volt info sciences leland stanford argued november decided march construction contract appellant appellee contained agreement arbitrate disputes arising contract clause providing contract governed law place project located dispute arose contract appellant made formal demand arbitration response appellee filed action appellant california superior alleging fraud breach contract action appellee sought indemnity two parties involved construction project arbitration agreements trial denied appellant motion compel arbitration granted appellee motion stay arbitration cal civ proc code ann allows stay pending resolution related litigation party arbitration agreement third parties bound state appeal affirmed holding specifying contract governed law place project located clause incorporated california rules arbitration including parties arbitration agreement application federal arbitration act faa act even though contract involved interstate commerce held appeal conclusion parties intended clause incorporate california arbitration rules arbitration agreement question state law set aside pp appellant contention state construction clause effect finding appellant waived federally guaranteed right compel arbitration waiver whose validity must judged reference federal rather state law fundamentally misconceives nature rights created faa section act confer absolute right compel arbitration right obtain order directing arbitration proceed manner provided parties agreement emphasis added state found incorporating california arbitration rules agreement parties agreed arbitration proceed situations within scope finding appellant waived right compel arbitration finding right first place parties agreement require arbitration proceed situation pp also without merit appellant argument state construction clause must set aside violates settled federal rule questions arbitrability contracts subject faa must resolved healthy regard federal policy favoring arbitration see moses cone memorial hospital mercury construction federal policy favoring arbitration certain set procedural rules federal policy simply ensure enforceability according terms private agreements arbitrate interpreting clause make applicable california arbitration rules manifestly designed encourage resort arbitral process offend moses cone rule liberal construction pp application stay arbitration parties contract faa faa contains express preemptive provision reflect congressional intent occupy entire field arbitration moreover since faa principal purpose ensure private arbitration agreements enforced according terms said application undermine act goals policies arbitration act matter consent coercion parties generally free structure arbitration agreements see fit may limit contract issues arbitrate mitsubishi motors soler may specify contract rules arbitration conducted parties agreed abide state arbitration rules enforcing rules according terms agreement fully consistent faa goals even result arbitration stayed act otherwise permit go forward pp rehnquist delivered opinion white blackmun stevens scalia kennedy joined brennan filed dissenting opinion marshall joined post took part consideration decision case james harrington argued cause appellant briefs robert thum deanne tully david heilbron argued cause appellee brief leslie landau chief justice rehnquist delivered opinion unlike federal counterpart california arbitration act cal civ proc code ann et seq west contains provision allowing stay arbitration pending resolution related litigation hold application california statute federal arbitration act faa act et case parties agreed arbitration agreement governed law california appellant volt information sciences volt appellee board trustees leland stanford junior university stanford entered construction contract volt install system electrical conduits stanford campus contract contained agreement arbitrate disputes parties arising relating contract breach thereof contract also contained clause providing contract shall governed law place project located app course project dispute developed regarding compensation extra work volt made formal demand arbitration stanford responded filing action volt california superior alleging fraud breach contract action stanford also sought indemnity two companies involved construction project arbitration agreements volt petitioned superior compel arbitration dispute stanford turn moved stay arbitration pursuant cal civ proc code ann west permits stay arbitration pending resolution related litigation party arbitration agreement third parties bound possibility conflicting rulings common issue law fact superior denied volt motion compel arbitration stayed arbitration proceedings pending outcome litigation authority app california appeal affirmed acknowledged parties contract involved interstate commerce faa governs contracts interstate commerce faa contains provision permitting stay arbitration pending resolution related litigation involving third parties bound arbitration agreement app however held specifying contract governed law place project located parties incorporated california rules arbitration including arbitration agreement finally rejected volt contention even parties agreed arbitrate california rules application nonetheless faa contract involved interstate commerce reasoned purpose faa mandate arbitration claims merely enforcement privately negotiated arbitration agreements quoting dean witter reynolds byrd faa therefore application state laws render arbitration agreements unenforceable follow however federal law preclusive effect case parties chosen arbitration agreement abide state rules app contrary thrust federal law arbitration strictly matter contract parties arbitration agreement liberty choose terms arbitrate parties chosen agreement abide state rules arbitration application faa prevent enforcement rules actually inimical policies underlying state federal arbitration law force parties arbitrate manner contrary agreement california denied volt petition discretionary review postponed consideration jurisdiction hearing merits hold appellate jurisdiction affirm appellant devotes bulk argument convincing us appeal erred interpreting clause mean parties incorporated california rules arbitration arbitration agreement see brief appellant