Arbitration Clause in Agreement Applied to Unattached Scopes of Work
Reprinted from the Spring 2013 BrickerConstructionLaw.com Newsletter
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A recent case by the Twelfth Appellate District Court confirms that an arbitration clause in one contract document may apply to claims based on other related documents for the same project.
In Gaffin v. Schumacher Homes of Cincinnati, Inc., 2013 Ohio 992 (Ohio Ct. App., Clermont County, Mar. 18, 2013) a contractor contracted for drywall and painting services from a subcontractor. The contractor and subcontractor signed a Trade Partner Agreement (agreement) that contained a provision in which the parties agreed to arbitrate any disputes that arose from the agreement. At the same time, the contractor and subcontractor signed a “Scopes of Work” agreement, which included the details and specifications for the work the subcontractor would do.
Six years after their initial agreement, the subcontractor sued the contractor claiming that it was owed money for work it had performed, breach of contract and unjust enrichment. The contractor argued that the parties were required to arbitrate the dispute.
The trial court noted that the subcontractor’s claims related only to the “Scopes of Work” and not the agreement itself. Because the arbitration clause was in the agreement, the trial court held that the arbitration clause applied only to the agreement and anything attached to the agreement. The “Scopes of Work” was not attached to the agreement. Since the subcontractor’s claims were based on the unattached “Scopes of Work,” the trial court held that the arbitration clause did not apply to the subcontractor’s claims.
The appellate court disagreed, noting that each of the parties signed the agreement and the “Scopes of Work” on the same date, the agreement referenced the “Scopes of Work” as being “attached,” and the “Scopes of Work” was referred to throughout the agreement. The appellate court determined that even if the “Scopes of Work” was not physically attached to the agreement, it was clearly incorporated through the language of the agreement. In addition, the “Scopes of Work” did not override or end the terms of the agreement in any way. Thus, the appellate court held that the agreement’s arbitration clause did apply to the “Scopes of Work” and that the arbitration clause was broad enough to apply to the claims brought by the subcontractor. Accordingly, the parties were required to arbitrate their dispute.Download PDF