Source: https://www.cunninghambounds.com/blog/2017/august/arbitration-scope-of-agreement-daphne-automotive/
Timestamp: 2019-04-24 03:02:42+00:00

Document:
ARBITRATION - SCOPE OF AGREEMENT - DAPHNE AUTOMOTIVE, LLC V. EASTERN SHORE NEUROLOGY CLINIC, INC.
It is well established that “ ‘ “ ‘arbitration is a matter of contract, and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.’ ” ’ ” Custom Performance, Inc. v. Dawson, 57 So. 3d 90, 97 (Ala. 2010) (quoting Central Reserve Life Ins. Co. v. Fox, 869 So. 2d 1124, 1127 (Ala. 2003), quoting in turn AT & T Techs., Inc. v. Communications Workers of America, 475 U.S. 643, 648 (1986), quoting in turn United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582 (1960)). “A party typically manifests its assent to arbitrate a dispute by signing the contract containing the arbitration provision.” Smith v. Mark Dodge, Inc., 934 So. 2d 375, 380 (Ala. 2006).
Ms. at 8-9. The defendants contended that the plaintiffs were third-party beneficiaries of the sales contract signed by the employee (which contained an arbitration provision), because the plaintiffs’ medical practice purchased the vehicle to compensate the nephew for his employment. The Court ultimately found it unnecessary to determine whether the plaintiffs were third-party beneficiaries of the arbitration agreement because it found that the dealership was “seeking to enforce the arbitration agreements beyond the scope of those agreements.” Ms. at 12. The Court noted that the scope of the arbitration agreement signed by the dealership and the employee, though broad in terms of the types of disputes covered, was “limited to disputes that arise ‘between them,’ i.e., the ‘buyer/lessor’ (employee) and the ‘dealership.’” Ms. at 12. The Court concluded that the dealership could not compel arbitration because the agreements were “limited by the terms to disputes between the signatories.” Ms. at 14.

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