Court Opinion

ID: 3032700
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:48:19.577317+00
Date Added: 2024-06-11T12:01:41.751636
License: Public Domain

United States Court of Appeals
                           FOR THE EIGHTH CIRCUIT
                                    ___________

                                    No. 03-1092
                                    ___________

Shook & Fletcher Asbestos             *
Settlement Trust,                     *
                                      *
      Plaintiff - Appellee,           * Appeal from the United States
                                      * District Court for the
      v.                              * Eastern District of Missouri.
                                      *
Safety National Casualty Corporation, *      [UNPUBLISHED]
                                      *
      Defendant - Appellant.          *
                                 ___________

                              Submitted: July 22, 2003

                                   Filed: October 21, 2003
                                    ___________

Before LOKEN, Chief Judge, FAGG and MORRIS SHEPPARD ARNOLD, Circuit
     Judges.
                              ___________

PER CURIAM.

       A flood of asbestos-related damage claims against Shook and Fletcher
Insulation Co., an insulation contractor, led to coverage disputes between Shook and
Fletcher and its many liability insurers. In November 1997, an Alabama state court
ordered the parties to arbitrate this dispute, which involves an excess umbrella policy
issued to Shook and Fletcher by Safety National Casualty Corporation. The
arbitration panel issued a decision in favor of Safety National and declared its award
to be binding. Shook and Fletcher moved to vacate the award under section 10 of the
Federal Arbitration Act, 9 U.S.C. § 10, arguing that the panel exceeded its authority
in declaring its decision to be binding. The district court1 agreed that the arbitration
is non-binding and vacated that portion of the award. Safety National appeals,
arguing the issue was a procedural matter for the arbitrators to decide, and their
decision must be upheld under the deferential standard of review mandated by the
Federal Arbitration Act.

       In Dow Corning Corp. v. Safety Nat’l Cas. Corp., 335 F.3d 742 (8th Cir. 2003),
we considered the same arbitration clause in Safety National policies issued to
another insured. We concluded that the issue whether the parties contracted for
binding or non-binding arbitration went to the scope of the arbitrators’ authority and
was therefore beyond their authority to resolve. We further concluded that the clause
in the Safety National policy was ambiguously silent on this issue. Lacking extrinsic
evidence in the record, such as evidence of custom and usage, we held that the
policies provided for mandatory but non-binding arbitration. Accordingly, we
vacated the arbitrators’ declaration to the contrary.

       This case presents the same issues we decided in Dow Corning. Once again,
the record contains no extrinsic evidence relevant to construing the ambiguous
arbitration provision. Therefore, Dow Corning is controlling. As the district court’s
decision is consistent with our later decision in Dow Corning, we affirm.
                       ______________________________

      1
       The HONORABLE CAROL E. JACKSON, Chief Judge of the United States
District Court for the Eastern District of Missouri.

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