Title: Southern Energy Homes, Inc. v. Kennedy
Citation: 774 So. 2d 540
Docket Number: 1980365
State: Alabama
Issuer: Alabama Supreme Court
Date: May 26, 2000

774 So. 2d 540 (2000)
SOUTHERN ENERGY HOMES, INC.
v.
Letha C. KENNEDY et al.
1980365.

Supreme Court of Alabama.
May 26, 2000.
*541 John Martin Galese and Jeffrey L. Ingram of Galese &amp; Ingram, P.C., Birmingham, for appellant.
D'Wayne May and J. Glen Padgett of May &amp; Padgett, L.L.P., Butler, for appellees.
LYONS, Justice.
Southern Energy Homes, Inc. ("Southern Energy"), appeals from the trial court's order denying its motion to compel arbitration of claims made against it by Letha C. Kennedy, Jeannie M. Kennedy (Letha Kennedy's daughter), and Sandra J. Ford (Letha Kennedy's sister and Jeannie Kennedy's aunt). (The plaintiffs are *542 sometimes referred to hereinafter collectively as "the Kennedys.") We affirm.
On March 28, 1996, the Kennedys purchased a mobile home from Jack Lee, doing business as Jack Lee Mobile Homes. That mobile home had been manufactured by Southern Energy. One of the documents executed during the purchase transaction was a document entitled "ALTERNATIVE DISPUTE RESOLUTION AGREEMENT." Jack Lee signed this document in the space provided for the seller's signature, and all three of the plaintiffs signed it in the spaces provided for the buyers' signatures. The names of the parties were not inserted, however, in several blanks in the document, and a blank related to the term "State" was not filled in. The agreement states:
(Capitalization, other emphasis, and blank lines in original.) The sales contract referenced in the arbitration agreement is not included in the record on appeal.
Southern Energy says that it extended a written warranty on the mobile home purchased by the Kennedys. A copy of the warranty Southern Energy says it provided appears in the record on appeal. The following text appears on the pages of that warranty numbered 4 and 5 (pages 1-3 are not included in the record):
We note that the warranty is a form document and that nothing on the copy submitted in the record indicates whether, or when, this document was provided to the Kennedys.
On March 25, 1998, the Kennedys sued Jack Lee, Southern Energy, and fictitiously named defendants, alleging negligence, fraud, and breach of express and implied warranties, against both of the named defendants. Specifically, the Kennedys alleged that Jack Lee and Southern Energy told them that the mobile home was new, "was free of defects," and "was top of the line"; that in fact these representations were false; that Jack Lee and Southern Energy breached written and implied warranties on the mobile home; and that Jack Lee, "acting by and through its agents, servants, or employees, negligently carried, transported, set up, installed, and built the foundation for the mobile home." Southern Energy and Jack Lee both moved to compel arbitration of the Kennedys' claims against them. The trial court denied both motions to compel arbitration. Southern Energy appealed from the order denying its motion. Jack Lee did not appeal.
Southern Energy argues that the Kennedys are bound by the arbitration provisions contained in its written warranty, and that, based upon those warranty provisions, the trial court erred in denying its motion to compel arbitration. In the alternative, Southern Energy argues that it is entitled to compel the Kennedys to arbitrate their claims against it, based upon the arbitration agreement the Kennedys signed when they purchased the mobile home.
We first address Southern Energy's argument that the arbitration agreement between the Kennedys and Jack Lee entitles Southern Energy to compel arbitration. The arbitration agreement is specifically applicable to the parties who executed it, namely, the Kennedys as the buyers and Jack Lee as the seller. The language of the arbitration agreement does not reach the manufacturer; therefore, Southern Energy is not by the terms *545 of that agreement entitled to compel arbitration. First American Title Ins. Corp. v. Silvernell, 744 So. 2d 883 (Ala.1999).
