BROWN et al.
RAC ACCEPTANCE EAST, LLC.
RAC Acceptance East, LLC swore out a warrant for Mira
Brown's arrest for theft by conversion of furniture that
she had rented from RAC, Brown filed a lawsuit against RAC
alleging malicious prosecution and other torts. The trial
court entered an order granting RAC's motion to compel
Brown to arbitrate her claims pursuant to the arbitration
agreement incorporated into the parties' rental
agreement. The Court of Appeals affirmed that order,
concluding that whether RAC had waived its right to demand
arbitration by its conduct in initiating the related criminal
proceeding against Brown was a matter for the court to decide
and that the trial court had correctly ruled that RAC did not
waive arbitration. We granted certiorari, and we now affirm
the Court of Appeals' judgment on the ground that the
delegation provision in the parties' arbitration
agreement clearly gave the arbitrator, not the courts, the
authority to determine that RAC did not waive by prior
litigation conduct its right to seek arbitration, and the
arbitrator's decision on the waiver question cannot be
properly challenged as legally erroneous.
record shows the following undisputed facts. In January 2012,
Brown entered into a rental-purchase agreement with RAC to
rent a bedroom set. The rental agreement incorporated by
reference an attached arbitration agreement, which Brown also
executed. The arbitration agreement says: "Either
[Brown] or [RAC] may require any Claim to be arbitrated.
Either [Brown] or [RAC] may do so before or after a lawsuit
has been started over the Claim . . . ." A section of
the arbitration agreement titled "What Claims Are
Covered" says, with emphasis added:
"Claim" means any claim, dispute or controversy
between you and us that in any way arises from or relates to
the Rental-Purchase Agreement or the leased property, except
"Claim" does not include any claim or action by
either party seeking judicial determination of that
party's right to possession of the leased merchandise,
provided that such a claim or action does not involve a
request for monetary relief of any kind.
"Claim" has the broadest possible meaning and,
except as set forth above, includes initial claims,
counterclaims, cross-claims and third-party claims. It
includes disputes based upon contract, tort, fraud and other
intentional torts, constitution, statute, regulation,
ordinance, common law and equity (including any claim for
injunctive or declaratory relief other than a declaration of
a party's right to possession). It also includes
disputes about the validity, enforceability, arbitrability or
scope of this Arbitration Agreement or the Rental-Purchase
did not make all payments required under the rental
agreement. Beginning in April 2012, and repeatedly over the
course of more than a year, RAC contacted Brown about her
payment obligations and the requirement that she return the
furniture. In January 2014, RAC submitted an arrest warrant
application and affidavit in the magistrate court. The
magistrate court scheduled a hearing for January 24, 2014,
but Brown did not appear. At the hearing, the magistrate
court issued an arrest warrant for theft by conversion. In
February 2014, Brown returned the furniture. In June 2014, a
police officer stopped Brown while she was driving with her
children in the car, found that an arrest warrant for theft
by conversion was outstanding, and arrested her. The
prosecutor declined to prosecute, citing RAC's decision
not to pursue charges because Brown had returned the
September 2014, Brown filed a complaint against RAC in the
Superior Court of Fulton County (the "trial
court"), asserting tort claims for malicious prosecution
and arrest, negligent and intentional infliction of emotional
distress, invasion of privacy, false imprisonment and arrest,
and slander and libel. The complaint alleged among other
things that RAC filed an arrest warrant application that
falsely accused her of theft by conversion, that RAC told her
that it would recall the warrant if she returned the
furniture, that she agreed to return the furniture and did
so, and that RAC then wrongfully failed to recall the
filed a motion to stay Brown's lawsuit and compel
arbitration, arguing that the parties' arbitration
agreement required Brown to arbitrate her claims. Brown
objected, arguing among other things that RAC "waived
any potential right to arbitration when [it] applied for and
obtained a warrant for [her] arrest." In January 2015,
the trial court entered an order granting RAC's motion,
staying the lawsuit, and compelling arbitration. The court
noted that Brown acknowledged the existence of the
arbitration agreement and the applicability of the Federal
Arbitration Act (FAA), 9 USC § 1 et seq., and concluded
that Brown's tort claims against RAC were subject to
arbitration under the parties' agreement. The court also
noted that the arbitration agreement delegated to the
arbitrator the responsibility to resolve "disputes about
the validity, enforceability, arbitrability or scope of this
Arbitration Agreement" and concluded that "whether
the Arrest Warrant [was] a waiver should be decided at
arbitration." The court ruled in the alternative that if
it were to consider Brown's waiver argument on the
merits, it would reject the argument, distinguishing this
Court's decision in Taft v. Buttram, 254 Ga. 687
(333 S.E.2d 585) (1985). Brown filed a motion for
reconsideration and a request for a certificate of immediate
review, both of which the trial court denied.
arbitration hearing was then held under the auspices of the
American Arbitration Association. Brown argued among other
things that Taft required a finding that RAC had
waived its right to demand that she arbitrate her tort
claims. In December 2015, the arbitrator ruled that
"[w]hile it is a close question, . . . [RAC] did not
waive arbitration in this action" by using the criminal
warrant procedure. The arbitrator then ruled in favor of RAC
on each of Brown's tort claims.
