Panhandle Fire Protection v. Batson Cook
| Decision Date | 01 November 2007 |
| Docket Number | No. A07A1037.,A07A1037. |
| Citation | 288 Ga. App. 194,653 S.E.2d 802 |
| Parties | PANHANDLE FIRE PROTECTION, INC. v. BATSON COOK COMPANY. |
| Court | Georgia Court of Appeals |
Glover & Davis, Taylor Bridges Drake, Newnan, for Appellee.
Panhandle Fire Protection, Inc. appeals from the order and final judgment entered by the Superior Court of Troup County confirming an arbitration award in favor of Batson Cook Company ("BCC") and awarding BCC attorney fees under OCGA § 9-15-14. Panhandle asserts that personal jurisdiction and venue were improper in Troup County. Additionally, Panhandle contends that the attorney fees award must be vacated because the superior court failed to make any findings of fact. For the following reasons, we vacate the superior court's order and final judgment, and we remand with instruction.
The record shows that BCC, a Georgia corporation, was the general contractor for a construction project located in Gulf Shores, Alabama. BCC entered into a subcontractor agreement with Panhandle, a Florida corporation, under which Panhandle agreed to install a fire sprinkler system as part of the construction project (the "Subcontractor Agreement"). BCC and Panhandle dispute over which version of the Subcontractor Agreement was assented to by the parties. According to BCC, the parties agreed to a version of the Subcontractor Agreement containing a choice of law clause which stated that the contract would "be governed by the law of the state of Georgia," as well as a Georgia choice of forum and arbitration clause which stated:
AGREEMENT TO ARBITRATE: All claims, disputes and matters in question arising out of, or relating to, this Agreement or the breach thereof . . . shall be decided by arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association then in effect unless the parties mutually agree otherwise. This agreement to arbitrate shall be specifically enforceable under the prevailing arbitration law.
. . .
The location of the arbitration proceedings shall be the city of [BCC's] headquarters or Atlanta, Georgia.
In contrast, Panhandle contends that the Subcontractor Agreement ultimately agreed to by the parties did not require arbitration in Georgia. According to Panhandle, the Subcontractor Agreement mutually assented to by the parties incorporated and made controlling an "Attachment X" which stated that "[a]ll or any legal disputes will be handle[d] in a Florida court."
In any event, Panhandle commenced work on the project. BCC apparently became dissatisfied with Panhandle's work and filed a demand for arbitration with the American Arbitration Association ("AAA"). BCC sought to recover expenses that it had incurred as a result of Panhandle's alleged breach of contract. Panhandle responded to the demand with several letters to the AAA in which it denied the existence of a Georgia choice of forum and arbitration clause in the Subcontractor Agreement and objected to the arbitration.
The arbitrator subsequently issued an order finding that Panhandle was bound by the arbitration clause and that the Subcontractor Agreement unambiguously provided for the arbitration to be conducted in the city of BCC's headquarters or Atlanta, Georgia. Consequently, the AAA scheduled an arbitration hearing and notified both BCC and Panhandle. The arbitration hearing was conducted in Atlanta. Panhandle did not participate. The arbitrator found in favor of BCC and awarded it the monetary damages sought in its arbitration demand.
Thereafter, BCC filed a motion to confirm the arbitration award in the Superior Court of Troup County, the location of its principal place of business. Panhandle filed a motion to dismiss, arguing that the superior court lacked personal jurisdiction over Panhandle and contesting venue in that court. The superior court confirmed the arbitration award and found that BCC was entitled to recover attorney fees under OCGA § 9-15-14.
1. Panhandle maintains that personal jurisdiction and venue were improper in the Superior Court of Troup County. As discussed below, we conclude that the superior court's order and final judgment must be vacated, and the case remanded, because the jurisdictional issues raised by Panhandle cannot be resolved until the superior court first conducts a de novo examination of whether the parties agreed to arbitrate their dispute. That, in turn, will require the superior court to examine the competing versions of the Subcontractor Agreement and decide which version the parties ultimately gave their mutual assent.
(a) The Subcontractor Agreement. If BCC's version of the Subcontractor Agreement is correct, personal jurisdiction and venue are proper in Troup County. Under Georgia law, personal jurisdiction is conferred over a nonresident if the nonresident enters into a contract containing a Georgia choice of forum and arbitration clause. Galindo v. Lanier Worldwide, 241 Ga.App. 78, 81(2)(b), 526 S.E.2d 141 (1999). Thus, if Panhandle entered into a Subcontractor Agreement providing for arbitration in Georgia to resolve disputes over the construction project, the superior court had personal jurisdiction over Panhandle. Id.
Likewise, venue in the Superior Court of Troup County would be proper pursuant to the Georgia Arbitration Code, OCGA § 9-9-1 et seq. ("GAC"), under BCC's version of the Subcontractor Agreement. Although Panhandle contends that the Federal Arbitration Act, 9 U.S.C. § 1 et seq., applies since the case involves interstate commerce the GAC controls because BCC's version of the Subcontractor Agreement contains a Georgia choice of law clause and an arbitration clause. Southwire Co. v. American Arbitration Assn., 248 Ga.App. 226, 227(1), 545 S.E.2d 681 (2001). Under the GAC, venue is proper, among other places, "[i]n the county where any party resides or does business." OCGA § 9-9-4(b)(3). And, Panhandle did not dispute in the court below that if the GAC applies in this case, venue would be properly conferred upon the superior court based on OCGA § 9-9-4(b)(3).1
In contrast, if Panhandle proves that the parties never agreed to the Georgia choice of forum and arbitration clause, personal jurisdiction and venue in the superior court would be improper. Panhandle is a Florida corporation, the project was located in Alabama, and the only other alleged contacts between Panhandle and Georgia was the mailing of letters to the arbitrator by Panhandle's attorney objecting to the arbitration. "It is well settled under Georgia law that . . . mailing a response to [an] arbitration notice and . . . letter[s] to the arbitrator, standing alone, are not sufficient to confer personal jurisdiction." Galindo, 241 Ga.App. at 81(2)(b), 526 S.E.2d 141. Furthermore, Panhandle asserts that the parties agreed to a forum selection clause requiring that all suits be brought in the Florida courts. If Panhandle proves its assertions, the superior court lacked jurisdiction to hear the motion to confirm the arbitration award.
(b) The Arbitrator's Decision. Here, the arbitrator ruled that BCC's version of the contract controlled and thus that the parties had agreed to arbitrate their dispute. That, however, does not resolve the matter. Under federal and Georgia arbitration law, the threshold question of whether parties to a contract agreed to arbitrate a dispute is normally a matter for a court, rather than an arbitrator, to decide. See First Options of Chicago v. Kaplan, 514 U.S. 938, 944-947(II), 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995); Crawford v. Great American Cash Advance, 284 Ga.App. 690, 692-693(1), 644 S.E.2d 522 (2007); Pickle v. Rayonier Forest Resources, 282 Ga.App. 295, 296, 638 S.E.2d 344 (2006); Galindo, 241 Ga.App. at 82-83(2)(b), 526 S.E.2d 141; North Augusta Assocs. v. 1815 Exchange, 220 Ga.App. 790, 793(2), 469 S.E.2d 759 (1996). Absent clear and unmistakable evidence that the parties agreed to arbitrate the issue of arbitrability, a trial court reviewing an arbitration decision should independently determine whether the parties contractually agreed to the arbitration. Galindo, 241 Ga.App. at 83(2)(b), 526...
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