Court Opinion

ID: 6930887
Source: CourtListenerOpinion
Date Created: 2022-07-23 23:59:51.78959+00
Date Added: 2024-06-11T16:07:09.882857
License: Public Domain

K.K. HALL, Circuit Judge,
dissenting:
In my view, the majority has rejected the most reasonable construction of the parties’ contract and, in doing so, has instructed the district court to compel a new arbitration on terms that cannot be detected on even the closest reading of the contract. I believe that the arbitration was conducted in compliance with the parties’ contract, and there were no defects in the arbitration serious’ enough to disturb the award. Consequently, I would affirm the judgment of the district court.
I.
The parties agreed to arbitrate all disputes, under the following clause:
DECIMO QUINTO:
Cualquier desaveniencia, mal entendido, querella o litis que se pudiese prestar en la interpretación y/o ejecución del presente CONTRATO, se resolverá mediante el lau-do (Fallo de Arbitradores) nombrados de común acuerdo. Esto puede ser en Nicaragua o la Asociación de Molineros de Ar-roz en los Estados Unidos.
In English, this clause means, according to Cargill:
FIFTEENTH:
Any dispute, misunderstanding, complaint or legal claim’which may arise in the interpretation and/or performance of this Contract shall be resolved by means of the judgment of arbitrators appointed by mutual agreement. This could be in Nicaragua or the Rice Millers’ Association in the United States.
ENABAS’ translation differs in a few respects. The differences are underlined:
FIFTEENTH:
Any dispute, misunderstanding, complaint or legal claim which may arise in the interpretation and/or performance of this Contract shall be resolved by arbitral award (decision of arbitrators) chosen by mutual agreement. This can be in Nicaragua or the Rice Millers’ Association of the United States.1
As the parties attempted to resolve the dispute without arbitration, Cargill expressed its preference to arbitrate, if necessary, before the Rice Millers’ Association (RMA). The RMA has a standing arbitration committee and a panel of arbitrators from whom the committee appoints three to hear any one *228case. Later, however, when ENAJBAS submitted the dispute to the RMA, Cargill balked at letting the committee select the individual arbitrators. It filed suit in district court .under the Federal Arbitration Act to compel arbitration by a panel of three arbitrators, consisting of one each appointed by the parties and a third appointed by the first two. Meanwhile, the RMA found that the contract contained a “mutual agreement” that the RMA was an acceptable arbitral forum and that the parties intended that any arbitration before the RMA would follow the RMA’s rules.
The district court ruled that the contract could reasonably be interpreted to deem the RMA an acceptable forum and to impliedly incorporate the RMA’s rules and procedures. The court also noted that the RMA was already beginning the arbitral process, and there was little practical sense in ordering some other arbitration. Accordingly, it denied Cargill’s request. Cargill appealed.
Next, the arbitration proceeded. The arbitrators found for ENAJBAS, and the decision was reduced to writing and distributed to the parties sometime shortly before November 24, 1992. The arbitrators awarded $1,338,-796.44, plus 18% interest from May 1, 1992, until payment.
On February 16, 1993, Cargill moved to vacate the award in district court, and E NA-BAS counterclaimed for • enforcement. The district court enforced the award, and Cargill appealed a second time.
II.
Arbitration is a creation of contract, and no one can be compelled to submit to an arbitration to which it has not agreed. Car-gill argues that it did not agree to arbitrate before RMA-appointed arbitrators, and the district court should have granted its motion to compel the parties to appoint arbitrators. ENAJBAS argues that the reference to the RMA in the final sentence of the clause amounts to a “mutual agreement” to the arbitrators who routinely conduct RMA arbi-trations.
I agree with ENAJBAS. The RMA is not a place. It is, among other things, a standing arbitral body with complete rules and procedures to handle disputes submitted to it. Under either party’s interpretation, the arbitration clause establishes at the very least that E NABAS and Cargill agree that the RMA is an acceptable forum. Generally, the agreement to arbitrate in a particular forum incorporates the rules and procedures of the forum. Scherk v. Alberto-Culver Co., 417 U.S. 506, 519, 94 S.Ct. 2449, 2457, 41 L.Ed.2d 270 (1974). This general rule can sometimes be overridden by the express terms of the parties’ contract,2 and Cargill maintains that the contract requires the parties to agree upon the individual human beings making up the RMA panel.
This interpretation of the contract is certainly not the most reasonable. It necessarily implies that the RMA will (indeed must) lend its imprimatur to an arbitration conducted under its roof by utter strangers, or even by persons of whom it disapproves. Using a collective name to refer to a group of persons — be it the Cleveland Symphony, the Chicago Bears, or the Rice Millers’ Association — is nonetheless a specific reference to those persons. If I buy a ticket to the game or the symphony, I expect to see a specific defensive backfield or horn section. Under the majority’s reasoning, I should expect no more than some human being dressed in a Bears uniform or occupying a certain seat in the concert hall.
Finally, the district court’s decision should be affirmed for practical reasons. First, the *229method of appointing arbitrators suggested by Cargill and adopted by the majority— each party chooses one, who then choose a third — is most definitely not prescribed anywhere in the contract. Ironically, under this method, not a single one of the arbitrators will have been chosen by “mutual agreement.” The majority’s explanation for imposing this “standard method” on the parties is telling: “The arbitration clause does not set forth how this choice of arbitrators by the parties should be conducted.” Supra at 226. Indeed. I wonder, then, why the method prescribed by an identified arbitral body agreed to by the parties — the RMA — should not control over this court’s perception of what ought to be a “standard” term in an international rice contract.
Second, where parties cannot agree on arbitrators, the Arbitration Act empowers the district court to appoint them. 9 U.S.C. § 5. Who would or should the district court appoint in such a situation? The court may have no choice: § 4 of the Arbitration Act limits the court to ordering arbitration in the district in which it sits, and, if puede means “can,” ENABAS has a very strong argument that it cannot be compelled to submit to arbitration in the United States except before the RMA.3 Even if other Fourth Circuit fora are available, there is probably no better qualified arbitral body than the RMA. I know whom I would appoint if I were in the district court’s shoes.
III.
I would affirm the denial of Cargill’s motion to compel arbitration. Consequently, I would also reach the merits of Cargill’s second appeal, and I would affirm the arbitral award. The arbitrators’ findings are rational and draw their essence from the rice sale contract, and I am profoundly unimpressed with the procedural trivia Cargill has bemoaned in its attempt to paint the arbitration as unfair and oppressive.
I respectfully dissent.

