# Petition for Writ of Certiorari — Home Buyers Warranty Corp. II v. Lopez

> Briefs, arguments, decisions, and more.

URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385017_1188%3A1

## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1995
- **Citation:** 513 U.S. 1123

## Text

In The

Supreme Court of the United

October Term, 1993
+

HOME BUYERS WARRANTY CORPORATION IL, and
NATIONAL HOME INSURANCE COMPANY,

Petitioners,

JULIETTE G. LOPEZ,
Respondent.

¢

On Petition For A Writ Of Certiorari
To The Supreme Court Of Alabama
*

PETITION FOR A WRIT OF CERTIORARI
+

PrHiur S. Grorere, Jr.
Counsel of Record
CARPENTER & GIDIERE
904 Union Bank Tower
60 Commerce Street
Montgomery, AL 36104
(205) 834-9950
Counsel for Petitioners

Of Counsel:
Epwarp A. DAUER
PopHaM Hark SCHNOBRICH
& KAUFMAN, Lr.
1200 Seventeenth Street
Denver, CO 80202

and

Daniet P. Levitt

Kay Coityer & Boose

One Dag Hammarskjold Plaza
New York, NY 10017

December 1993

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964
OR CALL COLLECT (402) 342-2831

ee

QUESTIONS PRESENTED

1. Whether the Alabama Supreme Court’s re-inter-
pretation of “involving commerce,” for purposes of Sec-
tion 2 of the Federal Arbitration Act, to apply only to
transactions where the parties subjectively “contemplated
substantial interstate activity” - a restrictive reading
avowedly adopted in order to promote the state’s own
anti-arbitration policy — is inconsistent with the intent of
Congress as interpreted by this Court and the federal
Courts of Appeals.

2. Whether “involving commerce” in Section 2 of
the Federal Arbitration Act should be interpreted to
exploit the full reach of the Commerce Clause, rather than
be given the restrictive scope specially created for the
federal Act by the Alabama Supreme Court.

3. Whether the Alabama Supreme Court's restric-
tive re-interpretation of Section 2 wrongly makes the
Federal Arbitration Act inapplicable to a wide variety of
transactions intended to be covered, thereby threatening
to marginalize the important body of federal substantive
and procedural FAA law developed by this Court over
the past several decades - by shrinking the number and
kind of cases to which it would apply.

li
LIST OF PARTIES

Two parties involved at earlier stages of this litiga-
tion are not named as parties in this petition. Aronov
Realty Company and Jack Deal, although defendants in
the original action, did not participate in the appeal to the
Alabama Supreme Court, whose decision is sought to be
reviewed.

Parent companies:

Home Buyers Warranty Corporation II (“HBW”) is a
wholly owned subsidiary of Builders Structural Services
Incorporated II (“BSSI II”).

National Home Insurance Company (A Risk Reten-
tion Group) (“NHIC”) is owned by its approximately
12,000 member-owner-homebuilders. One of them,
Holden Construction Management, Inc., a wholly owned
subsidiary of BSSI II, owns all the Class B common
shares, which constitute 95 per cent of the common share
equity of NHIC. The Class A common shares, constituting
5 per cent of the common share equity, are owned by the
other member-owner-homebuilders.

Subsidiaries:

Neither HBW nor NHIC has any subsidiaries.

iii
TABLE OF CONTENTS

QUESTIONS PRESENTED ..............0..00eeeee.
TN TE in a
TABLE OF AUTHORITIES.... ..............00005.
ee ec nacesecscvectececes
ee, Coir cei be avaucsvnvencaverss'

CONSTITUTIONAL AND STATUTORY PROVI-
PC CtCccheGek eebeeheVebwadeeiseesdeservoess

WEARS EMEC CFF BES CABG occ vccccccscrecccveses
REASONS FOR GRANTING THE WRIT ...........

I. The Alabama Supreme Court's re-interpretation of
9 U.S.C. Section 2 impermissibly restricts the FAA,
and therefore the federal substantive and pro-
cedural law linked to it, to transactions where the
parties subjectively “contemplated substantial
interstate activity” — contrary to the intent of Con-
gress as interpreted by this Court...............

II. The Alabama Supreme Court's re-interpretation
of 9 U.S.C. Section 2 conflicts with decisions of
the federal Courts of Appeals.................

Ill. The Alabama Supreme Court’s decision shrink-
ing the FAA’s application in Alabama, and
excluding a wide range of transactions intended
to be covered, threatens to marginalize the
important body of federal substantive and pro-
cedural law under the FAA...................

CONCLUSION ............. sie ay Rees

10

14

iv

TABLE OF CONTENTS - Continued

Page
APPENDIX
Opinion of Supreme Court of Alabama, Aug. 20,

IOSD nrcvcrvndcercacesvsccenvesccssecsvesvouns App. i
Order of Montgomery County Circuit Court, Oct.

OU ee oo dah at hessevrnntceberssssnedsunees App. 11
Order of Supreme Court of Alabama, Sept. 24,

WGDS .ccvcccccccsvccccscevevecesvsssoerencans App. 16
Text of 9 U.S.C. Sections 1 and 2.............. App. 17
Text of Code of Alabama 1975, Section 8-1-41(3)

ccbbubesuess aeaaUkb sine shabecesss ere eedaes¥ss App. 18

Text of Ex parte Jones, 1993 WL 262036 (Ala.), __
So. 2d __. (July 16, 1993).......-.. see eeeeees App.

19

Vv

TABLE OF AUTHORITIES
Page
Cases:

Allied-Bruce Terminix Companies, Inc. v. Dobson,
1993 Ala. LEXIS 800, ___ So. 2d ___ (August 13,

Bennish v. North Carolina Dance Theater, Inc., 108
N.C. App. 42, 422 S.E.2d 335 (N.C. Ct. of App.
«SP Se Sem erg yy anc ey vet me Oe eS TND ETN pe SOKO me! 13

Burke County Public Schools Bd. of Ed. v. Shaver
Partnership, 303 N.C. 408, 279 S.E.2d 816 (1981) .... 13

Continental Grain Co. v. Beasley, Ala. LEXIS 669,

— 2 pee | ee rere 5, 18
Del E. Webb Constr. v. Richardson Hosp. Authority,

Ee Wades Be CR GA. SO rnd chev bsonasnbaxeress 15
Ex parte Brice Building Co., 607 So. 2d 132 (Ala.

RD Pa ape bae BNE eile Lan Seer wine ay the CREE 5
Ex parte Costa & Head (Atrium), Ltd., 486 So. 2d

rae Bi | i ope ey ee 4, 5, 12, 15
Ex parte Jones, 1993 WL 262036 (Ala.), __ So. 2d

cians, SEO Bile ROR a 644s CA Rad Ah db cieenkebedes 5, 6, 9

Ex parte Warren, 548 So. 2d 157 (Ala.), cert. denied
sub nom Jim Skinner Ford, Inc. v. Warren, 493 U.S.
Gee Cc hich 0 Heck sdewel orndteo eee 4, 12, 18

Foster v. Turley, 808 F.2d 38 (10th Cir. 1986)......... 15

Henderson v. Superior Ins. Co., 1993 Ala. LEXIS 812,
mmm Oe Oe 5, (A@Rust 20, 1990)... 6252s 6, 17, 18, 19

Lopez v. Home Buyers Warranty Corp. II, 1993 Ala.
LEXIS 818, __ So. 2d __ (August 20, 1993) .. passim

Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Ware,
414 U.S. 117 (1973)...... seen eeeeeeeeeececnsnees 11

vi
TABLE OF AUTHORITIES - Continued
Page

Mesa Operating Limited Partnership v. Louisiana
Intrastate Gas Corp., 797 F.2d 238 (5th Cir. 1986) .... 15

Metro Industrial Painting Corp. v. Terminal Constr.

Co., 287 F.2d 382 (2d Cir. 1961)........-eeeeeeeees 12
Moses H. Cone Memorial Hospital v. Mercury Constr.

Corp., 460 U.S. 1 (1983)... .. cc cceccceseeceees 6, 7, 11
Perry v. Thomas, 482 U.S. 483 (1987)............ 6, 7, 10
Prima Paint Corp. v. Flood & Conklin Mfg. Corp., 388

US. B95 (1967) ..ccccccsccccessesssececedseses passim
Scherk v. Alberto-Culver Co., 417 U.S. 506 (1974)....... 7
Snyder v. Smith, 736 F.2d 409 (7th Cir. 1984), cert.

denied, 469 U.S. 1037 (1985)..........--555. 14, 15, 16

Southland Corp. v. Keating, 465 U.S. 1 (1984)
cevecavevacsecadceesevsseneee 6, 10, 11, 14, 19

The Terminix Int. Co. LP v. Jackson, 1993 Ala. LEXIS

803, __ So. 2d __. (August 13, 1993)........... 6, 17
Willis v. Dean Witter Reynolds, 948 F.2d 305 (6th

Che. 1998) occ ccccccscvctstccvckcceussceneahaawenes 16
STATUTES:
9 U.S.C. Gectlon 2 occ ccccvcodecevevesceneseveven passim
15 U.S.C. Sections 3901, ef 80q.....ccccsccccccccecsces 3
Code of Alabama 1975, Section 8-1-41(3) ........... 2, 8

OTHER AUTHORITIES CITED:

Bynam & Pugh, “Enforcing Arbitration Agree-
ments in Alabama: A Double Dilemma,” 54 Ala-
bama Lawyer 38 (January 1993)............. pated dies 9

No.

