Opinion ID: 2486093
Heading Depth: 2
Heading Rank: 2

Heading: Whether Alfonso, acting as Pass's agent, has a right to compel arbitration.

Text: ¶ 14. Lemon Drop first argues that Alfonso has no right to compel arbitration as a nonsignatory. But under the Agreement, Alfonso is Pass's express agent. See supra ¶ 2 (Alfonso represent[s] the SELLER and IS NOT a Buyer's agent....). An express agent is one who is `in fact authorized by the principal to act on their behalf.' McFarland v. Entergy Miss., Inc., 919 So.2d 894, 902 (Miss.2005) (citation omitted). Consistent with Mississippi law and the law of other states, Alfonso, as Pass's agent, had the right to compel arbitration based on the Agreement between Pass and Lemon Drop. [4] See Garcia v. Huerta, 340 S.W.3d 864, 869 (Tex.App.2011) ([t]he scope of an arbitration agreement may be extended to claims against agents of the principal when all the agents' allegedly wrongful acts relate to their behavior as agents of the principal signatory company, and those acts were within the scope of the claims covered by the arbitration provisions for which the principal would be liable.) (citation omitted); Kiskadee Commc'ns (Bermuda), Ltd. v. Father, 2011 WL 1044241, at  (N.D.Cal. March 22, 2011) (agents of a signatory can compel the other signatory to arbitrate so long as (1) the wrongful acts of the agents for which they are sued relate to their behavior as agents or in their capacities as agents ... and (2) the claims against the agents arise out of or relate to the contract containing the arbitration clause ....) (citations omitted); Sawyers, 26 So.3d at 1038 (quoting B.C. Rogers Poultry, Inc. v. Wedgeworth, 911 So.2d 483, 491-92 (Miss.2005)) ([a] nonsignatory should have standing to compel arbitration where the non-signatory has a close legal relationship, such as, alter ego, parent/subsidiary, or agency relationship, with a signatory to the agreement.); Amisil Holdings Ltd. v. Clarium Capital Mgmt., 622 F.Supp.2d 825, 832 (N.D.Cal. 2007); Arnold v. Arnold Corp., 920 F.2d 1269,1282 (6th Cir.1990). ¶ 15. Lemon Drop alternatively argues that, even if Alfonso had the right to compel arbitration, Pass waived that right. But this Court previously has rejected the proposition that one defendant may waive [a] defense on behalf of all defendants. Am. Family Life Assurance of Columbus v. Ellison, 4 So.3d 1049, 1052 (Miss.2009). In Ellison, the plaintiff filed a complaint against AFLAC and two of its agents, in their individual and corporate capacities, for breach of the duty of good faith and fair dealing. See id. at 1050. In its answer, AFLAC asserted improper venue as one of its affirmative defenses. Id. The two agents filed a separate answer, but failed to raise the defense of improper venue and, thus, waived it. Id. at 1050-51. Yet this Court recognized that the defense of improper venue was a personal defense that did not belong to one defendant exclusively, such that the agents' waiver did not waive the defense for AFLAC. See id, at 1051-52. ¶ 16. The same logic is controlling in this case. Pass's waiver is not imputed to Alfonso. We previously have stated that arbitration pertains to forum. See Covenant Health & Rehab. of Picayune, LP v. Estate of Moulds, 14 So.3d 695, 697 (Miss. 2009). Moreover, arbitration is in the nature of an affirmative defense. See Miss. R. Civ. P. 8(c). As arbitration is a forumrelated defense (i.e., an appropriate venue), emanating from arbitration law and provided for contractually in this case, a demand to arbitrate must be timely raised. The Motion to Compel Arbitration filed by Alfonso is akin to the Rule 12(b)(3) motion to transfer venue at issue in Ellison. [5] See Ellison, 4 So.3d at 1050 (the question presented is whether the trial court abused its discretion when it denied the defendant's motion to transfer venue.). Stated succinctly, both a motion to compel arbitration and a motion to transfer venue challenge the forum where the dispute should be resolved. Furthermore, a motion to compel arbitration is no less personal than a motion to transfer venue. The decision to exercise the right to arbitrate, vel non, is often made for strategic reasons consistent with the client's best interests (e.g., familiarity with local courts; lack of discovery, without permission, in arbitration; the reputation of client and counsel in the community; cost considerations; preference for a jury trial as opposed to a decision rendered by arbitrator(s); etc.). Such strategy considerations undeniably are personal and may differ as between the principal and agent. In Ellison, AFLAC was not bound by its agent's decisions, strategic or otherwise, [6] resulting in the agents' waiver of the venue defense. See id. at 1049, 1052. Therefore, Pass's waiver is not imputed to Alfonso. [7] ¶ 17. Although this is a matter of first impression for this Court, recent decisions in other states support the same conclusion. The only courts faced with this identical question have enforced arbitration agreements pleaded by nonsignatory agents for alleged wrongful acts related to their behavior as agents, holding that the principal's waiver of its right to arbitrate did not operate as a waiver of the agent's right to arbitrate under the same agreement. See Garcia, 340 S.W.3d at 869-70; Kiskadee Commc'ns, 2011 WL 1044241, at . In Garcia, the plaintiffs asserted that [the principal's] express waiver ... must be imputed to Garcia because he acted as [a nonsignatory] agent of [the principal], and his right to arbitration was therefore derivative of [the principal]. Garcia, 340 S.W.3d at 869-70. But the Texas appellate court rejected that assertion, determining that [t]he [plaintiffs] cite no authority for this proposition, and we cannot agree that one party's waiver of the right to arbitration can be imputed to another. Id. at 870 (emphasis added). See also Kiskadee Commc'ns, 2011 WL 1044241, at  ([p]laintiff reasons that [defendantagents] should be bound by [the principal's] alleged waiver of the arbitration clause because `[j]ust as acts of an agent within the scope of the agent's powers bind his principal as a matter of law, acts of the principal are equally binding on the agent.' Plaintiff, however, does not cite any legal authority for this proposition. On the contrary, `[a] principal cannot bind its agent.' Accordingly, [the principal's] alleged waiver of the arbitration clause could not bind the [defendant-agents].) (citation omitted) (emphasis added). Like the plaintiffs in Garcia and Kiskadee Communications, Lemon Drop has failed to cite any legal authority to support the contention that Pass's waiver should bind Alfonso. [8] ¶ 18. Given the presumption against the waiver of arbitration, and Alfonso's prompt Motion to Compel Arbitration after Lemon Drop filed its First Amended Complaint, there can be no dispute that Alfonso timely and properly asserted its arbitration rights. See Horton, 926 So.2d at 179-80.