ROSEMARY LEDET, Judge.
This is a declaratory judgment action seeking a determination that the parties had no agreement to arbitrate their underlying contractual dispute. The parties are Delta Administrative Services, L.L.C. ("DAS") and Limousine Livery, Ltd. ("LLI"). DAS commenced this action against LLI seeking not only a declaratory judgment, but also an injunction to prevent LLI from proceeding with the arbitration proceeding that it had commenced. From the trial court's judgment dismissing DAS's declaratory judgment action and denying its request for an injunction, DAS appeals. For the reasons that follow, we affirm.
Effective January 2010, DAS and LLI entered into an Administrative Services Contract (the "Agreement") for DAS to provide payroll services and human resources
An authorized representative of both DAS (Mr. Lawrence) and LLI (Christy Dirks, LLI's owner) signed the Agreement. Neither party's representative, however, selected either of the options — the "B" provisions — in the "either/or" provision.
Subsequently, a contractual dispute arose between the parties;
Meanwhile, in an attempt to resolve their contractual dispute, LLI attempted to invoke the "Dispute Resolution and Governing Law" provision of the Agreement, which imposed as a condition precedent to arbitration that the parties submit to mediation either by the Federal Mediation and Conciliation Service ("FMCS") or "by a procedure agreed to by both parties." In late 2012, LLI, with DAS's knowledge and without any objection from DAS, attempted to have FMCS mediate the dispute. The parties then engaged in two unsuccessful mediations, one in December 2012 and the other on February 5, 2014. DAS participated in both mediations without objection.
On April 11, 2014, over sixty days after the second mediation, LLI filed an arbitration demand with the American Arbitration Association (the "AAA"). To do so, LLI had to pay $6,200.00 to the AAA. In response, DAS objected contending it never agreed to arbitrate disputes between itself and LLI. On May 11, 2014, the AAA notified the parties that it had made an administrative determination that the matter met its filing requirements. The AAA also notified the parties that absent an agreement by the parties or a court order staying the matter, it would proceed with the administration of the arbitration.
On May 23, 2014, DAS filed a "Petition for Declaratory Judgment, Preliminary and Permanent Injunction" in Orleans Parish against LLI.
In June 2014, the parties entered into a consent judgment staying the arbitration until such time as the court ruled on DAS's request for a permanent injunction and declaratory judgment. DAS thus withdrew its request for a preliminary injunction, and the parties engaged in discovery.
On October 31, 2014, the trial court, following a hearing, rendered judgment denying DAS's request for a declaratory judgment and permanent injunction. In its reasons for judgment, the trial court found that DAS consented to arbitrate by signature and performance. The instant appeal followed.
A judgment denying a permanent injunction is an appealable judgment. La. C.C.P. art. 3612(B). A judgment denying a declaratory judgment is an interlocutory judgment. Walker v. State, 09-0973, p. 2 (La.App. 4 Cir. 10/21/09), 26 So.3d 782, 784 (holding that a "judgment denying a declaratory judgment is neither a final judgment nor a partial final judgment."). Nonetheless, "[a]n appellant is entitled to seek review of all adverse interlocutory judgments prejudicial to them, in addition to the review of the final judgment when an unrestricted appeal is taken." Orleans Parish Sch. Bd. v. Lexington Ins. Co., 11-1720, p. 10 (La.App. 4 Cir. 8/22/12), 99 So.3d 723, 729 (citing Alexander v. Palazzo, 08-1541, p. 6 (La.App. 1 Cir. 2/13/09), 5 So.3d 950, 953); see also Judson v. Davis, 11-0623, pp. 18-19 (La. App. 1 Cir. 11/9/11), 81 So.3d 712, 724. Such is the case here. DAS seeks review of the trial court's final judgment denying its request for injunctive relief. In the same judgment, the trial court denied its request for a declaratory judgment and dismissed its entire suit. The entire judgment is thus properly before us on appeal.
