73 So. 3d 1131
Miss.2011Background
- Pass Marianne entered a 2005 contract with Lemon Drop for Unit 209 of Pass Marianne Condominiums; arbitration clause required under AAA rules.
- Alfonso Realty, Inc. acted as Pass's agent in seller transactions and is described as not a buyer's agent in the contract.
- Construction delayed by Hurricane Katrina; Pass conveyed Unit 209 to Lemon Drop in 2007 with a warranty of completion.
- Lemon Drop sued Pass and Woodward in 2008 for defects, seeking rescission; the complaint did not attach the arbitration agreement.
- Pass answered in 2008 with a jury-trial demand and joined an agreed trial-date order, engaging in discovery.
- In 2009, Lemon Drop sought to amend to add Alfonso; Pass conditioned arbitration on court rulings, and Woodward's motion to compel arbitration was granted against Pass.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Pass waived its right to arbitration | Lemon Drop contends Pass's litigation conduct waived arbitration rights. | Pass argues the waiver should be limited and not extend to Alfonso. | Pass waived its right to arbitrate. |
| Whether Alfonso, as Pass's agent, has a right to compel arbitration | Alfonso, as agent, can compel arbitration under the agreement. | Pass's waiver should preclude Alfonso from enforcing arbitration. | Alfonso has the right to compel arbitration; waiver not imputed to Alfonso. |
Key Cases Cited
- In re Tyco Int'l (US) Inc., 917 So.2d 773 (Miss. 2005) (waiver and active participation can forfeit arbitration rights)
- American Family Life Assurance of Columbus v. Ellison, 4 So.3d 1049 (Miss. 2009) (personal defense not imputed to co-defendants; waiver not universal)
- Sawyers v. Herrin-Gear Chevrolet Co., Inc., 26 So.3d 1026 (Miss. 2010) (non-signatories and agency relationships extended to arbitration where appropriate)
- Garcia v. Huerta, 340 S.W.3d 864 (Tex.App. 2011) (nonsignatory agents may compel arbitration when related to principal's contract)
- Aladdin Construction Co., Inc. v. John Hancock Life Ins. Co., 914 So.2d 169 (Miss. 2005) (agency principles apply in contract context)
- Covenant Health & Rehab. of Picayune, LP v. Estate of Moulds, 14 So.3d 695 (Miss. 2009) (arbitration as forum-related defense; venue-focused considerations differ)
- L Horton v. MS Credit Ctr., Inc., 926 So.2d 167 (Miss. 2006) (active participation in litigation can constitute waiver of arbitration)
- Kiskadee Commc'ns (Bermuda), Ltd. v. Father, 2011 WL 1044241 (N.D. Cal. 2011) (agents of signatories may compel arbitration if related to claims and contract)