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Docket Number

Docket No. 98185.

Attorney(S)

O'Farrell, Smith Popielarz (by Rod O'Farrell), for plaintiff. Otto Otto (by James C. Howell), for defendant James E. Alexander. Charles F. Filipiak, for third-party defendant Mary Helen Barrera. Douglas I. Buck, II, for third-party defendant Ralph Barrera.

Judges

PER CURIAM.

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Smart Summary

Case Summary: CASTILLO v ALEXANDER, Docket No. 98185 (Mich. Ct. App. Apr. 29, 1988)

Factual and Procedural Background

Plaintiff filed a complaint alleging serious impairment of a body function arising from a multicar collision on September 24, 1983. The case was mediated pursuant to MCR 2.403. On June 5, 1986, the mediation panel awarded plaintiff $2,000. All parties accepted the mediation award, with plaintiff's acceptance occurring on June 11, 1986. Several days after accepting the award, plaintiff informed her attorney that she changed her mind and wished to reject the award. On June 20, 1986, plaintiff's counsel hand-delivered to the court administrator a letter indicating plaintiff's desire to revoke her acceptance, but plaintiff did not notify the defendants of that desire. On the same date, plaintiff's attorney received from the mediation clerk a notice (dated June 18, 1986) informing plaintiff's attorney that all parties accepted the award. Defense counsel then prepared a stipulation and order for dismissal and forwarded releases and settlement drafts to plaintiff's counsel for execution pursuant to the mediation acceptance.

Because the necessary documents for closing the court file had not been received, the court administrator sent a letter to all parties on November 17, 1986. The defendants' first indication that plaintiff wished to set aside the mediation was November 24, 1986, when plaintiff filed a motion to set the matter for trial. On that same date defendants filed a motion for entry of judgment and satisfaction of judgment. The trial court held that plaintiff's initial acceptance of the mediation award was binding and granted the defendants' motion for entry of judgment pursuant to the mediation award. Plaintiff appealed as of right from the January 16, 1987 order; this opinion affirms that order.

Legal Issues Presented

Whether a party, after accepting the award of mediation, has a right to rescind its acceptance by filing a rejection if done within twenty-eight days after service of the mediation panel's evaluation.

Arguments of the Parties

Plaintiff's Arguments

Plaintiff contended the mediation award should be set aside because the mediation clerk announced the parties' elections prior to the expiration of the twenty-eight-day period provided for response by MCR 2.403(L)(2).
Plaintiff assumed that under MCR 2.403(L) parties are entitled to change their minds within the twenty-eight-day period, even after submitting an acceptance or rejection notice to the mediation clerk.

Defendant's Arguments

Defendant asserted that the twenty-eight-day response period is designed to provide parties sufficient time to consider the award and notify the mediation clerk of their acceptance or rejection, not to permit parties to rescind an earlier election made to the clerk.
Defendant argued that once a party notifies the mediation clerk of its acceptance or rejection, the party is not entitled to alter that decision and that finality should be applied.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Coolman v D B Snider, Inc, 129 Mich. App. 233; 341 N.W.2d 484 (1983)	That a trial court has discretion to set aside a party's acceptance of a mediation award upon proper motion prior to entry of judgment on the award.	The court cited Coolman to show that setting aside an acceptance is within trial-court discretion but distinguished that rescission is not a matter of right; the trial court's refusal to set aside was appropriate here.
MGM Brakes Division of Indian Head, Inc v Uni-Bond, Inc, 417 Mich. 905; 330 N.W.2d 853 (1983)	Related authority (dealing with the former Wayne County Court Rule 403).	Cited as related authority on the court's discretionary powers regarding mediation/settlement acceptance under prior procedural rules.
Small v Zeff, 155 Mich. App. 288, 291-292; 399 N.W.2d 63 (1986)	Principles of finality applicable to parties' acceptance of mediation awards.	The court relied on Small to support the conclusion that plaintiff's original acceptance was final and binding.

Court's Reasoning and Analysis

The court began by identifying the applicable provisions of MCR 2.403(L): (1) each party must file a written acceptance or rejection with the mediation clerk within 28 days after service of the panel's evaluation, and failure to file within 28 days constitutes acceptance; and (2) there may be no disclosure of a party's election until the expiration of the 28-day period, at which time the mediation clerk shall send notice indicating each party's acceptance or rejection.

The court acknowledged that the mediation clerk violated MCR 2.403(L)(2) by notifying the parties of their unanimous acceptance before the twenty-eight-day period expired. However, the court characterized that error as harmless because the premature notification did not affect the parties' decisions to accept or reject the award.

The court rejected plaintiff's position that MCR 2.403(L) entitles a party to change its election within the 28-day period after having submitted an acceptance or rejection to the mediation clerk. The court interpreted the 28-day rule as providing time to consider and to notify the clerk, not as creating a right to rescind after notice to the clerk. The court emphasized finality: once a party has notified the mediation clerk of its election, the party is not entitled to alter that decision. The court cited Coolman for the principle that a trial court may, in its discretion, set aside an acceptance prior to entry of judgment, and Small v Zeff for principles of finality, and concluded that here rescission was not a matter of right and the trial court did not err in entering judgment pursuant to the mediation award.