Appellate courts review judgments denying a permanent injunction under an abuse of discretion standard of review. A.M.E. Disaster Recovery Servs., Inc. v. City of New Orleans, 10-1755, p. 4 (La.App. 4 Cir. 8/24/11), 72 So.3d 454, 456-57. The same standard of review applies to judgments denying declaratory relief. Edgar Benjamin Fontaine Testamentary Trust v. Jackson Brewery Marketplace, 02-2337, pp. 4-5 (La.App. 4 Cir. 5/7/03), 847 So.2d 674, 677 (quoting In re Peter, 98-0701, pp. 4-5 (La.App. 4 Cir 12/23/98), 735 So.2d 665, 667) (holding that "`the scope of appellate review is confined to a determination of whether or not the trial court abused its discretion by granting or refusing to render a declaratory judgment"); see also Louisiana Supreme Court Committee on Bar Admissions v. Roberts, 00-2517, p. 3 (La. 2/21/01), 779 So.2d 726, 728) (holding that "[t]rial courts
In Louisiana, the positive law favors arbitration as "a preferred method of alternative dispute resolution." Hodges v. Reasonover, 12-0043, p. 4 (La.7/2/12), 103 So.3d 1069, 1072 (citing Aguillard v. Auction Management Corp., 04-2804, p. 6 (La. 6/29/05), 908 So.2d 1, 7). Under Louisiana law, a written contract to settle a dispute by arbitration is binding and enforceable. La. R.S. 9:4201.
The proper procedure for a party to raise the failure to submit to arbitration is either a dilatory exception of prematurity or a motion to stay. Frank L. Maraist and Harry T. Lemmon, 1 LOUISIANA CIVIL LAW TREATISE: CIVIL PROCEDURE, § 6.6, n. 28 (1999). In this case, DAS properly raised the issue of whether there was an agreement between the parties to arbitrate by filing a request for injunctive relief to stay the arbitration LLI commenced.
In addressing a motion to stay, the threshold inquiry a court must decide is whether the parties agreed to arbitrate their dispute, which is a two-fold inquiry: (1) whether there is a valid arbitration agreement, and (2) whether the dispute in question falls within the scope of that agreement. Lakeland Anesthesia, Inc. v. United Healthcare of Louisiana, Inc., 03-1662, p. 9 (La.App. 4 Cir. 3/17/04), 871 So.2d 380, 388.
"[A]ny doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration." Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25, 103 S.Ct. 927, 941, 74 L.Ed.2d 765 (1983); see also Aguillard, 04-2804 at p. 18, 908 So.2d at 25. "Notwithstanding the strong presumption in favor of arbitration, the arbitration clause
This court in the Lakeland case summarized the principles that apply in resolving the issue of whether a contract to arbitrate exists as follows:
On appeal, DAS's sole assignment of error is that the trial court committed legal error by finding a valid arbitration agreement when there was no mutual consent between the parties to arbitration. The fact that the trial court found the parties' conduct demonstrated consent, DAS contends, is manifestly erroneous.
The subject of this appeal, as noted earlier, is the "either/or" provision contained in the Agreement. DAS contends that because neither party selected the arbitration alternative (the "Dispute Resolution and Governing Law" provision), there is no agreement to arbitrate. As a result, DAS contends that the default method of dispute resolution — litigation — applies.
LLI counters that the instruction in the Agreement that DAS cites was intended by the unknown attorney who provided DAS with the form contract to apply to DAS, not to DAS's clients.
Agreeing with LLI, the trial court, in its written reasons for judgment, found that there was consent by signing. The trial court reasoned as follows: "[DAS] prepared the contract and signed it, and in doing so consented to arbitrate." We disagree. To the extent the trial court relied on the fact DAS prepared the Agreement, we note, as DAS emphasizes, the Agreement expressly negates the general principle that ambiguous provisions are construed against the drafter. The Agreement provides as follows:
Moreover, the Agreement, which both parties signed, includes the two "Bs", which are arguably conflicting dispute resolution provisions. Only one of those provisions authorizes arbitration. We thus cannot conclude that by signing the Agreement DAS unambiguously agreed to arbitrate. Instead, we conclude that the inclusion of both provisions renders the Agreement ambiguous.
