THIRD DIVISION
DILLARD, P. J.,
GOBEIL and PIPKIN, JJ.
NOTICE: Motions for reconsideration must be
received no later than 4:30 pm on the 10th day after
the decision was issued to be deemed timely filed.
https://www.gaappeals.gov/rules
October 27, 2026
In the Court of Appeals of Georgia
A26A0984. RUMBAUGH v. BRUMBELOW et al.
GOBEIL, Judge.
Roger Rumbaugh appeals from the trial court’s order requiring him to arbitrate
his claims against certain defendants in his breach of contract and negligence action.
On appeal, he argues that the trial court erred in enforcing an arbitration provision
that is unenforceable under Georgia law and does not implicate interstate commerce
such that it is not preempted by federal law. For the reasons set forth below, we
reverse the trial court’s order.
The record here shows that on May 2, 2025, Rumbaugh sued Meridian
Restoration, Inc.; two of its agents, Ronald Keith Brumbelow and Henry Shugart; and
his homeowners insurance carrier, United Services Automobile Association (“USAA”). In the complaint, Rumbaugh alleged that after his home suffered
substantial water damage in a storm, he notified USAA, which gave him a list of
approved vendors to make the necessary repairs and promised to warrant the work of
those vendors. Rumbaugh contracted with Meridian, an approved vendor that was
specifically recommended by USAA, to remediate the water damage. Despite making
several attempts to repair his home, Meridian failed to fix the problems to
Rumbaugh’s satisfaction and instead “attempted to abandon their customer ... as well
as their duties and obligations” to him. The complaint asserted claims against
Meridian for breach of contract, negligent construction, and negligence per se. It also
asserted claims against Brumbelow and Shugart for negligent supervision, claims
against USAA for negligence and vicarious liability, and claims against all defendants
for punitive damages and attorney fees.
Meridian counterclaimed for breach of contract, quantum meruit, and attorney
fees. Additionally, Meridian, Brumbelow, and Shugart (“the Meridian defendants”)
filed a motion to dismiss or, in the alternative, to stay the proceedings and compel
2
Rumbaugh to arbitrate his claims against them.1 The Meridian defendants pointed to
the following arbitration clause in Rumbaugh’s remediation contract with Meridian:
Any controversy or claim arising out of or related to this contract or the
breach thereof, shall be resolved by binding arbitration according to the
Rules of the American Arbitration Association, and judgment upon the
award rendered may be entered in any court having jurisdiction thereof
except for the following types of actions: (a) lien foreclosures and
collections matters which shall be resolved by court action; and (b)
claims within the monetary limits of the small claims court may be
litigated in such court.
Notably, although Meridian was the party seeking to compel arbitration, its motion did
not invoke the Federal Arbitration Act (the “FAA”) nor assert that the contract
involved interstate commerce.
Rumbaugh opposed the motion, arguing as relevant here that the arbitration
clause was unenforceable under Georgia law because it fell within the “consumer
transaction exception” of OCGA § 9-9-2(c)(7), and no evidence supported the
application of the FAA. In response, the Meridian defendants argued that the
1
USAA did not oppose the court entering an order compelling arbitration between Rumbaugh and Meridian, but it did not agree to participate in any arbitration, as it was not a party to the arbitration agreement between Rumbaugh and Meridian.
3
arbitration clause at issue was preempted by the FAA because the contract “involves
interstate commerce,” bringing it within the federal statute’s purview. Specifically,
the Meridian defendants stated that interstate commerce was involved because “a
Toyota Tundra was used to transport lumber to [Rumbaugh’s] residence”; the
Meridian defendants “contracted with Sherwin Williams, a paint supplier
incorporated in Ohio for materials and supplies used to repair [Rumbaugh’s] home”;
and other materials used at Rumbaugh’s residence are of the type “that are commonly
manufactured out of state or in other countries.” Approximately two-and-a-half weeks
later, the Meridian defendants filed a “Notice of Filing” to provide the court with
exhibits related to their reply brief. Discussed further below, the exhibits consisted of
invoices and receipts for materials and subcontractors used at Rumbaugh’s home.
The trial court granted the Meridian defendants’ motion “[f]or the reasons
outlined in [their] briefing.” It ordered Rumbaugh to arbitrate his claims against those
defendants and stayed the proceedings pending arbitration. At Rumbaugh’s request,
the court certified its order for immediate review, and we granted Rumbaugh’s
application for interlocutory review. Case No. A26I0061. This appeal followed.
