United States District Court, D. Alaska
ORDER RE MOTION TO DISMISS
SHARON
L. GLEASON, UNITED STATES DISTRICT JUDGE.
Before
the Court at Docket 5 is Defendant Raibow Fiberglass &
Boat Repair, LLC's Motion to Dismiss. The motion has been
fully briefed.[1] Oral argument was not requested and was
not necessary to the Court's decision.
BACKGROUND
The
facts, presented here primarily from the perspective of
Plaintiff Lyle Myrvold (“Mr. Myrvold”) at this
initial stage of the case, [2] are as follows:
On or
about August 3, 2016, Mr. Myrvold reached an agreement
(“Agreement”) with Defendant Raibow Fiberglass
& Boat Repair, LLC, (“Raibow”) for repair
work to be performed on Mr. Myrvold's vessel, the F/V
NAKCHAMIK (“Vessel”).[3] Under the terms of the
Agreement, the parties agreed that the total cost of the
work, $45, 035.00, would be paid in three installments: an
initial payment of $15, 000.00 at the commencement of the
work; a second payment of $15, 000.00; and a final payment of
$15, 035.00 due upon completion of the work.[4] An itemized list
of the work to be performed (“Original Work”) and
materials required was contained in Invoice
2016-0314.[5]
On
August 9, 2016, Mr. Myrvold tendered the initial payment of
$15, 000 to Raibow and delivered the Vessel to Raibow's
property for the commencement of work.[6] The parties
agreed that all Original Work would be completed no later
than May 1, 2017.[7] On or about September 17, 2016, David
Phillips, in his capacity as Raibow's sole member and
manager, contacted Mr. Myrvold and requested immediate
payment of the remaining balance under the
Agreement.[8] Mr. Myrvold alleges that he and Raibow
subsequently agreed to an amended agreement (“Amended
Agreement”), pursuant to which Raibow agreed to perform
both the Original Work and additional work (“Additional
Work”) not included on Invoice 2016-0314 for a slightly
discounted price of $42, 500.00.[9] Mr. Myrvold then maintains
that he tendered an additional payment to Raibow in the
amount of $27, 500.00 on September 7, 2016, representing the
balance of the amount due under the Amended
Agreement.[10] Mr. Myrvold maintains that Raibow
documented the discount and final payment in writing on a
copy of Invoice 2016-0314 by indicating that all work was
“paid in full” as of September 7,
2016.[11]
Mr.
Myrvold alleges that as of May 1, 2017, neither the Original
nor the Additional Work had been completed and the Vessel was
in a state of disrepair on Raibow's
property.[12] Mr. Myrvold maintains that on May 9,
2017, Raibow generated a back-dated invoice, Invoice
2017-0108, that indicated that Mr. Myrvold owed Raibow an
additional $19, 497.04.[13] Raibow also informed Mr. Myrvold that
the Vessel would remain in Raibow's possession and no
further work would be performed on the Vessel until Mr.
Myrvold tendered these additional funds.[14] On May 12,
2017, Mr. Myrvold alleges that he visited Raibow's
property and discovered that the Vessel was disassembled in
several pieces; “neither the Original nor the
Additional Work had been completed”; and the repair
work that had been performed was of poor
quality.[15]
Mr.
Myrvold's Complaint also alleges, “on information
and belief, ” that Raibow filed a Notice of Claim of
Maritime Lien against the Vessel with the United States Coast
Guard.[16] Raibow maintains that it has the legal
right to establish a maritime lien against the Vessel and to
keep the Vessel at its place of business until Mr. Myrvold
meets his contractual obligations.[17]
On
November 22, 2017, Mr. Myrvold filed the instant Complaint,
alleging that Raibow had violated the terms of the Amended
Agreement.[18] Mr. Myrvold alleged that at the time of
filing, Raibow had not completed either the Original or
Additional Work and the Vessel remained on Raibow's
property in a state of disrepair.[19] Mr. Myrvold seeks damages
in admiralty for improper and defective workmanship and for
an alleged failure to protect the Vessel from the elements.
