No. 23	                     April 21, 2016	125

             IN THE SUPREME COURT OF THE
                   STATE OF OREGON

                COUCH INVESTMENTS, LLC,
              an Oregon limited liability company,
                     Respondent on Review,
                                v.
                     Leonard PEVERIERI,
                          an individual;
                 Judith Peverieri, an individual;
                and Peverieri Investments, LLC,
              an Oregon limited liability company,
                      Petitioners on Review.
          (CC 11CV0285SF; CA A155483; SC S063209)

   En Banc
   On review from the Court of Appeals.*
   Argued and submitted January 14, 2016.
   Charles A. Ringo, Bend, argued the cause and filed the
brief for the petitioners on review.
   Martin E. Hansen, Francis Hansen & Martin, LLP,
Bend, argued the cause and filed the brief for the respon-
dent on review. With him on the brief was Christopher J.
Manfredi.
    Phil Goldsmith, Law Office of Phil Goldsmith, Portland,
filed the brief for amicus curiae Oregon Trial Lawyers
Association.
   WALTERS, J.
   The decision of the Court of Appeals and the judgment of
the circuit court are affirmed.




______________
	 *  Appeal from Deschutes County Circuit Court, Michael Adler, Judge. 270
Or App 233, 346 P3d 1299 (2015).
126	                           Couch Investments, LLC v. Peverieri

     Case Summary: The trial court denied landlords’ petition to vacate the arbi-
tration award, and landlords appealed to the Court of Appeals, arguing that the
arbitrator exceeded his powers when he found not only that landlords were lia-
ble for the cost of improvements required by the Department of Environmental
Quality (DEQ), but also ordered remedies. The Court of Appeals affirmed the
trial court’s denial of landlords’ petition, and the Supreme Court affirmed. The
court applied principles of state contract law and concluded that the parties’ stip-
ulation to arbitrate was ambiguous, and that the trial court was therefore enti-
tled to consider extrinsic evidence in determining the parties’ intent. Because the
parties submitted such evidence to the trial court, the trial court is presumed to
have considered the evidence presented and decided the facts in a manner con-
sistent with the ultimate legal conclusion that it reached — that the arbitrator
did not exceed his powers. The court held that there was sufficient evidence to
support the trial court’s conclusion that the arbitrator acted within his authority
in ordering remedies.
    The decision of the Court of Appeals and the judgment of the circuit court
are affirmed.
Cite as 359 Or 125 (2016)	127

	          WALTERS, J.
	        Leonard and Judith Peverieri and Peverieri
Investments, LLC (landlords) appeal from the trial court’s
general judgment confirming an arbitration award in favor
of Couch Investments, LLC (tenant). Landlords argue
that the arbitrator exceeded his powers when he found not
only that landlords were liable for the cost of storm water
drainage improvements required by the Department of
Environmental Quality (DEQ), but also ordered remedies.
Landlords contend that the trial court erred in denying
their petition to vacate the arbitration award under ORS
36.705(1)(d),1 and that the Court of Appeals erred in affirm-
ing the trial court’s judgment. Couch Investments, LLC v.
Peverieri, 270 Or App 233, 346 P3d 1299 (2015). Although
our analysis differs from that of the Court of Appeals, we
affirm its decision.
	        The following facts are uncontested. Tenant oper-
ated a gas station on landlords’ property. Landlords filed a
complaint seeking tenant’s eviction, alleging, among other
things, that tenant was in default because tenant had failed
to comply with “DEQ regulations pertaining to the cap-
ture of storm water from the area surrounding the fueling
stations.” Tenant then filed a complaint against landlords,
alleging intentional interference with economic relations
and breach of the lease agreement and seeking injunctive
relief. The two cases were consolidated and the parties
signed a “stipulation to arbitrate and limit claims” (stipula-
tion). The stipulation provided:
    	 “1.  The Parties have agreed to arbitrate the claims
    raised in the above actions. The Parties have mutually
    selected William E. Flinn to serve as the arbitrator. The
    arbitration is scheduled for December 18, 2012.