+
In The
Supreme Court of the United States

October Term, 1993
°

HOME BUYERS WARRANTY CORPORATION II, and
NATIONAL HOME INSURANCE COMPANY,

Petitioners,

JULIETTE G. LOPEZ,
Respondent.
+

On Petition For A Writ Of Certiorari
To The Supreme Court Of Alabama

+

PETITION FOR A WRIT OF CERTIORARI
¢

Home Buyers Warranty Corporation II (“HBW”) and
National Home Insurance Company (“NHIC”) respect-
fully petition for a writ of certiorari to review the judg-
ment of the Supreme Court of Alabama in this case.

+

OPINIONS BELOW

The opinion of the Alabama Supreme Court, not yet
reported, is reproduced in the Appendix at App. 1-10.
The opinion of the Circuit Court of Montgomery County,

1

Alabama, likewise not reported, is reproduced in the
Appendix at App. 11-15.

JURISDICTION

The opinion of the Alabama Supreme Court was
released on August 20, 1993. (App. 1-10) Petitioners’
timely application for rehearing was overruled on Sep-
tember 24, 1993. (App. 16) This Court has jurisdiction to
consider this petition under 28 U.S.C. Section 1257(a).

+

CONSTITUTIONAL AND STATUTORY PROVISIONS

The federal constitutional provisions involved are the
Commerce Clause of Article I, Section 8, and the Suprem-
acy Clause of Article Vi. The statutory provisions
involved are Sections 1 and 2 of the Federal Arbitration
Act, 9 U.S.C. Sections 1 and 2, and Section 8-1-41(3) of the
Code of Alabama 1975, as amended. These provisions are
reproduced in the Appendix, at App. 17-18.

+

STATEMENT OF THE CASE

In 1988, petitioner HBW, a Colorado corporation,
from its service office in Denver, issued a home buyers
warranty covering specified potential defects on a new
house in Montgomery, Alabama. The warranty agreement
provided that HBW’s representative would inspect the
house, and that any claims under the warranty be filed
either in Denver, or at the Colorado company’s regional

office in Tucker, Georgia. HBW maintains no office or
personnel in Alabama.

In August of 1989 the Montgomery house was resold
to respondent and her husband, who at the time were in
Key West, Florida. Closing documents shuttled back and
forth between Key West and Montgomery by fax and
private courier. The new buyers executed the closing
documents in Key West, assisted by their lawyer, who
was also in Key West. The warranty transferred to the
new owner.!

Shortly after respondent moved into the Montgomery
house, she asserts she observed structural defects. She
notified HBW’s regional office in Tucker, Georgia. The
Denver service office replied, sending respondent the
necessary claims forms and other information. Despite a
clause in the warranty agreement requiring arbitration, in
April 1991 respondent sued HBW on the agreement in
Montgomery County circuit court. HBW moved to
enforce the agreement’s arbitration clause. Although Ala-
bama law prohibits specific enforcement of predispute
arbitration agreements, the circuit court found sufficient
involvement of interstate commerce under Section 2 of
the Federal Arbitration Act (the “FAA”), 9 U.S.C. Section

' The warranty is that of the builder. Petitioner HBW is a
warranty administration company which performs warranty-
related tasks for builder members of petitioner NHIC, and for
NHIC. NHIC is a Colorado corporation licensed and regulated
by the Colorado Division of Insurance. It is a risk retention
group organized and operating pursuant to the Federal Risk
Retention Act, 15 U.S.C. Sections 3901 et seq. NHIC insures its
member-owners’ new home warranties in the 48 contiguous
states. The builder here was a member-owner of NHIC.

2, to invoke the federal provision requiring enforcement.
(App. 13-15). On October 19, 1992, the court stayed suit
pending arbitration.

The Alabama Supreme Court granted a writ of man-
damus on August 20, 1993, vacating the circuit court's
order. A majority held the FAA inapplicable, for insuffi-
cient involvement of interstate commerce.? The majority
reached this result because a few weeks earlier, on July
16, 1993, it had dramatically re-interpreted the way Sec-
tion 2 of the FAA applies in Alabama.

Until this past summer, contradictory tests for deter-
mining the sufficiency of “commerce” for FAA purposes
had co-existed in Alabama jurisprudence. Under Ex parte
Costa & Head (Atrium), Ltd., 486 So. 2d 1272 (Ala. 1986)
(“Costa & Head”), the FAA was generally interpreted to
apply when there was the “slightest nexus” with inter-
state commerce - reflecting the court’s then view that the
FAA was intended to exploit the full reach of the Com-
merce Clause. On the other hand, in two narrow catego-
ries of cases — those involving consumer disputes with
automobile dealers and disputes arising out of stock pur-
chase agreements — the court had since 1989 applied a
more restrictive test. That was the test formulated in Ex
parte Warren, 548 So. 2d 157 (Ala.), cert. denied sub nom Jim

2 Lopez v. Home Buyers Warranty Corp. II, 1993 Ala. LEXIS
818, ___ So. 2d ___ (August 20, 1993), reproduced at App. 1-10.
Of the nine sitting justices, one — Justice Ingram — concurred in
the result, while two — Justices Maddox and Adams - dissented.
Both sides raised and briefed the federal issue of the appli-
cability of the FAA and how “involving commerce” should be
interpreted. That issue was decided by the court, and its resolu-
tion objected to by the dissenting justices. (App. 3-10)

Skinner Ford, Inc. v. Warren, 493 U.S. 998 (1989) (“War-
ren’), holding that the FAA applied only where the con-
tracting parties were shown at the time of agreement to

“

have subjectively
activity.”3

contemplated substantial interstate

On July 16, 1993, over the objections of Justices Mad-
dox, Adams and Ingram, the Alabama Supreme Court
formally overruled Costa & Head in favor of Warren. The
new, more restrictive re-interpretation was announced in
two cases decided that day: Ex parte Jones, 1993 WL
262036 (Ala.), __ So. 2d ___ (July 16, 1993); and Continen-
tal Grain Co. v. Beasley, Ala. LEXIS 669, ___ So. 2d ___ (July
16, 1993).4 The majority opinion in the present case can-
didly admitted that Warren's “contemplation” test had
been chosen because it “better promotes our strong pub-
lic policy against the use of predispute arbitration agree-
ments.” (App. 4) For the Court’s convenience, we have

3 By its own terms, and as described in later cases, until
mid-1993 Warren was originally confined to its own “narrow
factual context.” Ex parte Brice Building Co., 607 So. 2d 132 (Ala.
1992). Indeed, the majority in Ex parte Jones,1993 WL 262036, ___
So. 2d ___ (July 16, 1993), admitted that it had “reemphasized”
in prior cases that “Warren ‘has a narrow application.’ ” And
Justice Maddox observed in his Ex parte Jones dissent that War-
ren had in practice only been applied to consumer disputes with
auto dealers, and to disputes arising out of stock purchase
agreements.

4 In Ex parte Jones, a dispute arising out of a stock purchase
agreement, the majority denied arbitration. In Continental Grain,
involving agreements between a foreign corporation and its
Georgia division using Alabama chicken growers to raise poul-
try for interstate markets, the court found the federal Act appli-
cable even under the new test.

Neen

reproduced the text of Ex parte Jones in the Appendix,
starting at App. 19.

A few weeks later, the court applied this more restric-
tive test to deny arbitration to petitioner. Justices Maddox
and Adams again dissented.5 Justice Maddox argued that
the court’s new subjective “contemplation” test was
inconsistent with the FAA’s legislative history, and with
this Court’s decisions in Southland Corp. v. Keating, 465
U.S. 1 (1984), Moses H. Cone Memorial Hospital v. Mercury
Constr. Corp., 460 U.S. 1 (1983), and Perry v. Thomas, 482
U.S. 483 (1987). (App. 7-10)

The present case was only one of four separate cases
in which the Alabama Supreme Court, this past August,
used the new “contemplation” test to deny specific
enforcement of predispute arbitration agreements.® A

5 Justice Ingram concurred in the result.

6 The other three were Allied-Bruce Terminix Companies, Inc.
v. Dobson, 1993 Ala. LEXIS 800 (August 13, 1993), where the
homeowner deliberately replaced his local termite bond to “go
with a national company like Terminix,” used a Veterans
Administration form, and obtained a bond issued in Tennessee
by an Arkansas corporation and guaranteed by a Delaware
limited partnership based in Tennessee; The Terminix Int. Co. LP
v. Jackson, 1993 Ala. LEXIS 803 (August 13, 1993), involving a
Delaware limited partnership based in Tennessee, and a termite
bond issued by an Arkansas company utilizing a Veterans
Administration form and contemplating use of materials
brought in from out-of-state; and Henderson v. Superior Ins. Co.,
1993 Ala. LEXIS 812 (August 20, 1993), involving claims under
an accident insurance policy issued in Atlanta, Georgia, by a
Delaware corporation based in Atlanta with no Alabama office.

Neither of the Lopez dissenters sat in any of these three
cases.

timely petition for rehearing in the present case was
denied on September 24, 1993.

