MHC Kenworth-Knoxville/Nashville v. M & H Trucking, LLC
2013 Ky. LEXIS 12
| Ky. | 2013Background
- Arbitration clause in Customer Sales Order governs dispute between MHC Kenworth and M & H Trucking over delivered truck; clause states FAA governs interpretation and enforcement and place of arbitration; Halls signed the order; dispute arises after alleged premium model was delivered as a stripped-down truck.
- Trial court denied motion to compel arbitration; MHC Kenworth appealed; Court of Appeals affirmed, relying on Ally Cat to require Kentucky arbitration venue for enforcement.
- Court granted discretionary review; issue is whether FAA-governed arbitration is enforceable in Kentucky.
- Court holds: FAA governs arbitration clause when chosen by contract; Kentucky courts have jurisdiction to enforce such arbitration.
- Court concludes MHC Kenworth provided prima facie evidence of a valid arbitration agreement; heavy burden on M & H Trucking to show no agreement; the agreement is facially valid and enforceable under FAA.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is FAA-governed arbitration enforceable in Kentucky courts? | MHC Kenworth | M & H Trucking | Yes, FAA governs and enforces arbitration in Kentucky |
| Is there prima facie proof of an arbitration agreement? | MHC Kenworth provided a signed copy | M & H Trucking failed to negate existence | Yes, prima facie agreement established |
| Does FAA govern over Ally Cat when agreement selects FAA law? | FAA controls, Ally Cat inapplicable | Ally Cat controls where Kentucky act applies | FAA governs; Ally Cat not applicable; circuit court has jurisdiction |
Key Cases Cited
- Ally Cat, LLC v. Chauvin, 274 S.W.3d 451 (Ky. 2009) (arbitration enforceability hinges on arbitration location under Kentucky Act)
- Ernst & Young, LLP v. Clark, 323 S.W.3d 682 (Ky. 2010) (when FAA applies, Ally Cat inapplicable)
- Hathaway v. Eckerle, 336 S.W.3d 83 (Ky. 2011) (FAA controls; not Kentucky Act)
- General Steel Corp. v. Collins, 196 S.W.3d 18 (Ky. App. 2006) (threshold validity of arbitration agreement)
- Louisville Peterbilt, Inc. v. Cox, 182 S.W.3d 850 (Ky. 2004) (burden shifting on existence of arbitration agreement)
- Ernst & Young, 328 S.W.3d at 687, (referenced in text) (Ky. 2010) (control by FAA when chosen by agreement)