Skip to main content

ARBITRATION-CRITERIA-CONSTRUCTION DISPUTE

Von Sick v. ANC Builders, Inc., 2023 Pa. Super. LEXIS 286 (June 26, 2023) (Lazarus, J.) We employ a two-part test to determine whether the trial court should have compelled arbitration. First, we examine whether a valid agreement to arbitrate exists. Second, we must determine whether the dispute is within the scope of the agreement. Whether a claim is within the scope of an arbitration provision is a matter of contract, and as with all questions of law, our review of the trial court’s conclusion is plenary. Fineman, Krekstein & Harris, P.C. v. Perr, 2022 PA Super 117, 278 A.3d 385, 389 (Pa. Super. 2022) (citation omitted). Further, we are guided by the following principles:

(1) arbitration agreements are to be strictly construed and not extended by implication; and
(2) when parties have agreed to arbitrate in a clear and unmistakable manner, every reasonable effort should be made to favor the agreement unless it may be said with positive assurance that the arbitration clause involved is not susceptible to an interpretation that covers the asserted dispute.

Smay v. E.R. Stuebner, Inc., 2004 PA Super 493, 864 A.2d 1266, 1273 (Pa. Super. 2004). “Pennsylvania has a well-established public policy that favors arbitration, and this policy aligns with the federal approach expressed in the Federal Arbitration Act, 9 U.S.C. §§ 1-16 (FAA).” Pisano v. Extendicare Homes, Inc., 2013 PA Super 232, 77 A.3d 651, 660 (Pa. Super. 2013). This policy applies to all arbitration agreements. MacPherson v. Magee Mem’l Hosp. for Convalescence, 2015 PA Super 248, 128 A.3d 1209, 1219 (Pa. Super. 2015) (en banc).

Section 2 of the FAA binds state courts to compel arbitration of claims subject to an arbitration agreement. 9 U.S.C. § 2 (providing that arbitration [*8] agreements “shall be valid, irrevocable, and enforceable”). This directive is mandatory, requiring parties to proceed to arbitration on issues subject to a valid arbitration agreement, even if a state law would otherwise exclude it from arbitration. Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52, 58, 115 S. Ct. 1212, 131 L. Ed. 2d 76[] (1995).

The only exception to a state’s obligation to enforce an arbitration agreement is provided by the [FAA’s] savings clause, which permits the application of generally applicable state contract law defenses such as fraud, duress, or unconscionability, to determine whether a valid contract exists.

Taylor, 147 A.3d at 509. Here, Von Sick submitted no evidence in the trial court establishing that the arbitration clause, itself, unreasonably favored BPG. Rather, he based his unconscionability argument on other, unrelated clauses of the contract. Where the arbitration provision itself is valid, any determination as to the validity of the remainder of the contract is for the arbitrator to make. Buckeye Check Cashing, Inc., supra. Because Von Sick did not sustain his burden to prove the unconscionability of the arbitration clause, Salley, supra, the trial court erred in overruling BPG’s preliminary objection in the form of an application to compel arbitration. Order vacated. Case remanded for entry of order consistent with the dictates of this decision. Jurisdiction relinquished.