+

REASONS FOR GRANTING THE WRIT

Section 2 of the FAA declares that written agreements
to arbitrate

in any maritime transaction or a contract evi-
dencing a transaction involving commerce

. Shall be valid, irrevocable, and enforceable,
save upon such grounds as exist at law or in
equity for the revocation of any contract.
[Emphasis supplied]

This statute, reflecting a strong national policy favoring
arbitration, was intended to “revers[e] centuries of judi-
cial hostility to arbitration agreements.” Scherk v. Alberto-
Culver Co., 417 U.S. 506, 510 (1974). This Court zealously
enforces the statute, “notwithstanding any state substan-
tive or procedural policies to the contrary.” Moses H. Cone
Memorial Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24
(1983). Since Prima Paint Corp. v. Flood & Conklin Mfg.
Corp., 388 U.S. 395 (1967), this Court has eliminated one
state-created barrier after another to implementation of
the FAA’s pro-arbitration policy, and has created a body
of federal substantive and procedural law controlling in
both federal and state courts - applicable in those cases
where the FAA itself applies through Section 2. In the
course of developing this body of law, the Court has
recognized that Congress intended the FAA to apply
“within the full reach of the Commerce Clause.” Perry v.
Thomas, 482 U.S. 483, 490 (1987).

Alabama maintains a contrary state public policy
hostile to arbitration. By statute it strictly prohibits
enforcement of predispute arbitration agreements, except
where federal law preempts.? The Alabama Supreme
Court has now created a device to widen the scope of
Alabama’s anti-arbitration policy at the expense of the
federal policy strongly favoring arbitration. The device is
as simple as it is impermissible. Attack the federal policy
at its weakest link — that is, cut back the reach of the FAA,
and therefore the federal substantive and procedural law
inextricably linked to it, by shrinking the meaning of the
key jurisdictional phrase “involving commerce.” Once the
jurisdictional reach of the FAA is shrunk, the body of
federal substantive and procedural law developed by this
Court in connection with the FAA would only apply to
the shrunken number of cases that can satisfy this nar-
rower, and highly subjective, jurisdictional test.

In Alabama, “involving commerce” no longer means
that the FAA applies to any transaction with the “slight-
est nexus” to interstate commerce, or even to transactions
“affecting” commerce. Instead, in Alabama, the FAA now
only applies - and predispute arbitration clauses are only
specifically enforceable and the related federal law appli-
cable — where the contracting parties are found to have
subjectively “contemplated substantial interstate activity”

7 Code of Alabama, 1975, Article 8-1-41 includes among
“obligations [which] cannot be specifically enforced: . . .
(3) An agreement to submit a controversy to arbitration.”

when they agreed to arbitrate. The key in many cases will
be personal affidavits from parties seeking to avoid arbi-
tration, or to avoid some aspect of the body of federal law
that accompanies the FAA, that they “had not contem-
plated substantial interstate activity” when they volun-
tarily entered into contracts containing agreements to
arbitrate.®

The decision of the Alabama Supreme Court conflicts
with decisions by this Court and by several of the federal
Courts of Appeals. Should the Alabama decision stand,
the important federal policy strongly favoring arbitration
would have only a stunted application in Alabama and in
other states which do not enforce predispute arbitration
agreements. Moreover, courts bent on preserving anoma-
lous state limitations upon arbitration would be tempted
to use the subjective “contemplation” test in order to
limit the scope both of the FAA itself and of the federal
substantive and procedural law linked to it.

8 Justice Maddox’ Ex parte Jones dissent (App. 25) noted
that commentators in Alabama had criticized the Warren test for
its “subjectivity,” citing Bynam & Pugh, “Enforcing Arbitration
Agreements in Alabama: A Double Dilemma,” 54 Alabama Law-
yer 38, 43 (January 1993). The authors wrote: “The Warren sub-
jective test encourages the party seeking to avoid arbitration to
fabricate, after the fact, his alleged ‘state of mind’ at the time of
contracting to avoid the enforcement of an unambiguous writ-
ten clause.”

10

I. The Alabama Supreme Court’s re-interpretation
impermissibly restricts the FAA, and therefore the
federal substantive and procedural law linked to it,
to transactions where the parties subjectively “con-
templated substantial interstate activity” — contrary
to the intent of Congress as interpreted by this
Court

Southland Corp. v. Keating, 465 U.S., at 16, recognizes
that, in creating the FAA, “Congress intended to foreclose
state legislative attempts to undercut the enforceability of
arbitration agreements.” There, the Court confronted a
California ban on arbitration of claims brought in state
court under a state franchise investment law, on the the-
ory that the FAA did nothing more than create a pro-
cedural remedy for cases brought in federal court. This
Court gave that position short shrift. In language perti-
nent here, the Court held that in enacting the FAA:

Congress declared a national policy favoring
arbitration and withdrew the power of the states
to require a judicial forum for the resolution of
claims which the contracting parties agreed to
resolve by arbitration.

465 U.S., at 14.

In Perry v. Thomas, 482 U.S. 483 (1987), the Court held
that the FAA preempted provisions of the California
Labor Code purporting to exempt wage claims from arbi-

tration. In its decision, Section 2 of the FAA was
described, 482 U.S., at 490, as

11

a statute that embodies Congress’ intent to pro-
vide for the enforcement of arbitration agree-
ments within the full reach of the Commerce Clause.
[Emphasis supplied]?

As demonstrated by the dissenting opinions in such cases
as Southland, Mercury Construction, Perry and Prima Paint,
the FAA’s legislative history left room for honest dis-
agreement about aspects of the original intent. These
have included whether the FAA applies to state, as well
as federal, court proceedings; whether important substan-
tive areas regulated by various federal statutes are
beyond the reach of the FAA; whether states may carve
out substantive areas for exclusion from the FAA; and
whether the states may interpose procedural obstacles of
their own invention, such as court determination of
“fraud in the inducement” defenses. But Prima Paint and
subsequent cases have settled such disagreements.

Nor should it any longer be open to question that, as
this Court held in Perry, Section 2 was intended fully to
exploit the reach of the Commerce Clause. If Perry is
correct, enforceability under the FAA, and application of
the federal substantive and procedural law linked to it,
cannot be restricted to those arbitration agreements

* This broad interpretation of Section 2 was not casually
uttered. To reach its result, the Court had to distinguish its
earlier decision in Merrill Lynch, Pierce, Fenner & Smith, Inc. v.
Ware, 414 U.S. 117 (1973). Ware had held that the same California
Code provisions did not conflict with the federal securities
regulatory scheme and were not preempted. The Court distin-
guished Ware on the ground that, unlike the FAA, the federal
scheme involved there did not require “nationwide uniformity”
of dispute resolution, manifested no intent to require arbitra-
tion, and had a narrower jurisdictional base.

12

where the contracting parties are found to have subjec-
tively “contemplated substantial interstate activity.”

The Alabama Supreme Court’s decision to the con-
trary was not based on any examination of the legislative
history, or even on analysis of this Court’s decisions.
Instead, the majority simply chose Warren's more restric-
tive “contemplation” test, which the court had itself
always confined to its “narrow factual context,” over the
more expansive “slightest nexus” test of Costa & Head.
And it did so precisely because it believes the more
restrictive test better accommodates Alabama’s public
policy against specific enforcement of predispute arbitra-
tion agreements.

In Warren, too, the majority had omitted to review
either the legislative history or this Court’s decisions.
Instead, it had lifted language — out of context — from
dictum in a concurring opinion in Metro Industrial Paint-
ing Corp. v. Terminal Constr. Co., 287 F.2d 382 (2d Cir.
1961). Metro was an exceedingly easy case, whatever the
jurisdictional standard, for it arose out of an agreement
made in New York between Connecticut and New Jersey
contractors and a New York subcontractor under which
the New York sub performed painting services at Home-
stead Air Force Base in Florida, using out-of-state person-
nel and materials. Judge Lumbard’s concurring opinion
addressed the “involving commerce” question, not for the
purpose of restricting the reach of the FAA, but to sug-
gest that what mattered was not whether people or goods
actually crossed state lines (parties opposing arbitration

13

had argued that all the painting work was in fact per-
formed in one Florida county), but whether the agree-
ment on its face “evidences interstate traffic.” 287 F.2d, at
387.10

North Carolina’s Supreme Court, which sometimes
relies on Judge Lumbard’s “contemplation” language,
does so not to further an anti-arbitration policy, but to
broaden the reach of the FAA and rebut arguments that it
does not apply, e.g., where contractual performance was
exclusively in-state. See Burke County Public Schools Bd of
Ed v. Shaver Partnership, 303 N.C. 408, 279 S.E.2d 816,
818-19 and n.8 (1981), where a lower court had perversely
read Prima Paint to require “actual physical interstate
shipment of goods.” The state supreme court cited Metro
as one of several cases applying the FAA despite the fact
that the contracted-for performance was entirely local.'!

In short, the Alabama Court has stood Metro on its
head, using dictum in a concurring opinion in an easy
case — language intended to repel an attack on the FAA -

10 Indeed, Judge Lumbard observed the arbitration agree-
ment in Metro was, in any event, enforceable under New York
state law, as well as under the FAA. 287 F.2d, at 388 n.3.

'! Burke County involved a repealed, but arguably still
applicable North Carolina statute interpreted, despite ostensi-
bly favorable language, to forbid specific enforcement of predis-
pute arbitration agreements. A new statute, effective August 1,
1973, made such agreements specifically enforceable. 279
S.E.2d, at 818 n.5.

See also, Bennish v. North Carolina Dance Theater, Inc., 108
N.C. App. 42, 422 S.E.2d 335 (N.C. Ct. of App. 1992), where the
court emphasized North Carolina’s present pro-arbitration pol-
icy, and cited the Lumbard language to make clear that the FAA
applies to personal service contracts.

ee

14

as a device to broaden the reach of Alabama’s own anti-
arbitration policy at the expense of the FAA and the
federal body of law linked to it.

