1

FILED

March 5, 1996

Cecil Crowson, Jr.

Appellate Court Clerk

I N THE COURT OF APPEALS OF TENNESSEE

DUANE A. PETERS, ) C/ A NO. 03A01- 9508- CV- 00295

) BLOUNT COUNTY CI RCUI T COURT

 Pl a i ntif f - Appe lla nt , )

)

)

)

v. )

) HONORABLE W. DALE YOUNG,

) J UDGE

)

)

)

)

COMMONWEALTH ASSOCI ATES, )

) APPEAL DI SMI SSED

 De f e nda nt - Appe l l ee. ) REMANDED

KEVI N W. SHEPHERD, Ma r yville , for Appe lla nt .

DAVI D T. BLACK a nd C. EDWI N SHOEMAKER of KI ZER AND BLACK,

Ma r yville , for Appe lle e .

O P I N I O N

 Sus a no, J .
1

T.C.A. § 48-2-101, et seq.

2

T.C.A. § 47-18-101, et seq.

3

Commonwealth also relied upon the Federal Arbitration Act. We do not

find it necessary to determine if this federal legislation is applicable to

this case. Cf. Arnold v. Morgan Keegan & Co., Inc., 03S01-9410-CH-00091, 1996

WL 15857 at *7, footnote 2 (Supreme Court at Knoxville, January 16, 1996).

2

Thi s i s a n a c t i on br ought by Dua ne A. Pe t e r s ( Pe t e r s )

f or a l l e ge d vi ol a t i ons of t he Te nne s s e e Se c ur i t i e s Ac t of 19801

a nd t he Te nne s s e e Cons ume r Pr ot e c t i on Ac t of 19772. Pe t e r s ' s ui t

a ga i ns t Commonwe a l t h As s oc i a t e s ( Commonwe a l t h) a r os e out of

i nve s t me nt s ma de by Pe t e r s t hr ough Da vi d Dudki n, a n a ge nt of

Commonwe a l t h. Commonwe a l t h move d t o s t a y t hi s a c t i on a nd t o

c ompe l a r bi t r a t i on of Pe t e r s ' c l a i ms pur s ua nt t o T. C. A. § 29- 5-

301 e t s e q. , the Uni f or m Ar bitr a tion Ac t

3

. I n s uppor t of i t s

mot i on, Commonwe a l t h r e l i e d upon a wr i t t e n a gr e e me nt , s i gne d by

Pe t e r s , whe r e i n he agr eed t o s ubmi t al l cont r ove r s i e s be t ween t he

pa r tie s to a r bitr a tion. The tr i a l c our t gr a nt e d Commonwe a lth' s

mot i on, s t a yi ng a l l pr oc e e di ngs i n c our t a nd or de r i ng t he pa r t i e s

t o pr oc e e d with a r bitr a tion. Pe t e r s a ppe a l s , ra i s i ng the

f ol l owi ng i s s ue s :

1. I s t he a r bi t r a t i on a gr e e me nt voi d unde r

t he pr ovi s i ons of t he Te nne s s e e Se c ur i t i e s

Ac t of 1980?

2. Di d the tr i a l c our t e r r in or de r i ng

a r bitr a tion of Pe t e r s ' c l a i ms ?
3

I

Pe t e r s doe s not di s put e t ha t he s i gne d a " Cus t ome r

Agr e e me nt " wi t h Commonwe a l t h whi c h s t a t e s t ha t " c ont r ove r s i e s

a r i s i ng be t we e n [ Pe t e r s ] a nd [ Commonwe a l t h] . . . s ha l l be

de t e r mi ne d by a r bitr a tion. " He a s s e r t s , h owe ve r , tha t the

a gr e e me nt i s voi d unde r t he f ol l owi ng pr ovi s i on of t he Te nne s s e e

Se c ur i t i e s Ac t of 1980:

Any c ondi t i on, s t i pul a t i on, or pr ovi s i on

bi ndi ng a ny pe r s on a c qui r i ng a ny s e c ur i t y t o

wa i ve c ompl i a nc e wi t h a ny pr ovi s i on of t hi s

pa r t or a ny r ul e or or de r he r e unde r i s voi d.

 

T. C. A. § 48- 2- 122( i ) . Pe t e r s c ont e nds t ha t " t he a r bi t r a t i on

limita tion withi n hi s Cus t ome r Agr e e me nt is a pr ovi s i on whi c h

woul d a ttempt to limit [ hi s ] a bility to c ha lle nge " Commonwe a lth

f or a l l e ge d s t a t ut or y vi ol a t i ons . Pe t e r s f ur t he r a r gue s t ha t

" [ t ] he tr i a l c our t ' s a c tion in c ompe lling a r bitr a tion ha s in

e f f e c t pr e e mpt e d t he a ppl i c a t i on of t he t wo s t a t ut or y vi ol a t i ons

r a i s e d by [ hi m] . "

As can be s een, Pe t e r s ar gue s i n t he al t e r na t i ve .

