Koullas v. Ramsey

In Koullas v. Ramsey, 683 So. 2d 415 (Ala. 1996) a case involving a similar contract-construction issue, the Court stated that the term "arising under," like the term "arising from," similarly narrowed the scope of arbitration agreements and excluded claims that did not require a reference to, or a construction of, the underlying contract. 683 So. 2d at 418. The Court explained: "Where, as here, an arbitration clause refers to disputes or controversies 'arising under' an agreement, the clause will apply only to those claims arising under the terms of the agreement, and it will not extend to matters or claims independent of, or merely collateral to, the agreement. Old Republic Ins. Co. v. Lanier, 644 So. 2d 1258 (Ala. 1994). We agree that, in order for a dispute to be characterized as arising out of or relating to the subject matter of the contract, and thus subject to arbitration, it must at the very least raise some issue that cannot be resolved without a reference to or construction of the contract itself. Dusold v. Porta-John Corp., 167 Ariz. 358, 807 P.2d 526 (Ct. App. 1990); Terminix Int'l Co., L.P. v. Michaels, 668 So. 2d 1013 (Fla. Dist. Ct. App. 1996); Greenwood v. Sherfield, 895 S.W.2d 169 (Mo. App. 1995)." After making this statement, the Court in Koullas continued: "If there is no such connection between the claim and the contract, then the claim could not reasonably have been intended to be subject to arbitration within the meaning of a clause that required arbitration only for claims 'arising out of or related to' the contract." 683 So. 2d at 418. This particular statement, however, is dictum in that the arbitration clause in that case did not include the language "arising out of or related to." Koullas, 683 So. 2d at 417-18.