Raven Offshore Yacht Shipping, Llc & Richard Gladych v. F.t. Holdings, Llc.
199 Wash. App. 534
| Wash. Ct. App. | 2017Background
- FT contracted with Raven to transport the yacht Nanea from Florida to British Columbia; the written contract included a clause requiring arbitration "conducted in accordance with the Rules of the Maritime Arbitration Association of the United States."
- The contract price included Lloyd's cargo insurance; during transit the yacht flooded (bilge pumps were disconnected) and suffered about $300,000 in damage; Lloyd's denied FT's insurance claim.
- FT sued Raven and Raven's managing partner Gladych for negligence, negligent misrepresentation, and violations of the Washington Consumer Protection Act, alleging Gladych acted as Raven's agent and procured inadequate insurance.
- Raven moved to compel arbitration under the contract; the trial court denied the motion.
- On appeal, the primary legal dispute was whether incorporation of MAA rules constitutes "clear and unmistakable" evidence that the parties delegated questions of arbitrability to the arbitrator; FT also argued Gladych (a nonsignatory) was not bound to arbitrate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether incorporation of MAA rules delegates arbitrability to the arbitrator | Mere incorporation of MAA rules is insufficient to show parties clearly entrusted arbitrability to arbitrator | Incorporation of MAA rules (which contain Rule 9(a) delegating arbitrability) is clear and unmistakable evidence of delegation | Reversed: incorporation of MAA rules delegated arbitrability to arbitrator under First Options standard |
| Whether Gladych (nonsignatory) is bound to arbitrate | Gladych never agreed to arbitrate; threshold questions about his agreement must be decided by court | FT alleged Gladych acted for and on behalf of Raven (agency); an agent is bound by the principal's arbitration agreement | Court held no threshold dispute: allegation of agency binds Gladych to the arbitration agreement |
Key Cases Cited
- AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (federal policy favors enforcement of arbitration agreements)
- Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440 (arbitration clauses are matters of contract enforceable under federal law)
- First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (delegation of arbitrability requires clear and unmistakable evidence)
- Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (distinguishes arbitrability questions for courts vs. arbitrators)
- Satomi Owners Ass'n v. Satomi, LLC, 167 Wn.2d 781 (Washington law: arbitration agreement applies only to issues parties agreed to submit)
- Pritzker v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 7 F.3d 1110 (an agent of a contracting party may be bound by the party's arbitration agreement)