II. The Alabama Supreme Court’s re-interpretation of
Section 2 conflicts with decisions of the federal
Courts of Appeals

The Alabama Supreme Court’s decision that “involv-
ing commerce” requires that the parties subjectively
“contemplated substantial interstate activity” conflicts
with decisions by several of the federal Courts of
Appeals.

The leading case is Snyder v. Smith, 736 F.2d 409,
417-18 (7th Cir. 1984), cert. denied, 469 U.S. 1037 (1985).
Snyder involved a partnership whose sole function was to
own real property in Harris County, Texas, but whose
partners all lived in Illinois when the partnership was
formed. At issue was a dispute over the price to be paid
for a deceased partner’s interest. Appellant unsuc-
cessfully argued that it was not enough to show that the
transaction “affected commerce,” and disputed the suffi-
ciency of “any casual and sporadic activities in which the
partnership engaged.” On these facts, the appellate court
found the FAA applicable. It noted that Prima Paint had
declined to limit the FAA to interstate shipment of goods,
as the losing party there had argued. And it construed
Southland’s statement that “involving commerce” was not
a limitation on the statute but a “qualification” as “sug-
gest[ing] that Congress intended the [FAA] to apply to all

ee

15

contracts that it constitutionally could regulate.” 736 F.2d,
at 418.12

In the Fifth Circuit, the FAA applies to all contracts
“relating to interstate commerce.” The Court of Appeals
so held in Mesa Operating Limited Partnership v. Louisiana
Intrastate Gas Corp., 797 F.2d 238, 243-44 (5th Cir. 1986),
citing the legislative history, Prima Paint, and Snyder. At
issue was a take-or-pay contract over royalty gas owned
by the State of Louisiana, produced in Louisiana by Mesa,
and transported and sold to customers entirely in Louisi-
ana. It was sufficient to invoke the FAA that Mesa part-
ners lived in Texas, and sometimes traveled to and
otherwise communicated with Louisiana. In Del E. Webb
Constr. v. Richardson Hosp. Authority, 823 F.2d 145, 147-48
(Sth Cir. 1987), the Court of Appeals not only followed
Mesa, but expressly rejected an argument that for FAA
purposes the interstate commerce must be “substantial.”
Webb arose out of a construction dispute where all the
construction was in Texas, Webb maintained an office in
Texas to run the project, and issued all payroll checks in
Texas. The court found it sufficient that employees and
construction materials crossed state lines, and that the
mails were used.

The Alabama Supreme Court decision also conflicts
with the Tenth Circuit’s decision in Foster v. Turley, 808
F.2d 38, 40-41 (10th Cir. 1986), arising out of an agreement
to purchase half of a New Mexico mine. The buyer Foster
lived in Oregon, on at least one occasion sent trucks to

12 Back in 1986, when the Alabama Supreme Court fash-
ioned its own “slightest nexus” test, it relied explicitly on
Snyder. Costa & Head, 486 So. 2d, at 1275.

16

New Mexico, proceeds were sent to him in Oregon, and
the mine’s products were sometimes milled and sold
outside of New Mexico. The court had no difficulty on
these facts. And it, too, held that “involving commerce” is
to be construed as “coextensive with congressional power
to regulate under the Commerce Clause,” in reliance on
Prima Paint and Snyder. 808 F.2d, at 40.!9

III. The Alabama Supreme Court’s decision shrinking
the FAA’s reach in Alabama, and excluding a wide
range of transactions intended to be covered,
threatens to marginalize the important body of
federal substantive and procedural law under the
FAA

The decision sought to be reviewed is no fluke. For it
represents a deliberate effort to shrink the reach of the
FAA, and will inevitably curtail application, in Alabama
and many other states, of the body of federal substantive
and procedural law which this Court has developed since
Prima Paint.

In many jurisdictions, the FAA is interpreted to
require specific enforcement of predispute arbitration
agreements, and therefore compliance with this Court's
FAA-related decisions — in all transactions where the
fullest reach of the Commerce Clause justifies its applica-
tion. But in Alabama, the FAA now applies only where

13 In a slightly different context, the Sixth Circuit has like-
wise concluded that Section 2 “was meant to extend the appli-
cability of the Act and its exclusions to the scope of Congress’
power under the Commerce Clause...” Willis v. Dean Witter
Reynolds, 948 F.2d 305, 310 (6th Cir. 1991).

17

the courts find that the contracting parties subjectively
“contemplated substantial interstate activity.”

Among the immediate consequences of the new test,
and we needn’t speculate because they are alre'y
reflected in a half-dozen Alabama Supreme Court deci-
sions, are these:

1. The FAA, and this Court’s FAA-related decisions,
no longer apply in Alabama to home buyers warranties
issued by out-of-state companies with no local presence —
even where the home buyer negotiates to buy his or her
new home from outside the state, uses means of interstate
commerce to facilitate the purchase, files claims as
required in offices outside the state, and receives claims
information from out-of-state. Lopez v. Home Buyers War-
ranty Corp., supra.

2. The FAA, and this Court’s FAA-related decisions,
no longer apply in Alabama to termite bonds issued by
out-of-state national companies with no local presence -
even where the owner deliberately replaces a local bond
with a national one, uses a Veterans Administration form,
and has the home inspected by persons traveling from
out-of-state and who use out-of-state materials. Terminix
Int. Co. LP v. Jackson, supra, and Allied-Bruce Terminix
Companies, Inc. v. Dobson, supra.

3. The FAA, and this Court’s FAA-related decisions,
no longer apply in Alabama to claims arising out of
accident insurance policies issued by out-of-state com-
panies with no local presence, so long as the insured
deals with a local agent. Henderson v. Superior Ins. Co.,
supra.

18

4. The FAA, and this Court’s FAA-related decisions,
no longer apply in Alabama to claims against dealers
selling cars manufactured out-of-state and subject to a
whole panoply of federal regulation —- even where the
parties have agreed in writing “That the motor vehicle
described in this sale document has been heretofore trav-
eling in interstate commerce and has an impact upon
interstate commerce,” so long as the party opposing arbi-
tration asserts, contrary to the written agreement, that
“substantial interstate activity” was not “contemplated.”
Ex parte Warren, 548 So.2d, at 158.14

Indeed, Warren and Henderson together suggest the
court’s intention to limit the FAA only to the most obvi-
ously interstate transactions between commercial busi-
nesses like the ones in Continental Grain, excluding from
its reach all transactions between Alabama consumers, on
the one hand, and local merchants, agents and other
businessmen — regardless whether the transactions have a
nexus with, or relate to or affect interstate commerce.
There is no basis in the legislative history, or this Court's
decisions, for such a restrictive view of the FAA.

5. Except in obvious cases like Continental Grain, all
that it may take in Alabama to avoid the FAA and this
Court’s FAA-related decisions is a boiler-plate affidavit
asserting the subjective proposition that the affiant “did
not contemplate substantial interstate activity” when vol-
untarily agreeing to arbitrate future disputes. See, e.g.,

14 Justice Maddox, dissenting, wrote that he “cannot make
a distinction between a contract to buy stock [held subject to the
FAA in prior Alabama decisions] and a contract to buy an
automobile.” Ex parte Warren, 548 So. 2d, at 161.

xa

19

Henderson v. Superior Ins. Co., supra, where such an affi-
davit was accorded significant weight.!>

One by one, this Court has eliminated substantive
and procedural obstacles raised by states to the pro-
arbitration policy reflected in the FAA. The Court has, for
example, rejected contentions that the FAA, and the fed-
eral substantive and procedural law iinked to it, only
apply in federal court, that they have no application in
the face of the federal scheme regulating securities or
state schemes regulating wage claims, that they don’t
apply to international antitrust claims or to certain age
discrimination claims, that certain kinds of disputes are
not really suited to arbitration and are better left to the
courts, and that the FAA only applies to transactions
involving physical shipment of goods across state lines.

The Court has always recognized the special impor-
tance of policing how the FAA is treated in state courts,
since the vast bulk of litigation arguably subject to the
statute takes place in the state courts. The Alabama
Supreme Court’s attempt to shrink the reach of the FAA
represents, therefore, a serious threat to the objectives
which led Congress to enact the FAA and this Court to
police its enforcement.

The most immediate victims of this deviant re-inter-
pretation are the parties to the wide range of transactions

1S The Alabama decision invites costly and time-consuming
peripheral litigation over the truth of such subjective state-
ments, as well as over the “substantiality” of the interstate
activity involved. This Court has pointed out that a “core pur-
pose” of the FAA was to avoid such costly delays. Southland, 460
U.S., at 7-8

20

which now seem to be excluded from the FAA in Ala-
bama. These include transactions involving home buyer
warranties, termite bonds, accident insurance policies,
and the purchase of consumer goods including auto-
mobiles so long as local dealers and agents are used.

This more restrictive jurisdictional test is likely to
spread not only to states like Mississippi and Nebraska
with public policies hostile to arbitration agreements, but
also to the many states whose own laws carve out catego-
ries of disputes from arbitration, or interpose various
procedural hurdles to arbitration. This Court has been
vigilant not to permit the FAA to be whittled away by
such state-created hazards. But where restrictive and sub-
jective interpretations of “involving commerce” render
the FAA inapplicable, these state hazards will come in
through the back door.

