Regions Bank v. Ryan et al
Filing
41
ORDER AND REASONS granting 10 Motion to Dismiss Case; Motion to Stay. This matter is STAYED pending arbitration. Signed by Judge Mary Ann Vial Lemmon. (ecm, )
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
REGIONS BANK
CIVIL ACTION
VERSUS
NO: 11-1813
ASHTON J. RYAN, JR. AND PETER
D. WEITZNER, INDEPENDENT
EXECUTOR OF THE SUCCESSION
OF MARTIN J. WEITZNER
SECTION: "S" (4)
ORDER AND REASONS
IT IS HEREBY ORDERED that the Motion to Dismiss or Stay Action, filed by defendant,
Ashton J. Ryan Jr. (Doc. #10), is GRANTED, and this matter is STAYED pending arbitration.1
BACKGROUND
On September 23, 2009, Ashton J. Ryan Jr. executed a promissory note for one million
dollars in favor of Regions Bank, payable in full on September 22, 2010. That same day, Martin J.
Weitzner executed a commercial guaranty in favor of Regions with respect to the promissory note
in which he guaranteed full payment of Ryan’s debt. The promissory note and commercial guaranty
contain arbitration clauses and state that Ryan and Weitzner waive notices of demand, presentment
for payment, protest, notice of protest, and notice of nonpayment.
1
The Successions’ Motion to Dismiss will not be addressed because it is an issue for
arbitration.
Weitzner died on May 4, 2010. On May 7, 2010, Peter Daniel Weitzner was appointed
Independent Executor in the Succession of Martin J. Weitzner (the “Succession”).2
Regions extended the maturity date of the promissory note twice after Weitzner’s death: first
to December 22, 2010, and subsequently to March 22, 2011. On July 27, 2011, Regions filed this
suit alleging that both Ryan and the Succession are in default for failure to make final payment of
principal and interest on the note. The Succession asserted a cross claim against Ryan seeking
contribution and reimbursement for any amount paid to Regions.
Ryan filed a motion to dismiss or stay the action pending arbitration.
The Succession
opposes Ryan’s motion, arguing that it should not be ordered to submit to arbitration because there
is no pending motion to compel arbitration or to stay the claims between the Succession and the
other parties.
ANALYSIS
A. Arbitration
The Federal Arbitration Act, 9 U.S.C. § 1, et seq., “embodies the national policy favoring
arbitration.” Buckeye Check Cashing, Inc. v. Cardegna, 126 S.Ct. 1204, 1207 (2006).
In
determining whether a dispute is referable to arbitration, the court must analyze whether an
agreement to arbitrate exists and whether the claim at issue falls within the agreement:
To ascertain whether the parties have agreed to arbitrate a particular
claim, we must determine (1) whether there is a valid agreement to
arbitrate between the parties, and (2) whether the dispute in question
falls within the scope of that arbitration agreement. In view of the
policy favoring arbitration, we ordinarily resolve doubts concerning
the scope of coverage of an arbitration clause in favor of arbitration.
As a consequence, a valid agreement to arbitrate applies unless it can
be said with positive assurance that [the] arbitration clause is not
susceptible of an interpretation which would cover the dispute at
issue.
2
Succession of Martin Weitzner, No. 2010-4711, Civil District Court for the Parish of
Orleans, State of Louisiana.
2
Personal Security & Safety Systems v. Motorola, Inc., 297 F.3d 388, 392 (5th Cir. 2002) (internal
citations and quotations omitted). “[A]rbitration is a matter of contract and a party cannot be
required to submit to arbitration any dispute which he has not agreed to so submit.” AT & T Techs.,
Inc. v. Commc’ns Workers of Am., 106 S.Ct. 1415, 1418 (1986). Unless the parties agreed
otherwise, the court, not the arbitrator, must determine whether the parties agreed to arbitrate a
particular claim. Id.
Further, pursuant to Louisiana Revised Statutes § 9:4202:
If any suit or proceedings be brought upon any issue referable to
arbitration under an agreement in writing for arbitration, the court in
which suit is pending, upon being satisfied that the issue involved in
the suit or proceedings is referable to arbitration under such
agreement, shall on application of one of the parties stay the trial of
the action until an arbitration has been had in accordance with the
terms of the agreement, providing the applicant for the stay is not in
default in proceeding with the arbitration.
B. The Arbitration Agreements
Both the promissory note signed by Ryan and the commercial guaranty signed by Weitzner
contain arbitration clauses with almost identical language.3 Pursuant to the arbitration clauses:
Except as expressly provided below, any controversy, claim, dispute
or disagreement (any “Claim”) arising out of, in connection with or
relating to (1) Borrower’s [Guarantor’s] business relationship with
Lender; (2) the performance, interpretation, negotiation, execution,
collateralization, administration, repayment, modification, or
extension of this Note or the loan [Guaranty or the Indebtedness]; (3)
any charge or cost incurred pursuant to this Note or the loan
[Guaranty or the Indebtedness]; (4) the collection of any amounts due
under this Note or the loan [Guaranty or the Indebtedness]; (5) any
alleged tort or other claim arising out of or relating in any way to this
Note or the loan [Guaranty or the indebtedness], collateral under this
Note [Guaranty or the indebtedness], or any account established
pursuant to this Note [Guaranty]; (6) any breach of any provision of
this Note [Guaranty]; (7) any statement or representation made to
Borrower [Guarantor] by or on behalf of Lender; or (8) any of the
3
The only difference between the two clauses is that the term “borrower” is used in the
promissory note, and the terms “guarantor”, “guaranty”, and “indebtedness” are used in the
commercial guaranty.
3
foregoing arising out of, in connection with or relating to any
agreement which relates to this Note or the loan [Guaranty or the
Indebtedness] or any assignment of this Note or the loan [Guaranty
or the Indebtedness], or any relationship created by or resulting from
this Note or the loan [Guaranty or the Indebtedness], will be settled
by binding arbitration under the Federal Arbitration Act (“FAA”).
This agreement to arbitrate shall include any Claims involving
Lender’s officers, directors, employee, agents, representatives,
contractors, subcontractors, affiliates, successors or assigns, and any
such Claims against any of those parties may be joined or
consolidated with any related Claims against Lender in a single
arbitration proceeding.
Ryan invoked the arbitration clause in his Motion to Dismiss or Stay Action. The claims
of all parties arise out of the promissory note and commercial guaranty, which contain substantially
identical arbitration clauses. Weitzner’s liability as guarantor is contingent upon Ryan’s failure to
repay under the promissory note. Therefore, the promissory note and commercial guaranty are
“sufficiently intertwined” to require all claims to be arbitrated. See Regions Bank v. Weber, 53 So.
3d 1284, 1290 (La. App. 4 Cir. 2010). Pursuant to the national policy favoring arbitration, and to
promote judicial economy and prevent inconsistent results, this matter is STAYED pending
arbitration.
CONCLUSION
IT IS HEREBY ORDERED that the Motion to Dismiss or Stay Action, filed by defendant,
Ashton J. Ryan Jr. (Doc. #10), is GRANTED, and this matter is STAYED pending arbitration.
29th
New Orleans, Louisiana, this _____ day of November, 2011.
____________________________________
MARY ANN VIAL LEMMON
UNITED STATES DISTRICT JUDGE
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