    	 “2.  The only issue to be resolved through arbitration
    is whether [tenant], as tenant, or [landlords], as landlord,
    are liable under the lease that is the subject of the above
    actions (the ‘Lease’) for the cost of storm water drainage

	1
      ORS 36.705(1)(d) provides: “Upon petition to the court by a party to an
arbitration proceeding, the court shall vacate an award made in the arbitration
proceeding if * * * [a]n arbitrator exceeded the arbitrator’s powers.”
128	                     Couch Investments, LLC v. Peverieri

   improvements required by the Oregon Department of
   Environmental Quality (the ‘DEQ Issue’).
   	 “3.  The Parties agree that David Cole of the DEQ may
   testify both through his affidavit and by phone, as well. The
   Parties disagree whether any other witness can provide rel-
   evant testimony on [the] DEQ Issue. The Parties, however,
   do agree that should the arbitrator allow any testimony to
   be offered on the DEQ Issue (other than Mr. Cole’s testi-
   mony), it will only be testimony of the Parties themselves.
   	 “4.  Other than the DEQ issue, all claims raised in the
   Parties’ pleadings will be dismissed by the Parties with
   prejudice.
   	 “5.  The prevailing party/parties on the DEQ Issue
   shall be entitled to recover its/their reasonable attorneys’
   fees under the terms of the Lease.”
	        After a hearing, the arbitrator issued a letter opin-
ion concluding that landlords were “liable for the cost of
storm water drainage improvements to the leased prem-
ises required by the DEQ.” Tenant then submitted a pro-
posed arbitration award, which stated, in part: “[Landlords
are] liable for all costs associated with storm water drain-
age improvements * * *. [Landlords] shall complete such
improvements to the satisfaction of DEQ on or before [date
left blank for the arbitrator to fill in].” Landlords submitted
an objection to the proposed award, contending that the pro-
posed award sought relief outside the stipulated agreement.
	        After hearing oral argument on landlords’ objec-
tions, the arbitrator issued a letter overruling the objec-
tions. In the letter, the arbitrator addressed the scope of
the authority given to him by the parties’ stipulation and
Oregon law. The arbitrator stated:
   “ORS 36.695(3) says ‘an arbitrator may order such reme-
   dies as the arbitrator considers just and appropriate under
   the circumstances of the proceeding. The fact that such a
   remedy could not or would not be granted by the court is
   not a ground for refusing to confirm an award under ORS
   36.700 or for vacating an award under ORS 36.705.’ In my
   opinion, the stipulation and the cited statutes give me the
   authority to make the following rulings on [landlords’]
   objections and, also, to make the findings, conclusions and
   awards found in the enclosed proposed arbitration award.”
Cite as 359 Or 125 (2016)	129

After a hearing regarding the cost of the required storm
water drainage improvements, at which both sides pre-
sented additional evidence, the arbitrator issued an arbi-
tration award. The arbitrator ordered that landlords pay
$32,500 into tenant attorney’s client trust account and that
tenant complete the necessary improvements and refund
any excess funds to landlords with an accounting.
	        Tenant then filed a petition to enter the arbitra-
tion award in the circuit court, and landlords filed a peti-
tion to vacate the award on the basis that the arbitrator had
exceeded his powers. The circuit court granted tenant’s peti-
tion, denied landlords’ petition, and entered a general judg-
ment and money award confirming the arbitration award.
Landlords appealed to the Court of Appeals. That court
noted that ORS 36.695(3) gives arbitrators broad author-
ity to order remedies unless the parties waive or vary that
authority in accordance with ORS 36.610(1). Looking to the
parties’ stipulation to arbitrate, the court concluded that
because the parties had not explicitly agreed to “waive” or
“vary the effect of” ORS 36.695(3), and because there was
no indication that the parties had intended to do so, the arbi-
trator did not exceed his powers. Couch Investments, LLC,
270 Or App at 235. Therefore, the court affirmed the trial
court’s judgment. Id.
	        Before this court, landlords assert that the trial
court erred in upholding the arbitrator’s award because the
parties had agreed to limit the arbitrator’s authority to a
determination of which party is liable for the costs of the
improvements required by the DEQ. Landlords argue that
the parties had not agreed to submit an entire claim to arbi-
tration. Instead, they had agreed to submit only the lim-
ited issue of liability, and the arbitrator exceeded his powers
when he went further and ordered remedies.
	        Tenant responds that arbitrators have broad author-
ity to order remedies under ORS 36.695(3), which provides
in part:
   “[A]n arbitrator may order such remedies as the arbitra-
   tor considers just and appropriate under the circumstances
   of the arbitration proceeding. The fact that such a rem-
   edy could not or would not be granted by the court is not a
130	                    Couch Investments, LLC v. Peverieri