Once free of FAA compulsion, even those states
whose own laws do enforce predispute arbitration agree-
ments will regain the right under state law to carve out
exceptions. Courts everywhere will now be free — in cases
found to be outside the newly restricted jurisdiction of
the FAA — to declare that wage claims, franchise disputes,
or state RICO claims are not suitable for arbitration. And
they will regain the right to interpose such procedural
obstacles as court adjudication of “fraud-in-the induce-
ment” defenses, the right of parties unilaterally to revoke
their agreements to arbitrate, extraordinary requirements
that arbitration clauses must be signed by the parties’
counsel and not by the parties alone, unusual rules for
determining when the right to arbitrate has been waived,
and special rules governing the remedies allowable
through arbitration. These are obstacles to arbitration

21

which would not, or might not, be tolerated where the
FAA does apply.

In short, the Alabama Supreme Court's re-interpreta-
tion of “involving commerce” threatens to unravel much
of what this Court’s FAA decisions have accomplished
since Prima Paint.

CONCLUSION

The Alabama Supreme Court has deliberately chosen
to shrink “involving commerce,” in order to promote the
state’s anti-arbitration policy at the expense of the
national policy strongly favoring arbitration. Its restric-
tive re-interpretation is inconsistent with the intent of
Congress, as interpreted by this Court and the federal
Courts of Appeals. “Involving commerce” now means
one thing in Alabama, something else in the federal
Courts of Appeals and many other states. As a result,
decades of this Court’s FAA-related decisions are threat-
ened to be marginalized even in states whose own laws

22

enforce predispute arbitration agreements. This is an area
where the Court’s guidance is urgently needed.

Respectfully submitted,

Puiu S. Grprere, Jr.
Counsel of Record

CARPENTER & GIDIERE
60 Commerce Street
904 Union Bank Tower
Montgomery, AL 36104
(205) 834-9950
Counsel for Petitioners

Of Counsel:
Epwarp A. DAUER
PorpHAM Hatik SCHNOBRICH
& KAuUFMAN, Ltp.
1200 Seventeenth Street
Denver, CO 80202
and
Danie P. Levitt
Kay Coityer & Boose
One Dag Hammarskjold Plaza
New York, NY 10017

December 21, 1993

App. 1

SUPREME COURT OF ALABAMA
SPECIAL TERM, 1993

1920330

Juliette G. Lopez
v.
Home Buyers Warranty Corporation, et al.

Appeal from Montgomery Circuit Court
(CV-91-897)

SHORES, JUSTICE.

Juliette Lopez filed an “appeal” from an order of the
Circuit Court of Montgomery County compelling her to
arbitrate her claims against Home Buyers Warranty Cor-
poration II (“Homes Buyers”). The issue here is whether a
claim based on a homeowner’s warranty is subject to
arbitration under the provisions of the Federal Arbitra-
tion Act (“FAA”), 9 U.S.C. §§ 1-15.

Because “a petition for a writ of mandamus is the
proper means to test a trial court’s granting of a motion
to arbitrate,” Ex parte Alexander, 558 So.2d 364, 365 (Ala.
1990), we treat Lopez’s filing, although it was in the form
of an appeal, as a petition for a writ of mandamus requir-
ing the Montgomery Circuit Court to vacate its order
compelling arbitration. See A.G. Edwards & Sons, Inc. v.
Clarke, 558 So.2d 358, 360 (Ala. 1990). We grant the writ.

Mrs. Lopez and her husband purchased a house in
Montgomery, Alabama, from Mr. and Mrs. Glen Browder
on August 31, 1989. The Browders had listed the house
with, and the sale was conducted in part through agents

App. 2

of, Aronov Realty Company, Inc. (“Aronov”). The
Lopezes executed the closing documents on the house
while they were in Key West, Florida.! The house was
covered by a Home Buyers warranty against specified
defects. This warranty was issued in 1988 from the Home
Buyers office in Denver, Colorado, to the Browders, as the
original homeowners. Under the terms of the warranty, a
Home Buyers representative was to inspect the house
during its construction. The warranty coverage trans-
ferred to the Lopezes when they bought the house from
the Browders.

Mrs. Lopez moved into the house in June 1990;
shortly thereafter, she noticed cracks in the floors and
noticed other structural defects. Her attorney notified
Home Buyers’ regional office in Tucker, Georgia, by letter
dated March 1, 1991, of her potential claim under her
Home Buyers warranty. A representative from Home
Buyers’ warranty service office in Denver, Colorado,
wrote Mrs. Lopez on March 6, 1991, and informed her of
the procedure for filing a claim for coverage of structural
damage under her warranty. On April 19, 1991, Mrs.
Lopez sued Home Buyers for recovery of the costs of
structural repairs to her house. She also sued Aronov,
alleging fraud in regard to the sale of the house.

Home Buyers moved to dismiss, or, in the alternative,
to compel arbitration under the terms of the arbitration

1 The closing documents were sent back and forth between
Key West and Montgomery by fax and by private courier. Mr.
and Mrs. Lopez closed the purchase on their house with the help
of their attorney, who was also in Key West.

App. 3

clause contained in the warranty. That arbitration clause
States, in part:

“Should the Builder or the Homebuyer(s) dis-
agree with the Insurer’s decision to deny the
claim as recommended by the Service, the con-
testing party shall call for conciliation with the
Service or an arbitration to be conducted by the
American Arbitration Association (A.A.A.), or
other mutually agreeable arbitration service at
the Service’s expense. . . . The voluntary dispute
settlement process provided herein shall be a
condition precedent to the commencement of
any litigation by any party to compel compli-
ance with the warranty documents or to seek
relief for any dispute arising out of this pro-
gram.”

On October 19, 1992, the trial court ordered Mrs. Lopez io
submit her claims against Home Buyers to arbitration
under the terms of the warranty contract. The claims
against Aronov have been stayed pending our ruling on
the enforceability of the arbitration clause. Although the
trial court’s order compelling arbitration purported to
“dismiss” Mrs. Lopez’s claims against Home Buyers, we
understand that “dismissal” to be in reality a stay of the
proceedings against Home Buyers pending arbitration.

Under Alabama law, the specific enforcement of a
predispute arbitration agreement violates public policy
unless federal law preempts state law. See § 8-1-41(3),
Ala. Code 1975; Wells v. Mobile County Bd. of Relators, Inc.,
387 So.2d 140, 144 (Ala. 1980); Bozeman v. Gilbert, 1 Ala.
90, 91 (1840). “The FAA applies to a transaction within
this state if the contract [1] involves interstate commerce
and [2] contains an arbitration clause voluntarily entered

App. 4

into by the parties.” A.J. Taft Coal Co. v. Randolph, 602
So.2d 395, 397 (Ala. 1992), citing Ex parte Alabama Oxygen
Co., 452 So.2d 860 (Ala. 1984). To determine whether
federal law preempts our public policy against enforce-
ment of predispute agreements to arbitrate, we must
examine whether the warranty agreement containing the
arbitration provision involves interstate commerce. Ex
parte Jones, [Ms. 1920249, July 16, 1993], __ So.2d __
(Ala. 1993).

Home Buyers argues that the warranty agreement
involves interstate commerce, and, because this dispute
arose out of the warranty agreement, that the FAA must
apply. In so arguing, Home Buyers relies on the “slightest
nexus” test of Ex parte Costa & Head (Atrium), Ltd., 486 So.
2d 1272 (Ala. 1986), wherein the existence of the slightest
nexus between an agreement and interstate commerce
would bring the agreement within the ambit of the FAA,
thus allowing enforcement of a predispute arbitration
provision within the agreement. Id. at 1275.

However, we have recently overruled the Costa &
Head “slightest nexus” test in favor of the more reasoned
approach of the “contemplation” test applied in Ex parte
Warren, 548 So. 2d 157 (Ala.), cert. denied sub nom Jim
Skinner Ford, Inc. v. Warren, 493 U.S. 998 (1989). Ex parte
Jones, supra, __ So.2d at __. The Warren test examines
whether the parties “contemplated substantial interstate
activity” at the time they entered into the contract and
accepted the arbitration clause.* Ex parte Waren, supra, at

2 The standard in Warren better promotes our strong public
policy against the use of predispute arbitration agreements. Its

a ee —

ee

SE, RR LT ee

roe

Point) Aine eet G6 ale laty wan” oe

jie ibae

App. 5

160. Whether the parties contemplated substantial inter-
state commerce is, of course, to be determined by the
facts and circumstances of each case.

The trial court applied the slightest nexus test when
it compelled arbitration:

“After hearing oral arguments and after
consideration of the briefs and memoranda sub-
mitted by the parties, the Court has determined
that the facts surrounding the Home Buyers
contract do support a finding that the contract
has at least [the] slightest nexus with interstate
commerce so as to bring the contract under the
purview of the FAA. Some of the facts support-
ing this finding are as follows: Home Buyers is a
Colorado corporation and Plaintiff is an Ala-
bama resident; if Plaintiff is not satisfied with
the builder’s performance, she must send an
application to either Georgia or Colorado; the
Home Buyers district office for the State of Ala-
bama is in Tucker, Georgia; and the Home
Buyers Claims & Warranty Service Office is in
Denver, Colorado. As stated previously, the
above facts indicate that the Home Buyers con-
tract has at least [the] ‘slightest nexus’ with
interstate commerce.”

Mrs. Lopez contends that there is insufficient
involvement with interstate commerce to require arbitra-
tion, because the house was built in Alabama by an
Alabama builder for an Alabama resident and was listed

“contemplation” test is to be applied exclusively in determining
whether a contract involves interstate commerce for purposes of
applying the FAA to arbitration disputes. Continental Grain Co.
v. Beasley, [Ms. 1920241, July 16, 1993], __ So.2d __ (Ala. 1993).

