Are Umpires in an Insurance coverage Appraisal Immune from Being Sued?

This publish is a follow-up to “Does an Umpire Have Immunity From Go well with? Is an Appraisal an Arbitration in North Carolina?” The events have filed appellate briefs on the matter and are awaiting a choice.¹

Arguments for arbitral immunity made by the Umpire, O’Leary, are:

1. The North Carolina Arbitration Act offers that arbitrators have the identical immunity as judges, and this immunity “dietary supplements any immunity beneath different regulation.”
2. The “different regulation” contains North Carolina widespread regulation on the immunity of personal residents resolving disputes.
3. Below the “performance check,” non-public residents reminiscent of O’Leary performing as arbitrators have judicial immunity when resolving disputes between events or adjudicating non-public rights.
4. O’Leary was a non-public citizen performing the perform of resolving the dispute between the insurer and insured in accordance with the coverage’s appraisal course of, so he ought to get immunity beneath the performance check.
5. Denying O’Leary immunity would deter non-public residents from serving as umpires/arbitrators and intrude with the conduct of those proceedings.

Arguments towards arbitral immunity made by First Protecting embrace the next:

1. The Arbitration Act solely applies to “arbitrators” and “arbitration agreements.” O’Leary was an “umpire” beneath an appraisal provision, not an arbitration settlement.
2. The district court docket accurately discovered the Arbitration Act inapplicable to an umpire in an appraisal. O’Leary deserted this argument on enchantment.
3. The “performance check” from North Carolina widespread regulation doesn’t apply to develop arbitral immunity to umpires. The case cited by O’Leary predated the Arbitration Act and concerned an precise arbitration settlement reasonably than an insurance coverage appraisal.
4. O’Leary waived the “performance check” argument by not correctly elevating it within the district court docket.
5. Public coverage doesn’t justify extending arbitral immunity to umpires in insurance coverage value determinations past the phrases of the coverage.

The important thing dispute is whether or not the Arbitration Act’s immunity applies solely to formal arbitrators or if it extends to umpires in value determinations beneath the widespread regulation “performance check.” O’Leary argues for a broad studying, whereas First Protecting argues for limiting immunity to what the statute expressly covers. Because the case is so depending on North Carolina regulation, I’m not sure how a lot the choice will affect this problem in different states.

One lesson from this case is that every one appraisers and umpires ought to carry insurance coverage to assist defray the numerous authorized prices if one occasion recordsdata swimsuit.

Thought For The Day 

Judges, like individuals, could also be divided roughly into 4 courses: judges with neither head nor coronary heart—they’re to be prevented in any respect prices; judges with head however no coronary heart—they’re virtually as dangerous; then judges with coronary heart however no head—dangerous however higher than the primary two; and eventually, these uncommon judges who possess each head and a coronary heart—due to blind luck, that’s our decide. 
—Robert Traver

¹ First Protecting Ins. Co. v. O’Leary, Case No. 23-2160 (4th Cir.).