PER CURIAM.
This case requires the Court to consider whether an arbitration clause included in invoices for plaintiffs' artwork purchases applies to disputes arising from plaintiffs' previous artwork purchases when the invoices for the previous purchases did not refer to arbitration. We agree with plaintiffs that the arbitration clause contained in the later invoices cannot be applied to disputes arising from prior sales with invoices that did not contain the clause. Each transaction involved a separate and distinct contract, and the facts do not reasonably support a conclusion that the parties intended for the arbitration clause to retroactively apply to the previous contracts.
Accordingly, we reverse that part of the Court of Appeals judgment that extends the arbitration clause to the parties' prior transactions that did not refer to arbitration. We remand this case to the Court of Appeals for consideration of the issues raised in plaintiffs' appeal that the Court did not address to the extent those issues relate to claims that are not subject to arbitration. In all other respects, leave to appeal is denied because we are not persuaded that the remaining question presented should be reviewed by this Court.
Defendant Park West Galleries, Inc. (Park West) sold art on various cruise ships traversing international waters. Plaintiffs
With each sale, Park West provided plaintiffs with a certificate of authentication and a written appraisal, both of which were signed by agents of defendants.
However, prior invoices provided with plaintiffs' purchases contained no such clause.
According to plaintiffs, years after they made their purchases, they discovered that the art purchased from Park West was not actually worth the represented value and that some of the art was forged. Plaintiffs filed the instant suit against defendants on September 28, 2011, asserting claims of breach of contract, breach of warranty of fitness, fraud, negligent misrepresentation, conspiracy, conversion, negligence, intentional infliction of emotional distress, violation of the sales of fine art act,
On June 1, 2012, the trial court granted defendants' first motion for summary disposition under MCR 2.116(C)(7) with respect to claims arising out of transactions with invoices that contained the arbitration clause. The trial court determined that the clause was enforceable and required arbitration of all disputes arising from the purchases described in those particular invoices. The trial court thus dismissed all claims brought by plaintiffs Audrey Mahoney and Patty Brown and some of the claims brought by plaintiffs David and Felice Oppenheim. The trial court declined to dismiss any of the claims brought by the Oppenheims that involved purchases in which the invoices did not contain an arbitration clause, concluding that the arbitration clause in the later invoices did not extend to transactions with invoices that did not contain the clause.
Defendants filed a second motion for summary disposition under MCR 2.116(C)(7), alleging that the rest of the Oppenheims' claims were barred by the statute of limitations. The trial court agreed in a September 6, 2013 order and
Mahoney, Brown, and the Oppenheims appealed in the Court of Appeals. Defendants cross-appealed, disputing the trial court's ruling that not all the Oppenheims' claims were subject to arbitration. The Court of Appeals reversed in part, holding that the arbitration clause in invoices for the later-executed transactions extended to prior transactions for which the invoices did not contain the clause.
This Court reviews de novo a trial court's decision on a motion for summary disposition brought under MCR 2.116(C)(7).
"Arbitration is a matter of contract."
With these principles in mind, the pertinent issue for our review is whether the Court of Appeals erred by concluding that the arbitration clause included in the parties' later invoices encompassed disputes arising from earlier transactions when the invoices for the earlier transactions did not contain the clause. We conclude that the Court of Appeals erred because "[a] party cannot be required to arbitrate an issue which he has not agreed
Michigan law requires that separate contracts be treated separately.
Accordingly, disputes arising from plaintiffs' 2003 and 2004 purchases are subject to arbitration only if the arbitration clause contained in the 2008 and 2009 invoices can be retroactively applied to the earlier transactions. Michigan law, however, has long recognized that contracts generally cannot be construed to operate retroactively,
A majority of the Court of Appeals panel determined that this language was controlling and resolved the issue in favor of defendants.
While this language recognized "[t]he policy favoring arbitration of disputes arising under collective bargaining agreements," it does not remotely suggest that an arbitration agreement between parties outside the collective-bargaining context applies to any dispute arising out of any aspect of their relationship.
Moreover, the analysis in Kaleva is inapplicable to the factual circumstances of the instant case. In Kaleva, the relevant arbitration provision was contained in a collective-bargaining agreement, the terms of which governed the plaintiff's employment with the defendant. There was no dispute that the collective-bargaining agreement containing the clause was applicable to the parties' employment relationship, and the relevant issue was simply whether the plaintiff's particular grievance fell within the terms of the arbitration clause. In contrast, the arbitration clause in the instant case was extended from distinct contracts concerning separate transactions to disputes over earlier transactions with their own distinct contracts. Therefore, the facts and issues presented in Kaleva were very different from those presented here. Consequently, the analysis in Kaleva is not helpful in resolving the instant matter and does not compel the result reached by the Court of Appeals.
We are also not persuaded by the federal authority cited by the Court of Appeals. In those cases, the federal courts held that the terms of later-executed contracts applied to previous dealings between the same parties. See Levin v. Alms & Assoc., Inc., 634 F.3d 260 (C.A.4, 2011), and Watson Wyatt & Co. v. SBC Holdings, Inc., 513 F.3d 646 (C.A.6, 2008). Those cases are distinguishable from the present case because the litigants' transactions in the federal cases were ongoing and
In sum, the undisputed facts do not reasonably support the conclusion that the parties intended for the arbitration clause contained in the invoices for some transactions to apply to separate and distinct prior transactions. There simply is no legal basis on which to retroactively insert an arbitration clause into the parties' 2003 and 2004 contracts. Consequently, only plaintiffs' claims arising from purchases for which the invoices included the arbitration clause are subject to arbitration.
We disagree with the Court of Appeals' conclusion that, by signing an invoice containing an arbitration clause, plaintiffs agreed to arbitrate not only disputes regarding transactions described in that invoice, but also disputes regarding past transactions, regardless of whether the invoices associated with the past transactions included an arbitration clause. The plain language of plaintiffs' 2003 and 2004 invoices makes no mention of arbitration, and there is no basis on which to conclude that the parties intended for the arbitration clause contained in their 2008 and 2009 invoices to retroactively apply to the earlier transactions.
Because we conclude that the only claims subject to arbitration are those arising from invoice agreements containing an arbitration clause, we reverse that part of the Court of Appeals judgment that applied the arbitration clause to the parties' prior transactions completed without reference to arbitration. We remand this case to the Court of Appeals for consideration of the issues raised in plaintiffs' appeal that the Court did not address to the extent those issues relate to claims that are not subject to arbitration. In all other respects, leave to appeal is denied, because we are not persuaded that the remaining question presented should be reviewed by this Court.
YOUNG, C.J., and MARKMAN, ZAHRA, McCORMACK, VIVIANO, BERNSTEIN, and LARSEN, JJ., concurred.
Similarly, comment b regarding Restatement, § 240, p. 230, provides in relevant part: