Opinion ID: 787501
Heading Depth: 2
Heading Rank: 1

Heading: Marriott's Appeal10

Text: 19 Marriott appeals the District Court's conclusion that the Agreements allow CTF to litigate its claims and do not require arbitration. Marriott argues that the disputes at issue involved interpretation of provisions of the 1999 Agreement, and that CTF must arbitrate any disputes relating both to CTF and HPI hotels under the dispute resolution provision in that agreement. 20 Arbitration is strictly a matter of contract. If a party has not agreed to arbitrate, the courts have no authority to mandate that [it] do so. Bel-Ray Co. v. Chemrite, 181 F.3d 435, 444 (3d Cir.1999). Principles of contract law therefore govern our inquiry. When interpreting contracts, we are required to read contract language in a way that allows all the language to be read together, reconciling conflicts in the language without rendering any of it nugatory if possible. New Castle Cty. v. National Union Fire Ins. Co., 174 F.3d 338, 349 (3d Cir.1999). 21 Thus, Section IX.K of the 1999 Agreement controls our analysis. Marriott argues that Clause 2, which states that a dispute relating to a Hotel owned or leased by HPI must be resolved under the HPI Master Agreement, governs the disputes at issue. According to Marriott, the instant disputes relate to both HPI hotels and CTF hotels as is evident from the litigation/arbitration involving Marriott, CTF, and HPI. Therefore, argues Marriott, its dispute with CTF has to be governed by Clause 2 and the HPI Master Agreement controls. As noted above, the HPI Master Agreement contains a dispute resolution clause requiring the parties [thereto] to arbitrate disputes that can not be settled by the good faith efforts of those parties. 22 However, CTF was not a party to that agreement. Moreover, Marriott's interpretation ignores that Clause 1 of Section IX.K is also relevant to the disputes at issue here because they relate to CTF hotels as well as HPI hotels and thus implicate the CTF Master Agreement. As noted above, the CTF Master Agreement does not require arbitration of disputes between CTF and Marriott. As also noted above, we are obligated to interpret contracts in a manner that gives meaning to every word. If we read Clauses 1 (such dispute ... relates to ... a Hotel owned or leased by CTF) and 2 (such dispute... relates to ... a Hotel owned or leased by HPI) as mutually exclusive, the confusion disappears along with the conflict. Under this interpretation, where a dispute relates to CTF, the CTF Master Agreement governs and there is no duty to arbitrate pursuant to Clause 1; but where a dispute relates to HPI, the HPI Master Agreement governs and there is a duty to arbitrate pursuant to Clause 2. Accordingly, under New Castle County, we read Clauses 1 and 2 as mutually exclusive in order to eliminate the conflict and give meaning to every word in the relevant clauses of the 1999 Agreement. 23 Moreover, the resulting interpretation is eminently reasonable. The 1999 Agreement maintained the separate CTF and HPI Master Agreements with their corresponding dispute resolution provisions. As CTF observes, the lack of a unitary arbitration provision for disputes common to CTF and HPI in Section IX.K is no accident.. . . Brief at 21. Clause 3 makes this crystal clear. As noted above, Clause 3 provides that: Nothing herein is intended to require arbitration of any dispute under the CTF Master Agreement or to limit any right any party may have to proceed in federal or state court on any dispute under the CTF Master Agreement. Marriott's interpretation requires that we strike Clause 3 from the 1999 Master Agreement. Of course, we can not do that. 24 If the parties really intended the result Marriott urges upon us here, they could easily have provided for it by simply requiring that any dispute that similarly involves Marriott's operation of both CTF and HPI hotels be governed by the HPI Master Agreement or be subject to arbitration, notwithstanding anything to the contrary in the CTF Master Agreement. No such language appears, and Clause 3 is precisely to the contrary. That Clause clearly provides for certain disputes arising under the 1999 Agreement to be excepted from arbitration. It therefore vitiates Marriott's argument that Clause 2 gives rise to a presumption that all disputes arising under the 1999 Agreement must be arbitrated. Such a presumption is applicable only in the absence of any express provision excluding a particular grievance from arbitration.... AT & T Tech., Inc. v. Comm. Workers of America, 475 U.S. 643, 650, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986) (internal citation and quotation marks omitted). Moreover, even if the disputes regarding CTF hotels are identical to those regarding HPI hotels, CTF's claim pertains only to its hotels. Such disputes are subject to the CTF Master Agreement, and CTF is therefore not required to arbitrate. 25 Marriott argues that evidence outside the parties' contracts establishes that CTF and HPI have an identity of interests that makes them functionally the same corporation, thus binding CTF to HPI's contractual obligation to arbitrate disputes. Marriott also argues that, even if CTF is not actually contractually obligated to arbitrate these disputes, CTF should be estopped from litigating its claim because the parties' correspondence indicates that it relied on the HPI Master Agreement to assert its rights. Both arguments require us to consider evidence extrinsic to the written contract. Such evidence is admissible to explain the terms of a written contract when there is ambiguity in the contract. 58 N.Y. JUR. 2d Evidence and Witnesses § 586 (2003). 11 The contracts here leave no ambiguity regarding the terms of the dispute resolution mechanisms. Therefore, extrinsic evidence such as the parties' correspondence can not properly be considered. This leaves these arguments without any foundation. 26 Thus, the District Court correctly held that CTF is not required to arbitrate its dispute with Marriott, and it properly denied Marriott's motion to compel arbitration and enjoined the arbitration of CTF's disputes.