Perdue Properties, LLC et al v. Diamond P Enterprises, Inc. et al
Filing
90
ORDER granting 52 Motion to Compel Arbitration; granting 52 Motion to Dismiss Third-Party Complaint without prejudice Signed by Honorable David C. Bramlette, III on 5/16/2016 (ECW)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
WESTERN DIVISION
PERDUE PROPERTIES, LLC, ET AL.
VS.
PLAINTIFFS
CIVIL ACTION NO. 5:15-cv-47(DCB)(MTP)
UNITED STATES OF AMERICA, ET AL.
DEFENDANTS
AND
17, LLC
THIRD-PARTY PLAINTIFF
VS.
MISSISSIPPI VALLEY TITLE INSURANCE
COMPANY AND OLD REPUBLIC NATIONAL
TITLE INSURANCE COMPANY
THIRD-PARTY DEFENDANTS
ORDER COMPELLING ARBITRATION
AND DISMISSING THIRD-PARTY COMPLAINT
This cause is before the Court on third-party defendants
Mississippi Valley Title Insurance Company (“MVT”) and Old Republic
National Title Insurance Company (“Old Republic”)’s Motion to
Compel Arbitration and Dismiss Third-Party Complaint (docket entry
52).
Having carefully considered the motion, to which no response
has been filed by third-party plaintiff, 17, LLC, the Court finds
as follows:
On or about May 30, 2008, 17, LLC, executed a Contract for the
Sale and Purchase of Real Estate Lots and Lands (the “Contract”)
agreeing to purchase land from LandMax, Inc. (“LandMax”).
The property described in the Contract is approximately 122
acres in Township 4 North, Range 1 East, Section 16 of Amite
County, Mississippi “bounded on the North by Homochitto River and
the South by Nebo Road.”
On or about June 6, 2008, LandMax conveyed to 17, LLC, by
Warranty Deed, the property which is the subject of the Contract,
which the Warranty Deed describes as “that part of Irregular
Section 16 lying North of Nebo County Road” in Township 4 North,
Range 1 East in Amite County, Mississippi (the “Subject Property”).
On or about June 11, 2008, the law firm of Morrow & Elliott,
PLLC (“Morrow & Elliott”), as title insurance agent for MVT and Old
Republic, issued to 17, LLC, an Owner’s Policy of Title Insurance
bearing Policy Number OP11151 (the “Policy”), insuring title to the
Subject Property as provided for in the Policy, up to the Amount of
Insurance, being $362,484.62.
On August 15, 2008, Morrow & Elliott sent the Policy to Scott
Lindsey (“Lindsey”), a member and manager of 17, LLC.
After the closing on the purchase and conveyance of the
Subject Property, 17, LLC, had the Subject Property surveyed, and
the survey indicated that the Subject Property contained 258 acres,
not 122 acres.
On or about June 21, 2012, 17, LLC sold and conveyed by
Warranty
Deed
certain
parcels
individuals and entities.
of
the
258
acres
to
several
Soon thereafter, the United States of
America (“U.S.A.”) put those purchasers, i.e. Perdue Properties,
LLC, Badeaux Holdings, LLC, Diamond P. Enterprises, Inc., Rhett
Steven Guerin, and Point Nebo, LLC (collectively referred to as the
2
“Perdue Parties”), on notice that the land they purchased from 17,
LLC, was owned by the U.S.A. and not 17, LLC (such land is
hereinafter referred to as the “Disputed Property”).
The Perdue Parties have sued the U.S.A., 17, LLC, and others,
to quiet and confirm title to the Disputed Property and/or for
damages including damages in connection with any breach of the
covenant warranty found in the Warranty Deeds from 17, LLC, to the
Perdue Parties.
On November 17, 2015, 17, LLC filed a Third-Party Complaint in
this case against MVT and Old Republic claiming that the Policy
covers
claims
concerning
title
to
the
Disputed
Property
and
claiming that MVT and Old Republic are required to defend and
indemnify 17, LLC, against all claims made against 17, LLC, in this
case.
