Legal Memorandum: Motion to Compel Arbitration in VI

Issue: What are the Virgin Islands court standards for evaluating a motion to compel arbitration?

Area of Law: Alternative Dispute Resolution, Litigation & Procedure
Keywords: Standards for evaluation; Motion to compel arbitration; Valid arbitration agreement
Jurisdiction: Federal, Virgin Islands
Cited Cases: 328 F.3d 1165; 921 F.2d 507; 473 U.S. 614; 531 U.S. 79; 500 U.S. 20; 540 U.S. 1160; 475 U.S. 643
Cited Statutes: None
Date: 06/01/2005

In deciding a motion to compel arbitration under the Federal Arbitration Act (“FAA”), a court must conduct a two-step inquiry.  John Hancock Mut. Life Ins. Co. v. Olick, 151 F.3d 132, 137 (3d Cir. 1998).  The first step is to determine whether the parties agreed to arbitrate the dispute in question.  This determination involves asking:  (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.  Id. at 137; AT&T Techs. v. Communications Workers of Am., 475 U.S. 643, 649 (1986); PaineWebber, Inc. v. Hartmann, 921 F.2d 507, 511 (3d Cir. 1990), overruled by implication on other grounds by Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (2002). Thus, before the court entertaining a motion to compel arbitration may order arbitration, the FAA “‘requires the court to engage in a limited review to ensure that the dispute is arbitrable.'”  Bellevue Drug Co. v. Advance PCS, 333 F. Supp. 2d 318, 323 (E.D. Pa. 2004) (quoting PaineWebber, 921 F.2d at 511) (emphasis added).  “[O]rdinary state-law principles that govern the formation of contracts” should apply when deciding whether the parties agreed to arbitrate the dispute in question.  First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944 (1995).  “Arbitration agreements . . . are subject to all defenses to enforcement that apply to contracts generally.”  Ingle v. Circuit City Stores, Inc., 328 F.3d 1165, 1170 (9th […]

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