Fi r s t , he c ont e nds t ha t t hi s c a s e i s not c ont r ol l e d by t he

Uni f or m Ar bi t r a t i on Ac t be c a us e , s o t he a r gume nt goe s , t he

a r bi t r a t i on pr ovi s i on i n que s t i on i s voi d a s vi ol a t i ve of T. C. A.

§ 48- 2- 122( i ) . Se c ond, he c ont e nds t ha t e ve n i f t he Uni f or m

Ar bi t r a t i on Ac t a ppl i e s , t he t r i a l c our t s houl d not ha ve or de r e d
4

a r bitr a tion. We will a ddr e s s the a ppe lla nt ' s f i r s t is s ue f or the

t hr e s hol d pur pos e of de t e r mi ni ng whe t he r t he pa r t i e s ' Cus t ome r

Agr e e me nt is s ubj e c t to the Uni f or m Ar bitr a tion Ac t .

I I

The pos i t i on a dva nc e d by Pe t e r s i n hi s f i r s t i s s ue wa s

r e j ect e d by t he Uni t e d St a t e s Supr e me Cour t i n a case ar i s i ng

unde r a f unc t i ona l l y i de nt i c a l pr ovi s i on of t he f e de r a l

Se c ur i t i e s Ac t of 1933. I n Rodr i gue z de Qui j as v .

She ar s on/ Ame r i c an Exp., I nc ., 490 U. S. 477, 109 S. Ct . 1917, 104

L. Ed. 2d 526 ( 1989) , t he c our t f ound a n a gr e e me nt t o a r bi t r a t e

di s put e s e nf or c e a bl e , not i ng t ha t

[ b] y a gr e e i ng t o a r bi t r a t e a s t a t ut or y c l a i m,

a pa r t y doe s not f or go t he s ubs t a nt i ve r i ght s

a f f or de d by t he s t a t ut e ; i t onl y s ubmi t s t o

t he i r r e s ol ution in a n a r bitr a l, ra t he r tha n

a judi c i a l, f or um.

I d., 490 U. S a t 481, 109 S. Ct a t 1920. We a gr e e wi t h t he

a na l ys i s of t he Supr e me Cour t . Pe t e r s ' s ubs t a nt i ve s t a t ut or y

r i ght s wi l l not be a br i dge d by s ubmi s s i on of hi s c l a i ms t o a body

of a r bi t r a t or s r a t he r t ha n t o a j udi c i a l f or um. The f ol l owi ng

obs e r va t i on by t he c our t i n Rodr i gue z de Qui j as hol ds t r ue he r e :

The r e i s not hi ng i n t he r e c or d be f or e us , nor

i n t he f act s of whi c h we can t a ke j udi c i a l

notic e , to indi c a t e tha t the a r bitr a l 

s ys t e m . . . woul d not a f f or d t he pl a i nt i f f

t he r i ght s to whi c h he is e ntitle d.
5

I d., 490 U. S. a t 483, 109 S. Ct . a t 1921. We hol d t he a r bi t r a t i on

pr ovi s i on a t i s s ue i n t hi s c a s e i s not voi de d by T. C. A. § 48- 2-

122( i ) . The r e f or e , t he pa r t i e s ' Cus t ome r Agr e e me nt i s s ubj e c t t o

t he Uni f or m Ar bitr a tion Ac t .

III

 Re ga r di ng Pe t e r s ' ge ne r a l cha l l e nge t o t he t r i a l

c our t ' s or de r c ompe l l i ng a r bi t r a t i on, Commonwe a l t h a r gue s t ha t

s uc h a n or de r i s not a ppe a l a bl e unde r Te nne s s e e ' s s t a t ut or y

a r bi t r a t i on s c he me . We agr ee. I n t he unr e por t e d cas e of

Ande r s on Count y v . Ar c hi t e c t ur al Te c hni que s Cor p. , No. 03A01-

9205- CH- 00184, 1993 WL 5921 ( Cour t of Appe a l s a t Knoxvi l l e ,

J a nua r y 14, 1993) ( Fr a nks , J . ) , t hi s c our t a ddr e s s e d t he que s t i on

of whe t he r a n or de r c ompe l l i ng a r bi t r a t i on i s a ppe a l a bl e , a nd

c onc l ude d i t wa s not . We s t a t e d t he f ol l owi ng i n t he Ande rson

Count y opi ni on:

The Uni f or m Ar bi t r a t i on Ac t pr ovi de s whe n a n

a ppe a l a s of r i ght will lie in a r bitr a tion

c a s e s . T. C. A. Se c . 2 9- 5- 319 s t a t e s :

" Appeal . - - ( a ) An appeal ma y be t a ke n f r om:

( 1) An or de r de nyi ng a n a ppl i c a t i on

t o c ompe l a r bi t r a t i on ma de unde r

Se c . 29- 5- 303;

( 2) An or de r gr a nt i ng a n

a pplic a tion to s t a y a r bitr a tion

ma de unde r Se c . 29- 5- 303( b) ;

( 3) An or de r c onf i r mi ng or de nyi ng

c onf i r ma t i on of a n a wa r d;
4

T. C. A. § 29- 5 - 315 pr ovi d e s as f o l l o ws :

Upon t h e gr a n t i ng of an or d e r conf i r mi ng, modi f y i ng or

c o r r e c t i ng an a wa r d , j udgme n t or dec r e e s h a l l be

e n t e r e d i n conf o r mi t y t h e r e wi t h and be enf o r c e d as any

o t h e r j udgme n t or dec r e e . Co s t s of t h e appl i c a t i on,

a nd of t h e pr o c e e d i ngs s ubs e que n t t h e r e t o , and

d i s bur s e me n t s ma y be a wa r d e d by t h e cour t .

