RENDERED: APRIL 1, 2022; 10:00 A.M.

NOT TO BE PUBLISHED

Commonwealth of Kentucky

Court of Appeals

NO. 2021-CA-0396-MR

COURTNEY BACHE APPELLANT 

v. 

APPEAL FROM JEFFERSON CIRCUIT COURT

HONORABLE ANN BAILEY SMITH, JUDGE

ACTION NO. 19-CI-006647

PHILIP SALLEE APPELLEE 

OPINION

AFFIRMING

**   **  **

BEFORE: ACREE, DIXON, AND K. THOMPSON, JUDGES.

DIXON, JUDGE: Courtney Bache appeals from an order denying her petition to 

compel arbitration entered by the Jefferson Circuit Court on March 16, 2021. 

Following review of the record, briefs, and law, we affirm. 

FACTS AND PROCEDURAL BACKGROUND

Courtney Bache and Philip Sallee entered into a written agreement, 

which included a nondisclosure provision and provided for damages if breached. It
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also contained an arbitration clause. Bache believed Sallee breached the 

agreement and demanded he pay her damages. When Sallee refused, Bache 

repeatedly demanded arbitration – but to no avail. Bache subsequently filed this 

action requesting that the trial court compel arbitration. The trial court ultimately 

denied Bache’s request, finding: (1) the Federal Arbitration Act (FAA)1 did not 

apply because the agreement did not involve interstate commerce, and (2) it could 

not compel arbitration because the agreement did not comply with the mandates of 

the Kentucky Uniform Arbitration Act (KUAA)2 by providing that arbitration

occur in Kentucky. This appeal followed. 

STANDARD OF REVIEW

An order denying a motion to compel arbitration is appealable under 

KRS 417.220(1). Conseco Fin. Servicing Corp. v. Wilder, 47 S.W.3d 335, 340 

(Ky. App. 2001). On review,

we defer to the trial court’s factual findings, upsetting 

them only if clearly erroneous or if unsupported by 

substantial evidence, but we review without deference 

the trial court’s identification and application of legal 

principles. Apparently the trial court made no factual 

findings in this case, but based its ruling solely on the 

application of certain principles of contract law to the 

 

1

 9 United States Code (U.S.C.) §§ 1 et seq. 

2

 Kentucky Revised Statutes (KRS) 417.045 et seq. 
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arbitration clause . . . . Our review, accordingly, is de 

novo.

Id. 

ANALYSIS

On appeal, Bache first asserts the FAA applies to the agreement. In 

Southland Corporation v. Keating, 465 U.S. 1, 16, 104 S. Ct. 852, 861, 79 L. Ed.

2d 1 (1984), the United States Supreme Court held that Congress intended the 

FAA to apply in state courts and to pre-empt state antiarbitration laws to the 

contrary. Stated another way, the FAA, where applicable, preempts all state law. 

See Saneii v. Robards, 289 F. Supp. 2d 855 (W. D. Ky. 2003).

The FAA provides:

A written provision in any maritime transaction or a 

contract evidencing a transaction involving commerce to 

settle by arbitration a controversy thereafter arising out of 

such contract or transaction, or the refusal to perform the 

whole or any part thereof, or an agreement in writing to 

submit to arbitration an existing controversy arising out 

of such a contract, transaction, or refusal, shall be valid, 

irrevocable, and enforceable, save upon such grounds as 

exist at law or in equity for the revocation of any 

contract.
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9 U.S.C. § 2 (emphasis added).

