Compelling and Staying Arbitration in Maryland

1 2017 Thomson Reuters. All rights the Resource ID numbers in blue on Westlaw for more. Resource ID: w-008-0124 Andrew JAy GrAhAm, JeAn e. Lewis, And Louis P. mALick, krAmon & GrAhAm PA, with PrActicAL LAw ArbitrAtionCompelling and Staying Arbitration in MarylandA Practice Note explaining how to request judicial assistance in Maryland state court to compel or stay Arbitration . This Note describes what issues counsel must consider before seeking judicial assistance, and explains the steps counsel must take to obtain a court order Compelling or Staying Arbitration in of this noteWhen a party commences a lawsuit on an issue subject to an Arbitration agreement, the opposing party may need to seek a court order to stay the litigation and compel Arbitration .

2 Likewise, when a party starts an Arbitration proceeding in the absence of an Arbitration agreement, the opposing party may need to seek a court order Staying the Arbitration . This Note describes the key issues counsel should consider when requesting a court to compel or stay Arbitration in information on Compelling or Staying Arbitration in federal courts, see Practice Note, Compelling and Enjoining Arbitration in US Federal Courts (6-574-8707).PreLiminAry considerAtions when Compelling or Staying ArbitrAtionBefore seeking judicial assistance to compel or stay Arbitration , parties must determine whether the Federal Arbitration Act (FAA) or Maryland state law applies to the Arbitration agreement (see Determine the Applicable Law).

3 Parties must also consider: The threshold factual issues courts consider when evaluating a request to compel or stay Arbitration (see Threshold Issues for the Court to Decide). The issues specific to requests to compel Arbitration (see Considerations When Seeking to Compel Arbitration ). The issues specific to requests to stay Arbitration (see Considerations When Seeking to Stay Arbitration ). Whether to make an application for provisional remedies, such as an attachment or preliminary injunction, when seeking to compel or stay Arbitration (see Considerations When Seeking Provisional Remedies).determine the APPLicAbLe LAwWhen evaluating a request for judicial assistance in Arbitration proceedings, the court must determine whether the Arbitration agreement is enforceable under the FAA or Maryland Arbitration fAAAn Arbitration agreement falls under the FAA if the agreement: Is in writing.

4 Relates to interstate or international commerce or a maritime mat ter. States the parties agreement to arbitrate a dispute.(9 1 and 2.)The FAA applies to all arbitrations arising from maritime transactions or to any other contract involving interstate commerce, a term the courts define broadly. Parties may, however, contemplate enforcement of their Arbitration agreement under state law (see Hall St. Assocs., v. Mattel, Inc., 552 576, 590 (2008); Rourke v. AmChem Prods., Inc., 835 193, 209 (Md. Ct. Spec. App. 2003)).If the agreement falls under federal law, state courts apply the FAA, which preempts conflicting state law only to the extent that [state law] stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress (Volt Info.)

5 Scis., Inc. v. Bd. of Trs. of Leland Stanford Junior Univ., 489 468, 476-77 (1989) (there is no federal policy favoring Arbitration under a certain set of procedural rules; the federal policy behind the FAA is simply to ensure that Arbitration agreements are enforceable); Wells v. Chevy Chase Bank, , 768 620, 625 (Md. 2001) (concluding the FAA does not preempt Maryland procedural law)).For more information on Compelling Arbitration when an Arbitration agreement falls under the FAA, see Practice Note, Compelling and Enjoining Arbitration in US Federal Courts: Agreement Must Fall Under Federal Arbitration Act (6-574-8707). 2017 Thomson Reuters. All rights reserved. 2 Compelling and Staying Arbitration in Marylandmaryland state LawThe Maryland Uniform Arbitration Act (MUAA), codified at Md.