January 2016, RAC filed a motion in the trial court to
confirm the arbitrator's award, and in February the court
entered a confirmation order and a final judgment in favor of
RAC. Brown then appealed, arguing among other things that the
trial court erred in its initial order staying the lawsuit
and compelling arbitration. In February 2017, the Court of
Appeals affirmed in an unreported opinion, holding that
because Brown's waiver argument was based on RAC's
alleged litigation conduct, the trial court rather than the
arbitrator had the primary power to decide the threshold
issue of arbitrability. See Brown v. RAC Acceptance East,
LLC, Case No. A16A1886, slip op. at 5-6 (Ga.App. Feb. 2,
2017). Reviewing that issue de novo, the Court of Appeals
upheld the trial court's ruling that RAC had not waived
its right to arbitration, again distinguishing Taft.
See Brown, slip op. at 6-11. We granted Brown's
petition for certiorari, directing the parties to address
Taft. We now affirm, but on a different ground as to
which Taft is not pertinent.
this Court, Brown does not dispute that she signed the
arbitration agreement with RAC, that the FAA governs the
agreement, or that the agreement's broad definition of a
"Claim" for which either party may demand
arbitration encompasses her tort claims against RAC. Instead,
citing Taft, Brown contends that she had the right
to have her tort claims decided in court because RAC waived
its right to enforce the arbitration agreement through its
litigation conduct - specifically, by swearing out the
warrant for her arrest. RAC disagrees that the decision in
Taft applies to this case. Thus, Brown and RAC have
a dispute about the enforceability of their arbitration
agreement, in addition to their dispute over RAC's
liability to Brown on her tort claims.
asserts that pursuant to the parties' arbitration
agreement, the dispute about enforceability was properly
submitted to arbitration. That is correct. A dispute about
the enforceability of an arbitration agreement is a classic
"'gateway' question of
'arbitrability.'" Rent-A-Center, West, Inc.
v. Jackson, 561 U.S. 63, 68-69 (130 S.Ct. 2772, 177
L.Ed.2d 403) (2010) (citations omitted). See BG Group,
PLC v. Republic of Argentina, 572 U.S.__, __(134 S.Ct.
1198, 1206-1208, 188 L.Ed.2d 220) (2014) (discussing various
gateway, or "threshold, " issues of arbitrability).
And as the U.S. Supreme Court explained in First Options
of Chicago, Inc. v. Kaplan, 514 U.S. 938 (115 S.Ct.
1920, 131 L.Ed.2d 985) (1995), "the question 'who
has the primary power to decide arbitrability' turns upon
what the parties agreed about that matter."
Id. at 943 (emphasis in original).
should not assume that the parties agreed to arbitrate
arbitrability, " id. at 944, and "'in
the absence of an agreement to the contrary, issues of
substantive arbitrability . . . are for a court to decide,
'" Howsam v. Dean Witter Reynolds, Inc.,
537 U.S. 79, 85 (123 S.Ct. 588, 154 L.Ed.2d 491) (2002)
(citation omitted). Thus, as the Court of Appeals recognized,
"[g]enerally, courts decide issues of alleged
'conduct-based' waiver of arbitration rights."
Brown, slip op. at 5. However, as the U.S. Supreme
Court has explained but the Court of Appeals here failed to
acknowledge, where there is "'clear and
unmistakable' evidence that the parties wanted an
arbitrator to resolve the dispute" about arbitrability,
courts must give effect to the parties' agreement.
Oxford Health Plans LLC v. Sutter, 569 U.S. 564, 569
n.2 (133 S.Ct. 2064, 186 L.Ed.2d 113) (2013) (citation and
brackets omitted). See also Rent-A-Center, 561 U.S.
at 68-70 & n.1; Losey v. Prieto, 320 Ga.App.
390, 392 (739 S.E.2d 834) (2013).
agreements these days often contain what is known in
arbitration law as a "delegation provision" - that
is, "an agreement to arbitrate threshold issues
concerning the arbitration agreement."
Rent-A-Center, 561 U.S. at 68. In this case, the
delegation provision clearly assigns responsibility for
resolving "disputes about the validity, enforceability,
arbitrability or scope of this Arbitration Agreement" to
the arbitrator. And Brown's ...