Rule 34 of the Minnesota No-Fault, Comprehensive or Collision Damage Automobile Insurance Arbitration Rules, 15 Minn. Stat. 598 (2000) ("Minn. No-Fault Arb. R."), requires that a party object in writing after gaining knowledge that a provision or requirement of the rules has not been complied with or is deemed to have waived the right to object.
A party does not waive its right to object to arbitration of claims in excess of the jurisdictional limit by going forward with arbitration; a party preserves its objection under Minn. No-Fault Arb. R. 34 by filing a written objection to arbitration of claims in excess of the jurisdictional limit.
Insurer objected in writing to arbitrating amounts claimed by the insured that exceeded the jurisdictional limit in Minn. No-Fault Arb. R. 6.
Heard, considered, and decided by the court en banc.
The opinion of the court was delivered by: Page, Justice.
Respondent Michelle Regenscheid was awarded $24,834.12 in a mandatory no-fault arbitration proceeding against her no-fault automobile insurance carrier, appellant Farm Bureau Mutual Insurance Company ("Farm Bureau"). Farm Bureau filed a motion in district court to partially vacate the award on the grounds the arbitrator exceeded the $10,000 jurisdictional limit on mandatory no-fault arbitration. The district court concluded that Farm Bureau waived the jurisdictional limit by proceeding to arbitration and affirmed the award. The court of appeals affirmed, concluding that Farm Bureau waived its right to object to arbitration of claims that exceeded the $10,000 jurisdictional limit because it failed to make a written objection as required by Rule 34 of the Minnesota No-Fault, Comprehensive or Collision Damage Automobile Insurance Arbitration Rules, 15 Minn. Stat. 598 (2000) ("Minn. No-Fault Arb. R."). Because we conclude that Farm Bureau objected in writing to arbitration of claims in excess of $10,000, we reverse and remand.
Farm Bureau was the Minnesota no-fault automobile insurance carrier for Regenscheid on April 5, 1998. Regenscheid claims that on that date she injured one of her knees while exiting her vehicle to chase her dog. Farm Bureau initially paid no-fault benefits, but after conducting an investigation, it concluded that Regenscheid's injury did not arise out of the maintenance or use of the motor vehicle it insured. By letters dated June 8 and July 9, 1998, Farm Bureau notified Regenscheid that it was denying her claim for no-fault insurance benefits. On August 24, 1999, Regenscheid filed a petition for no-fault arbitration seeking $9,999 in no-fault benefits, which was within the $10,000 limit for mandatory arbitration. See Minn. No-Fault Arb. R. 6. The arbitration hearing was scheduled for May 16, 2000. On May 11, 2000, five days before the scheduled hearing, Regenscheid sought to withdraw her arbitration petition, stating that her health insurer wished to add approximately $10,000 to the claim.
That same day, Farm Bureau objected in writing to the request for withdrawal as being improper under Minn. No-Fault Arb. R. 13 because it was made less than ten days before the hearing date. Rule 13 provides that a claimant "may withdraw a petition up until ten (10) days prior to the hearing." Minn. No-Fault Arb. R. 13. Responding to Farm Bureau's May 11 letter, Regenscheid's attorney stated in a letter dated May 12, 2000, that he deemed Farm Bureau's refusal to allow withdrawal of the petition to be a waiver of the $10,000 jurisdictional limit and noted that he would include the approximately $10,000 in medical bills at the arbitration proceeding. Farm Bureau responded by letter that same day, stating:
Just so the record is clear, Farm Bureau's refusal to allow withdrawal of the Arbitration Petition in no way should be construed as a waiver by Farm Bureau of the jurisdictional limit imposed by the Arbitration rules. Ms. Regenscheid chose her forum to pursue her dispute, and is bound by that decision and the AAA rules.
The arbitration went forward as scheduled on May 16, 2000, with the arbitrator considering the full amount of Regenscheid's claim, including the amounts attributable to the additional medical benefits claim. Ultimately, the arbitrator awarded $24,834.12 to Regenscheid. Because the award exceeded the $10,000 jurisdictional limit for mandatory no-fault arbitration, Farm Bureau filed a motion in district court seeking to have a portion of the award vacated. The district court concluded that Farm Bureau had waived the jurisdictional limit by proceeding with arbitration and denied the motion. The court of appeals affirmed on different grounds. It concluded that Farm Bureau had failed to object in writing to arbitration of claims in excess of the jurisdictional limit and therefore Farm Bureau had waived its right to object under Minn. No-Fault Arb. R. 34.
The issue before the court is whether Farm Bureau made a written objection to arbitration of claims in excess of $10,000 under Minn. No-Fault Arb. R. 34. Application of the law to a particular set of facts is a question of law, which we review de novo. State Farm Mut. ...