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ARBITRATION - DON DRENNEN MOTOR CO., INC. V. MCCLUNG

In Don Drennen Motor Co., Inc. v. McClung, [Ms. 1100734, Sept. 9, 2011] __ So. 3d __(Ala. 2011), the Supreme Court of Alabama reversed an order from a circuit court requiring the defendant, Don Drennen, to pay the cost of arbitration stemming from an action filed by McClung, one of Drennen's former employees. The arbitration agreement between the two parties stated that the parties must "share equally the costs, fees, and expenses incurred by arbitration." However, McClung argued at the trial court that he was without sufficient funds to initiate an arbitration proceeding and Drennen had far greater resources to pay all the costs associated with the arbitration proceeding which Drennen had requested and was awarded against McClung's objections. Subsequently, the trial court entered an order requiring Don Drennen to pay all costs associated with the arbitration procedure. On appeal, McClung conceded that the trial court erred in its order by requiring Drennen to pay the costs of the arbitration in contravention to the terms of the arbitration agreement. The Supreme Court held that a trial court may not enter orders compelling parties to act in a manner that is inconsistent with the parties' arbitration agreement. Thus, the Court reversed the trial court's order, insofar as it required Drennen to pay the entire costs of the arbitration proceedings.
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