* The Honorabl e Rob e rt Holmes Bell , Chief United St ates Dis tri ct Jud ge for th e W estern D istrict of M ichigan , sitting by de signatio n.
1 RECOMMENDED FOR FULL-TEXT PUBLICATION Pursuant to Six

th Circuit Rul e 206

ELECTRO NIC CIT

ATION: 2004 FED App . 0287P (6th C ir.) File Name: 04a02 87p.06



### UNITED STATES COURT OF APPEALS

FOR THE SIXT H CIR CUIT

_________________
M ASCO C ORPORATI ON ,

Plaintiff-Appellee,

v.

Z URIC H A MERI CAN I NSURANCE C OMPANY , Defenda nt-Appel

lant,

N EAR N ORTH I

NSURANCE A GENCY , I

NC ., et al., Defenda nts. X

- - - -
> , - - - - - - - - N No. 03-3071

Appeal from the United States District Court for the Northern District of Ohio at Akron. No. 02-00988—James S. Gallas, Magistrate Judge.

Argued: April 27, 2004 Decided and Filed: August 31, 2004

Bef ore : M ART IN an d R OGE RS , C irc ui t J udg es; BELL,

Chief District Judge. * 2 Masco Corp. v. Zurich Am. Ins. C

o., et al. No. 03-3071

_________________ COUNSEL

ARGUED: Joseph A. Hinkh ouse , LOR D, B ISS ELL & BROOK, Chicago, Illinois, for Appellant. Mar c A. Sa nche z, FR ANTZ WARD, Cleve land, Ohio, for Appellee

. ON BRIE F: Damon N. Vocke, LOR D, B ISS ELL & BROOK, Chicago, I l linois, Hugh D. Berkson, HERMANN, CAHN & SCHNEIDER, Cleveland, Ohio, f orAppellan

t. Marc A. San chez, FRANT Z W A RD, Cleveland, Ohio, for Appellee.
ROGERS, J., delivered the opinion of t he court, in which BELL, D. J., joined. MARTIN, J. (p p. 12-18), delivered a separate dissenting opinion.

_________________ OPINION

_________________ ROGERS, Circuit Judge. The di strict court in th is case

r efused to give e ffect to

a broad a

rbitrati on clause

in a n insurance policy, where

the under

lyin g disp ute between the parties revolved aroun d policy covera ge that neither party intended, but that was imposed on the contract by law as determined

by subsequent Ohio Supreme C ourt opinions. Becau se the dispute nonethele ss falls within the ambit of the arbitration agreement, we re verse.
Zurich American

Insurance Company

(“Zurich”), throu gh its agent, Near North I

nsurance Agency

, Inc. (“Nea

r North”),
so ld to Masco Corporation (“Masco”) two commer cia l automobile

insuranc e policie s, one ef fective June 30, 199 7, to June 30, 1998, and asecond, renewal policy , effective June 30, 1998, to June 30, 1 999. The two policies included a deductib le agreement, consisting of a basic agreement and aNo. 03-3071 Masco Corp. v. Zurich Am. Ins. C

o., et al. 3

1 The Ohio Supreme Co urt has si nce drasticall y reduced the scope of Scott-Pontz er cove rage. See Wes tfield Ins . Co. v . Ga latis , 797 N.E. 2d 1256 (O hio 2003). set of speci fication s. As par t of the de ductible

agree ment, Zurich agree d to pay and ha

ndle the claims made under the policies
, and M asco agreed to pay Zurich a $500,000 deductib le for cla

ims made un

der the p olicies. T

he deductible agreement

in clude d an arbitration clause reading, “ Any dispute arisi ng o u t of the interpretation, performance or alleged breach of this agr

eement, shall be s

ubmitted to arbitration . . . .”

Innegotiating the purchase of automo bile insurance, Masco specific ally

instructed

Near No rth that it wished topurchas e p olicies that cont

ained no u

ninsured /underin sured-motorist (“UM/UIM”)coverage. Near North and Zuri ch pr ovided Masco with form s that all parties thought

rej ect ed U M/ UIM
cov erage. A t the time the polices were purchased and the deductib le agree

ment was e

ntered i nto, both pa

rties to th is appeal thought that their contract d id not in clu de U M/ UIM coverage.
Later events, however , render ed the pa rtie s ’ rejection of UM/ UIM covera

ge inef fective . The Ohio

Supreme Court

in Scott-Pontzer

v. Liberty M

utual Fire Insurance Co. , 710 N.E.2d 1116 (Ohio 1999), and Linko v. Indemnity Insurance Co. of North Amer ica , 739 N.E.2d 338 (Ohio 2000), interpreted