Holding and Implications

Holding: The trial court's order granting defendant's motion for entry of judgment pursuant to the mediation award is affirmed. The court held that rescission of a mediation acceptance, after a party has notified the mediation clerk of acceptance, is not a matter of right.

Implications: The direct effect is that plaintiff remains bound by her original acceptance and the trial court properly entered judgment pursuant to the mediation under MCR 2.403(L). The opinion applies principles of finality to bar unilateral rescission after notifying the mediation clerk; the opinion does not elaborate on any broader rulemaking or additional prospective changes beyond the disposition of this appeal.

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CASTILLO v ALEXANDER

PER CURIAM.

Plaintiff appeals as of right from a January 16, 1987, order granting defendant's motion for entry of judgment pursuant to a mediation award. We affirm.

Plaintiff filed a complaint alleging serious impairment of a body function arising from a multicar collision on September 24, 1983. The case was mediated pursuant to MCR 2.403 and on June 5, 1986, the mediation panel awarded plaintiff the sum of $2,000. All parties accepted the mediation award, with plaintiff's acceptance occurring on June 11, 1986. Several days after accepting the award, plaintiff notified her attorney that she changed her mind and wished to reject the award. On June 20, 1986, plaintiff's counsel hand delivered to the court administrator a letter indicating plaintiff's desire to revoke her acceptance. Plaintiff did not notify the defendants of her desire to revoke acceptance. On that same date, plaintiff's attorney received from the mediation clerk a notice dated June 18, 1986, which informed plaintiff's attorney that all parties accepted the award. Defense counsel prepared a stipulation and order for dismissal, and releases and settlement drafts were forwarded to plaintiff's counsel for execution pursuant to the mediation acceptance.

On November 17, 1986, the court administrator sent a letter to all parties involved because the necessary documents for closing the court file had not yet been received. Defense counsel's first indication that plaintiff wished to set aside the mediation occurred on November 24, 1986, when plaintiff filed a motion to set the matter for trial. On that same date, defendants filed a motion for entry of judgment and satisfaction of judgment. The trial court held that plaintiff's initial acceptance of the mediation award was binding and this appeal followed.

The sole and narrow issue on this appeal is whether a party, after accepting the award of mediation, has a right to rescind its acceptance by filing a rejection if done within twenty-eight days after service of the mediation panel's evaluation. We hold that rescission of the acceptance in such a case is not a matter of right.

The Court in Coolman v D B Snider, Inc, 129 Mich. App. 233; 341 N.W.2d 484 (1983), held that a trial court had the discretion to set aside a party's acceptance of a mediation award upon proper motion prior to the entry of a judgment on the award. See also MGM Brakes Division of Indian Head, Inc v Uni-Bond, Inc, 417 Mich. 905; 330 N.W.2d 853 (1983), dealing with the former Wayne County Court Rule 403.

MCR 2.403(L)(1) and (2) state:

(1) Each party must file a written acceptance or rejection of the panel's evaluation with the mediation clerk within 28 days after service of the panel's evaluation. The failure to file a written acceptance or rejection within 28 days constitutes acceptance.

(2) There may be no disclosure of a party's acceptance or rejection of the panel's evaluation until the expiration of the 28-day period, at which time the mediation clerk shall send a notice indicating each party's acceptance or rejection of the panel's evaluation.

Plaintiff contends that the mediation award should be set aside because the mediation clerk announced the parties' elections prior to the expiration of the twenty-eight-day period provided for response. MCR 2.403(L)(2). The purpose behind MCR 2.403(L)(2) is to guard against the potential of a party imposing sanctions set forth in the rule based solely on their knowledge of another party's acceptance or rejection. Although plaintiff correctly points out that the mediation clerk violated MCR 2.403(L)(2) by notifying the parties of their unanimous acceptance of the mediation award before expiration of the twenty-eight-day response period, this notification, if error, is harmless because it did not affect the parties' decision to either accept or reject the mediation award.

Plaintiff assumes that under MCR 2.403(L) parties are entitled to change their minds within the twenty-eight-day period, despite submission of an acceptance or rejection notice to the mediation clerk. Defendant asserts, and this Court agrees, that the twenty-eight-day response period is designed to provide the parties with sufficient time to consider the award and notify the mediation clerk of their acceptance or rejection of the award. The rule was not intended to provide the parties with a period of time during which they can request that the mediation clerk disregard their initial election and change it to the other alternative. A party is not entitled to alter its decision once it has notified the mediation clerk of its acceptance or rejection of a mediation award. The principles of finality compel us to consider plaintiff's original acceptance as binding upon her. Small v Zeff, 155 Mich. App. 288, 291-292; 399 N.W.2d 63 (1986). The trial court did not err by granting defendant's motion for entry of judgment pursuant to mediation under MCR 2.403(L).

Affirmed.

CASTILLO v. ALEXANDER