Laura Lynn McNay v. James Michael McNay ( 2023 )

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
LAURA LYNN MCNAY, UNPUBLISHED
March 2, 2023
Plaintiff-Appellee,
v No. 361186
Wayne Circuit Court
JAMES MICHAEL MCNAY, LC No. 20-109687-DM
Defendant-Appellant.
Before: K. F. KELLY, P.J., and MURRAY and SWARTZLE, JJ.
PER CURIAM.
Plaintiff and defendant were married for 24 years before they entered a divorce action that
culminated in a mediation, with an arbitrator, and a consent judgment of divorce. The arbitrator
issued an opinion regarding the judgment of divorce, and defendant moved to modify a section of
that judgment. The trial court denied defendant’s motion. We affirm.
The trial court ordered the parties to submit to binding arbitration, which stated, in relevant
part, “The following issues will be submitted to arbitration in lieu of a Court trial: Content and
language disputes regarding the Judgment of Divorce[;] . . . [and a]ny issues inadvertently left
unsolved by the attorneys and their clients at mediation.” This process produced a proposed
judgment of divorce, which included paragraph 8b that concerned plaintiff’s reimbursement for
the equity in the marital home:
Defendant shall buy out Plaintiff’s 50% interest in the property, for the net
sum of $51,000.00, within 6 months of October 20, 2021. Defendant may refinance
the home, or he may use his share of his Ford 401k in order to buy out Plaintiff’s
interest in the property and pay off the existing mortgage and home equity line of
credit. If Defendant uses his share of the 401k funds to buy out Plaintiff’s 50%
interest in the property, he will need to liquidate enough money to pay Plaintiff the
net sum of $51,000.
Defendant argued that this section misrepresented the obligation that he agreed to during
mediation because he agreed to “rollover” $51,000 of his pretaxed money from his 401k benefits
to satisfy plaintiff’s interest in the marital home as opposed to buying out plaintiff’s interest in a
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“net sum.” In support of his argument, defendant pointed to the mediation notes regarding the
equalization of the parties’ 401k benefits.
The parties each have 401K benefits. In addition there is some custodial stock. All
three of those accounts, the husband’s 401K, the wife’s 401K, and the custodial
account will be equalized between the parties. However, as part of the formula to
be used, the wife will receive a credit in the sum of $51,000.00 which represents
how the husband is going to, quote on quote [sic], pay the wife her half of the equity
in the marital home. That is a paper credit. An additional paper credit will be one
half of the credit card debt that the wife is agreeing to take and pay and hold the
husband harmless on.
The arbitrator issued an opinion that the language of paragraph 8b merely memorialized
that defendant agreed to pay plaintiff $51,000 for her interest in the marital home, and defendant
moved to modify or correct the arbitration award. He argued that it was beyond the arbitrator’s
authority to add the language of “net sum” into the proposed judgment of divorce. The trial court
denied defendant’s motion, stating that this dispute was within the arbitrator’s authority and that
the arbitrator made a decision in the mediation that was voluntarily entered into by both parties.
Defendant now appeals.
A trial court’s decision to enforce, vacate, or modify an arbitration award is reviewed de
novo. Nordlund & Assoc, Inc v Hesperia, 288 Mich App 222, 226; 792 NW2d 59 (2010). Whether
an arbitrator exceeded any authority is also reviewed de novo. Miller v Miller, 474 Mich 27, 30;
707 NW2d 341 (2005).
The scope of an arbitrator’s remedial authority is limited to the contractual agreement of
the parties. Nordlund & Assoc, Inc, 288 Mich App at 228. In this case, the arbitrator was granted
the authority to decide both “[c]ontent and language disputes regarding the Judgment of Divorce[;]
. . . [and a]ny issues inadvertently left unsolved by the attorneys and their clients at mediation.”
Defendant argues that the mediation notes indicate that the payment to plaintiff, for her
interest in the marital home, was going to be a “paper credit” that was considered alongside the
equalization of their 401k benefits. The mediation notes, however, demonstrate that the parties
were considering other financial matters that did not concern the equalization of the parties 401k
benefits in that same paragraph; namely their custodial account and the credit card debt.
Additionally, there is nothing within the mediation notes that demonstrates that defendant was
obligated to pay plaintiff for the interest in the marital home through his 401k benefits, and the
plain language of the judgment of divorce only states that the $51,000 paid to plaintiff would be
accounted for in the formula used to equalize the parties’ 401k benefits. The ambiguity
surrounding how defendant was supposed to pay plaintiff for her interest in the marital home was
squarely within the arbitrator’s authority because the arbitrator had the authority to resolve the
content and language of disputes in the judgment of divorce, as well as other issues that had not
yet been resolved.
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Therefore, the trial court did not err when it denied defendant’s motion to modify the arbitration
award.
Affirmed.
/s/ Kirsten Frank Kelly
/s/ Christopher M. Murray
/s/ Brock A. Swartzle
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