In resolving the ambiguity presented by the Agreement, we find the analysis employed in J. Caldarera & Co. v. Louisiana Stadium and Exposition Dist., 98-294 (La.App. 5 Cir. 12/16/98), 725 So.2d 549, instructive. In that case, the issue was whether a construction contract included an agreement to arbitrate. In negotiating the contract, the parties struck the entire section entitled "ARBITRATION," but failed to strike arbitration language in the preceding section entitled "RESOLUTION OF CLAIMS AND DISPUTES." The language that was retained provided that the architect's decision will be made within seven days, "which decision shall be final and binding on the parties but subject to arbitration."
The trial court in Caldarera found the contract included an agreement to arbitrate. Affirming, the appellate court concluded that deleting the arbitration section without striking or otherwise amending the resolution of claims and disputes section "raise[d] a question as to whether the parties intended the controversy to be arbitrable." Caldarera, 98-294 at p. 6, 725 So.2d at 552. Continuing, the appellate court reasoned as follows:
Id. The appellate court in Caldarera thus identified the three relevant factors to be considered in resolving the ambiguity created by an agreement containing conflicting provisions regarding arbitration; the three factors are as follows: (1) extrinsic evidence of intent, (2) contract interpretation principles, and (3) the presumption favoring arbitration. See 7 Bruner & O'Connor CONSTRUCTION LAW § 21:87 (discussing Caldarera, supra, and noting these factors).
As in the Caldarera case, we find the inclusion of both "B" provisions — the "Dispute Resolution and Governing Law" and "Governing Law" provision — in the Agreement created an ambiguity regarding whether the parties intended to agree to arbitrate. Unlike in Caldarera, the parties in this case presented the trial court with extrinsic evidence of intent.
As noted, DAS contends the trial court's finding of consent by performance is manifestly erroneous. Quoting the language of La. C.C. art. 1927, DAS contends that the evidence of consent must be "clearly indicative of consent" and that the evidence relied upon by the trial court to find consent by performance is not clearly indicative of its consent to arbitrate. In support, DAS asserts the following contentions:
As LLI points out, DAS never objected — based on La. C.E. art. 408 or any other ground — in the trial court to the evidence of its participation in the mediations and Mr. Lawrence's January 3, 2013 letter. As a result, LLI contends that this court should not consider these arguments made for the first time on appeal. See Scott v. Zaheri, 14-0726, p. 14 (La.App. 4 Cir. 12/3/14), 157 So.3d 779, 788 (citing Rule 1-3, Uniform Rules — Courts of Appeal and noting that "[g]enerally, issues not raised in the trial court will not be given consideration for the first time on appeal."). Regardless, LLI contends that La. C.E. art. 408 would not bar consideration of either DAS's participation in mediation or Mr. Lawrence's letter for purposes of establishing that DAS's conduct was consistent with its acceptance by performance. We agree. Indeed, La. C.E. art. 408 expressly states that it "does not require exclusion when the evidence is offered for another purpose" than to prove liability for or invalidity of the claim or its amount.
As to Mr. Lawrence's deposition testimony, the record reflects that Mr. Lawrence was asked why he did not want to participate in arbitration; he replied as follows: "Who said I didn't want to participate [in an arbitration]?"
Finally, DAS's contention that the trial court erred in focusing on the parties' post-contract actions is unpersuasive. Performance, as LLI points out, follows the signing of a contract. The trial court thus could not determine whether there was consent by performance without considering the parties' post-contract actions. Indeed, La. C.C. art.2053 provides that "a doubtful provision must be interpreted in light of ... the conduct of the parties before and after the formation of the contract."
In sum, we find, contrary to DAS's contention, that the trial court's finding of consent by performance was not manifestly erroneous. Based on the extrinsic evidence presented, the pertinent Civil Code articles, and the policy favoring arbitration, we find no error in the trial court's finding that the parties consented by performance to arbitrate disputes arising out of the Agreement.
For the forgoing reasons, the judgment of the trial court is affirmed.