Mr. Myrvold also brings several claims under Alaska
law.[20] Mr. Myrvold seeks damages as well as a
declaration that the Vessel is not subject to Raibow's
maritime lien.[21]
On
January 3, 2018, Raibow filed the instant motion, alleging
that Mr. Myrvold and Raibow had entered into a valid
arbitration agreement, and therefore the Court must dismiss
the action and compel arbitration. Raibow attached to the
motion, as Exhibit A, an unsigned document titled
“Repair Agreement, ” which Raibow describes as a
“sample Repair Agreement that Raibow's
administration makes all Vessel Owners sign prior to the
commencement of work.”[22] The sample document contains a
clause containing language requiring that all disputes
arising out of the Agreement are to be “determined by
binding arbitration in Seward before one
arbitrator.”[23]
In its
motion to dismiss, filed on January 3, 2018, Raibow stated
that it was “having a hard time locating the executed
contract.”[24] With its reply on the motion, Raibow
provides an affidavit of David Phillips, in which he states,
“[I]t is my recollection that a Repair Agreement
exactly replicating the one attached to the Motion to Dismiss
was signed by myself and Mr. Myrvold on that date. My copy of
Repair Agreement that was entered into and signed by both of
us on or about August 3, 2016 was placed in my office safe on
that date.”[25] Mr. Phillips also explains that the safe
was stolen from Raibow's office in November
2017.[26]
Mr.
Myrvold maintains that the parties never signed an agreement
like the one offered by Raibow and that the only written
record of the agreement was the original Invoice 2016-0314,
and as amended on or around September 7, 2016.[27] In Mr.
Myrvold's affidavit, he asserts that “on August 3,
2016, I entered into an oral agreement with Phillips, on
behalf of Raibow.”[28] Mr. Myrvold denies the existence of
an original signed Repair Agreement, maintaining that
“[t]he parties in this action did not discuss or review
the terms set forth in such form, did not accept such written
terms, and did not execute the form with the intent to be
bound thereby.”[29]
DISCUSSION
I.
Jurisdiction
Mr.
Myrvold asserts that this Court has jurisdiction over this
action pursuant to 28 U.S.C. § 1331 and 28 U.S.C. §
1333.[30]
II.
Nature of the Motion to Dismiss
Raibow
purports to bring the motion under Fed R. Civ. Proc. 12(b)(6)
and 12(b)(3). However, Rule 12(b)(6) is not applicable, as
the asserted basis for dismissal is not the failure to state
a claim upon which relief can be granted, but is instead
Raibow's assertion that the parties agreed to a valid
arbitration clause.[31] Raibow contends that both the Federal
Arbitration Act and a similar state statute require dismissal
of Mr. Myrvold's case in favor of
arbitration.[32] Rule 12(b)(3) is also not applicable
here because Raibow does not appear to be challenging the
propriety of venue in this particular district
court.[33]Furthermore, the case that Raibow cites
for the general proposition that “an arbitration clause
is [a] ‘specialized kind of forum-selection clause,
'” Weyerhaeuser Co. v. W. Seas Shipping
Co., focused on whether a federal court may order the
consolidation of two separate maritime arbitrations when a
party objects to joint arbitration.[34] Here, the parties'
present dispute is not focused on how to arbitrate;
rather, it is focused on whether to arbitrate at
all. Thus, the Court will treat the motion as a motion to
dismiss so as to compel arbitration pursuant to the FAA.
III.
Application of the Federal Arbitration Act
Raibow
is correct that valid arbitration clauses are enforceable
under federal and state law.[35] Under the Federal Arbitration
Act,
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 . . . shall be valid, irrevocable, and
enforceable.[36]
However,
“[i]t is axiomatic 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.'”[37]Therefore, “a party who contests
the making of a contract containing an arbitration provision
cannot be compelled to arbitrate the threshold issue of the
existence of an agreement to
arbitrate.”[38] “[W]hen one party disputes
‘the making of the arbitration agreement, ' the
Federal Arbitration Act requires that ‘the court
proceed summarily to the trial thereof' before compelling
arbitration under the ...