Opinion ID: 1403743
Heading Depth: 2
Heading Rank: 1

Heading: Whether Work Order was a valid contract.

Text: The issue to be resolved by the Court is whether the circuit court erred in determining that the indemnification question should be arbitrated according to the arbitration provision in the work order. The fundamental problem with the circuit court's decision stems from the absence of a clear ruling by the circuit court as to whether the work order constitutes a valid, binding contract between the parties. In the Order, the circuit court states that it feels that there is a valid work order and that the parties were bound. The circuit court, however, further acknowledges that more discovery may be needed on the issue. Moreover, the circuit court suggests that certain facts may need to be decided by a jury before the court could determine if the contract, as a matter of law, was binding. Generally, the existence of a contract is a question of fact for the jury. Syl. Pt. 4, Cook v. Heck's Inc., 176 W.Va. 368, 342 S.E.2d 453 (1986). Yet, in this case, despite the circuit court's acknowledgment that discovery may be needed on the issue of whether the work order is a valid contract between Halliburton and Texas Keystone, the circuit court decided the issue without allowing more factual development. Thus, the circuit court placed the proverbial cart before the horse. The circuit court must determine, or allow a jury to determine, whether the work order constitutes a valid contract between the parties before it can decide whether the indemnification claim falls within the scope of the arbitration provisions. If there is no contract between the parties, then there is no express indemnification between Halliburton and Texas Keystone and no arbitration provision. The only cross-claims that Halliburton could have asserted against Texas Keystone under this scenario are implied indemnification and contribution. [2] If, however, the circuit court finds that there was a valid, enforceable contract between Halliburton and Texas Keystone, the circuit court must apply this Court's well-established case law, which was most recently reiterated in syllabus point three of State ex rel. Clites v. Clawges, 224 W.Va. 299, 685 S.E.2d 693 (2009): It is presumed that an arbitration provision in a written contract was bargained for and that arbitration was intended to be the exclusive means of resolving disputes arising under the contract; however, where a party alleges that the arbitration provision was unconscionable or was thrust upon him because he was unwary and taken advantage of, or that the contract was one of adhesion, [3] the question of whether an arbitration provision was bargained for and valid is a matter of law for the court to determine by reference to the entire contract, the nature of the contracting parties, and the nature of the undertakings covered by the contract. Syllabus Point 3, Board of Education of the County of Berkeley v. W. Harley Miller, Inc., 160 W.Va. 473, 236 S.E.2d 439 (1977). 224 W.Va. at 301, 685 S.E.2d at 695, Syl. Pt. 3 (footnote added). In the instant matter, given the equivocal determination by the circuit court on the issue of whether the work order was a valid, binding contract between Halliburton and Texas Keystone, the circuit court erroneously dismissed the action by determining that the contract was binding.