   ground for refusing to confirm an award under ORS 36.700
   or for vacating an award under ORS 36.705.”
Furthermore, tenant argues, in accordance with ORS
36.610(1), parties may limit an arbitrator’s power to order
remedies only by waiving the operation of ORS 36.695(3) or
varying its effect. ORS 36.610(1) provides:
   	 “Except as otherwise provided in this section, a party
   to an agreement to arbitrate or to an arbitration proceed-
   ing may waive, or the parties may vary the effect of, the
   requirements of ORS 36.600 to 36.740 to the extent permit-
   ted by law.”
In this case, tenant contends, the parties did not waive or
vary the arbitrator’s default authority to order remedies;
the stipulation to arbitrate contains no express invocation
of ORS 36.610(1), and a waiver cannot be implied from its
wording.
	         We begin our analysis with ORS 36.705(1), which
grants a court authority to vacate an arbitrator’s award
in specified circumstances. One such circumstance is “if
* * * [a]n arbitrator exceeded the arbitrator’s powers.” ORS
36.705(1)(d). In this case, as noted, the arbitrator deter-
mined that he had authority to order remedies, and the trial
court agreed.
	        The starting point in considering the extent of an
arbitrator’s powers is whether the parties agreed to arbi-
trate and, if so, the contours of the dispute that they agreed
to arbitrate. ORS 36.620(2) provides that “the court shall
decide whether an agreement to arbitrate exists or a contro-
versy is subject to an agreement to arbitrate.” Thus, land-
lords are correct that, before a court considers an arbitra-
tor’s authority to order remedies under ORS 36.695(3), the
court first must determine whether the parties’ controversy
is subject to an agreement to arbitrate.
	        As the text of ORS 36.620(2) indicates, whether a
particular controversy is subject to an agreement to arbi-
trate is a matter for the court. ORS 36.620(2) codifies sec-
tion 6(b) of the Revised Uniform Arbitration Act. Or Laws
2003, ch 598, § 6(2); see Snider v. Production Chemical
Manufacturing, Inc., 348 Or 257, 261, 230 P3d 1 (2010)
Cite as 359 Or 125 (2016)	131

