Vivian and Victor live in Mesa, Arizona. Victor owns and operates a retail shoe outlet while Vivian sells shoes wholesale. On January 1, 2013, Victor ordered 2,000 pairs of shoes from Vivian.
The purchase order (which was signed by both parties) contained the following 2 clauses:
“14. Any dispute that arises under this Agreement shall be submitted to arbitration in accordance with the rules set forth in the Uniform Arbitration Act. …”
“19. In the event that the Seller hereunder breaches this Agreement and the Purchaser is forced to commence any civil proceeding against the Seller, then the Seller shall be liable for all attorneys’ fees borne by the Purchaser if the Purchaser succeeds in the action.”
On March 1, 2014, Vivian delivers the 2,000 pairs of shoes. Unfortunately, Victor soon realizes that Vivian sent him 4,000 LEFT shoes instead of 2,000 left shoes and 2,000 right shoes. Since the vast majority of Victor’s customers have one left foot and one right foot, this constitutes an egregious and harmful breach of the agreement.
As per clause 14 above, Victor commences an arbitration proceeding against Vivian, in which he prevails, as the arbitrator awards him $10,000 in damages in addition to a refund of the purchase price. However, Vivian refuses to pay and Victor sues Vivian in Arizona civil court to enforce the arbitrator’s award. In addition, Victor asks the court to award him the attorneys’ fees he spent in having an attorney represent him in the arbitration proceeding. Vivian argues that clause 19 in the contract should only apply to attorneys’ fees for representation in court, not representation during an arbitration proceeding.
Under Arizona law, who is correct?
ScholarMatic: Explanation & Answer
Your ready answer from a verified tutor is just a click away for as little as $14.99
Click Order Now to get 100% Original Answer Customized to your instructions!
