# FILE
IN CLERKS OFFICE IUPRS.4F. C()URT, STATEOFWASI•tcmlN

# m;r~~t2~9 CHIEFJUSriCE Ron 

### a
.**~upreme** CourtClerk


### IN THE SUPREME COURT OF THE STATE OF WASHINGTON

TIMOTHYWEIDERT, individually and L.W. WEIDERTFARMS, INC., a Washingtoncorporation, Respondents, 

### v. JERALDA. HANSON, d/b/aWALLA WALLAINSURANCE SERVICES, and JERALD andJANEDOEHANSON, husband and wife, Defendants, PRODUCERS AGRICULTURE INSURANCE COMPANY, Petitioner. NO. 8 8 2 9 3-2

ENBANC

Filed: 

### SEP l**~** 

### 2013

PER CURIAM-A superior court purporting to act in equity refused to compel arbitration pursuant to a valid arbitration clause in a federally mandated crop insurance contract. The Court ofAppeals affirmed. Weidert v. Hanson, 172 Wn. App. 106, 288 P.3d 1165 (2012). For the reasons discussed below, we grant review and
reverse. Through a private agent, Tim Weidert and L.W. Weidert Farms (collectively Weidert) bought a multiperil crop insurance policy for the 2009 crop year. The policy was issued by Producers Agriculture Insurance Company andNo. 88293-2 PAGE2
reinsured by the Federal Crop Insurance Corporation as established by the Federal Crop Insurance Act, 7U.S.C. § 1501. Policies issuedunder the federal act are subject to federal regulations governingtheterms, issuance, and sales ofsuchpolicies. The standard policy issued to Weidert expressly provided that any disagreement over a determination made by the insurer was to be resolved through arbitration, and that ifthe insured failed to either initiate arbitration or complete the arbitration process, judicial review would not be available. Weidert suffered a loss from drought and sued the private insurance agent, alleging that the agent misrepresentedthe amount ofinsurance coverage available. Weiderthad also initiated arbitration with Producers Agriculture but failed to complete the process. Weidert then amended the complaint to name Producers Agriculture as an additional defendant. Weidert's basic complaint was that Producers Agriculture, after it issued its initial estimated amount of insurance coverage available, determined that the insured's yields had changed and lowered the amount of coverage available. Accordingto Weidert, he overplanted onthe basis ofthe initial information, whichhe claims was negligentlyprovided. After Weidert amended the complaint to add Producers Agriculture as a defendant, Producers Agriculture moved to compel arbitration under the terms ofthe federal crop insurance policy. Weidert opposed arbitration, arguing that it would result in piecemeal litigation ofthe claims against the insurer and the agent. The superior court agreed andrefusedto compel arbitration. The Court ofAppeals affirmed, holding that a trial court sitting in equity may refuse to compel arbitration under an otherwise valid arbitration clause in the interest of judicialefficiency. ProducersAgriculturepetitioned forthis court'sreview. An agreement to submit a controversy to arbitration is valid, enforceable, and irrevocable "except upon a ground that exists at law or m equity for theNo. 88293-2 PAGE3
revocation ofa contract." RCW 7.04A.060(1). The Federal Arbitration Act provides the same. See 9 U.S.C. § 2 (an agreement in writing to submit a controversy to arbitration arising out ofa contract evidencing atransaction involving commerce shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation ofany contract). The term "'as exist at law or in equity"' refers to general contract defenses such as fraud, duress, or unconscionability, which may be applied to invalidate arbitration agreements without violating the federal arbitration mandate. Satomi Owners Ass'n v. Satomi, LLC, 167 Wn.2d 781, 813-14, 225 P.3d 213 (2009) (emphasis omitted) (quoting 9 U.S.C. § 2). Washington law provides substantially the same. Saleemi v. Doctor's Assocs., Inc., 176 Wn.2d 368, 376, 292 P.3d 108 (2013); McKee v. AT&TCorp., 164 Wn.2d 372, 383, 191 P.3d 845 (2008) (general contract defenses such as unconscionability may invalidate an arbitration agreement). There is no support for the notion that a court may ignore an otherwisevalid arbitration agreement onequitable grounds. The arbitration clause here is federally mandated. Crop insurance is underwritten by the Federal Crop Insurance Corporation. See 7 C.P.R. § 457.8 (required insurance policy). The federal regulation specificallyrequires arbitration of disputes arising under the policy. We agree with Producers Agriculture that the Federal Arbitration Act prohibits a state court from ignoring a valid federally mandated arbitrationclause onequitable grounds. We therefore grant the petition for review, reverse the Court ofAppeals, andremandto the superiorcourtfor furtherproceedings consistentwiththis opinion.