Sphere Drake Insurance PLC v. Marine Towing, Inc.
United States Court of Appeals for the Fifth Circuit
16 F.3d 666 (1994)
- Written by Mary Katherine Cunningham, JD
Facts
Marine Towing, Inc. (Marine Towing) (plaintiff) sought a protection and indemnity insurance policy for its vessels through a contractor, Schade. Schade secured a policy from Sphere Drake Insurance PLC (Sphere Drake) (defendant). However, before Schade delivered the policy to Marine Towing, one of Marine Towing’s insured vessels sank. When Marine Towing received the policy from Schade, Marine Towing found a clause requiring arbitration for all disputes in London. Marine Towing sued Sphere Drake and Schade in state court for a declaration of rights under the policy. Sphere Drake removed the suit to federal court and moved for a stay to litigation and to compel arbitration under a protection and indemnity policy. Marine Towing filed a motion to dismiss the suit for lack of jurisdiction. The district court denied the motion and ordered arbitration. Marine Towing appealed to the Fifth Circuit, arguing the district court lacked jurisdiction under the New York Convention because the parties did not sign an agreement in writing to refer disputes to arbitration. Marine Towing argued that the convention defined “agreement in writing” only as (1) a contract or other written agreement signed by the parties or (2) an exchange of correspondence between the parties demonstrating consent to arbitrate. Marine Towing argued that the policy cannot provide the agreement in writing required by the convention because Marine Towing did not sign the insurance contract.
Rule of Law
Issue
Holding and Reasoning (Duhe, J.)
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