App. 6

for sale through an Alabama real estate agency. Home
Buyers points to possible interstate activity by the
Lopezes during their purchase and financing of the
house, to support its contention that there was sufficient
involvement with interstate commerce to require arbitra-
tion. “However, for the FAA to apply, the agreement that
contains the predispute arbitration provision must
involve interstate commerce.” Ex parte Jones, supra, ___
So.2d at __ (emphasis original). That agreement in this
case is the Home Buyers warranty, not the contract for
purchase of the house. The warranty does not involve
“the production of articles to be shipped in interstate
commerce,” Continental Grain Co., supra, __ So.2d at ___;
nor does it require the use of specific materials made by
and shipped from out-of-state manufacturers. Ex parte
Brice Bldg. Co., 607 So.2d 132, 134 (Ala. 1992); Maxus, Inc.
v. Sciacca, 598 So.2d 1376, 1379 (Ala. 1992).

Although Home Buyers contends that under the war-
ranty Mrs. Lopez would have to file a claim in either
Georgia or Colorado, we have determined that “[t]he
mere use of the telephone and mail by persons in differ-
ent states to communicate about activity that is purely
local” is not a sufficient contact with interstate commerce
to require application of the FAA. First Real Estate Corp. of
Alabama v. Brown Marx Tower Ltd. Partnership, (Ms. 1911779,
May 7, 1993] __ So.2d __ (Ala. 1993).3 Furthermore,

3 Although First Real Estate Corp. applied the old “slightest
nexus” test in finding insufficient involvement with interstate
commerce to require arbitration, its reasoning is certainly appli-
cable to the stricter test required by Ex parte Warren and Ex parte
Jones. In First Real Estate Corp., a New York partnership and an
Alabama corporation with its principal place of business in New

App. 7

it is the scope of the contract containing the arbitration
clause, and not the place of performance, that determines
the applicability of the FAA when using the “contempla-
tion” test. Continental Grain Co., supra, citing Circle “S”
Industries, Inc. v. Berryman, 613 So.2d 329, 331 (Ala. 1993).

In this case, we find no evidence that the parties
contemplated substantial interstate activity when they
entered into the warranty contract. Therefore, the FAA
does not apply. We hold that, under the “contemplation”
test, Mrs. Lopez is not required to submit her warranty
claims with Home Buyers to arbitration. See Ex parte
Alexander, 558 So.2d 364, 366 (Ala. 1990). The writ is due
to be granted for the foregoing reasons.

WRIT GRANTED.

Hornsby, C. J., and Almon, Houston, Steagall, and
Kennedy, JJ., concur.

Ingram, J., concurs in the result.

Maddox and Adams, JJ., dissent.
Juliette G. Lopez v. Home Buyers Warranty Corp., et al.
MADDOX, JUSTICE (dissenting).

I disagree with the majority’s use of the “contempla-
tion” test for determining whether the particular transac-
tion involves interstate commerce for purposes of the
Federal Arbitration Act (“FAA”), 9 U.S.C. § 1 et seq.
Furthermore, I disagree with the majority’s conclusion

York were found to have insufficient contacts with interstate
commerce in a dispute over an Alabama corporation’s manage-
ment of their property within Alabama.

App. 8

that the trial court erred in compelling arbitration of Mrs.
Lopez’s claims.

The threshold question is whether the FAA applies to
this case. If the Act applies, as I believe it does, then the
predispute arbitration agreement is enforceable, see 9
U.S.C. § 2, and whether the agreement would otherwise
be unenforceable under Alabama law, see Ala. Code 1975,
§ 8-1-41(3), would be immaterial.

Does the home warranty agreement involve inter-
state commerce so as to invoke the FAA and thereby
render the arbitration agreement enforceable? I believe
that it does.

Section 2 of the FAA provides, in pertinent part, that
“[a] written provision in any maritime transaction or a
contract evidencing a transaction involving interstate
commerce to settle by arbitration a controversy thereafter
arising out of such contract or transaction . . . shali be
valid, irrevocable, and enforceable.” As the United States
Supreme Court has held, in enacting this section, “Con-
gress declared a national policy favoring arbitration and
withdrew the power of the states to require a judicial
forum for the resolution of claims which the contracting
parties agreed to resolve by arbitration. . .. Congress has
thus mandated the enforcement of arbitration agree-
ments.” Southland Corp. v. Keating), 465 U.S. 1, 10 (1984).
The Supreme Court noted in Keating that the FAA “per-
mits ‘partics to an arbitrable dispute [to move] out of
court and into arbitration as quickly and easily as possi-
ble,” 465 U.S. at 7 (quoting in part Moses H. Cone Memorial
Hospital v. Mercury Construction Corp., 460 U.S. 1, 22
(1983)) (bracketed words added in Keating. The Supreme

a a ”

App. 9

Court also noted: “Contracts to arbitrate are not to be
avoided by allowing one party to ignore the contract and
resort to the courts. Such a course could lead to pro-
longed litigation, one of the very risks the parties, by
contracting for arbitration, sought to eliminate.” Id.

The United States Supreme Court has also charac-
terized the FAA as “a statute that embodies Congress’
intent to provide for the enforcement of arbitration agree-
ments within the full reach of the Commerce Clause.”
Perry v. Thomas, 482 U.S. 483, 490 (1987). The House
Judiciary Committee Report on the arbitration bill also
reflects Congress’ intent. That report states in part: “Arbi-
tration agreements are purely matters of contract, and the
effect of the bill is simply to make the contracting party
live up to his agreement. He can no longer refuse to
perform his contract when it becomes disadvantageous to
him. An arbitration agreement is placed upon the same
footing as other contracts, where it belongs.” H. R. Rep.
No. 96, 68th Cong., Ist Sess. 1 (1924); see also Ex parte
Alabama Oxygen Co., 433 So. 2d 1158, 1170 (Ala. 1983)
(Maddox, J., dissenting). In Alabama Oxygen, after remand
from the United States Supreme Court for further consid-
eration in light of Keating, this Court adopted my dissent
as its opinion. Ex parte Alabama Oxygen Co., 452 So. 2d
860, 861 (Ala. 1984); see also Ex parte McKinney, 515 So. 2d
693 (Ala. 1987).

This Court held in Ex parte Costa & Head (Atrium),
Ltd., 486 So. 2d 1272 (Ala. 1986), that “[t]he requirement
of the FAA that an arbitration agreement ‘involve inter-
state commerce’ has been construed very broadly so that
the slightest nexus of the agreement with interstate com-
merce will bring the agreement within the ambit of the

App. 10

FAA.” 486 So. 2d at 1275 (citations omitted). I realize that
a majority of this Court rejected this “slightest nexus” test
in Ex parte Jones, [Ms. 1920249, July 16, 1993] ___ So. 2d
__ (Ala. 1993), but I believe that Jones is wrong. See Jones,
_. So. 2d at ___ (Maddox, J., dissenting); and Continental
Grain Co. v. Beasley, |Ms. 1920241, July 16, 1993] So. 2d
_. (Ala. 1993) (Maddox, J., concurring in the result).

For the reasons cited by the trial court in that part of
its order quoted in the majority opinion, I believe that the
home warranty agreement, which was transferred to Mrs.
Lopez, meets the “slightest nexus” test and that the trial
court properly compelled arbitration of the claims; there-
fore, I respectfully dissent.

ee eee

—-

App. 11

IN THE CIRCUIT COURT OF
MONTGOMERY COUNTY, ALABAMA

JULIETTE G. LOPEZ,
Plaintiff, CASE NO.

VS. CV-91-897

HOME BUYERS WARRANTY
CORPORATION II; JACK DEAL;
and ARONOV REALTY
COMPANY, INC., et al.,

Defendants.

i

ORDER

This matter has been submitted to this Court upon a
Motion to Dismiss or in the Alternative to Require Plain-
tiff to Submit to Arbitration, filed by Defendant Home
Buyers Warranty Corporation II (Home Buyers). The
Plaintiff, Juliette Lopez, argues that arbitration is not
proper in this case.

The contract upon which Plaintiff's case is based
contains the following language: “VII. Conciliation and
Arbitration — Should the Builder or Homebuyer(s) dis-
agree with the Insurer’s decision to deny the claim as
recommended by the Service, the contesting party shall
call for conciliation with the Service or an arbitration to
be conducted by the American Arbitration Association
(A.A.A.), or other mutually agreeable arbitration ser-
vice....” Plaintiff asserts two grounds as to why the
arbitration clause in the contract is not enforceable
against her: (1) Plaintiff never signed the contract, and
therefore, has not agreed to submit herself to arbitration;

App. 12

and (2) Under § 8-1-41, Code of Alabama, 1975, an agree-
ment to submit a controversy to arbitration cannot be
specifically enforced. This court addresses both of these
issues as follows.

With regard to Plaintiff's first argument, the Court
finds that Plaintiff's complaint is based upon the contract
containing the arbitration clause set out above. The con-
tract was originally between the former owners of the
house in question (the Browders) and Home Buyers. Nei-
ther Plaintiff nor her late husband signed the contract.
This Court notes that generally, “persons who are not
parties to a contract are not bound by the provisions of
that contract.” A. L. Williams & Associates, Inc. v.
McMahon, 697 F.Supp. 488, 493 (N.D.Ga. 1988). The Plain-
tiff herself relies on a portion of the contract as a basis for
her claims. The A. L. Williams case, supra, logically holds
that this necessarily subjects Plaintiff to all parts of that
contract, including the arbitration clause. “[A] party can-
not have it both ways; it cannot rely on a contract when it
works to its advantage and then repute it when it works
to its disadvantages. Therefore, in this case the court will
not allow [respondent] to assert claims allegedly arising
out of the agreements executed by [a 3rd party] without
requiring her also to abide by the arbitration clauses in
those agreements.” Id. at 494. Plaintiff cannot adopt the
contract as a basis for her claims without agreeing to the
arbitration clause as well. Therefore, Plaintiff's first argu-
ment that she is not subject to the arbitration clause since
she never signed the contract is without merit.

