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IN THE COURT OF APPEALS OF TENNESSEE AT JACKSON
January 22, 2003 Session PROMUS HOTELS, INC. v. MARTIN, COLE, DANDO & ROBERTSON, INC, ET AL.
A Direct Appeal from the Chancery Court for Shelby County No. 110205-1 The Honorable Walter L. Evans, Chancellor

No. W2002-01028-COA-R3-CV - Filed February 3, 2003

This is an appeal from an Order denying Appellant's Motion to Compel Arbitration. Appellant filed a third-party claim against its subcontractor, Appellee, for indemnity. The Subcontract between the parties contained an agreement to arbitrate. Appellant contends that the agreement binds Appellee to arbitrate the matter. Appellee contends that it is not bound to arbitrate due to an exception in the Subcontract. We affirm and remand. Tenn. R. App. P. 3; Appeal as of Right; Judgment of the Chancery Court Affirmed and Remanded W. FRANK CRAWFORD , P.J., W.S., delivered the opinion of the court, in which DAVID R. FARMER , J. and HOLLY KIRBY LILLARD, J., joined. Don L. Smith; Kenneth S. Schrupp, Nashville, For Appellant, Martin, Cole, Dando & Robertson, Inc. Nicholas E. Bragorgos; Thomas F. Preston, Memphis, For Appellee, David Moore, d/b/a D&M Enterprises OPINION Martin, Cole, Dando & Robertson, Inc. ("MCDR," or "Appellant") was the general contractor for an addition to the Promus Data Center Facility in Memphis, Tennessee (the "Project"). On November 21, 1997, Plaintiff Promus Hotels, Inc. ("Promus") brought suit in chancery court against MCDR and Co-Defendants Hnedak Bobo Group, Inc. and HBG Management, Inc. (collectively referred to as "HBG"). Promus alleged that MCDR breached its contract with Promus by performing deficient construction at the Project. On February 3, 1998, MCDR filed an Answer to Promus' Complaint and a third-party complaint against its subcontractor, David Moore d/b/a D&M

Enterprises (D&M).1 The Third-Party Complaint was amended on February 24, 1998, and essentially seeks indemnity against D&M for such sums for which MCDR is liable to Promus. MCDR sues D&M alleging negligence and breach of contract entered into August 11, 1994 by and between MCDR and D&M.. Promus reached a compromise and settlement of all its claims against all defendants. Consent orders of dismissal were entered for all of Promus' claims, thus removing Promus as a party to this action. MCDR continues to assert its indemnity claims against D&M. On February 10, 2000, MCDR filed a Motion to Stay Litigation Pending Arbitration, with MCDR asserting that Article 14 of the Subcontract between MCDR & D&M binds D&M to arbitration. On March 2, 2000, D&M filed a Response to MCDR's Motion to Stay Litigation. D&M's Response claims that they are not bound to arbitrate this matter due to an exception found in the Subcontract. By order entered March 28, 2000, the chancery court denied MCDR's Motion to Stay Litigation and granted MCDR's Motion for Interlocutory Appeal. MCDR filed an Application for Permission to Appeal to this Court on April 10, 2000. At the time of their Tenn. R. App. P. 9 appeal to this Court, MCDR had filed no Motion to Compel Arbitration and there was no order denying a motion to compel arbitration. Consequently, this Court denied MCDR's application by Order dated May 2, 2000. Still without filing a Motion to Compel Arbitration in the trial court, MCDR appealed to this Court pursuant to Tenn. R. App. P. 3(e). On May 15, 2001, this Court dismissed the appeal, because MCDR had failed to file a Motion to Compel Arbitration in the trial court and, under T.C.A.

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