PC Scale, Inc. v. Roll Off Services, Inc.
2010 Ark. App. 745
| Ark. Ct. App. | 2010Background
- Tran-scomp appeals an order denying its motion to compel arbitration.
- Roll Off purchased Transcomp’s software package in 2004 and signed three ancillary agreements: Support, License, and Professional Services.
- Arbitration clauses appear only in the License and the Professional Services Agreements; the Proposal and Support Agreement lack governing-law/arbitration terms.
- Roll Off sued in Oregon’s Benton County Circuit Court in 2008 for software defects, fraud, and related claims, attaching the four documents.
- Transcomp moved to stay and compel arbitration arguing the documents form a single transaction; Roll Off opposed, arguing no arbitration clause covering all disputes.
- The circuit court found ambiguities, held further testimony, and denied the motion without prejudice; it stated it would refer disputes to arbitration if later shown to fall within the License or Professional Services Agreement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Do four documents form a single contract for arbitration purposes? | Transcomp: yes, as a single transaction. | Roll Off: no, instruments show separate contracts with distinct arbitration scopes. | No; instruments are interrelated but not a single contract; arbitration limited to License/Professional Services disputes. |
| Do arbitration clauses apply to Roll Off’s lawsuit based on the License and/or Professional Services Agreements? | Roll Off’s claims implicate those agreements; arbitration should be compelled. | Claims do not necessarily arise under those agreements; scope is narrower. | Arbitration applies only to disputes arising under the License or the Professional Services Agreement. |
| Was the circuit court correct to deny arbitration without prejudice and preserve the option to compel later? | Trial court should compel arbitration now if applicable. | Denial without prejudice is acceptable pending development showing arbitration scope. | Respect the denial without prejudice; potential future arbitration if appropriate developments occur. |
| Should the court consider extrinsic evidence to interpret contract when unambiguous? | Extrinsic evidence clarifies intent to treat all four documents as one transaction. | Contract language is unambiguous; interpretive analysis should be at law. | Court conducted de novo review; contract language shows arbitration limited to the two agreements. |
Key Cases Cited
- Gruma Corp. v. Morrison, 2010 Ark. 151 (Ark. 2010) (arbitration favored; policy supporting arbitration)
- Gravillis v. Coldwell Banker Res. Brokerage Co., 143 Cal.App.4th 761 (Cal. Ct. App. 2006) (arb. favored; ambiguity resolved in favor of arbitration)
- Terminix Int'l Co., LLC v. Trivitt, 104 Ark.App. 122 (Ark. App. 2008) (de novo review of arbitration-denial rulings)
- Hot Spring County Med. Ctr. v. Ark. Radiology Affiliates, P.A., 103 Ark.App. 252 (Ark. App. 2008) (contract interpretation; related rule for evaluating agreements)
- A.G. Edwards & Sons, Inc. v. Myrick, 88 Ark.App. 125 (Ark. App. 2004) (unambiguous contract interpretation is a question of law)
- Stokes v. Roberts, 289 Ark. 319 (Ark. 1986) (treatment of instruments executed in the same transaction)
- Riceland Foods, Inc. v. Pearson, 2009 Ark. 520 (Ark. 2009) (advisory opinions not issued; issues must be arbitrated to be decided)