industries, Inc. We affirm.
In an earlier appeal, this Court succinctly set forth the following facts:
On May 25, 1984, Ajax agreed to do certain work in accordance with the plans and specifications of the City's Asphalt Paving Program. The written agreement provided a two-stage procedure in the event of disputes. Under §§ 9.11 and 9.12 all requests for contract changes had to be submitted within thirty days after occurrence of the event giving rise to the request. The engineer was the initial interpreter and judge. His decision was a condition precedent to the exercise of any other contractual rights or remedies.
Sections 16.1 and 16.2 provided the opportunity for arbitration. A demand for arbitration had to be made within thirty days of the engineer's written decision. If it was not made, the decision became final and binding.
The Court also held that Ajax waived its limitations defense claim when it failed to plead or raise the defense in the trial court. [ City of Huntington Woods v Ajax Paving Industries, Inc, 177 Mich. App. 351, 352-354; 441 N.W.2d 99 (1989).]
Subsequently, this Court granted a rehearing to determine whether Ajax waived the limitations defense under MCR 3.602(I) in the trial court. City of Huntington Woods v Ajax Paving Industries, Inc (On Rehearing), 179 Mich. App. 600, 601-602; 446 N.W.2d 331 (1989). The Court clarified its decision and held that Ajax was entitled to wait until its responsive pleading to raise a statute of limitations defense and that its motion for summary disposition was not such a pleading. Id.
On March 20, 1990, the Michigan Supreme Court denied Ajax's application for leave to appeal. 434 Mich. 892.
Upon remand, Ajax filed its answer and affirmative defenses and a motion for summary disposition on the ground that the city's complaint, which sought confirmation of the engineer's arbitration award, had not been filed within the one-year period allowed by MCR 3.602(I). On July 11, 1990, the trial court granted Ajax's motion for summary disposition. The city now appeals.
The city contends that the trial court abused its discretion under MCR 3.602(I) when it dismissed the complaint for confirmation of the arbitration award because the court failed to exercise its discretion. This issue is without merit. A review of the record indicates that the trial court exercised its discretion in granting Ajax's motion for summary disposition.
In the alternative, the city contends that the trial court abused its discretion when it granted Ajax's motion for summary disposition where the city's delay was excusable neglect and where Ajax was not prejudiced by the delay. We disagree. The city's complaint was not filed within the one-year limitation period pursuant to MCR 3.602(I), giving the trial court authority to bar the city's claim. Furthermore, the city has failed to prove that the trial court abused its discretion when it upheld the one-year limitation period. Marrs v Bd of Medicine, 422 Mich. 688, 694; 375 N.W.2d 321 (1985); Henritzy v General Electric Co, 182 Mich. App. 1, 7; 451 N.W.2d 558 (1990).
Finally, the city contends that the trial court erred in dismissing the misrepresentation claims on the ground that the claims were not arbitrable. We disagree.
The existence of an arbitration contract and the enforceability of its terms are judicial questions that cannot be decided by the arbitrator. Arrow Overall Supply Co v Peloquin Enterprises, 414 Mich. 95, 99; 323 N.W.2d 1 (1982). To ascertain the arbitrability of an issue, the court must consider whether there is an arbitration provision in the parties' contract, whether the disputed issue is arguably within the arbitration clause, and whether the dispute is expressly exempt from arbitration by the terms of the contract. Federal Kemper Ins Co v American Bankers Ins Co, 137 Mich. App. 134, 139-140; 357 N.W.2d 834 (1984). Any doubts about the arbitrability of an issue should be resolved in favor of arbitration. Omega Construction Co, Inc v Altman, 147 Mich. App. 649, 655; 382 N.W.2d 839 (1985).
In this case, the city's misrepresentation claims were arbitrable under the specific dictates of the parties' arbitration agreement, which provided that all claims and disputes relating to the contract or its breach "will be decided by arbitration." Furthermore, the claims of misrepresentation directly relate to the contract price, and all disputes involving price were to be referred initially to the engineer for resolution. Finally, the arbitration agreement specifically stated that written notice of all claims and disputes must be delivered to the engineer within thirty days of its occurrence. Thus, when the city failed to bring its misrepresentation claims within thirty days, it waived its right to arbitration. The purpose of an arbitration agreement is to avoid protracted litigation. NuVision v Dunscombe, 163 Mich. App. 674, 684; 415 N.W.2d 234 (1987). Thus, to now circumvent the express terms of the parties' arbitration agreement would entirely defeat the agreement's purpose.
Affirmed.