. The affidavits sponsoring these translations do not specify the identity or qualifications of the translators, or any explanation why the translator chose particular English words for the phrases in dispute. This defect in the record makes review difficult and frustrating. For example, the majority must resort to logic to find the antecedent of the English word “chosen,” supra at 225, strongly suspecting that the word nom-brados could, as a matter of elementary Spanish grammar, only refer to Arbitradores. Every schoolboy would translate puede as "can," but language and idiom are probably just a little too fluid for us to reject Cargill's proffer of "could” through judicial notice. This dispute is not rele*228vant to analysis of the controlling- issue today, though it could prove to be vitally important on remand. If puede means "can” and not "could”— and I have little doubt of it- — the final sentence of the arbitration clause could be read to require the arbitration to proceed before the RMA or else in Nicaragua. As I discuss later in the text, this limitation could force the district court to simply order that the RMA arbitration repeat itself.

. See, e.g., Szuts v. Dean Witter Reynolds, Inc., 931 F.2d 830 (11th Cir.1991) (parties' contract stated that arbitration would be conducted be-' fore at least three arbitrators; even though American Arbitration Association was chosen as forum, AAA rule permitting arbitration to proceed before two arbitrators was overridden by parties’ contract).

. If Nicaragua were a signatory to the 1958 Convention on the Recognition and Enforcement of Foreign Arbitral Awards — it is not — a court in the United States could order the arbitration to proceed in Nicaragua. See 9 U.S.C. § 206.