§ 3937.18 of the Ohio Revised C ode to extend UM/ UIM covera

ge to almo st all corporations buying automobile

insur ance unle ss the

y e xp r essly rejected the
covera ge in a v er y pr ec is e w ay. Both Zurich and Mascoagree that the manner in which they rejected po ss ib le U M/ UIM coverage, altho ugh arguably valid at the ti me of co ntract ing, did not sa tisf y the Linko requirements. It is thus
uncon trove rted t hat a n ew burd en of co verage arose flowing from Zurich to Masco and those affiliated with Masc o. 1 4 Masco Corp. v. Zurich Am. Ins. C

o., et al. No. 03-3071

Zurich has pai d a p air of U M/ UIM claims made against the policies. On March 11, 1999, Natalie Ruska, the daughter of
anemployee of a

Masco subsidiary, wa s killed in an automobil e accident. Ms. Ruska’s estate sued Zurich in an Ohio state co

urt c l aiming entitlement to Scott-Pontzer benefit s. Zurich settled the suit, pa yin g Ms. Rusk

a’s esta te approxima

tely $700,000. Zurich then demanded pay ment of the $500,000 deductible from Masco.

On A pril 7, 199 9, Lin da Collins was injure d in a n automobile

accide nt. At the t

ime of the accident, Ms. Collins

w as a passenger in a vehicle being driven by her

dau ghter
, Rachael Collins, an employee of a Ma sc o s ub si di ar y. Collins suedZurich deman ding Scott-Pontzer benefits. At or a l argume nt, Zurich

admi tt ed that it p aid Ms. Coll ins at least $140,000 in Scott-Pontzer benefits. Mas co believes that Zurich will demand payment of a ded uctible for the Collins claim. Wishing to clarif

y its legal p osit ion , Masco filed a complaint in the Ohio Court of Common Pleas against Zurich and Near N orth seek ing a declaration that: (a) it owed no obligation

to pay deductibles for UM/UIM claims broug ht againstZurich, (b) if it is required to pay Zurich a deductible thenNear North should indemnify it, and (c ) that the ded uc tible contained in the liability portion of the policies does notapply to U M/UIM co verage imposed by operation of law. Zurich

removed the case to the federal district court, and moved to stay and compel ar

bitration based on

the arbitration clause in the deductible agreement. The district court denied the mo ti on to st ay, holding that the “the underly ing disputes inthe compl aint a

re be yon d the scop e” of the

deductib le agreement

because “Masco c ould

never have agree d to pay a deductible for

covera ge that would ar ise by operation of la

w years later as a result of a deficiency in the p oli cy or wa

iver drafted by Zur ich.” Masco Corp. v. Zurich Am. Ins. Co.
, No. 4:02 CV 0988, slip op. at 5 (N.D. Ohio Dec. 5, 2002). ZurichNo. 03-3071 Masco Corp. v. Zurich Am. Ins. C

o., et al. 5

timely appealed. The question

of arbitr ability is the sole issue on appea l.

The Federal Arbi t ration Act (the “FAA”) manifests “a liberal federal policy

favor ing arbitra

tio n agreements.” Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp. , 460 U.S. 1, 24 (1983). “To enforce this dictate, [the FAA] provides for
a stay of proce edings when an issue is referable to a rbitration and f or orders compelling arbitration when one par ty has failed or refu sed to compl y with an a rbitr ation agr eem ent.” Javitch v. First Union Sec., Inc. , 315 F.3d 619, 624 (6th Cir. 2003) (citing 9 U.S.C. §§ 3 & 4 ). This court reviews de novo
a district court’s decision whe ther to compel arbitration pursuant to the FAA. Burden v. Check Into Cash of Kentuck y, LLC, 267 F.3d 483, 487 (6th Cir. 2001).