appellant acknowledges must interpretation private contracts ordinarily question state law sit review see appellant nonetheless maintains set aside appeal interpretation particular contractual provision two principal reasons appellant first suggests appeal construction clause effect finding appellant waived federally guaranteed right compel arbitration parties dispute waiver whose validity must judged reference federal rather state law argument fundamentally misconceives nature rights created faa act designed overrule judiciary longstanding refusal enforce agreements arbitrate byrd supra place agreements upon footing contracts scherk quoting section act therefore declares written agreement arbitrate contract involving interstate commerce maritime transaction shall valid irrevocable enforceable save upon grounds exist law equity revocation contract allows party arbitration agreement petition district order directing arbitration proceed manner provided agreement faa confer right compel arbitration dispute time confers right obtain order directing arbitration proceed manner provided parties agreement emphasis added appeal found incorporating california rules arbitration agreement parties agreed arbitration proceed situations fell within scope code civ proc ann west finding appellant waived right compel arbitration dispute finding right first place parties agreement require arbitration proceed situation accordingly appellant contention contract interpretation issue presented involves waiver federal right without merit second appellant argues set aside appeal construction clause violates settled federal rule questions arbitrability contracts subject faa must resolved healthy regard federal policy favoring arbitration brief appellant citing moses cone memorial hospital mercury construction faa create body federal substantive law arbitrability applicable arbitration agreement within coverage act requires questions arbitrability addressed healthy regard federal policy favoring arbitration doubts concerning scope arbitrable issues resolved favor arbitration mitsubishi motors soler construing arbitration agreement within coverage faa contract parties intentions control intentions generously construed issues arbitrability cases course establish applying general principles contract interpretation interpretation arbitration agreement within scope act see perry thomas due regard must given federal policy favoring arbitration ambiguities scope arbitration clause resolved favor arbitration think appeal offended moses cone principle interpreting provision mean parties intended california rules arbitration including stay provision apply arbitration agreement federal policy favoring arbitration certain set procedural rules federal policy simply ensure enforceability according terms private agreements arbitrate interpreting clause make applicable state rules governing conduct arbitration rules manifestly designed encourage resort arbitral process simply offend rule liberal construction set forth moses cone offend policy embodied faa question remains whether assuming clause meant appeal found mean application cal civ proc code ann nonetheless faa extent used stay arbitration contract involving interstate commerce undisputed contract falls within coverage faa since involves interstate commerce faa contains provision authorizing stay arbitration situation appellee contends however faa specific sections claimed conflict california statute issue applicable proceeding thus application california statute see brief appellee argument without merit need resolve decide case conclude even faa fully applicable proceedings prevent application cal civ proc code ann stay arbitration parties agreed arbitrate accordance california law faa contains express provision reflect congressional intent occupy entire field arbitration see bernhardt polygraphic upholding application state arbitration law arbitration provision contract covered faa even congress completely displaced state regulation area state law may nonetheless extent actually conflicts federal law extent stands obstacle accomplishment execution full purposes objectives congress hines davidowitz question us therefore whether application cal civ proc code ann stay arbitration contract interstate commerce accordance terms arbitration agreement undermine goals policies faa conclude faa designed overrule judiciary longstanding refusal enforce agreements arbitrate dean witter reynolds byrd place agreements upon footing contracts scherk quoting congress doubt aware act encourage expeditious resolution disputes passage motivated first foremost congressional desire enforce agreements parties entered byrd accordingly recognized faa require parties arbitrate agreed see act mandate arbitration claims prevent parties agree arbitrate excluding certain claims scope arbitration agreement see mitsubishi motors soler citing prima paint flood conklin mfg simply requires courts enforce privately negotiated agreements arbitrate like contracts accordance terms see prima paint supra act designed make arbitration agreements enforceable contracts recognition congress principal purpose ensuring private arbitration agreements enforced according terms held faa state laws require judicial forum resolution claims contracting parties agreed resolve arbitration southland keating see finding state statute rendered agreements arbitrate certain franchise claims unenforceable perry thomas finding state statute rendered unenforceable private agreements arbitrate certain wage collection claims follow faa prevents enforcement agreements arbitrate different rules set forth act indeed result quite inimical faa primary purpose ensuring private agreements arbitrate enforced according terms arbitration act matter consent coercion parties generally free structure arbitration agreements see fit may limit contract issues arbitrate see mitsubishi supra may specify contract rules arbitration conducted parties agreed abide state rules arbitration enforcing rules according terms agreement fully consistent goals faa even result arbitration stayed act otherwise permit go forward permitting courts rigorously enforce agreements according terms see byrd supra give effect contractual rights expectations parties without violence policies behind