3

 Thus, as indicated by the above emphasized 

language, the FAA applies where there is “a contract evidencing a transaction 

involving commerce[.]” Id. See also Allied-Bruce Terminix Cos., Inc. v. Dobson, 

513 U.S. 265, 277, 115 S. Ct. 834, 841, 130 L. Ed. 2d 753 (1995). 

Concerning the applicability of the FAA, the Supreme Court of 

Kentucky observed:

The Federal Act applies to arbitration provisions in 

contracts “evidencing a transaction involving [interstate] 

commerce,” 9 U.S.C. § 2, and almost certainly applies 

here. Congress’s commerce power is interpreted broadly, 

and “may be exercised in individual cases without 

showing any specific effect upon interstate commerce if 

in the aggregate the economic activity in question would 

represent a general practice . . . subject to federal 

control.” Citizens Bank v. Alafabco, Inc., 539 U.S. 52, 

56-57, 123 S. Ct. 2037, 156 L. Ed. 2d 46 (2003) (citation 

and internal quotation marks omitted). The Supreme 

Court has held that health care is one such activity.

Ping v. Beverly Enters., Inc., 376 S.W.3d 581, 589 (Ky. 2012). 

Here, the trial court found the FAA inapplicable because the 

agreement dealt solely with matters concerning Kentucky parties and activity – or 

inactivity – and was, therefore, an intrastate contract as opposed to one involving 

interstate commerce. The trial court correctly found the case herein is 

 

3

 During the pendency of this appeal, this section was amended, effective March 3, 2022, to add 

the phrase “or as otherwise provided in chapter 4.”
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distinguishable from Ping because the actions and inactions4addressed in the 

agreement – namely nondisclosure of their relationship, refraining from litigating 

any disputes between themselves, returning one another’s personal property, and 

no further contact with each other – do not represent general practices subject to 

federal control, such as healthcare. 

Bache next argues the arbitration clause of the agreement is 

enforceable under the KUAA. However, the Supreme Court of Kentucky held, 

“[s]ubject matter jurisdiction to enforce an agreement to arbitrate is conferred upon 

a Kentucky court only if the agreement provides for arbitration in this state. Thus, 

an agreement to arbitrate which fails to include the required provision for 

arbitration within this state is unenforceable in Kentucky courts.” Ally Cat, LLC v. 

Chauvin, 274 S.W.3d 451, 455 (Ky. 2009) (emphasis added). 

 

4

 The United States Supreme Court has held:

The Constitution grants Congress the power to “regulate 

Commerce.” Art. I, § 8, cl. 3 (emphasis added). The power to 

regulate commerce presupposes the existence of commercial 

activity to be regulated. This Court’s precedent reflects this 

understanding: As expansive as this Court’s cases construing the 

scope of the commerce power have been, they uniformly describe 

the power as reaching “activity.” E.g., United States v. Lopez, 514 

U.S. 549, 560, 115 S. Ct. 1624, 131 L. Ed. 2d 626 [(1995)].

Nat’l Fed’n of Indep. Bus. v. Sebelius, 567 U.S. 519, 520, 132 S. Ct. 2566, 2572-73, 183 L. Ed.

2d 450 (2012). Thus, to the extent the agreement addresses inactions, the FAA cannot apply. 
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In the instant action, while the parties’ agreement includes a choice of 

law provision designating Kentucky law to be followed, it failed to include a forum 

selection clause, and absolutely no location was designated for arbitration to occur. 

“Such failure is fatal to the arbitration clause’s enforceability in this 

Commonwealth.” Padgett v. Steinbrecher, 355 S.W.3d 457, 463 (Ky. App. 2011). 

Accordingly, the trial court did not err in its denial of Bache’s motion to compel 

arbitration. 

CONCLUSION

Therefore, and for the foregoing reasons, the order of the Jefferson 

Circuit Court is AFFIRMED. 

ALL CONCUR.

BRIEFS FOR APPELLANT:

Steven R. Romines

Louisville, Kentucky 

BRIEF FOR APPELLEE:

Emily W. Newman

Paul A. Dzenitis 

Miranda R. Carter5

Louisville, Kentucky

James L. Deckard

Lexington, Kentucky 

 

5

 Miranda Carter moved the Court of Appeals to withdraw as counsel. Her motion was granted 

by order entered January 25, 2022.