The non-aggrieved party does not waive the right to arbitrate when the aggrieved party fails to initiate arbitration proceedings as required by the parties' agreement and its controlling rules, according to the Alabama Supreme Court.

In Chris Myers Pontiac-GMC, Inc. v. Perot, No. 1061090, 2008 WL 1759112 (Ala. Apr. 18, 2008), Perot purchased a van from Chris Myers Pontiac-GMC (Myers). The purchase contract contained an arbitration agreement. Later, Perot had a recurring problem with the van and returned it to Myers for service on several occasions. Myers was allegedly unable to fix the problem, and Perot sued Myers for negligence, breach of warranty, and statutory violations.

Myers then moved to compel arbitration with the trial court. The trial court granted the motion, but neither Myers nor Perot subsequently initiated arbitration proceedings in the manner provided for in the agreement. After seventeen months without initiation, Perot moved that Myers be compelled to initiate arbitration, or, in the alternative, for reconsideration of the original motion to compel. After three more months, the trial court denied the original motion to compel ex mero motu.

On appeal, the Court observed that the dismissal ex mero motu was not accompanied by any explanation for the decision. However, the Court presumed dismissal was granted because it deemed the right to arbitrate waived after Myers failed to timely initiate proceedings.

The Court noted that the clear and plain language of the arbitration agreement stated that the "aggrieved party" bore the burden of initiating any proceedings by filing a demand and paying any filing fee. Also, the Court found that the agreement invoked the Commercial Rules of the American Arbitration Association, which clearly states that the "claimant," or the party asserting the claim, bears the burden of initiation. See American Arbitration Association, Commercial Rule R-4.

Therefore, the Court held Myers could not waive the right to arbitrate through its delay, because it "had no obligation under the arbitration agreement to initiate arbitration proceedings in the event the Perots had a grievance concerning their purchase of the van."