Case la w a mp ly s uppo rts arbit rability of Masco ’s claims againstZurich

in this case. “Before compe lling an unwilling party to arbitrate, the court must engag e in a limited review t o determine whether the dispute is arbitrable; mea ning th at a valid a gr eement to arbitrate exists between the parties and that the specific

dispute f alls within

the substantive scope of that agr eeme nt.” Javitch , 315 F.3d at 624. “[A]s a matter of federallaw, any doubts conc erning the sco pe of arbitr able issues should be resolved in favor of arbitration.” Moses H. Cone , 460 U.S. at 24-25 (1983). “[T]here is a general presumptionof arbitrability, and any doubts are

to be resolved infavor of

arbitra tio n ‘un less it may be said with positive
assurance that the arbitration clause is not suscep tible of an interpretation

that cove rs the as se rted dispute.’” Highlands Wellmont Health Network, Inc. v. John De ere Health Plan, Inc. , 350 F.3d 568, 576-77 (6th Cir. 2 003) ( quot ing AT & T Techs., Inc. v. Communications Worker s of Am. , 475 U.S. 643, 650 (1986)). Where, as here, the arbi tration c lause is b road, “only an express provision excluding a spe ci fi c dispute, o r ‘t he most forceful evidenc e of a pur

pose to exclude the claim from arbitrat ion ,’ will re move the d

ispute fromconsideration by

the arbitrators.” Id. at

577 (q uoti ng AT 6 Masco Corp. v. Zurich Am. Ins. C

o., et al. No. 03-3071

& T Techs. , 475 U.S. at

650). Of course, “[w]hile ambiguities inthe language of the ag

reement should be resolved in favor of arbitration, we do no t override the clear intent of the parties, or re ach a

resu lt inc onsis tent w

ith th e pla in text of the contract, simply

because the policy f

avoring arbitra tion is implicated.” EEOC v. Waffle House, Inc. , 534 U.S. 279, 294 (2002) (internal citations omitted).
Here, no tw it hs ta nd in g M as co ’s ar gu me nt to th e c on tr ar y, the arbitration clause in t he deductible agreement was patently broad enough to cover the dispute as to whether Zurich can rec over ded

uctibles f or the UM/

UIM p ay ments made under the policies. The arbitra tion clau se encompasses “[a]ny dispute a risin g out of the interpretation, performance
or allege d breac

h of [the de ductible

agreement].” J.A. at

66. Masco’s claims against Zurich, which pray for a declaration that Masco has no obligation under the deductible agre ement to pay deductib les for U

M/UIM covera

ge, pla inly fall withi n thesespacious terms. The dispu te “aris es out of”

the part ies’ conflicting“interpretation” of Masco’s obligations under the deductib le agree

ment and M asco’s “ all eged breach” of the deductib le agreement by failing to pay

deductibles fo r UM/UIM coverag e.
Masco argues that, because the parties did not

contempl ate UM/ UIM coverage, they

could n ot possibly have contrac ted to submit disputes arising out of this coverage to arbitration. But, by its plain terms, the arbitration clause embraces any dispute arising out of the deductible agre ement whether or not the parties a

nticipate d the dispu

te at the t ime of con tract ing. Our tas k , of course, is limite d to enfor cing the parties’ agreement

as written, and we have no license to w rite a “f or es ee ab il it y” limitation i nto the arbitration agreement. As the Seventh Circuit held in Deputy v. Lehman Bros., Inc. , 345 F.3d 494, 513 ( 7th Cir. 200 3), “[w]he ther a c laim

is subject to arbitration

depends on the contractual languag e, and in this
casethe arbitra

tion clau se did

not limit its s cope to r

easonab lyNo. 03-3071 Masco Corp. v. Zurich Am. Ins. C

o., et al. 7

forese eable

claims.” See also Fazio v . Lehma n Bros., Inc. , 340 F.3d 386, 395-96 (6th Cir. 2003).

Masco further argues that (1)the deductible, which applies to “Masco Policies for Automobile Liability ” (J .A. at 75), does not apply

to UM/UIM claims, and (2) Ohio law for bids the imposition of adeduc tibl e on UM /UIM cov erage created by operation of

law. The se arg

uments ad

dress the substance of the parties’ dispute, not whether the dispute falls with the terms of the ar

bitration clause, and henc e the ar guments lie within the province of the arbitrator.

Inessence, Masco a

tte mpts to recast its challenge to the underlying

contractual liability as a challenge to the arbitra bility of the dispute. W hile Masc o denies t hat it is obligated by the deductible a

greement to reimbur

se Zurich for deductib le amounts that Zurich paid as a result of the imposition of UM/U IM coverag e, it has no argument for making a partic

ular cha llenge to the ar bitration agree ment. Instead , Masc o’s ch allen ge is based squarely onthe absence of an underlying

contractual obligation. Masco ar gues tha t it
never purchased UM/UIM cover age, that the de ductibilit y obligation

accordingly

did not apply to such covera ge, an d that, in turn, it cannot be compelled to arbitrate a non-existent obligat ion to pay UM/UI M deducti

bles.