Plaintiff's second argument as to why she should not
be required to submit her claims to arbitration is that in
Alabama, agreements to submit a matter to arbitration

App. 13

are not enforceable. Home Buyers, however, argues that
the Federal Arbitration Act (FAA) applies to this contract,
preempting Alabama law, and therefore, the arbitration
clause should be upheld. Where it applies, the FAA pro-
vides for the enforcement of arbitration agreements. A. G.
Edwards & Sons, Inc. v. Syrrud, 597 So.2d 197 (Ala. 1992).
The FAA applies where the contract in question “[1] was
one involving interstate commerce . . . and [2] the con-
tract contained an arbitration agreement voluntarily
entered into by the parties.” Ex parte Warren, 548 So.2d
157, 159 (Ala. 1989), cert. denied sub. nom. Jim Skinner Ford,
Inc. v. Warren, 493 U.S. 998 (1989). Since the second prong
of the above FAA applicability test has been met (see
previous discussion regarding Plaintiff's adoption of the
contract), the final question left to be determined by this
Court is whether the contract was one “involving inter-
state commerce.”

The Alabama Supreme Court has issued two seem-
ingly differing opinions on what constitutes “involving
interstate commerce.” In 1986, Ex Parte Costa & Head
(Atrium), Ltd., 486 So.2d 1272, 1975 (Ala.) declared that
“[t]he requirement of the FAA that an arbitration agree-
ment ‘involve interstate commerce’ has been construed
very broadly so that the slightest nexus of the agreement
with interstate commerce will bring the agreement within
the ambit of the FAA.” Home Buyers argues that this
“slightest nexus” test should be applied in the case at bar
to determine whether the contract falls under the FAA.

In 1989, the Alabama Supreme Court stated in Ex
Parte Warren, supra, that the applicable standard for that
case was “ ‘whether at the time [the parties] entered into
[the contract] and accepted the arbitration clause, they

App. 14

contemplated substantial interstate activity.’” Plaintiff
argues that this contemplation of substantial interstate
activity standard should be used in the present case.

The Alabama Supreme Court recently clarified the
law in this area in Ex Parte Brice Building Company,
released July 17, 1992 (Docket No.s 1910190, 1910214), by
stating: “The Warren case was expressly addressed by this
Court with regard to its ‘narrow factual context.’ Implic-
ity, we have cecognized that the Costa standard, rather
than the Warren standard, is the appropriate standard to
utilize within the factual context of this case.” Therefore,
the “slightest nexus” test is the appropriate standard to
be used in the present case to determine whether the FAA
applies to the Home Buyers contract.

After hearing oral arguments and after consideration
of the briefs and memoranda submitted by the parties,
the Court has determined that the facts surrounding the
Home Buyers contract do support a finding that the
contract has at least a slightest nexus with interstate
commerce so as to bring the contract under the purview
of the FAA. Some of the facts supporting this finding are
as follows: Homer Buyers is a Colorado corporation and
Plaintiff is an Alabama resident; if Plaintiff is not satisfied
with the builder’s performance, she must send an appli-
cation to either Georgia or Colorado; the Home Buyers
district office for the State of Alabama is in Tucker, Geor-
gia; and the Home Buyers Claims & Warrant Service
Office is in Denver, Colorado. As stated previously, the
above facts indicate that the Home Buyers contract has at
least a “slightest nexus” with interstate commerce.

App. 15

Therefore, pursuant to the FAA, it is hereby
ORDERED, ADJUDGED and DECREED as follows:

1. Plaintiff shall submit herself to arbitration as per
the terms of the Conciliation and Arbitration clause of the
contract;

2. This action is due to be and is hereby DIS-
MISSED; and

3. Costs of these proceedings are taxed against the
Plaintiff, for which let execution issue.

DONE this the 19th day of October, 1992.

/s/ Joseph D. Phelps
JOSEPH D. PHELPS,
CIRCUIT JUDGE

cc: Jere Beasley
J. Cole Portis
BEASLEY, WILSON

Dennis Bailey

RUSHTON, STAKELY, JOHNSTON & GARRETT
Philip Gidiere

CARPENTER & GIDIERE

App. 16

IN THE SUPREME COURT OF ALABAMA
September 24, 1993

1920330

Juliette G. Lopez v. Home Buyers Warranty Corporation,
et al. (Montgomery: CV-91-897)

NOTICE

The application for rehearing filed in this cause is
overruled. No opinion written on rehearing.

SHORES, J. - Hornsby, CJ., Almon, Houston, Steagall
and Kennedy, JJ., concur;
Maddox and Adams, JJ., dissent

I, Robert G. Esdale, as Clerk of the Supreme
Court of Alabama, do hereby certify that the
foregoing is a full, true and correct copy of the
instrument(s) herewith sat out as same
appear(s) of record in said Court.

Witness my hand this 24 day of Sept. 1993.

/s/ Robert G. Esdale
Clerk, Supreme Court of Alabama

App. 17

9U.S.C.§ 1. “Maritime transactions” and “commerce”
defined; exceptions to operation of title

“Maritime transactions”, as herein defined, means
charter parties, bills of lading of water carriers, agree-
ments relating to wharfage, supplies furnished vessels or
repairs to vessels, collisions, or any other matters in
foreign commerce which, if the subject of controversy,
would be embraced within admiralty jurisdiction; “com-
merce”, as herein defined, means commerce among the
several States or with foreign nations, or in any Territory
of the United States or in the District of Columbia, or
between any such Territory and another, or between any
such Territory and any State or foreign nation, or between
the District of Columbia and any State or Territory or
foreign nation, but nothing herein contained shall apply
to contracts of employment of seamen, railroad
employees, or any other class of workers enyaged in
foreign or interstate commerce. July 30, 1947, c. 392, 61
Stat. 670.

9 U.S.C. § 2. Validity, irrevocability, and enforcement
of agreements to arbitrate

A written provision in any maritime transaction or a
contract evidencing a transaction involving commerce to
settle by arbitration a controversy thereafter arising out
of such contract or transaction, or the refusal to perform
the whole or any part thereof, or an agreement in writing
to submit to arbitration an existing controversy arising
out of such a contract, transaction, or refusal, shall be

re

App. 18

valid, irrevocable, and enforceable, save upon such
grounds as exist at law or in equity for the revocation of
any contract.

July 30, 1947, c. 392, 61 Stat. 670.

Code of Alabama 1975

§ §-1-41. Obligations which cannot be specifically
enforced.

The following obligations cannot be specifically
enforced:

* * *

(3) An agreement to submit a controversy
to arbitration;

App. 19

Ex Parte Bruce M. JONES
(Re: Bruce M. JONES,

Charles S. CALDWELL, III and Automatic
Detection Systems, Inc.).
1920249.
Supreme Court of Alabama.
July 16, 1993

KENNEDY, JUSTICE.

This mandamus proceeding stems from a lawsuit
involving a dispute over a stock purchase agreement
between the plaintiff/petitioner, Bruce M. Jones, and the
defendant/respondent Charles S. Caldwell III. Jones
seeks a writ of mandamus requiring the Jefferson County
Circuit Court to set aside its order directing arbitration as
to some of Jones’s claims. We grant the writ.

Caldwell is the majority shareholder and president of
Automatic Detection Systems, Inc. (“ADS”). ADS is an
Alabama corporation that sells, installs, maintains, and
monitors security system equipment. ADS is also a defen-
dant in the underlying action.

Jones owned all of the stock in another Alabama
corporation, Birmingham Protection Systems, Inc.
(“BPS”). In November 1990, Caldwell, individually,
entered into a stock purchase agreement with Jones.
Under the agreement, Jones, as the sole stockholder of
BPS, was to sell Caldwell his BPS stock. This agreement
contained an arbitration provision requiring that disputes

App. 20

regarding the stock agreement be arbitrated. Later, such
disputes arose and Jones sued.!

The trial court ordered arbitration. At issue in this
mandamus proceeding is whether the stock purchase
agreement “involves interstate commerce,” and thus,
invokes the Federal Arbitration Act, which would render
the arbitration provision in the contract enforceable.

Predispute arbitration agreements are not unenforce-
able [sic] under Alabama Law. Ala. Code 1975, s 8-1-41.
If, however, an arbitration agreement was voluntarily
entered into, and relates to a contract involving interstate
commerce, the Federal Arbitration Act, 9 U.S.C. s 1 et seq.
(the “FAA”) applies, and preempts Alabama law. See Ex
parte Alabama Oxygen Co., 433 So.2d 1158 (Ala. 1983)
(Maddox, J., dissenting), review after remand from
United [sic] Supreme Court, 452 So.2d 860 (Ala. 1984)
(adopting views expressed in Justice Maddox’s original
dissent); A. G. Edwards & Sons, Inc. v. Syvrud; 597 So.2d
197 (Ala. 1992). Under the FAA, a predispute arbitration
agreement — in the context of a contract involving inter-
state commerce - is enforceable. Id.

