*Pursuant to Local Rule 47.5, the court has determined that

this opinion should not be published and is not precedent except

under the limited circumstances set forth in Local Rule 47.5.4.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

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No. 96-40267

(Summary Calendar)

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PARSLEY DAIRY FARM, A TEXAS GENERAL PARTNERSHIP;

JOE PARSLEY; MARTHA PARSLEY; MICHAEL PARSLEY; 

JEFFREY PARSLEY; JOANN PARSLEY

Plaintiffs-Appellees

versus

CARGILL INCORPORATED, ET AL

Defendants

CARGILL INCORPORATED

Defendant-Appellant

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Appeal from the United States District Court

For the Eastern District of Texas

(6:95-CV-577)

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November 8, 1996

Before HIGGINBOTHAM, WIENER, and BENAVIDES, Circuit Judges.

PER CURIAM:*

Defendant-Appellant Cargill, Inc., Cargill Grain Division,

(Cargill) appeals the district court’s order denying Cargill’s

Motion to Abate and/or Dismiss and Proceed to Arbitration (Motion).
1The parties dispute whether the Sale Confirmation and

Contracts accompanied each shipment or were received shortly

thereafter; however, the resolution of this dispute is not

necessary for us to decide the instant case.

2

Finding that Cargill failed to assert its demand for arbitration in

a timely fashion, we affirm.

I.

FACTS AND PROCEEDINGS

Plaintiffs-Appellees Parsley Dairy Farm, a Texas general

partnership, and its partners, Joe Parsley, Martha Parsley, Michael

Parsley, Jeffrey Parsley, and Joann Parsley (collectively the

Parsleys), needed cottonseed to feed the cows on their dairy farm.

Martha Parsley (Ms. Parsley) discussed the purchase of cottonseed

with a Cargill salesman located in Minneapolis, Minnesota. Cargill

had already purchased cottonseed from Armistead Gin Co., Inc.

(Armistead) in Coushatta, Louisiana. Ms. Parsley and Cargill

reached an oral agreement on the price, quantity, and quality of

the cottonseed, and Cargill agreed that its truckers would deliver

three separate shipments of cottonseed from Coushatta to the

Parsley Dairy Farm in Texas. With or shortly after each delivery,

Cargill sent Ms. Parsley a Sale Confirmation and Contract

(Contract) which she signed but did not return.1 Each Contract is

a one page, preprinted document, on the front of which the

particular shipment is described and on the back of which the terms

and conditions of the sale are set forth. Specifically, the back
2Emphasis added.

3

of each Contract recites the following provision:

The parties both agree that the sole remedy for

resolution of all disagreements or disputes between the

parties arising under this contract shall be arbitration

proceedings under NGFA Arbitration Rules (or under the

Rules specified on the front of this contract, if

different). The decision and award determined by such

arbitration shall be final and binding upon both

parties.2

The front of each Contract refers to the National Cottonseed

Products Association Rules (NCPA Rules), indicating that

arbitration under the NCPA Rules provides the sole remedy for

resolution of all disagreements or disputes between the parties

arising under the Contract. 

Some of the Parsleys’ cows became sick and died after eating

the cottonseed purchased from and delivered by Cargill. The Texas

Feed & Fertilizer Control Service ordered Cargill to recall the

cottonseed and ruled Cargill in violation of the Texas Feed Act for

selling adulterated feed. On May 4, 1995, Cargill received written

notice of the Parsleys’ claims under the Texas Deceptive Trade

Practices Act. Just two months later, on July 14, 1995, the

Parsleys filed suit in Texas state court against Cargill and

Armistead, alleging under various theories that Cargill and

Armistead produced, manufactured, distributed, or sold contaminated

cottonseed. Cargill removed the case to federal court and

answered, seeking contribution or indemnity, or both, against
3Snap-On Tools Corp. v. Mason, 18 F.3d 1261, 1264 (5th Cir.

1994); Catholic Diocese of Brownsville v. A.G. Edwards & Sons,

Inc., 919 F.2d 1054, 1056 (5th Cir. 1993).

4

Armistead. On January 22, 1996--262 days after Cargill had

received written notice of the Parsleys’ claims and 191 days after

the Parsleys had filed suit in state court--Cargill filed a Motion

to Abate and/or Dismiss and Proceed to Arbitration, asserting for

the first time its demand for arbitration. The district court

denied Cargill’s Motion, and Cargill timely appealed.

II.

ANALYSIS

A. STANDARD OF REVIEW

We review de novo the district court’s decision not to compel

arbitration.3

B. NCPA RULES 93 AND 84

As earlier noted, each of the Contracts designates arbitration

under the NCPA Rules as the sole remedy for resolution of all

disputes between the parties arising under the Contracts. The NCPA

Rules recognize that agreements may be made and disputes may arise

between parties, some of whom may not be members of the National

Cottonseed Products Association (Association). In particular, NCPA

Rule 93 provides as follows:

No non-member may demand an arbitration against a

member of this Association.