Where challenges to an arbitration clause, like those in this case, are based on disagreeme nt regarding an underly

ing contractual dispute, the Sup re me Court’s holding in Prima Paint Corporation v. Flood & Conk lin M anufacturing Company , 388 U.S. 395 (1967), makes clear t hat arbitration is required. Under Prima Paint , a general ar bitration clause is enforc eable e

ven if it is

contain ed in a c ontract

that is gener ally asserte d t o be voidable, unless the basis for rescission applies specifically to the arbitration clause.

It is true tha

t a party opposing a motion tostay

and compel arbitration

ma y argue t

hat the a rbitrati on clause

is itself 8 Masco Corp. v. Zurich Am. Ins. C

o., et al. No. 03-3071

invalid. “An arbitration agreement may be invalidated

for the
same re asons for which any contract may

be invalidated, including forgery , unco nscionab ility , and lack o f consideration.” Fazio , 340 F.3d at 393. In this case, Masc o argues that the a

rbitrati on clause

fails bec ause it c annot app ly to a contra

ctual pr ovision tha

t Masco di d not ag

ree to. B ut, by virtue of Ohio l aw, th e ext ensio n of UM /UIM cov erage was lega ll y deemed to be an obligation arising from the contract, and it is anissue of contract interpretation whether the deductible reimbursement requirement appl ied t o the UM/ UIM obli gation . One s eekin g to cha llenge an arbitration clause must make an argumen t t hat is specific to the arbitration

clause , how ever, a

nd that doe s not simply chall enge the contractual obligation to which the arbitration clause applies. See Burden , 267 F.3d at 491.

The dissentconcludes that Masco’s obligat ion to reim

burse Zurich for the U

M/UIM deducti

bles a rose fr om a mutual mistake, and that t

he arbit ration a greement with r

espect t o that dispute was infected

by thesame mutual mistake. Masco’s complaint

contains a claim for contract reformation based on mutual mi st ake, bu t the theory was not otherwise argued by t he parti es, and normally

this court treats an issue notra is ed by a party as wa ived. Rybarczyk v. TRW, I nc. , 235 F.3d 975, 984 ( 6th

Cir. 2000). In particular, the parties have notaddressed wh ethe r, under the relevant law, a party can b ase a mut ual mistake claim on a change in the law subseque nt t o the formation of the contract, given the requirement

that the mistake exist at the time the contract was made. The answer appears to be no. See In the Matter of the Liquidation of the New York Agency and Other Assets of Bank of Credit & Comme

rce Int’l, S.A.
, 683 N.E.2d 756, 764 (N.Y. 1997) (“The doctrine of mut ual mistake requires that the mistake exist at the

time the c ontract

is negotia

ted.”); cf. Wheelabrator

Envtl. Sy s., Inc. v . Galante
, 136 F. Supp. 2d 21, 33 (D. Conn. 2001) (holding that the defe ndant cou ld not base
a defense of mutual m

ista ke on a court decision rendered a year after the con

tract was formed); Sheet Me tal Wo rkersNo. 03-3071 Masco Corp. v. Zurich Am. Ins. C

o., et al. 9

Local 137 v. Vic Constr. Corp. , 825 F. Supp. 463, 467 (E.D.N.Y. 1993) (stating

that a fa ilure todetermine or predict
a controlli ng inter pretati on of

a statute does not constitute a mistake); Krantz v. Univ. of Kansas , 21 P.3d 561, 567 (Kan. 2001) (“A subsequent change in the law wil l not justify rescission of a settlement agreement or contract on the basis of ‘mistake of the law.’”).

Even assuming that

the mutual mistake theory might ap ply inthis case, the argum ent still amounts to an attack on the underlying

liability , and only derivat ively on the obligation

to arbitrate. Therefore, under Prima Paint , the general arbitration

provision still applies. The existence of a mutual mistake leads at

most to the c onclusion

th at the underlying contract obligation was voidable, or subject to rescission

. Chastain v. The Robinson-Humphrey Co, Inc.
, 957 F.2d 851, 855 (11th Cir. 1992); Gould v . Bd. of Educ. of Sewanhaka Cent. High Sch. D ist