faa judgment appeals affirmed footnotes claims disputes matters question parties contract arising relating contract breach thereof shall decided arbitration accordance construction industry arbitration rules american arbitration association prevailing unless parties mutually agreed sic otherwise agreement arbitrate shall specifically enforceable prevailing arbitration law app volt motion compel apparently brought pursuant faa parallel provision california arbitration act cal civ proc code ann west motion cited acts authority specify particular sections upon reliance placed app volt also asked stay superior litigation arbitration completed presumably pursuant faa parallel provision california arbitration act cal civ proc code ann west app section provides pertinent part determines party arbitration agreement also party pending action special proceeding third party arising transaction series related transactions possibility conflicting rulings common issue law fact may refuse enforce arbitration agreement may order intervention joinder parties single action special proceeding may order intervention joinder certain issues may order arbitration among parties agreed arbitration stay pending action special proceeding pending outcome arbitration proceeding may stay arbitration pending outcome action special proceeding appellate jurisdiction review final judgment rendered highest state decision drawn question validity statute state ground repugnant constitution treaties laws decision favor validity appellant explicitly drew question validity cal civ proc code ann west federal grounds contending statute applied stay arbitration dispute faa thus invalid supremacy clause california appeal upheld application statute challenge appellate jurisdiction seem assured see longshoremen davis jurisdiction exists state statute upheld claim application particular set facts federal law mccarty mccarty appellee contends however jurisdiction exist appeal decision directly address validity statute simply uph eld validity parties agreement turn required application statute brief appellee agreement statute appellee argues appeal decision one appeal lie disagree decisions establish state statute sustained within meaning state holds applicable particular set facts contention application invalid federal grounds japan line county los angeles citing cohen california warren trading post arizona tax bantam books sullivan milling bondurant regardless particular grounds reasons state decision put case appellant contended appeal even contract required application cal civ proc code ann west california statute applied stay arbitration contract interstate commerce conflicted faa invalid supremacy clause appeal upheld application statute challenge progeny sufficient bring case within terms even though decision may premised interpretation contract unlike dissent see post think california arbitration rules parties incorporated contract generally foster federal policy favoring arbitration indicated faa contains provision designed deal special practical problems arise multiparty contractual disputes contracts issue include agreements arbitrate california taken lead fashioning legislative response problem giving courts authority consolidate stay arbitration proceedings situations order minimize potential contradictory judgments see civ proc code ann held faa substantive provisions applicable state well federal see southland keating never held terms appear apply proceedings federal see referring proceedings brought courts referring district nonetheless applicable state see southland corp keating supra expressly reserving question whether arbitration act apply proceedings state courts see also dissenting faa apply federal justice brennan justice marshall joins dissenting litigants case parties construction contract contained clause obligating arbitrate disputes making obligation specifically enforceable contract also incorporated provisions standard form contract prepared american institute architects endorsed associated general contractors america among general provisions contract shall governed law place project located dispute arose parties volt invoked arbitration clause stanford attempted avoid apparently dispute also involved two contractors stanford arbitration agreements federal arbitration act faa et requires courts enforce arbitration agreements contracts involving interstate commerce see ante california courts nonetheless rejected volt petition compel arbitration reliance provision state law circumstances presented permitted stay arbitration pending conclusion related litigation volt surprisingly suggested supremacy clause compelled different result california appeal found however parties agreed contract governed solely law state california exclusion federal law reaching conclusion relied extrinsic evidence parties intent solely language form contract law place project located govern app declines review holding denies effect important federal statute apparently finds question federal law involved accept neither state unusual interpretation parties contract unwillingness review reverse judgment california appeal contrary view state construction clause reviewable two independent reasons decision review state interpretation clause appears based principle interpretation private contracts ordinarily question state law sit review ante quarrel general proposition interpretation contracts matter state law ending analysis level generality however overlooks precedent effect order guard arbitrary denials federal claims state construction contract way preclude enforcement federal right immune review adequacy many cases hold involve understandably enough claims contract clause appleby city new york example petitioners alleged city unconstitutionally impaired rights contained contract deeding certain submerged lands city harbor chief justice taft stated issue follows questions determine first contract second proper construction effect third obligation impaired subsequent legislation enforced state questions must answer independently conclusion state course give proper weight judgment perform duty enforce guaranty federal constitution inviolability contracts state legislative action unless give questions independent consideration issue arisen solely cases brought