United States District Court, S.D. Alabama, Southern Division
WILLIAM H. STEELE CHIEF UNITED STATES DISTRICT JUDGE
matter is before the Court on the defendants' motion to
compel arbitration and stay judicial proceedings. (Doc. 22).
The plaintiff has filed a response and the defendants a
reply, (Docs. 24, 26), and the motion is ripe for resolution.
After careful consideration, the Court concludes the motion
is due to be granted.
to the amended complaint, (Doc. 8), the entity plaintiff
(“Bay South”) entered two subcontracts with one
defendant (“Stephens”) to furnish labor and
materials on two federal construction projects. The second
defendant (“Fidelity”) issued payment bonds for
the protection of Bay South and other subcontactors, in
accordance with Stephens' obligations under the Miller
Act. Bay South fully performed, but Stephens refused to pay
Bay South all amounts due. The amended complaint asserts six
causes of action (three as to each of the projects): (1) suit
on the payment bond, brought against both defendants pursuant
to the Miller Act; (2) a breach of contract claim, brought
against Stephens; and (3) a state law claim for violation of
the Alabama Prompt Pay Act, brought against Stephens.
defendants seek to compel arbitration of all claims against
Stephens; they do not seek to compel arbitration of the
claims against Fidelity. The defendants seek a stay of all
proceedings herein, including with respect to the claims
against Fidelity, pending arbitration. (Doc. 22 at 2).
Federal Arbitration Act (“FAA”) “reflect[s]
both a liberal federal policy favoring arbitration, and the
fundamental principle that arbitration is a matter of
contract.” Inetianbor v. CashCall, Inc., 768
F.3d 1346, 1349 (11th Cir. 2014) (internal quotes
omitted). Thus, “courts must place arbitration
agreements on an equal footing with other contracts, and
enforce them according to their terms.” Id.
(internal quotes omitted).
subcontracts contain the following provision:
In the event of a dispute arising between CONTRACTOR and
SUBCONTRACTOR under the Subcontract Agreement, at the
election of the CONTRACTOR, and not otherwise, the dispute
shall be settled by arbitration in accordance with the
Construction Industry Arbitration Rules of the American
Arbitration Association then in effect. Such arbitration
shall be held in Birmingham, Alabama, or another location if
mutually agreeable to the parties.
(Doc. 22-2 at 4; Doc. 22-3 at 4). The plaintiff makes no
argument that its claims for breach of contract, and those
for violation of the Alabama Prompt Pay Act, fall outside the
terms of this provision. Neither does the plaintiff assert
any objection or defense to the arbitrability of these
claims. As to the Miller Act claims asserted against
Stephens, however, the plaintiff raises three objections -
one statutory, one contractual, and one procedural. The Court
considers these in turn.
Statutory Prohibition on Arbitration.
plaintiff argues that “the plain language of the Miller
Act rejects arbitration.” (Doc. 24 at 2). The plaintiff
relies on the following provision, added to the Miller Act by
amendment in 1999:
(c) A waiver of the right to bring a civil action on a
payment bond required under this subchapter is void unless
the waiver is -
(1) in writing;
(2) signed by the person whose right is waived; and
(3) executed after the person whose right is waived has
furnished labor or material for use in the ...