. , 616 N.E.2d 142, 145 (N.Y. 1993); Restatement

(Seco nd) of Co ntracts § 152 (1981). In a similar situation, where the party

objectingto arbitration claimed that the entire c ontract

was fra udulently in duced, the Supre

me Court in Prima Paint nonetheless required arbitration where the fra udul ent inducement did not relate specifically to the arbitration

clause. The Court reasoned that a court may consider only claims concer

ning the valid

ity of the arbitration clause its elf, as opposed to challenges to the validity of the contract as a whole, in determining whether a valid ag reement to arbitrate exists. Prima Paint , 388 U.S. at 402-06; see also Great Earth Cos., Inc. v. Simons , 288 F.3d 878, 889- 90 (6th Cir. 2002). T he r easoning clearly extends beyond the fraudulent

inducement

context to cases involving other bases for rescinding a contract in tot o . As the F irst Circu it reasoned: Contrary to Bene ficial’ s asserti on, the fa ct that its attempt to rescind the entire agreeme nt is ba sed o n the grounds of

frustration of purpose rather than on fraud in the induceme

nt does not

chang e applic abili ty

of the 10 Masco Corp. v. Zurich Am. Ins. C

o., et al. No. 03-3071

2 Th is is not l ike a case where , for instanc e, a co ntract is void for lack of a vali d signat

ure. I n such cas es, cour ts hav e in di cated that an

ar bitrat ion clause conta ined in the co ntract w ould not be bind ing. See, e.g., Chastain v. The Robinson-Hump hrey Co., I nc. , 957 F. 2d 851, 855 (11 th Cir. 1992). Such cases involve the as serted total absenc e of any express ed int ent t o arbitrate cont ractua l is sues. There is c learl y no such absence in this case , where at mo st the co ntract i s void able rathe r than void ab in it io. (We do not mean to sug gest that Prim a P aint cann ot ap ply in at least

some cases of contracts t hat are all egedly void, onl y tha t Pr ima Paint does apply wher e the cont ractis said to be voidabl e rath er than void .) severa bility doctrine. The teaching of Prima Paint is that
a federal court must not remove from the ar bit rators consideration o f a substantive challenge to a contrac t
un less there has been an independent challenge to th e making of the arbitration clauseitself. The basis of the underl ying

ch allenge to the contract does not alter the
severa bility principle . Thus, the

Seventh Ci

rcuit, applying Prima Pain t to a case similar to the one before us, h eld th at a par ty could n ot avo id arb itrat ion t hrough rescissionof an entire agreement when it had made no independent chal lenge to the arbitration clause. See, Wilson Wear, Inc. v. Un ite d Mercha nts & Manufact urers, Inc. , 713 F.2d 324, 327-28 (7th Cir. 1983).

Unionmutual

Stock Life

Ins. Co. of

Am. v. Be neficial Li fe Ins. Co. , 774 F.2d 524, 528-29 (1 st Cir. 1985). The reasoning applies a fortiori to a claim of mutual mistake. 2 In the instant case, Masco’s claims, includingits mutual mistake claim, are entirely unrelated to the arbitration clause. As Masco’s complaint makes cl ear, its a

llegat ion of mutual mistake
concerns the co verage of the automobile liability policies, not the arbitra tion clau se itself. Prima Pain t accord ingly requires
revers al.No. 03-3071 Masco Corp. v. Zurich Am. Ins. C

o., et al. 11

The judgmen

t of the district cou

rt i s REVE RSED and REMANDED

for proceedings consistent with this opinion. 12 Masco Corp. v. Zurich Am. Ins. C

o., et al. No. 03-3071

______________ DISSENT

______________ BOYCE F. MARTIN, JR., Circuit Judge, dissenting. This is not a simple

case. A t its core , it

asks whether a state-court decisio n cantrump the clear intent of the parties and bar
access to a declaration of rights in federal court. Bec ause I believe that Masco and Zurich did not agre e to arbitrat e this dispute, I respectfully

dissent. When we compel arbitration,
we should actualize the

parties' intent. I do not beli eve that

is what the Court has done. My principal difference with the Court, and the rea son I cannot join the opinion, is that I believe the arb i tration
a greem ent, as app lied to a dispute ove r uninsure d/underi

nsured- motorist

covera ge, isnot binding on the parties due to a mutual mistake. In other words, I believe the parties did not intend for thi s disput e to go arbitration. They did not intend for there to be u ninsured/underinsuredmotorist coverage at all.

