Wagner v. Stratton Oakmont, Inc., No. 95-35176
| Court | United States Courts of Appeals. United States Court of Appeals (9th Circuit) |
| Writing for the Court | CANBY |
| Citation | 83 F.3d 1046 |
| Parties | 96 Cal. Daily Op. Serv. 2994, 96 Daily Journal D.A.R. 4975 Fred WAGNER; Scott Serven, d/b/a Wagner/Serven, a partnership, Plaintiffs-Appellees, v. STRATTON OAKMONT, INC.; Mathew Bloom; Neil Kimpermen, Defendants-Appellants. |
| Docket Number | No. 95-35176 |
| Decision Date | 30 April 1996 |
Page 1046
D.A.R. 4975
partnership, Plaintiffs-Appellees,
v.
STRATTON OAKMONT, INC.; Mathew Bloom; Neil Kimpermen,
Defendants-Appellants.
Ninth Circuit.
Decided April 30, 1996.
Page 1047
Francis L. Van Dusen, Jr., Miller, Nash, Weiner, Hager & Carlsen, Seattle, Washington, for defendants-appellants.
Barton L. Adams, Adams & Adams, Tacoma, Washington, for plaintiffs-appellees.
Appeal from the United States District Court for the Western District of Washington; Franklin D. Burgess, District Judge, Presiding, No. CV-94-05551-FDB.
Before: WRIGHT, ALARCON and CANBY, Circuit Judges.
CANBY, Circuit Judge:
The question presented by this appeal is whether an arbitration agreement signed by a partner when he opened his own individual account with a stockbroker binds his partnership or himself to arbitration of partnership claims against the stockbroker arising from a separate trading account opened in the partnership's name. We hold that it does not, and we therefore affirm the district court's refusal to stay this action pending arbitration.
In August 1993, Scott Serven opened a brokerage account with Stratton Oakmont, Inc. On the account application, Serven indicated that the account was an "individual" account, and he listed his social security number as the tax identification number. As part of his account application, Serven signed a customer agreement that provided in relevant part:
This agreement ("Agreement") sets forth the terms and conditions under which Bear Stearns Securities Corp., ... will transact business with you, including but not limited to the maintenance of your account(s).
....
You agree, and by maintaining an account for you Bear Stearns agrees, that controversies arising between you and Bear Stearns ... shall be determined by arbitration....
(Emphasis added). Bear Stearns is Stratton Oakmont's clearing broker. The agreement is made applicable to Stratton Oakmont by the following clause:
You agree that your broker [i.e., Stratton Oakmont] and its employees are third-party beneficiaries of this Agreement, and that the terms and conditions hereof, including the arbitration provision, shall be applicable to all matters between or among any of you, your broker and its employees, and Bear Stearns and its employees.
(Emphasis added). This agreement, which was signed in Serven's own name, listed only the account opened by Serven in the space provided for account numbers.
Within one month, Serven had deposited approximately $412,000 in the account opened in his name. According to Serven this sum consisted of funds that were either personal, drawn from his corporation, or borrowed. At one point, Serven attempted to deposit into this account a check for $98,635.00 that apparently was made payable to Wagner/Serven. Stratton Oakmont refused to deposit the funds and notified Serven that, because the account was an "individual" account, partnership funds could not be deposited without a letter from the partnership indicating that the funds could be placed in Serven's account without the partnership's having any rights to the funds. Serven subsequently provided such a letter, and the funds were deposited.
Page 1048
In October 1993, Wagner/Serven opened a brokerage account with Stratton Oakmont. The account application indicated that the account was a "partnership" account, and it listed the Wagner/Serven tax identification number. Shortly thereafter, Serven transferred $400,000 from the account opened in his individual name to the "partnership" account.
The partnership's account did not do well. In September 1994, Wagner/Serven brought this action in the Superior Court of the State of Washington against Stratton Oakmont. The complaint alleges six causes of action based on federal and state securities laws, state consumer protection laws, common law fraud, negligence, and breach of fiduciary duty. Stratton Oakmont removed the action to federal court and moved to stay the litigation pending arbitration, pursuant to the arbitration agreement between Serven and Stratton Oakmont. The district court denied the motion, finding that Stratton Oakmont had "provided no facts to support [its] position that a preexisting agreement to arbitrate existed between it and the plaintiff partnership [Wagner/Serven], or alternatively, through the doctrines of apparent authority and/or ratification, that Mr. Serven's individual acts bound the partnership to his agreement with the defendant." This appeal followed.
I.
We first must decide whether the district court or the arbitrators should determine whether an arbitration agreement between the parties exists. Like the district court, we conclude that this was an issue for the district court to decide.