If a dispute arises between a member and a nonmember, arbitration may be held if the member originates

the request and the non-member is agreeable thereto. In

such cases, the non-member must either (a) apply for
4National Cottonseed Products Association General Rules,

Chapter I, Article 7, Rule 93.

5Rule 84 provides: The member demanding an arbitration will be

referred to as the complainant. . . . Demand for an arbitration

shall be made by letter or telegram addressed to the Secretary of

the Association within 90 days after the complainant’s right to

arbitrate has accrued. National Cottonseed Products Association

General Rules, Chapter I, Article 7, Rule 84.

5

membership, accompanying such application by the

prescribed membership and arbitration fees, or (b)

deposit with the Association the regular arbitration fee

plus a special fee . . . .4

Cargill is a member of the Association, but the Parsleys are not.

The Parsleys, however, are parties to the Contracts which contain

the arbitration agreements. They became contractually bound by the

arbitration clauses by virtue of Ms. Parsley’s (1) signing the

Contracts, (2) failing to question or object to the arbitration

clauses in the Contracts, and (3) accepting the shipments of

cottonseed. By thus binding themselves to arbitrate under the NCPA

Rules, the Parsleys became Rule 93 non-members “agreeable” to

arbitrate under the NCPA Rules. As such, the Parsleys must be

deemed to have agreed to take all steps reasonably required by the

NCPA Rules, explicitly or implicitly, to facilitate arbitration.

Even though, as non-members, the Parsleys could not initiate

arbitration, they are nonetheless subject to all of the applicable

NCPA Rules. Thus they are entitled to enforce Rule 84's

requirement that the member who has been notified of a complaint

and who attempts to invoke arbitration must assert his right within

ninety days after that right has accrued.5 Even if we assume the
6

facts in the light most favorable to Cargill, i.e., that (1)

Cargill’s right to arbitration did not accrue, and thus the ninety

days did not begin to run, until Cargill received written notice of

the Parsleys’ claims, (2) the initial ninety-day period was

interrupted by the Parsleys’ filing suit on the seventy-first day

after Cargill received written notice of the Parsleys’ claims, and

(3) the ninety-day clock was thus re-set at day-one and commenced

to run anew from the date suit was filed, Cargill still would have

failed to assert its demand for arbitration within ninety days as

prescribed by Rule 84. Indeed, Cargill did not attempt to assert

its right to arbitrate until it filed its Motion 262 days after

receiving written notice of the Parsleys’ claims and 191 days after

the Parsleys filed suit. Until it finally filed that Motion,

Cargill slept on its right to demand arbitration. Cargill’s

receipt of written notice of the Parsleys’ claims--or, at a

minimum, service of the Parsleys’ suit--should have been a wake-up

call to Cargill, alerting it to the fact that a dispute existed and

that arbitration had to be demanded in the manner and within the

time set forth in the rules that its own contract form specified.

Cargill has no excuse for its failure to demand arbitration

timely. Cargill provided the Contracts, which mandate arbitration

subject to the NCPA Rules, and Cargill is a member of the

Association. As such, Cargill is presumed to be familiar with the

NCPA Rules and is certainly in a better position than the Parsleys,

who are not members, to know that a member desiring arbitration
7

must demand it in a timely fashion. Furthermore, the Parsleys’

filing suit in no way inhibited Cargill’s ability to demand

arbitration. And Cargill’s awareness of the suit is shown by its

prompt removal to federal court. If Cargill wanted arbitration, it

should have invoked it in accordance with the rules of its own

association. 

Cargill’s argument that by filing suit the Parsleys renounced

their status under the NCPA Rules as non-members agreeable to

arbitrate and thereby precluded themselves from invoking any other

NCPA Rule to avoid arbitration, in particular Rule 84's ninety day

limitation, is logically flawed. Even if we accept arguendo

Cargill’s argument that the Parsleys violated the arbitration

agreement by filing suit, at worst the Parsleys’ action is a

violation of the provision requiring arbitration; but it is not

conceivably a renunciation of applicability of the NCPA Rules when

and if Cargill should seek arbitration after such a violation by

the Parsleys. Cargill cannot be heard to insist on application of

the NCPA Rules to obtain arbitration while arguing out of the other

side of its mouth that the Parsleys have renounced their rights

under those rules. If the NCPA Rules apply at all, they apply in

their entirety.

In a last-ditch effort to salvage arbitration, Cargill

emphasizes the strong public policy favoring arbitration. This

public policy, however, cannot be invoked to cure Cargill’s
8

unreasonable delay--at least 101 days beyond the deadline under

NCPA Rule 84--in demanding arbitration as required by this rule,

especially when the delay was wholly attributable to Cargill’s

inaction. Cargill has no one to blame but itself for its

predicament. There may be circumstances in which the public policy

favoring arbitration could be the factor that pulls chestnuts out

of the fire, but that policy cannot magically resurrect Cargill’s

chestnuts from these cold, dead ashes 191 days after the fire

burned out. For the foregoing reasons, the district court’s order

denying Cargill’s Motion to Abate and/or Dismiss and Proceed to

Arbitration is

AFFIRMED.