4
We review de novo a trial court’s order compelling arbitration. C. R. of
Thomasville, LLC v. Hannaford, 363 Ga. App. 581, 582 (871 SE2d 679) (2022). “The
factual findings on which the ruling is based, however, will not be overturned unless
clearly erroneous.” Id. “The party seeking arbitration bears the burden of proving the
existence of a valid and enforceable agreement to arbitrate.” Id.
On appeal, Rumbaugh argues that the arbitration clause at issue is
unenforceable under the Georgia Arbitration Code (“GAC”), which excludes from
its purview “[a]ny contract involving ... consumer transactions” as that term is
defined by Georgia’s Fair Business Practices Act (“FBPA”). OCGA § 9-9-2(c)(7).
And under the FBPA, “consumer transactions” include the sale or purchase of
“services ... primarily for ... household purposes.” OCGA § 10-1-392(10).
The Meridian defendants do not dispute this part of Rumbaugh’s argument, but
rather argue that the trial court correctly concluded that the FAA preempts Georgia
law in this case. Indeed, “the FAA preempts any state law that conflicts with its
provisions or undermines the enforcement of private arbitration agreements.” Langfitt
v. Jackson, 284 Ga. App. 628, 634–35(3) (644 SE2d 460) (2007). In particular, the
FAA overrides state laws “requiring a judicial forum for the resolution of disputes
5
pertaining to a particular subject matter,” such as consumer transactions. Am. Gen.
Fin. Svcs. v. Jape, 291 Ga. 637, 640(2) (732 SE2d 746) (2012).
The contract between Rumbaugh and Meridian did not invoke the FAA, but the
FAA applies nonetheless to “an arbitration clause that involves or affects interstate
commerce.” SunTrust Bank v. Lilliston, 302 Ga. 840, 842 (809 SE2d 819) (2018)
(quotation marks omitted); 9 USC § 2. See also Allied-Bruce Terminix Companies v.
Dobson, 513 U.S. 265, 281(IV) (115 SCt 834, 130 LE2d 753) (1995) (holding that the
FAA applies to contracts involving or affecting interstate commerce “even if the
parties did not contemplate an interstate commerce connection”). The FAA’s use of
the broad term “involving” to explain the required connection to interstate commerce
“signals an intent to exercise Congress’ commerce power to the full.” Triad Mgmt.
of Ga., III v. Johnson, 298 Ga. App. 204, 205(1) (679 SE2d 785) (2009).
Rumbaugh’s argument centers on the fact that the burden to establish the
applicability of an enforceable arbitration agreement lies with the Meridian defendants
as the ones seeking to compel arbitration, and they did not invoke the FAA in their
original motion to compel arbitration. Further, even in their reply brief, which came
only after Rumbaugh raised the issue of preemption in an abundance of caution, the
6
Meridian defendants failed to put forward any proof to support their argument that
the contract involved interstate commerce. Rumbaugh argues that the contract at issue
was between himself, a Georgia resident, Meridian, a Georgia corporation, and its
agents, both Georgia residents, to repair his home located in Georgia. And he argues
that the invoices and receipts the Meridian defendants filed separately were not
admissible, as they were not attached as exhibits to any pleading, and they were not
authenticated. Further, even if properly considered, Rumbaugh asserts that the
documents themselves show only that the Meridian defendants contracted with other
Georgia subcontractors and purchased materials at Georgia stores.
As argued by the Meridian defendants, the trial court is not so restricted in what
evidence it may consider in ruling on a motion to compel arbitration. See S. Telecom,
Inc. v. Level 3 Communications, 295 Ga. App. 268, 271(1)(a) (671 SE2d 283) (2008)
(“A Georgia court reserves the power to examine the entire record, not to reach the
underlying merits of the dispute, but to fulfill its gatekeeping role to determine
whether any arbitrable claim has been presented in the current action.” (quotation
marks omitted)). But, even keeping in mind the broad definition of contracts that
“involve” or “affect” interstate commerce, the documents provided by the Meridian
7
defendants do not substantiate a case for federal preemption of an arbitration
agreement that is unenforceable under Georgia law.
Despite having access to the information about the alleged interstate nature of
the contract at issue, the Meridian defendants have failed to produce evidence
sufficient to invoke FAA preemption. More specifically, their supporting documents
show that a variety of building materials were used at the job site, and although these
might be the types of materials that often originate out of state, not one invoice or
receipt provided by the Meridian defendants shows that any of the materials used at
Rumbaugh’s job site actually did originate out of state. Sherwin Williams, from whom
the Meridian defendants purchased materials, is an Ohio corporation, but the stores
from which the defendants purchased paint for this project were all located in Georgia.
All of the subcontractors mentioned in the documents appear to be Georgia
businesses, and there is no indication – via receipts, affidavits, or otherwise – of any
specific contractor or even laborer that came from out of state to work on this project.
