Originally from Dispute Resolution Journal

SALE OF GOODS

Motion to Compel Procedures

The Oklahoma Supreme Court held that the record was insufficient to support the lower court’s denial of an application to compel arbitration. Accordingly, it reversed and remanded with instructions for the court to follow the procedures for ruling on motions to compel arbitration involving an arbitration clause in a contract for the sale of goods subject to Article 2 of the Uniform Commercial Code (UCC).

In this case, Paul Palmer and Donna Rogers filed suit against Dell Computer seeking certification of a class action and alleging violations of the Oklahoma Consumer Protection Act, negligence and breach of contract in connection with the purchase of some computers. Dell moved to compel arbitration. The trial court denied Dell’s motion and the company appealed. The Oklahoma Court of Civil Appeals affirmed.

The Oklahoma Supreme Court held that the lower court did not follow proper procedures in deciding the motion to compel arbitration. It went on to detail the procedures that should be followed and then remanded the case to the lower court.

The court said that the procedures in the Oklahoma Uniform Arbitration Act (2004) should be followed, as long as they do not frustrate the purposes of the Federal Arbitration Act. A party’s motion to compel must be accompanied by a statement of law and facts showing that: (1) an enforceable agreement to arbitrate exists under state contract law, and (2) the clause covers the parties’ dispute. The opposing motion must be filed within 15 days of service of the moving party’s motion, and it should be “supported by affidavits, pleadings, stipulations, and other evidentiary materials which are verified by a person having knowledge of their accuracy,” together with a concise brief including a list of authorities on which the opposing party relies. Alternatively, this party may submit a statement of what the proof will show and present that proof at a hearing. The trial court must move to summarily decide the issue.

The Oklahoma Supreme Court said that if the existence of an agreement to arbitrate is controverted, the better procedure is for the trial court to conduct an evidentiary hearing before entering an order on the motion to compel. Either party may request a hearing, but the discretion whether to grant a hearing rests solely with the court.