The Federal Arbitration Act requires a court to stay an action whenever the parties to the action have agreed in writing to submit their claims to arbitration:
If any suit or proceeding be brought in any of the courts of the United States upon any issue referable to arbitration under an agreement in writing for such arbitration, the court in which such suit is pending, upon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under such an agreement, shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement....
9 U.S.C. § 3 (emphasis added). Under this provision, the question whether the Wagner/Serven partnership is governed by the arbitration agreement must initially be resolved by the district court. See Ralph Andrews Prods., Inc. v. Writers Guild of America, 938 F.2d 128, 130 (9th Cir.1991); cf. Van Ness Townhouses v. Mar Indus. Corp., 862 F.2d 754, 756 (9th Cir.1989) ("When we are asked to compel arbitration of a dispute, our threshold inquiry is whether the parties agreed to arbitrate."). The rationale for such an inquiry comes from the fact that "arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit." Tracer Research Corp. v. Nat'l Envtl. Servs. Co., 42 F.3d 1292, 1294 (9th Cir.1994) (quoting United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582, 80 S.Ct....
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Hebei Hengbo New Materials Tech. Co. v. Apple, Inc., Case No. 18-CV-00468-LHK
...favor of arbitration." Mundi v. Union Sec. Life Ins. Co. , 555 F.3d 1042, 1044 (9th Cir. 2009) (quoting Wagner v. Stratton Oakmont, Inc. , 83 F.3d 1046, 1049 (9th Cir. 1996) ). "[A]s with any other contract, the parties' intentions control, but those intentions are generously construed as t......
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Ortiz v. Hobby Lobby Stores, Inc., No. 2:13–cv–01619.
...favor of arbitration.’ ” Botorff v. Amerco, No. 2:12–cv–01286, 2012 WL 6628952, at *3 (E.D.Cal. Dec. 19, 2012) (citing Wagner v. Stratton, 83 F.3d 1046, 1049 (9th Cir.1996) ). An arbitration agreement may only “be invalidated by ‘generally applicable contract defenses, such as fraud, duress......
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Arriaga v. Cross Country Bank, No. 01 0498 IEG (RBB).
...court may also request that the action be stayed pending arbitration of the issues. See 9 U.S.C. § 3; Wagner v. Stratton Oakmont, Inc., 83 F.3d 1046, 1048 (9th Cir. B. Analysis As stated above, Arriaga opposes this motion to compel arbitration on several grounds. The Court will address each......
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Ortiz v. Hobby Lobby Stores, Inc., No. 2:13–cv–01619.
...favor of arbitration.’ ” Botorff v. Amerco, No. 2:12–cv–01286, 2012 WL 6628952, at *3 (E.D.Cal. Dec. 19, 2012) (citing Wagner v. Stratton, 83 F.3d 1046, 1049 (9th Cir.1996)). An arbitration agreement may only “be invalidated by ‘generally applicable contract defenses, such as fraud, duress,......
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Hebei Hengbo New Materials Tech. Co. v. Apple, Inc., Case No. 18-CV-00468-LHK
...favor of arbitration." Mundi v. Union Sec. Life Ins. Co. , 555 F.3d 1042, 1044 (9th Cir. 2009) (quoting Wagner v. Stratton Oakmont, Inc. , 83 F.3d 1046, 1049 (9th Cir. 1996) ). "[A]s with any other contract, the parties' intentions control, but those intentions are generously construed as t......
-
Ortiz v. Hobby Lobby Stores, Inc., No. 2:13–cv–01619.
...favor of arbitration.’ ” Botorff v. Amerco, No. 2:12–cv–01286, 2012 WL 6628952, at *3 (E.D.Cal. Dec. 19, 2012) (citing Wagner v. Stratton, 83 F.3d 1046, 1049 (9th Cir.1996) ). An arbitration agreement may only “be invalidated by ‘generally applicable contract defenses, such as fraud, duress......
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Arriaga v. Cross Country Bank, No. 01 0498 IEG (RBB).
...court may also request that the action be stayed pending arbitration of the issues. See 9 U.S.C. § 3; Wagner v. Stratton Oakmont, Inc., 83 F.3d 1046, 1048 (9th Cir. B. Analysis As stated above, Arriaga opposes this motion to compel arbitration on several grounds. The Court will address each......
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Ortiz v. Hobby Lobby Stores, Inc., No. 2:13–cv–01619.
...favor of arbitration.’ ” Botorff v. Amerco, No. 2:12–cv–01286, 2012 WL 6628952, at *3 (E.D.Cal. Dec. 19, 2012) (citing Wagner v. Stratton, 83 F.3d 1046, 1049 (9th Cir.1996)). An arbitration agreement may only “be invalidated by ‘generally applicable contract defenses, such as fraud, duress,......