The Policy contains an “Arbitration Agreement” which allows
either party to the Policy to demand arbitration in connection with
any controversy or claim arising out of relating to the Policy, any
claim of alleged breach of the Policy, or any claim related to the
transaction giving rise to the Policy.
Once arbitration is demanded, if the amount of insurance at
issue
is
less
than
$2,000,000.00,
the
Arbitration
Agreement
requires or mandates that the parties shall submit to arbitration.
The Arbitration Agreement provides as follows:
3
14. ARBITRATION
Either the Company [the MVT Parties] or the Insured [17,
LLC] may demand that the claim or controversy shall be
submitted to arbitration pursuant to the Title Insurance
Arbitration Rules of the American Land Title Association
(“Rules”). Except as provided in the Rules, there shall
be no joinder or consolidation with claims or
controversies of other persons. Arbitrable matters may
include, but are not limited to, any controversy or claim
between the Company and the Insured arising out of or
relating to this policy, any service in connection with
its issuance or the breach of a policy provision, or to
any other controversy or claim arising out of the
transaction giving rise to this policy. All arbitrable
matters when the Amount of Insurance is $2,000,000 or
less shall be arbitrated at the option of either the
Company or the Insured. All arbitrable matters when the
Amount of Insurance is in excess of $2,000,000 shall be
arbitrated only when agreed to by both the Company and
the Insured. Arbitration pursuant to this policy and
under the Rules shall be binding upon the parties.
Judgment upon the award rendered by the Arbitrator(s) may
be entered in any court of competent jurisdiction.
The Federal Arbitration Act [“FAA”], 9 U.S.C. §§1-14, applies
to and controls arbitration agreements related to transactions that
“involve”
interstate
commerce.
In
this
case,
the
relevant
transaction involves interstate commerce and therefore the FAA
applies.
The United States Supreme Court and United States Court of
Appeals for the Fifth Circuit have instructed the District Courts
to find in favor of arbitration if there are any doubts concerning
any issues of whether or not a claim is arbitrable.
Mississippi
law is consistent with the federal standard.
Applying the FAA requires a two step inquiry regarding motions
to compel arbitration.
The first step requires the Court to
4
determine whether the parties agreed to arbitrate, i.e. (1) there
must be a valid contract and (2) the claims must be within the
scope of the arbitration agreement.
The second step requires
inquiry into whether there were any external constraints when the
parties entered into the arbitration agreement.
17, LLC, has been in possession of the Policy for several
years.
It has not attempted to rescind the Policy, nor has it
objected to any of its terms.
17, LLC, filed its Third-Party
Complaint attempting to enforce the Policy. Therefore, pursuant to
Mississippi law, 17, LLC, has taken an unequivocal course of
conduct disclosing that it has assented to the Policy as binding
upon it, making the Policy and Arbitration Agreement contained
therein a valid contract.
All of the claims, theories of recovery, and alleged damages
are claims and controversies directly related to and contingent on
the existence of the Policy, and fall squarely within the scope of
the
Arbitration
arbitrable.
Agreement;
therefore,
all
of
the
claims
are
Once either party to the Policy demands arbitration
relating to an arbitrable matter, arbitration is mandatory.
The
Court finds that there are no circumstances outside of the Policy
that would prevent this dispute from being arbitrated.
ACCORDINGLY,
IT IS HEREBY ORDERED that third-party defendants Mississippi
Valley Title Insurance Company and Old Republic National Title
5
Insurance Company’s Motion to Compel Arbitration and Dismiss Third
Party Complaint (docket entry 52) is GRANTED;
FURTHER ORDERED that the parties are compelled to arbitrate
their claims and defenses in accordance with the terms of the
applicable Arbitration Agreement;
FURTHER ORDERED that the Third-Party Complaint in this action
is dismissed without prejudice;
FURTHER ORDERED, inasmuch as all claims and defenses of the
parties in the Third-Party Complaint in this action have been
ordered to arbitration by the Court, and all claims have been
dismissed without prejudice by this Order Compelling Arbitration,
the Court shall issue a Final Judgment herein dismissing the ThirdParty action without prejudice.
SO ORDERED, this the 16th day of May, 2016.
/s/ David Bramlette
UNITED STATES DISTRICT JUDGE
6
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?