contract clause memphis gas beeler commerce clause case appellant constitutional challenge state tax dependent particular interpretation contract appellant operated sustained tennessee construction contract thus reach federal issue emphasized meaning effect contract local questions conclusively settled decision state save performance duty safeguard asserted constitutional right may inquire whether decision state question rests upon fair substantial basis indeed ability review decisions circumstances limited interpretation contracts rogers alabama noted necessary well settled rule exercise jurisdiction protect constitutional rights declined plain fair result decision deny rights well known decide whether contract made well whether obligation contract impaired merely illustration general rule citation omitted case federal right issue statutory constitutional one principle review antecedent question state law existence application federal right turns logically antecedent finding matter state law essential performance function exercise ancillary jurisdiction consider state question federal rights otherwise nullified manipulation state law wechsler appellate jurisdiction reflections law logistics direct review lee rev see also hill inadequate state ground colum rev less cited cases right instant parties arbitration agreement enforced pursuant faa readily circumvented construction contract intended exclude applicability federal law therefore essential according due deference decision state independently determine whether clearly judged issue differently state highest wechsler supra arbitration course matter contract party required submit arbitration dispute agreed submit steelworkers warrior gulf agree faa require parties arbitrate agreed ante since faa merely requires enforcement parties agreed moreover free wish write agreement arbitrate outside coverage faa agreement permit state rule otherwise faa govern arbitration substantive question case whether done question made clear past matter federal law faa require enforcement arbitration agreements held also establishes substantive federal law must consulted determining whether extent given contract provides arbitration stated clearly moses cone memorial hospital mercury construction section faa congressional declaration liberal federal policy favoring arbitration agreements notwithstanding state substantive procedural policies contrary effect section create body federal substantive law arbitrability applicable arbitration agreement within coverage act courts appeals consistently concluded questions arbitrability must addressed healthy regard federal policy favoring arbitration agree arbitration act establishes matter federal law doubts concerning scope arbitrable issues resolved favor arbitration whether problem hand construction contract language allegation waiver delay like defense arbitrability recognizes relevance moses cone principle finds unoffended appeal decision suggests merely determines set procedural rules apply ante agree fully federal policy simply ensure enforceability according terms private agreements arbitrate disagree emphatically conclusion policy frustrated applying california procedural rule stays arbitration litigation issue goes forward means simply parties dispute litigated rather arbitrated thus interpreting parties agreement say california procedural rules apply rather faa parties arguably intent implicates moses cone principle less interpretation parties contract erroneously denied existence agreement arbitrate appearing recognize state interpretation contract raise question federal law nonetheless refuses determine whether state misconstrued agreement warrant failing faa requires determining question arbitrability stop application rules construing parties intentions also take account command federal law intentions generously construed issues arbitrability mitsubishi motors supra thus decision based state federal law thoroughly intertwined circumstances judgment said rest adequate independent state ground bar review see enterprise irrigation dist farmers mutual canal ground interwoven independent matter jurisdiction plain proper application federal law case state judgment might different review therefore barred cf ake oklahoma hen resolution state procedural law question depends federal constitutional ruling prong holding independent federal law jurisdiction precluded ii construed deference opinion california appeal yet healthy regard federal policy favoring arbitration moses cone clear clause bear interpretation california assigned construction contractual provision course matter discerning parties intent important recall first place case extrinsic evidence intent must therefore rely contract provision contract issue one parties drafted rather incorporated portions standard form contract commonly used construction industry makes unlikely intent way variance purposes clauses commonly written manner generally interpreted seems beyond dispute normal purpose clauses determine law one state rather another state applicable simply speak interaction state federal law cursory glance standard conflicts texts confirms observation contain reference relation federal state law discussions contractual clauses see weintraub commentary conflict laws ed scoles hay conflict laws leflar mcdougal felix american conflicts law ed true standard codifications see uniform commercial code restatement second conflict laws indeed restatement conflicts notes expressly deal problem determining respective spheres authority law courts nation member comment decisions fully bear impression clauses speak issue least two occasions called upon determine applicability vel non faa contracts containing clauses similar issue despite adverting clauses contexts opinions ascribed significance whatever connection applicability faa scherk bernhardt polygraphic great weight lower authority similarly rejects notion clause renders faa inapplicable clauses simply never used purpose dealing relationship state federal law basis whatever believing parties case intended clause moreover literal language contract law place gives indication intention apply state law exclude law normally applicable something taking place location settled principles federal supremacy law place includes federal law see