6

( 4) An or de r modi f yi ng or

c or r ect i ng an a wa r d;

( 5) An or de r va c a t i ng a n a wa r d

wi t hout di r e c t i ng a r e - he a r i ng; a nd

( 6) A j udgme nt or de c r e e e nt e r e d

pur s ua nt t o t he pr ovi s i ons of t hi s

pa r t .

 ( b) The Appe a l s ha l l be t a ke n i n t he ma nne r

a nd t o t he s a me e xt e nt a s f r om or de r s or

j udgme nt s in a c i vi l a c t i on. "

None of t he ba s e s f or a ppe a l s i n t he

f or e goi ng c ode s e c t i on i s me t . Si nc e t he

s t a t ut e a l l ows a n a ppe a l f r om t he gr a nt i ng of

a s t a y [ of a r bitr a tion] , the c or olla r y is no

a ppe a l i s pr ovi de d f r om t he de ni a l of a s t a y.

Mor e ove r , "j udgme nt or decr ee" r e f e r r e d t o i n

Se c . 29- 5- 319( a ) ( 6) i s t he e nt r y of j udgme nt

or decr ee as cont e mpl a t e d i n T. C. A. Sec. 29-

5- 315. 4

I d. a t 1993 WL 5921 a t *1. 

The Ge ne r a l As s e mbl y ha s not a me nde d T. C. A. § 29- 5- 319

t o a l l ow a n a ppe a l of a n or de r c ompe l l i ng a r bi t r a t i on s i nc e t he

Ande r s on Count y c a s e . We a dhe r e t o our j udgme nt t ha t we c a nnot

" r e a d i n" a pr ovi s i on a l l owi ng a n a ppe a l i n a f a c t ua l pa t t e r n not

s pe c i f i c a l l y r e c ogni z e d i n t he c ode pr ovi s i on t ha t de l i ne a t e s

whe n " [ a ] n a ppe a l ma y be t a ke n. " Fur t he r , i n l i ght of t he

Uni f or m Ar bi t r a t i on Ac t ' s pr ovi s i on ma nda t i ng t ha t " [ t ] hi s pa r t

s ha l l be s o c ons t r ue d a s t o e f f e c t ua t e i t s ge ne r a l pur pos e t o
5

T.C.A. § 29-5-320.

7

ma ke uni f or m t he l a w of t hos e s t a t e s whi c h e na c t i t

5

, " we f i nd

pe r s ua s i ve c a s e s i n a c c or d wi t h our vi e w f r om ot he r s t a t e s t ha t

ha ve e na c t e d t he pr ovi s i on of our Uni f or m Ar bi t r a t i on Ac t de a l i ng

wi t h a ppe a l s. Se e , e . g., Che m- As h, Inc . v . Ar kans as Powe r &

Li ght Co., 751 S. W. 2d 353 ( Ar k. 1988) ; Fayet t e Count y Far m Bur e au

Fe de r at i on v . Mar t i n, 758 S. W. 2d 713 ( Ky. App. 1988) ; Bl uffs ,

I nc ., v . Wy s oc ki, 314 S. E. 2d 291 ( N. C. App. 1984) ; s ee ge ne r al l y

Annot a t i on, Appe al abi l i t y of St at e Cour t ' s Or de r or De c r e e

Compe l l i ng or Re f us i ng t o Compe l Ar bi t r at i on, 6 A. L. R. 4t h 652

( 1981) .

Thi s appeal i s pr e ma t ur e . The r e f or e , we cannot r each

t he a ppe lla nt ' s is s ue c l a i mi ng tha t the tr i a l c our t e r r e d in

or de r i ng a r bi t r a t i on.

Thi s a ppe a l i s di s mi s s e d. The c os t s on a ppe a l a r e

t a xe d t o t he a ppe l l a nt a nd hi s s ur e t y. Thi s c a s e i s r e ma nde d t o

t he t r i a l c our t f or s uc h f ur t he r pr oc e e di ngs a s ma y be ne c e s s a r y,

c ons i s t e nt wi t h t hi s opi ni on.
8

____________________________

Cha r l e s D. Sus a no, J r ., J .

CONCUR:

___________________________

Hous t on M. Godda r d, P. J .

___________________________

He r s c he l P. Fr a nks , J .