South Carolina Court of Appeals holds arbitration orders regarding children’s issues are void ab initio

Many family law attorneys in the Charleston area were awaiting the Court of Appeals decision in Singh v. Singh, which was argued there this February. That appeal was supposed to determine whether child issues in family court could be arbitrated. While many family law attorneys were allowing such issues to be arbitrated, other family law attorneys refused to do so, believing that the family court could not enforce such arbitration awards.While we were waiting on a decision in Singh, a different Court of Appeals panel heard Kosciusko v. Parham in October and issued its decision on November 6, 2019. Addressing the same issue as in Singh, the Kosciusko court held that family court orders approving arbitration awards regarding children’s issues are void ab initio. Assuming the Kosciusko opinion isn’t subsequently overturned, every provision of any arbitration order regarding child’s issues in family court within the State of South Carolina is now void.

In Kosciusko, the parties agreed to submit the issues of “right of first refusal, holidays, visitation schedule, vacations, and transfers/transportation” to binding arbitration and obtained a consent order incorporating the agreement. The order further provided that “the parties further agreed that such confirmation shall not require a hearing, but may be accomplished based on written application of either party.” Additionally, the order provided that the family court would retain continuing jurisdiction to modify the arbitration award or any order of the court. They then arbitrated these issues and the family court issued an order confirming the arbitration award without a hearing. Neither party appealed the order confirming the award.

Father then filed a contempt action against Mother alleging she had violated terms of the arbitration award. Mother moved to dismiss the contempt action, arguing the order was not valid. The family court agreed and dismissed the contempt action. After the family court denied Father’s motion for reconsideration, he appealed.

The Court of Appeals first found that “the submission of children’s issues to binding arbitration would be an improper delegation of the family court’s authority and violative of South Carolina law because the procedures mandated by the Uniform Arbitration Act would prevent the family court from determining whether an award is in the child’s best interest.” It found that, in the context of children’s issues in family court, the provisions of S.C. Code § 63-3-530(A)(39) override the provisions of South Carolina’s Uniform Arbitration Act, S.C. Code § 15-48-10, both because 63-3-530(A)(39) is more recent and more specific. That code subsection limits the family court’s jurisdiction for alternative dispute resolution (ADR):

The family court has exclusive jurisdiction: to require the parties to engage in court-mandated mediation pursuant to Family Court Mediation Rules or to issue consent orders authorizing parties to engage in any form of alternate dispute resolution [that] does not violate the rules of the court or the laws of South Carolina . . .

Father argued such arbitrations were authorized by Rule 3(a), SCADR, which allows parties to domestic relations case to “mediate, arbitrate or submit to early neutral evaluation at any time,” However the Court of Appeals noted Rule 4(d)(2), SCADR, specifically authorizes parties “may submit the issues of property and alimony to binding arbitration,” while Rule 4(d)(1), SCADR only authorizes mediation for custody and visitation issues. It further noted that Rule 4(d)(5), SCADR, states that “[i]n lieu of mediation, the parties may elect to submit issues of property and alimony to binding arbitration in accordance with the Uniform Arbitration Act…” and that this subsection did not grant a similar right to arbitrate custody and visitation issues. It thus held the ADR rules did not authorize arbitration for custody or visitation issues.

The Court of Appeals further noted that the Uniform Arbitration Act limited the family court’s authority to review arbitration awards in a manner inconsistent with the family court’s obligation to protect the best interests of children. Under the Uniform Arbitration Act “an inquiry into the substantive fairness of an agreement . . . would be inconsistent with the Arbitration Act and would severely undermine the finality of arbitration agreements.” Prior case law indicated that such circumscribed review was allowable for alimony and property division awards but had never been acceptable for child related issues. As the opinion notes:

Because the family court may not delegate its authority to ensure that issues regarding children are resolved in their best interest, our supreme court has provided that family courts have continuing jurisdiction to do whatever is in the best interests of the child regardless of what the separation agreement specifies. …Accordingly, we find that our state’s precedent precludes the submission of issues involving child custody and visitation to binding arbitration as such action would constitute an improper delegation of the family court’s authority to determine issues in the best interest of the child.

Father raised a number of additional grounds to uphold the arbitrated custody agreement, all of which the Court of Appeals refused to address because they were not preserved for appellate review and because subject matter jurisdiction cannot be waived.

Assuming Kosciusko is not subsequently modified, child custody, visitation, and child support issues cannot be arbitrated in South Carolina and all existing confirmed arbitration award on these issues are unenforceable.

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