G & G Builders v. Randie Gail and Deanna Dawn Lawson
238 W. Va. 280
| W. Va. | 2016Background
- G & G Builders and Randie Lawson signed a 12-page AIA A111-1997 construction Agreement; Mrs. Lawson was identified as an owner but did not sign. The Agreement stated in a margin note that AIA Document A201-1997 (General Conditions) was "adopted in this document by reference."
- The General Conditions (which contained the arbitration clause) were not attached to the Agreement and were never provided to the Lawsons; the Agreement itself does not mention "arbitration."
- G & G sued the Lawsons in circuit court for unpaid contract sums and to enforce a mechanic’s lien; the Lawsons counterclaimed for breach, defective work, and overcharges.
- G & G moved to dismiss the counterclaim and compel arbitration; the Lawsons opposed, arguing the arbitration clause was not incorporated by reference and Mrs. Lawson (a non‑signatory) could not be compelled.
- The circuit court denied the motion, finding no meeting of the minds to arbitrate because the General Conditions were never provided and the Agreement gave no clear notice of arbitration.
- The Supreme Court of Appeals of West Virginia affirmed, applying incorporation‑by‑reference principles and precedent distinguishing commercial/sophisticated parties from ordinary consumers.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the A201 General Conditions (including arbitration) were effectively incorporated by reference into the signed A111 Agreement | The Agreement expressly adopted the A201 by reference; a party has a duty to read and thus would be bound | The reference was too general, A201 was never provided, and Lawson lacked knowledge/assent to arbitration | Not incorporated: court affirmed denial to compel arbitration because A201 was not provided and reference did not establish assent |
| Whether a non‑signatory (Mrs. Lawson) can be compelled to arbitrate | G & G argued arbitration should apply to both owners identified in Agreement | Lawsons argued non‑signatory cannot be forced where no agreement to arbitrate exists | Mooted by primary holding; court noted non‑signatory issue unnecessary after finding no agreement to arbitrate |
Key Cases Cited
- Credit Acceptance Corp. v. Front, 231 W. Va. 518 (recognizes immediate appealability of denials to compel arbitration)
- State ex rel. U-Haul Co. v. Zakaib, 232 W. Va. 432 (establishes three‑part test for incorporation by reference: clear reference, identifiable document, knowledge/assent to avoid surprise)
- Brown v. Genesis Healthcare Corp., 228 W. Va. 646 (arbitration clauses bind parties only by clear and unmistakable writing)
- State ex rel. TD Ameritrade, Inc. v. Kaufman, 225 W. Va. 250 (trial court’s threshold duties under the FAA: existence of agreement and scope)
- Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614 (court must determine whether parties agreed to arbitrate the dispute)
- Evans v. Bayles, 237 W. Va. 269 (upheld incorporation where signed form specifically referenced arbitration and provided the incorporated agreement to the signer)
- Standard Bent Glass Corp. v. Glassrobots Oy, 333 F.3d 440 (incorporation more likely enforced between sophisticated merchants familiar with standard terms)
- Logan & Kanawha Coal Co., LLC v. Detherage Coal Sales, LLC, [citation="514 F. App'x 365"] (incorporation may be binding between sophisticated businesses with prior notice/ course of dealing)
