Todd Santomauro v. Pultegroup Inc
328404
| Mich. Ct. App. | Dec 20, 2016Background
- Santomauro signed Pulte’s arbitration agreement when hired, agreeing to arbitrate employment claims.
- After Pulte discharged him, Santomauro filed arbitration claims including breach of contract, discrimination, retaliation, and fraud.
- Pulte requested return of Santomauro’s company laptop; when examined later the laptop’s hard drive and screws were missing.
- Thirteen days before arbitration, Pulte moved for discovery sanctions based on alleged deletion of emails and removal of the hard drive.
- Arbitrator Glendon found Santomauro willfully removed the hard drive to prevent discovery, concluded Santomauro destroyed evidence, and dismissed all claims as a sanction.
- Santomauro sought vacatur in circuit court; the court confirmed the award. Santomauro appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether arbitrator denied due process by refusing material evidence | Santomauro: arbitrator refused to consider evidence and denied due process and statutory civil-rights forum | Pulte: arbitrator acted within arbitration agreement and afforded process; sanction was warranted | Held: No due process violation; arbitrator had authority and provided opportunity to be heard |
| Whether arbitrator exceeded powers or was evidently partial | Santomauro: arbitrator exceeded authority, was biased, and refused to hear motions showing partiality | Pulte: arbitrator acted under parties’ ADR agreement authority; no evidence of bias | Held: Arbitrator acted within contractual authority; no evident partiality shown |
| Whether dismissal was an appropriate sanction for destroyed evidence | Santomauro: dismissal was disproportionate; alternative remedies available | Pulte: willful destruction justified dismissal; alternatives insufficient given prejudice and credibility loss | Held: Dismissal was within arbitrator’s authority and appropriate under circumstances |
| Applicability of after-acquired evidence rule | Santomauro: argued after-acquired evidence should limit sanction or affect outcome | Pulte: after-acquired evidence doctrine inapplicable because removal occurred after termination and concerns different misconduct | Held: Rule inapplicable; doctrine concerns employment-related misconduct discovered later, not post-termination evidence destruction |
Key Cases Cited
- City of Ann Arbor v. American Federation of State, Co. & Mun. Employees (AFSCME) Local 369, 284 Mich. App. 126 (Michigan Court of Appeals) (limited judicial review of arbitration awards)
- Dohanyos v. Detrex Corp., 217 Mich. App. 171 (Michigan Court of Appeals) (arbitrator authority derives from parties’ agreement)
- Konal v. Forlini, 235 Mich. App. 69 (Michigan Court of Appeals) (judicial review of arbitrator not to substitute court judgment)
- Detroit Automobile Inter-Ins. Exch. v. Gavin, 416 Mich. 407 (Michigan Supreme Court) (review limited to legal errors apparent on award face)
- Gordon Sel-Way, Inc. v. Spence Bros., Inc., 438 Mich. 488 (Michigan Supreme Court) (determine arbitrator power by contract terms)
- Brenner v. Kolk, 226 Mich. App. 149 (Michigan Court of Appeals) (trial court authority to sanction for failure to preserve evidence; dismissal is drastic but available)
- Landin v. Healthsource Saginaw, Inc., 305 Mich. App. 519 (Michigan Court of Appeals) (after-acquired evidence doctrine in employment termination context)