The law is cle ar. "B efore c ompelling an unwilli

ng par ty to arbitrate, [a] court must engage in a limited review to d etermin e whether

the disput

e is arbit rable; me aning that a valid agreement to arbitrate exists between the parties and the specific dispute f

alls wit hin t he substantive scope of that agr e ement." Bratt Enters., Inc. v. Noble Intern., Ltd. , 338 F.3d 609, 612 (6th C ir. 200 3). "An arbitration agree ment may be invalidated for the same reasons for which a ny contract m ay be invalidate d, including forgery
, unconsc ion ab il it y, and lack of con sideration ." Fazio v. Lehman Bro s., Inc. , 340 F.3d 386, 393 (6th Cir. 2003). "'[O]rd in a rily state-law principles that govern formation of contracts' will apply

to this ana

lys i s." Id. at 394 (quoting First Options of Chicago, Inc. v. Kaplan , 514 U.S. 938, 944 (1995)). One who challenges an arbitration clause must makeNo. 03-3071 Masco Corp. v. Zurich Am. Ins. C

o., et al. 13

anargume

nt that is sp ecific t

o the arbitration clause and does notchallenge the con

tractas a whole. See Burden v. Check into Cash of Kent

ucky, LLC

, 267 F.3d

483, 491 ( 6th Ci r

. 2001).

There appears to be some dispute as to what state law governs the valid

ity of the arbitration agreement. Z urich sugge sts that New York law applies. Masco isnot willing to concede that New York law applies, but it doe s not offer a suggestion

of what law applies, or which it would p refer t o app ly

. The deductibles agreement contains a New York choice-of-law

provision, and the District Court applied New York law. I need not reac

h the issue in my reasoning
, however, as there is no conflict between Ohio and NewYork statelaw as to the relev a nt issue. Both Ohio and New York
reco gniz e that a de fense of mutual mista

ke will g eneral ly support the rescission or reformation o f a contract. See Reilley v. Richards
, 69 Ohio St. 3d 352, 352-53, 632 N.E.2d 507, 509 (1994) , and Morris v. New York City E mployee s' Ret. Sys. , 129 F. Supp. 2d 599, 605 (S.D.N.Y. 2001).

Under Ohio law, a "mistake is material when it is a mistake
as to a basic assumption on which the contract was made that ha s a material effect on the ag reed upon exchange o f promises. " R.J. Wildner Contracting Co., Inc. v. Ohio Tpk
., 913 F. Supp. 1031, 1041 (N.D. Ohio 1996). "The mutual mistake must . . . fr

ustrate t he in tent of the parties ." Ibid. Si mi la rl y, " [u]nder Ne

w York la

w a reme dy f

or mistake

is availab le only where a

mistake of both parties at the time the contract was ma de as to a basic assumption on which the contr act was made has a material effec t on the agree d exch ange of performance. " Emergent Capital In v. M gmt., LLC v. Stonep ath , 165 F. Supp. 2d 615, 624 (S.D.N.Y. 2001) (internal citations and quotations omitted). The mista ke must speak "to the very

nature of the subject sold . . . for example, where what b o th parties believed to be barren cow turns out to be a calf." Ibid. 14 Masco Corp. v. Zurich Am. Ins. C

o., et al. No. 03-3071

Iam convinced that under ei ther Ohio law or New York lawthe parties' mutual mistake as to t he ir repudiation of uninsure d/underi

nsured- motorist

coverage wasfundame

ntal, and signifi cantl y affe cted their agreed upon exchang e of promises. When Masco an d Zurich agreed to a rbitrate "any dispute" arisingout of the deductibles agreement, they knew what the ra nge of those disputes might be. They knew, because they had just neg otiated the substantive terms of the contract. Th ey both thought this contract was a barren cow, with unin sured /und erins ured-m otori st cov erage e xpressly rejected, not a calf, with coverage aple nty. I t is true that an Ohio Supreme Court case changed the covera ge from a barren
cowto a calf, but that does not change the nature of the mistake. Nor does it change the time of t he mistake. The parties were mistaken

as to a key

fact – what was be ing sold

– at the time they agreed to arbi trate "any dispute." By submitting this case

to arbitration, I believe

the Court ignores
a clear mu

tual mista

ke and jud

icially constructs intent to arbitra te when the facts at the time the parties signed the contract repudiate that construction.