And although the Meridian defendants stated that they could “provide more than an
affidavit stating that a Toyota Tundra was used to transport lumber to [Rumbaugh’s]
residence,” they did not in fact provide such an affidavit, much less provide proof that
8
any vehicles used to transport materials to Rumbaugh’s home were manufactured out
of state. Compare Krut v. Whitecap Housing Group, 268 Ga. App. 436, 439–40(1) (602
SE2d 201) (2004) (finding arbitration agreement within construction contract to
sufficiently involve interstate commerce to invoke the FAA where the defendant
provided an affidavit that it used materials manufactured outside Georgia, where
subcontractors employed laborers who were not from Georgia, and used vehicles
manufactured outside Georgia) and McCormick-Morgan, Inc. v. Whitehead Elec. Co.,
179 Ga. App. 10, 12 (345 SE2d 53) (1986) (finding arbitration agreement within
construction contract to sufficiently involve interstate commerce where one
contractor and materials used were from out of state).
The Meridian defendants all but acknowledge this lack of proof of interstate
commerce on appeal, arguing that the materials used at Rumbaugh’s job site “almost
certainly originat[ed] outside the State of Georgia,” and “undoubtedly were not all
placed into the stream of commerce in Georgia alone.” Indeed, there is a strong
possibility that in fact, that is the case. But strong possibilities are not enough.
The Meridian defendants rely heavily on our previous recognition that “[h]ome
construction generally involves interstate commerce.” Wise v. Tidal Constr. Co., 261
9
Ga. App. 670, 673(1) (583 SE2d 466) (2003).2 True, but unlike the record in this case,
our precedent points to evidence in the record showing that some part of the
construction project — be it materials, or an insurance provider, or a worker, or a
vehicle — implicated interstate commerce. See, e.g., Krut, 268 Ga. App. at 439–40(1);
McCormick-Morgan, 179 Ga. App. at 12; Brockett Pointe Shopping Ctr. v. Dev.
Contractors, 193 Ga. App. 854, 856 (389 SE2d 374) (1989) (contract involved interstate
commerce where “undisputed evidence show[ed] that out-of-state goods, services,
materials and financing were supplied during execution of the construction
contract”); ADC Const. v. McDaniel Grading, 177 Ga. App. 223, 225(1) (338 SE2d
733) (1985) (contract involved interstate commerce where defendant supplied affidavit
stating that he used equipment manufactured and purchased abroad and in other
2
In Wise, we reversed the trial court’s order compelling arbitration between the plaintiffs and the company that constructed their home, holding that the construction company’s actions were inconsistent with arbitration, thereby waiving their right to seek arbitration. 261 Ga. App. at 674–75(2). We noted, however, that we disagreed with the plaintiffs’ argument that the contract did not involve interstate commerce, stating “[v]irtually any activity related to building and construction involves interstate commerce, because materials flow across state lines and internationally.” Id. at 676(3). As this statement was made in a part of our opinion that was not essential to the decision, it is arguably dicta. However, even taking such an observation as true, it still does not eliminate the necessity that we examine the record to determine “whether the transaction in question turns out, in fact, to have involved interstate commerce.” Jenkins v. First Am. Cash Advance of Georgia, LLC, 400 F3d 868, 875 n. 6 (III)(A) (11th Cir. 2005).
10
states, subcontractors were from out of state, and subcontractors purchased materials
in other states). Compare Rhodes v. Inland-Rome, 195 Ga. App. 39, 40(2) (392 SE2d
270) (1990) (no interstate commerce was shown in contract related solely to the sale
of timber located within Georgia; only evidence of effect on another state came from
defendant’s unilateral actions after the transaction was completed).
Here, where the contract’s effect on another state is supported by mere
speculation, we cannot agree with the trial court that the contract between the parties
“evidenc[es] a transaction involving interstate commerce” to implicate the FAA. 9
USC § 2; see Columbus Anesthesia Grp., P.C. v. Kutzner, 218 Ga. App. 51, 52–53(1)
(459 SE2d 422) (1995) (FAA did not preempt employment contract where the
contract contemplated actions that all took place within Georgia; no interstate
commerce was established to invoke federal preemption). Our Commerce Clause
jurisprudence — for better or worse — sets the bar very low. But, the bar is not
nonexistent and we decline to assume facts not in the record to clear it.
11
Accordingly, “[t]here being no evidence to authorize a finding of the applicability of
the [FAA] in the instant case, the trial court erred in finding that arbitration was
mandated thereunder.” Rhodes, 195 Ga. App. at 40(2).
Judgment reversed. Dillard, P. J., and Pipkin, J., concur.
12