6 Code Ann., Cts. & Jud. Proc. 3-201 through 3-234, governs Arbitration in Maryland , including applications to stay or compel Arbitration . The MUAA is based on the Uniform Arbitration Act of 1956 (UAA), which the National Conference of Commissioners on Uniform State Laws revised in 2000 when it promulgated the Revised Uniform Arbitration Act (RUAA). To date, the Maryland legislature has not introduced legislation to conform the MUAA to the RUAA or to adopt the RUAA wholesale. For more information on the RUAA and a list of states that have adopted it, see Practice Note, Revised Uniform Arbitration Act: Overview (w-004-5167).The UAA and the MUAA mirror the FAA, which Maryland courts consider an analogue to the MUAA (see Holmes v. Coverall N.)

7 Am., Inc., 649 365, 368 (Md. 1994); Regina v. Envirmech Contracting Corp., 565 693, 696 (Md. 1989)). Like the FAA, the MUAA promotes a policy favoring the enforcement of Arbitration agreements (see Gold Coast Mall, Inc. v. Lamar Corp., 468 91, 95 (Md. 1993)). Maryland courts rely on federal and state court decisions interpreting the FAA when interpreting the MUAA (see Holmes, 649 at 368; Walther v. Sovereign Bank, 872 735, 742 (Md. 2005)).The MUAA applies: If the parties agreement contains a choice of law clause that provides for Maryland law to govern dispute resolution (see Rourke, 835 at 209 (noting that the dispute met the interstate commerce requirement for applicability of the FAA but applying the MUAA as dictated by the Arbitration agreement choice of law provision); see also C & L Enters.

8 , Inc. v. Citizen Band Potawatomi Indian Tribe of Okla., 532 411, 419 (2001)). To Arbitration agreements made after May 31, 1965 (Md. Code Ann., Cts & Jud. Proc. 3-231).The MUAA does not apply to an Arbitration agreement between employers and employees or their representatives unless the agreement specifies that the MUAA applies (Md. Code Ann., Cts. & Jud. Proc. 3-206(b)). Courts construe this section as exempting collective bargaining agreements from application of the MUAA unless specified in the agreement, but not individual employment agreements (see Wilson v. McGrow, Pridgeon & Co., , 467 1025, 1031 (Md. 1983)).Under the MUAA, any provision in a consumer s insurance contract that requires Arbitration is void and unenforceable, except for contracts establishing an appraisal process to determine the value of property (Md.

9 Code Ann., Cts. & Jud. Proc. (b)).intersection of the fAA And Maryland LAwBecause the FAA only preempts state law to the extent that state law contradicts federal law, the FAA does not prevent Maryland state courts from, among other things, applying state contract law to determine whether the parties have entered into an Arbitration agreement (see Walther, 872 at 743; Cheek v. United Healthcare of Mid-Atlantic, Inc., 835 656, 661 (Md. 2003)).If an agreement falls under the FAA, a Maryland state court applies the federal standard for arbitrability when determining whether to compel or stay Arbitration , rather than evaluating these threshold questions under Maryland state law (see Southland v. Keating Corp., 465 1, 12-13 (1984); see also Practice Note, Compelling and Enjoining Arbitration in US Federal Courts: Arbitrability (6-574-8707)).

10 Maryland state courts apply state law to determine the enforceability of an Arbitration agreement if, for example, the agreement: Does not affect interstate commerce (see Mattingly v. Hughes Elec. Corp., 810 498, 503 (Md. Ct. Spec. App. 2002); Practice Note, Compelling and Enjoining Arbitration in US Federal Courts: Agreements Covered by Chapter 1 of the FAA (6-574-8707)). Contains a choice of law provision specifying that Maryland law governs the agreement and its enforcement (see Rourke, 835 at 209).For a further discussion of various states procedural rules relating to Arbitration , see Practice Note, Choosing an Arbitral Seat in the US (1-501-0913).threshoLd issues for the court to decideWhen deciding an application to stay or compel Arbitration , the role of the court is limited to determining whether there is an agreement to arbitrate the subject matter of the dispute (see Allstate Ins.)