Arbitrationis a creature of consent. Inland Bulk Transfer

v. Cummins Engine Co. , 332 F.3d 1007, 1015 (6th Cir. 2002). Consent, in turn, is a creature of in ten t. It is the parties' intent and not ours that dictates whether a dispute should be arbitrated. See Javitch v. First Union Sec., Inc. , 315 F.3d 619, 624 (2003). Here the parties were c lear as to their intende d
covera ge relation ship, and d eriv ativel y clear, although in an impliedway , as to the

limit ed sc ope of the arbitration agree ment. That the parties were mutually mistaken about

the scope of their uninsured/underinsured-motori s t coverage, or lack t here of, does not change their origina l limited intent as to arbitra tion. To do

so by judicial f

iat, it see ms, would frustrate their original purpose.

Relat ed ly, I don't fi nd per suasi ve the Court 's readi ng o f P rima Paint Corp. v. Flood & Conklin Manufacturing Co., 388 U.S. 395 (1967). Seealso Burden 267 F.3d at 491. TheNo. 03-3071 Masco Corp. v. Zurich Am. Ins. C

o., et al. 15

Prima Paint

Court held th at an argument that contests the applica bility of an arbitration ag

ree ment must be

specific to the arbitration

agreement and not be a def ense that invalidates the whole contract. Prima Paint, 388 U.S. at 404. Stretched to an extreme, the Prima Paint Court's instruction could bar
a lower court fro m loo king at the rest of a contract when analyzing the valid ity o f an arb itration a

greement. I do no t believe that was the intent of the Prima Pain t Court – especia lly in the co ntext of a mutual-mistake defense. The
reasons fo r n ot ap pl yi ng an arbitration agreement must be specific to the ar bitration agree ment, it istrue, but the pa

rties' intent, as manifested in the wh ole agreement, certainly can informour understanding of theparties' intent as t

o the scope of the ar bitrati on agree ment. Here, M asco an d Zuric h's specific exclusion o f uninsur ed/under insured-mo toris t
covera ge from their limited relationship suggests that they did notintend their arbitration agreement to control claims base d
onuninsured/underinsured-motorist coverage, or had at least notexpressly agr

eed to submit th ose cla im s t o ar bi tra ti on. It is our duty to give some e ffect to that repudiation. My an al ysi s i s n ot pr em is ed on a q ue st io n o f f or se ea bi li ty. Instead, it gives effect to the parties' c ontractual language. SeeDeputy v

. Lehman Bros. Inc., 345 F.3d 494, 513 (7th Cir. 2003). Put in abstract

terms, arbitra

tion agr eements speak to the parties' intent regarding how alleged

breaches of

duties are to be resolved. If, a

t the time they ag

ree to arbitrate alleged breaches of duty A or

B, part ies to a contract expressly agree that there is no duty C, I

believe it is a logical construction of the parties'

manifest ed intent not to arb itrate

any later a

lleged breach of the expressly

repudiated duty C.

The Court rej ects my

view, ar guing that my understanding is a hidden r

uling on t

he merits . I do

not th ink it i s. I concede, as I m

ust, that Masco can, and likel y will, asserta mutual-mistake defense

inthe substantive dispute . The fa cts alleged will be the

same, but

the leg al analy

sis wil l be differe nt. The ar

bitration analy sis looks on

ly a t where the 16 Masco Corp. v. Zurich Am. Ins. C

o., et al. No. 03-3071

1 The Ma jority distinguishes Ch astain v. T he Ro binson-Humphrey Co

., Inc. , 957 F.2d 85 1 (11th Cir. 1992) in a footnote. I, in t urn, di sagree in a footno te. In the b ody o f its opinio n, the M ajor ity argues that: "[t]he [ Pri ma Paint ] Cour t r eas oned t hat a courtmay cons ide r on lycl aim s considering the validi ty of t he arbitrati on clause itself, as op pos ed to chall enges to the validi ty of t he contract as a whole, in determining whether a valid agree men t exists." An te at 9. In Ch astain , the Ele venth Circu it reasoned that the Supreme Court's hol ding in Prima Paint does not compel t he ar bitrat ion of

"a purported cont

ractwhich indisp utab ly lacks the for mal it ies nec ess ary

to s ig nal Ch astain' s ex an te assent to t he agreement as a wh ole." Id. at 855 . W hile I be lieve tha t M asco 's mutualmist ake argument

sati sfi es the Prima Paint doc trine, it is eno ugh to note that the Ele venth Circuit

believed that an argument, which pote ntially

cou ld inval idate t

he contr act as a whole, could al so defea t an attem pt to compel arbitra tion. In es sence , t he qu estion to ask i s whether the purported invalidat ing caus e can be asserted once or t wice. If a party can only argue t

hat the cont

ract i s inv alid, then Prim a P aint instruct s that t he case sh ould be sent to arbi trat ion. I f th e argument can be ass erted twic e