claflin houseman hauenstein lynham constitution laws treaties much part law every state local laws constitution dissenting judge noted california law federal law governs matters cognizable california courts upon definitively spoken app opinion capaccioli thus mere choice california law selection california law federal law absence evidence contrary must assumed parties meant law place project located indeed precisely said previously confronted virtually question fidelity federal savings loan assn de la cuesta contract provision stated deed trust shall governed law jurisdiction property located rejecting contention parties thereby agreed bound solely local law held paragraph provides deed governed law jurisdiction property located law jurisdiction includes federal well state law similarly conclude clause intended make federal law inapplicable contract iii commercial contracts written country contain clauses similar one contract specifying state law govern interpretation contract see scoles hay conflict laws party autonomy means parties free select law governing contract subject certain limitations usually means express clause written contract every state construe clauses expression parties intent exclude application federal law california appeal case result render federal arbitration act virtual nullity presently existing contracts believe parties contracts intend consequences flow insertion standard clause even less agree powerless review decisions state courts effectively nullify vital piece federal legislation respectfully dissent american institute architects document general conditions contract construction see app california appeal correctly assumed faa applicable provisions cal civ proc code ann west apparent federal rules apply volt petition compel arbitration granted app stanford nonetheless attempts cast doubt conclusion arguing faa provide orders stay litigation compel arbitration applicable state brief appellee stated state courts much federal courts obliged grant stays litigation arbitration act moses cone memorial hospital mercury construction see also nn immaterial resolution case whether actually apply parties agreed arbitrate also agreed agreement specifically enforceable see ante faa indisputably apply state southland keating requires enforce parties agreement indeed southland read stand proposition makes arbitration agreements specifically enforceable see dissenting stay arbitration proceedings pending litigation issues provides compatible specific enforcement agreement arbitrate faa requires section therefore given effect unless california appeal held parties somehow agreed federal law play role governing contract held word place intended mean forum state app added find reasonable volt interpretation place project located construed mean state california also nation america disagree holding ante faa state arbitration rules even applied contracts involving interstate commerce parties agreed arbitrate rules exclusion federal arbitration law reach question however conclude parties made agreement rogers frequently declined bound state procedural rulings prevented us reaching federal issue see davis wechsler brown western naacp alabama ex rel patterson james kentucky recent years may willing examine state procedural rulings see henry mississippi one study cases concluded historically shown less deference state substantive decisions ancillary questions similar procedural decisions hill inadequate state ground colum rev cf davis supra principle independent review adequacy state ruling clear proper standard review poses difficult question indeed cases employed wide range standards ranging de novo review appleby city new york must give judgment accept present conclusion state without inquiry inquiring whether state judgment rested fair substantial basis memphis gas beeler demorest city bank determining whether state decision palpably erroneous phelps board education west new york doubt proper standard review narrow one see need purposes present case settle precise formulation appear state construction clause sustained regardless standard employed language might read suggest moses cone principle applies construction arbitration clause ante mbiguities scope arbitration clause must resolved favor arbitration reading flatly contradicted moses cone language omits quotation ante made clear liberal rule construction favor arbitrability applies whether problem hand construction contract language allegation waiver delay like defense arbitrability moses cone memorial hospital whether california arbitration rules generally foster federal policy favoring arbitration ante relevant question section faa requires courts enforce agreements arbitrate moses cone held doubts whether parties agreed resolved favor arbitration whether california arbitration rules likely federal law foster arbitration induce parties agree arbitrate disputes another matter entirely question congress fashio legislative response ante meantime free substitute notions good policy federal law currently written scherk contract contained following clause laws state illinois shall apply govern agreement interpretation performance despite discussing effect clause different context consider possibility faa might apply parties choice law illinois similarly bernhardt contract provided arbitration new york law recognized problem whether new york vermont law applicable resolved question arbitrability faa without reference clause see huber hunt nichols architectural stone commonwealth edison gulf oil burke county public schools board education shaver partnership episcopal housing federal ins tennessee river pulp paper eichleay mamlin susan thomas tex civ app see also liddington energy group cal app cal rptr reversing trial ruling applied rather faa clause specified contract construed california law see garden grove community church moines steel cal app cal rptr standard new orleans elliott construction la stanford contends garden grove decision antedated conclusion present contract must informed language parties used brief appellee tr oral arg argument might greater force clause one parties actually negotiated rather one incorporated form contract case impossible believe actually intended result foreign normal purpose clauses flow agreement failed say explicitly