Case Title: Lopez v. Home Buyers Warranty Corp.

Citation: 670 So. 2d 35

Docket Number: 

State: alabama

Court: Alabama Supreme Court

Date: 1995-11-03T00:00:00Z

Document:
670 So. 2d 35 (1995)
Juliette G. LOPEZ
v.
HOME BUYERS WARRANTY CORPORATION, et al.
1920330.

Supreme Court of Alabama.
November 3, 1995.
*36 Jere L. Beasley and J. Cole Portis of Beasley, Wilson, Allen, Main & Crow, P.C., Montgomery, for appellant.
Philip S. Gidiere, Jr. of Carpenter & Gidiere, Montgomery, for appellees.
SHORES, Justice.
The issue presented on this remand from the Supreme Court of the United States is whether the Federal Arbitration Act, 9 U.S.C. §§ 1-15 (1982), requires arbitration of the claims at issue. The original opinion of this Court is published at 628 So. 2d 361 (Ala.1993). In it, this Court treated Juliette Lopez's "appeal" from the trial court's order compelling arbitration as a petition for a writ of mandamus and granted the writ:
628 So. 2d  at 362. The essential facts of this case are set out in the original opinion as follows:
628 So. 2d  at 362-63.
Under Alabama law, the specific enforcement of a predispute arbitration agreement violates both our statutory law and public policy, unless federal law preempts state law. § 8-1-41(3), Ala.Code 1975; Wells v. Mobile County Bd. of Realtors, Inc., 387 So. 2d 140, 144 (Ala.1980); Bozeman v. Gilbert, 1 Ala. 90, 91 (1840); Lopez v. Home Buyers, supra, at 363. In its first opinion in this case, this Court determined that in this case federal law did not preempt our law and public policy against enforcement of predispute agreements to arbitrate, because we could find no evidence that the parties "contemplated substantial interstate activity" when they entered into the warranty contract. We held that under the "contemplation" test,[1] Mrs. Lopez was not required to submit her warranty claims against Home Buyers to arbitration:
628 So. 2d  at 364.
The Supreme Court of the United States vacated the judgment of this Court and remanded the case for further consideration in light of its opinion in Allied-Bruce Terminix Cos. v. Dobson, 513 U.S. ___, ___, 115 S. Ct. 834, 837, 130 L. Ed. 2d 753 (1995). Home Buyers Warranty Corp. II v. Lopez, 513 U.S. ___, ___, 115 S. Ct. 930, ___, 130 L. Ed. 2d 876 (1995). The cause has been submitted on the order of remand and on the original briefs.[2]
In Allied-Bruce Terminix, supra, the United States Supreme Court rejected the "contemplation" test followed by this Court, writing:
513 U.S. at ___ - ___, 115 S. Ct.  at 839-43. Allied-Bruce Terminix held that the language of the FAA, making enforceable an arbitration provision in "a contract evidencing a transaction involving commerce," is applicable "to the limits of Congress' Commerce Clause power," and that, because the transaction in that case involved interstate commerce, the FAA was applicable and preempted state law. Id., 513 U.S. at ___, 115 S. Ct.  at 837. See Terminix International Co. Ltd. v. Jackson, 669 So. 2d 893 (Ala. 1995) (on remand opinion).
The trial court, when it compelled arbitration in this case, determined "that the facts surrounding the Home Buyers contract do support a finding that the contract has at least [the] slightest nexus with interstate commerce so as to bring the contract under the purview of the FAA."[3] This Court stated the facts supporting that conclusion:
See Lopez v. Home Buyers, supra, 628 So. 2d  at 363-64. The evidence reflects that in addition to those facts cited by the trial judge, this house has a Veterans' Administration loan guaranty and the title insurance was procured through a California company.
Therefore, in light of the United States Supreme Court's holding in Allied-Bruce Terminix, supra, and this Court's holdings in Allied-Bruce Terminix Cos. v. Dobson, [Ms. 1920473, November 3, 1995] ___ So.2d ___ (Ala.1995), and Terminix International v. Jackson, supra, we hold that Mrs. Lopez's petition for a writ of mandamus directing the trial court to vacate its order compelling arbitration of the claims against Home Buyers is due to be denied. The trial court properly compelled arbitration of the claims against Home Buyers. The other claims *39 stated in the complaint are not subject to arbitration, and the litigation of those claims is not due to be stayed unless the Circuit Court, in exercising its discretion pursuant to the considerations discussed in Terminix International v. Jackson, supra, grants a stay of litigation as to those claims.
WRIT DENIED.
ALMON, HOUSTON, KENNEDY, INGRAM, and COOK, JJ., concur.
MADDOX, J., concurs in the result.
[1]  The test applied in Ex parte Warren, 548 So. 2d 157 (Ala.), cert. denied sub nom. Jim Skinner Ford, Inc. v. Warren, 493 U.S. 998, 110 S. Ct. 554, 107 L. Ed. 2d 550 (1989).
[2]  The issues presented on this remand were adequately addressed by the parties in their original briefs submitted to this Court.
[3]  In our first opinion in this case we pointed out that this Court had "recently overruled the ... `slightest nexus' test in favor of the more reasoned approach of the `contemplation' test applied in Ex parte Warren, 548 So. 2d 157 (Ala. [1989])." 628 So. 2d  at 363. See n. 1, at 37, supra.