At the outset, we note that ADS was not a party to
the stock purchase agreement. Thus, ADS has no stand-
ing to seek enforcement of the arbitration provision
therein, and it would be error for the trial court to compel

! There are also disputes between the parties as to an “inde-
pendent consulting agreement” between ADS and Jones, but the
issues here relate solely to the trial court’s order requiring the
arbitration of claims arising under the stock purchase agree-
ment.

App. 21

arbitration of claims against ADS, under this arbitration
provision. We do not necessarily read the trial court’s
order to so require, but we address this question nonethe-
less, because the parties suggest that they so read the trial
court’s order.

We turn to the dispositive issue before us, whether
the agreement between Caldwell and Jones involved
“interstate commerce.” In this regard, Caldwell, citing Ex
parte Costa & Head (Atrium), Ltd., 486 So.2d 1272, 1275
(Ala. 1986), argues that even the “slightest nexus” of an
agreement with interstate commerce will bring the agree-
ment within the scope of the FAA. See Ex parte Brice
Building Co., 607 So.2d 132 (Ala. 1992). Caldwell dis-
cusses, in this regard, ADS and BPS’s interstate connec-
tions outside the agreement. Caldwell concedes that the
stock purchase agreement between himself and Jones
makes no reference to any interstate matters. However,
for the FAA to apply, the agreement that contains the
predispute arbitration provision must involve interstate
commerce.

Our review of the record indicates that the agreement
relates to the sale of all the stock in an Alabama corpora-
tion (located solely within Alabama), between two Ala-
bama businessmen, negotiating within Alabama to create
an agreement consisting of duties and obligations to be
performed within Alabama. Based on these facts, we hold
that the FAA does not apply.

Although one could reasonably conclude that the
agreement had not even the “slightest nexus” with inter-
state commerce, we reach our holding by applying the
standard set out in Ex parte Warren, 548 So.2d 157 (Ala.

App. 22

1989), for determining whether a contract involves inter-
state commerce, rather than the Costa “slightest nexus”
standard. The Warren standard is “[W]hether at the time,
[the parties] entered into [the contract] and accepted the
arbitration clause, they contemplated substantial inter-
state activity.” 548 So.2d at 160 (quoting Metro Industrial
Painting Corp. v. Terminal Constr. Co., 287 F.2d 382, 387
(2d Cir. 1961) (emphasis in Metro), cert. denied, 368 U.S.
817 (1961).

In Warren the Court declined to apply the Costa
“slightest nexus” standard and implicitly overruled it in a
“narrow” set of circumstances. Warren, 548 So.2d at 160.
Warren, which involved a retail automobile sales con-
tract, had a very limited applicability, as was indicated by
the Warren opinion itself and as subsequent cases sug-
gested. Noting this, we observed in Ex parte Brice Bldg.
Co., 607 So.2d 132 (Ala. 1992); “The Warren case was
expressly addressed by this Court with regard to its
‘narrow factual context.’ ... “In H.L. Fuller Constr. Co. v.
Industrial Dev. Bd. of [the] Town of Vincent, 590 So.2d
218 (Ala. 1991), decided after Warren, we restated the
Costa standard. H.L. Fuller Constr. involved a construc-
tion contract. ... We restated the Costa standard, but did
not go on to apply it... . “In Roscoe v. Jones, 571 So.2d
1043 (Ala. 1990), another construction contract case, we
reemphasized that Warren has a ‘narrow application.’ Id.
at 1046.” 607 So.2d at 134. (Emphasis original.)

To resolve any inconsistency or confusion generated
by the existence of two different standards, and deter-
mining, as we now do, that Warren represents a more
reasoned approach than the Costa standard, we overrule
any case inconsistent with Warren to the extent that it

App. 23

states a different standard for determining the involve-
ment of interstate commerce.

In this case, because the FAA does not apply, Ala-
bama law renders the arbitration provision unenforce-
able. Ala. Code 1975, s 8-1-41; Wells v. Mobile County Bd.
of Realtors, Inc., 387 So.2d 140 (Ala. 1980).

WRIT GRANTED.

Hornsby, C. J., and Almon, Shores, Houston, and Steagall,
JJ., concur.

Maddox and Ingram, JJ., dissent.
MADDOX, JUSTICE (dissenting).

I respectfully dissent. I disagree with the majority as
to the applicable test for determining whether a transac-
tion involves interstate commerce for purposes of the
FAA. I also believe that the stock purchase agreement
containing an arbitration clause involves interstate com-
merce and, therefore, that the trial court properly granted
the motion to compel arbitration.

I.

In determining whether a transaction involves inter-
state commerce, I believe that the “slightest nexus” test
set forth in Ex parte Costa & Head (Atrium), Ltd., 486 So.
2d 1272 (Ala. 1986), and not the “contemplation” test set
forth in Ex parte Warren, 548 So. 2d 157 (Ala.), cert.
denied sub nom. Jim Skinner Ford, Inc. v. Warren, 493
U.S. 998 (1989), provides the proper analysis. See Warren,
548 So. 2d at 160-63 (Maddox. J., dissenting). Although

App. 24

the majority concludes “that Warren represents a more
reasoned approach than the Costa standard,” So. 2d at,
the majority also recognizes that Warren “had a very
limited applicability, as was indicated by the Warren
opinion itself and as subsequent cases suggested.” So. 2d
at.

Indeed, Warren's “contemplation” test has been
applied in only two contexts — those involving auto-
mobile sales contracts between dealers and consumers,
see Warren and Ex parte Williams, 555 So. 2d 146 (Ala.
1989), and those, like this present case, involving stock
purchase agreements. See Ex parte Clemants, 587 So. 2d
317 (Ala. 1991). That this Court has applied the “contem-
plation” test sparingly indicates “that Warren has a ‘nar-
row application.’ ” Ex parte Brice Building Co., 607 So. 2d
132, 134 (Ala. 1992) (quoting in part Roscoe v. Jones, 571
So. 2d 1043, 1046 (Ala. 1990)). In contrast, in addition to
cases involving construction contract disputes, such as
Brice Building Co., this Court has also recently applied
the “slightest nexus” test in a number of other contexts.
See First Real Estate Corp. of Alabama, Inc. v. Brown
Marx Tower Ltd., [Ms. 1911779, May 7, 1993] So. 2d (Ala.
1993) (real estate management agreement); Circle S.
Industries, Inc. v. Berryman, 613 So. 2d 329 (Ala. 1993)
(consent judgment involving agreement not to compete),
Garikes, Wilson, & Atkinson, Inc. v. Episcopal Foundation
of Jefferson County, Inc., 614 So. 2d 447 (Ala. 1993) (con-
tract for architectural services); and A. J. Taft Coal Co.,
Inc. v. Randolph, 602 So. 2d 395 (Ala. 1992) (mining
lease).

oo

App. 25

Because this Court had already adopted the “slight-
est nexus” test in Costa & Head, its adoption of the
“contemplation” test in Warren has been criticized as
“creating a double standard.” Stanley D. Bynum & J.
David Pugh, Enforcing Arbitration Agreements in Ala-
bama: A Double Standard Dilemma, 54 Ala. Law, 38, 43
(January 1993). Bynum and Pugh wrote that Costa &
Head “brought Alabama law generally in line with the
majority of other jurisdictions” but that Warren “is incon-
sistent with all other jurisdictions that have addressed the
issue.” Id. at 38-39 and 41. The authors particularly crit-
icized Warren's “contemplation” test for its subjectivity.
Id. at 43.

I do not think that the United States Supreme Court's
denial of the petition for certiorari in Warren should be
viewed as that Court’s imprimatur of the “contempla-
tion” test, because a denial of a petition for certiorari has
no significance in regard to the merits. Parker v. Ellis, 362
U.S. 574, 576 (1960).?

Based on the foregoing, I believe that the “slightest
nexus” test gives more effect to Congress’s intent in
enacting the FAA, which was “to provide for the enforce-
ment of arbitration agreements within the full reach of

2 For example, last year the United States Supreme Court
denied a petition for certiorari review raising the issue of
whether the principle of Batson v. Kentucky, 476 U.S. 79 (1986),
applies to gender-based peremptory strikes, Murphy v. State,
596 So. 2d 42 (Ala. Cr. App. 1991), cert. denied, U.S., 113 S. Ct. 86
(1992), but in another case that Court has recently granted a
certiorari petition raising the same issue. J.E.B. v. State, 606 So.
2d 156 (Ala. Civ. App. 1992), cert. granted, U.S., [92-1239, May
17, 1993].

App. 26

the Commerce Clause.” Perry v. Thomas, 482 U.S. 483,
490 (1967). I am unwilling to overrule recent, well-rea-

soned cases applying the test this court adopted in Costa
& Head.

II.

Regarding whether the arbitration agreement in this
case is enforceable, I note that “[a]rbitration clauses con-
tained in contracts involving stock purchases are enforce-
able.” Warren, 548 So. 2d at 161 n.2 (Maddox, J.,
dissenting) (citing Shearson/American Express, Inc. v.
McMahon, 482 U.S. 220 (1987)). I believe that the stock
purchase agreement in this case had at least the “slightest
nexus” with interstate commerce, so that the arbitration
agreement is specifically enforceable pursuant to the
FAA. Consequently, I must respectfully dissent.

Ingram, J., concurs.

. coe eal see ~ ome Pe er eee Le . I te fog = RNR PE RTT ON ERS OCT EE Tos ene

o~ rr

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385017_1188%3A1. Public record. Not legal advice.