– i.e., (1) the lack o f a sign ature inval idates the arbi tra ti on cl ause , an d (2) the lack of

a sig nature also i nvali dates t he contr act as a whole – t hen Pri ma Pa int's separability doctrine is s atisf

ied, and a distri ct court is f ree parties agreed to resolve a dispute. It is a question of contract lawand contract interpretation. Unlikethe Court, I suspect the resolution of the substantive issue will have very little to do with O hio c ontract law. The parties expressly excluded uninsure d/underinsured- motorist coverage f

rom t hei r contractual relationship. My hunch is that the parties will be tossing around arguments rega rding : g ratuitous

pay ments, failure to join, implied indemnities, a nd th e like. Co ns eq ue nt ly, the trier

of the sub stantive i ssue will li kely resolve a question of equ ity an d fairness, not a question of contract law. Thus, I

do notthink my analy

sis is a ruling on the merits. The mutual mistake certain ly d efeats the claim that the parties should be c ompelled to resolv e this dispute in arbitration, but it does not necessarily re solve the merits question. After reviewing the equities, the trier of the subst antive issu e may or may not find i n favo r of Zu rich

. Whe re to resolve the dispute and how to resolve the dispu t e are sep arate q

uestions. 1No. 03-3071 Masco Corp. v. Zurich Am. Ins. C

o., et al. 17

to move on t o h earing the me rits of the ca se. I be lieve m y argum ent is entirely consistent with this p osi tion. As I have expla ined, the mutua lmist ake defens e can be ass erted t wice. Iadm it I a m not with out s ome sympa thy for Zur ich's argume nt. The parties agreed that disputes arising out of the "interpretation, performance or allege d breach" of the deductibles agree

ment would

be submitte d to arbitr

ati on . The Court ac cepts this

contenti on and be lieves thi s is a dispu te about deductib les. I

believe that view

is too narrow. To reach the conclusion advanced, the Cou rt has to read the deductibles agreement and the arbitra

tion clau se in a va

cuum. This is actua

lly a dispute about

the deductibles agreement as it re lat es to uninsured/underinsured-motorist coverage –
covera ge that both p arties thought a t the time they

agree d to arbitra te deductib les dispute s had bee n expressl y rejected. At best, Zurich can argue that the parties proba bly would have wanted to submit this type of claim to arbitration, but "p ro ba bl y" is not enough. Although there is a "liberal fede ral policy favoring arbit ration agreement s," Mo s es H. Cone Memorial Hosp. v. Mercury Const. Cor p. , 460 U.S. 1, 24 (1983), and it is "a well establ ished ru le that any doubt regarding arbitra bilit y sho uld be resolved in favor of arbitration," Fazio , 340 F .3d a t 392, "[t ]he duty

to arbitr ate
a dispute derives from the parties' ag reement and a party cannot be required to submit to arbitration any dispute that the party has not agre ed to su

bmit." Bratt Ente

rs. , 338 F.3d at 612. Evidence of what they might have done is different than evidence of what they did. Tha tthe arbitration agreement can be inter preted to cov er Zu rich' s claim is a product o f both parties' mistake, a

nd by submitting

this claim

to arbitr at ion, the Court exten

ds the sco pe of the origina l agre eme nt t o an extent I do not believe the parties ag reed to or intended.

Las tl y, I disagree with the Co urt's a lternative holding that Masco waived the mutual-mistake argument. I t is true that the Court in Rybarczyk

v. TRW, Inc., 235 F.3d 9 75, 984 (6 th 18 Masco Corp. v. Zurich Am. Ins. C

o., et al. No. 03-3071

Cir. 2000), stated that "[f]ailure to raise an i ssue on appeal would normally constitut e a wa iver ." B ut, in

the v ery next sentence, the Court states: "[h]ere, h o wever, we have a pure ques tion of law that cries out for resolution – and in such a situa tion we are not foreclosed from consider ing the issue." Ibid.; see also Hutcherson v. Lauderdale Cty. , 326 F.3d 747, 756 (6 th Cir. 2003) (holding an appellate court may rea c h legal issue not r

aised by the part ies to affirm the lower court). While I think Masco sufficie ntly raised the mistake argument to survive a waive

r challe nge, e ven if it ha

dn't, thi s is a

purely legal issue that cries out for resolution.

I re spectfu

lly d issent.