In Granite Rock Co. v. International Brotherhood of Teamsters et al., No. 08-1214 (2010) -- the United States Supreme Court held -- by a vote of seven to two -- that the issue of when and whether an arbitration agreement was ratified falls within the exclusive purview of the court, and not the arbitrator, if that determination concerns whether the parties’ intent was to submit the dispute at issue to arbitration.
Granite Rock arose out of a labor dispute in which the defendant/respondent challenged whether a collective bargaining agreement was in effect. The CBA contained an arbitration clause. In an opinion by Justice Clarence Thomas, the Court held that because the issue of when the contract was formed was central to whether the parties intended to have the dispute resolved in arbitration, that question was properly decided by a court. Justice Thomas stressed that a court should only order arbitration if it is convinced that the parties’ agreed to arbitrate in the first place, and the agreement is enforceable and encompasses the dispute at issue.
The Court rejected arguments that arbitration was proper in this case based on the federal policy favoring enforcement of arbitration agreements. The Court reasoned that this policy did not trump the general principle that a court may only order arbitration of disputes that the parties intended to arbitrate.