Portland General Electric Co. v. U.S. Bank Trust National Ass'n

special joinder in concurrence:

Although I am the author of the opinion, I join in Judge Tashima’s concurrence because I question the vitality of Wasyl, Inc. v. First Boston Corp., 813 F.2d 1579 (9th Cir.1987). At issue is a question of statutory interpretation. Whether this appraisal contract calls for an “arbitration” within the scope of the FAA therefore strikes me as a question of federal law. See Mitsubishi Motors Corp. v. Soler Chrysler-Plym *1092 outh, Inc., 473 U.S. 614, 626 , 105 S.Ct. 3346 , 87 L.Ed.2d 444 (1985) (holding courts determine whether parties agreed to arbitration under FAA’s “substantive law of arbitrability”) (quoting Moses H. Cone Mem. Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 , 103 S.Ct. 927 , 74 L.Ed.2d 765 (1983)).

Opinion by Judge MCKEOWN; Concurrence by Judge TASHIMA; Concurrence by Judge MCKEOWN.

This case requires us to address a threshold issue of controlling law. We must determine what law governs a challenge to a final appraisal decision issued pursuant to a commercial contract. Portland General Electric (“PGE”) and the United States Bank Trust National Association (“the Trust”) were parties to a lease agreement under which they agreed that a qualified independent appraiser would be appointed to determine the fair market value of two turbine generators. Although the appraiser’s valuation was to be considered final, the Trust was dissatisfied and challenged the appraisal on multiple grounds. In response, PGE sought a court order confirming the appraisal. The district court treated the appraisal decision as an arbitration award, analyzed the case under the Federal Arbitration Act (“FAA”), and confirmed the appraisal. Our decision in this case is governed by Wasyl, Inc. v. First Boston Corp., 813 F.2d 1579 (9th Cir.1987), where we held that because the FAA neither defines arbitration nor spells out whether the term arbitration includes appraisal, we look to state law. The contract at…

with whom LAY, Circuit Judge, * joins, concurring:

I concur fully in Judge McKeown’s majority opinion. I write separately to express my doubts as to whether Wasyl, Inc. v. First Boston Corp., 813 F.2d 1579 (9th Cir.1987), by which we are bound and which governs the disposition of this case, was correctly decided.

By enacting the Federal Arbitration Act (FAA), “Congress declared a national policy favoring arbitration.” Southland Corp. v. Keating, 465 U.S. 1, 10 , 104 S.Ct. 852 , 79 L.Ed.2d 1 (1984) (emphasis added). See also Craft v. Campbell Soup Co., 177 F.3d 1083, 1090 (9th Cir.1999) (discussing the Act’s legislative history and recognizing that “the FAA was part of an effort to gain uniformity in the application of agreements to arbitrate sales and commercial disputes”) (emphasis added). As the majority opinion correctly concludes, Wasyl accepted state law as binding and as supplying the meaning of the term “arbitration” in the FAA. See Wasyl, 813 F.2d at 1582 .

It seems counter-intuitive to look to state law to defíne a term in a federal statute on a subject as to which Congress has declared the need for national uniformity. Yet, that is exactly what Wasyl requires. This…