Southern Energy also argues that it is entitled to compel arbitration on the basis that the Kennedys' claims against it are inextricably intertwined with their claims against Jack Lee. This Court has held that in some circumstances a nonsignatory can compel arbitration of claims against it if those claims are sufficiently intertwined with claims against a signatory to the agreement containing the arbitration clause. See, e.g., Ex parte Napier, 723 So. 2d 49 (Ala.1998); Ex parte Dyess, 709 So. 2d 447 (Ala.1997). In such a case, the doctrine of equitable estoppel allows the nonsignatory to compel arbitration. MS Dealer Service Corp. v. Franklin, 177 F.3d 942 (11th Cir.1999). In Franklin, the United States Court of Appeals for the Eleventh Circuit discussed the circumstances in which equitable estoppel arises:
177 F.3d  at 947 (interpolations and ellipses in Franklin).
We can lay to one side the first circumstance described in Franklin because the Kennedys assert a claim against the signatory to the arbitration agreement, Jack Lee, based on a contract separate from the freestanding arbitration agreement executed in this case. We are not aware of any other contract in this case that contains an arbitration clause. Nonsignatories may not compel arbitration of claims against them when those claims arise independently of the contract containing the arbitration clause. Ex parte Roberson, 749 So. 2d 441 (Ala.1999) (Lyons, J., concurring as to the section entitled "Agreement to Arbitrate"). That is what Southern Energy seeks to do here.
As for the second circumstance in Franklin, a critical factor is missing in this case that is necessary to allow Southern Energy to compel the Kennedys to arbitrate their claims against it based on a theory that their claims against Southern Energy are inextricably intertwined with their claims against Jack Lee. The concept of "intertwining" necessarily presupposes that the signatory to the arbitration agreement is or will be engaged in an arbitration proceeding with the plaintiff. In this case, Jack Lee did not appeal the trial court's denial of its motion to compel arbitration. Therefore, there is no pending or contemplated arbitration proceeding in which the doctrine of equitable estoppel could allow Southern Energy to compel the Kennedys to arbitrate their claims against it. In other words, "intertwining" requires at least two threads to weave togetherone cannot intertwine a single thread. Under the circumstances presented by this case, requiring Southern Energy to litigate the Kennedys' claims against *546 it cannot render arbitration proceedings meaningless, nor can it thwart federal policy in favor of arbitration.
Finally, we address Southern Energy's argument that the arbitration clause in the warranty it says it provided to the Kennedys entitles it to compel them to arbitrate their claims against Southern Energy. In support of its motion to compel arbitration, Southern Energy attached a copy of the warranty it said was provided to the Kennedys (quoted above). It also attached an affidavit from Don McNutt, Southern Energy's director of consumer affairs. He testified:
The copy of the warranty that is in the record, however, is simply a standard form, and the only evidence submitted by Southern Energy that indicates that it was provided to the Kennedys is McNutt's affidavit. The warranty contains no notation or certification indicating that the Kennedys received a copy of the warranty, and no documents related to the transaction in which the Kennedys purchased the mobile home, other than the arbitration agreement between the Kennedys and Jack Lee, are included in the record.
As Southern Energy points out, the Kennedys' complaint alleges a breach of both express and implied warranties. The complaint states:
Despite having alleged that Southern Energy breached both written and implied warranties, however, two of the plaintiffs executed affidavits in which they claim that they never received the written warranty relied upon by Southern Energy. *547 These affidavits were submitted as exhibits to the Kennedys' response to the motions to compel arbitration. Jeannie Kennedy testified in her affidavit as follows:
Letha Kennedy also executed an affidavit that contains testimony identical to that given by Jeannie. Southern Energy made no further evidentiary submissions after the Kennedys responded to its motion to compel arbitration.
Jeannie Kennedy and Letha Kennedy, in their affidavits, state unequivocally that they never received the warranty Southern Energy says it extended and that Southern Energy has never provided any service to them pursuant to that warranty. As previously noted, Southern Energy's records custodian described the warranty attached to Southern Energy's motion to compel arbitration as the warranty extended to the Kennedys. The evidence was in conflict as to whether Southern Energy had provided the Kennedys with the warranty form containing the arbitration provision, and the trial court was therefore entitled to find that there was no express contract of warranty, and, therefore, no arbitration agreement between Southern Energy and the Kennedys. See Shearson Lehman Bros., Inc. v. Crisp, 646 So. 2d 613, 617 (Ala.1994) (holding that the court should decide challenges to the very existence of an agreement that includes an arbitration provision). We therefore must reject Southern Energy's argument that it is entitled to compel arbitration on the basis of the arbitration clause contained within the warranty. However, the Kennedys are foreclosed from maintaining any claim they may have had against Southern Energy for its alleged breach of the express written warranty.
Under the circumstances presented by this case, we affirm the order denying Southern Energy's motion to compel arbitration.
AFFIRMED.
HOOPER, C.J., and MADDOX, HOUSTON, COOK, SEE, BROWN, JOHNSTONE, and ENGLAND, JJ., concur.