(noting that ORS 36.730 codifies section 28 of Revised
Uniform Arbitration Act). Comment 2 to section 6 of the
Revised Uniform Arbitration Act confirms that a court is to
decide whether a dispute is encompassed by an agreement
to arbitrate:
   “Subsections (b) and (c) of Section 6 are intended to incor-
   porate the holdings of the vast majority of state courts and
   the law that has developed under the FAA that, in the
   absence of an agreement to the contrary, issues of substan-
   tive arbitrability, i.e., whether a dispute is encompassed by
   an agreement to arbitrate, are for a court to decide.”
See Datt v. Hill, 347 Or 672, 682, 227 P3d 714 (2010) (look-
ing to commentary to uniform act to determine legislative
intent).
	        Although this court has not considered how to
interpret an agreement to arbitrate and issues of substan-
tive arbitrability under Oregon’s arbitration statutes, it has
considered those issues under the Federal Arbitration Act
(FAA). In Industra/Matrix Joint Venture v. Pope & Talbot,
341 Or 321, 331, 142 P3d 1044 (2006), the court explained
that “a court, in construing a valid arbitration agreement
within the coverage of the FAA, applies ordinary principles
of state contract law to determine whether the parties have
agreed to arbitrate a particular dispute.” We see no reason
why ordinary contract principles should not apply in inter-
preting arbitration agreements in the context of Oregon
arbitration law. Therefore, in construing a valid arbitration
agreement in that context, a court should apply ordinary
principles of state contract law. See Gamble et ux v. Sukut,
208 Or 480, 488, 302 P2d 553 (1956) (applying principles of
state contract law to arbitration agreement).
	        In doing so, however, a court must be alert to a dis-
tinction described in First Options of Chicago, Inc. v. Kaplan,
514 US 938, 115 S Ct 1920, 131 L Ed 2d 985 (1995), a case
cited in Industra/Matrix Joint Venture, 341 Or at 331-32. In
First Options of Chicago, Inc., the United States Supreme
Court described the role that an arbitrator’s decision may
play when the parties dispute the scope of an arbitration
agreement. 514 US at 941. The Court distinguished between
cases in which the parties agree to arbitrate the question of
132	                    Couch Investments, LLC v. Peverieri

whether a particular controversy is arbitrable and cases in
which the parties leave that issue to the courts. Id. at 943.
In the former instance, courts “give considerable leeway
to the arbitrator, setting aside his or her decision only in
certain narrow circumstances.” Id. In the latter, “the court
should decide [the question of substantive arbitrability] just
as it would decide any other question that the parties did not
submit to arbitration, namely, independently.” Id.
	        In this case, neither party argues that they agreed
to submit the issue of substantive arbitrability to the arbitra-
tor, and nothing in the stipulation to arbitrate indicates that
intent. Therefore, ordinary principles of state contract law
govern, without any heightened deference to the arbitrator.
	        Oregon contract principles require that a court look
to the text and context of the parties’ agreement to deter-
mine the parties’ intent. Yogman v. Parrott, 325 Or 358, 361,
937 P2d 1019 (1997). The first inquiry that a court makes
is whether the agreement is ambiguous. Evenson Masonry,
Inc. v. Eldred, 273 Or 770, 772, 543 P2d 663 (1975). “In the
absence of an ambiguity, the court construes the words
of a contract as a matter of law.” Eagle Industries, Inc. v.
Thompson, 321 Or 398, 405, 900 P2d 475 (1995).
	        Applying those principles here, landlords argue that
the parties’ agreement to arbitrate is unambiguous and, as
a matter of law, must be interpreted as submitting only the
limited issue of liability to the arbitrator. Landlords call our
attention to two words in the stipulation—“only” and “issue.”
As noted, the stipulation provides that “the only issue to be
resolved through arbitration is whether [tenant], as tenant,
or [landlords], as landlord, are liable under the lease that
is the subject of the above actions.” Landlords contend that
the word “only” indicates that the parties intended to limit
the arbitrator’s authority to a single legal issue—liability.
Landlords contend that the word “issue” indicates that the
parties did not intend to submit an entire claim to the arbi-
trator, but only one aspect of a claim—the “issue” of liability;
the parties did not intend to arbitrate the separate “issue” of
damages or remedies. Furthermore, landlords contend, the
parties agreed to dismiss “all claims” “[o]ther than the DEQ
issue” with prejudice, leaving no claim for decision by the
Cite as 359 Or 125 (2016)	133

arbitrator and foreclosing the arbitrator’s authority to order
remedies.
	       Landlords also make an alternative argument. They
argue that, even if the stipulation to arbitrate is ambiguous,
its wording and the evidence at the hearing before the trial
court indicate that the parties intended to arbitrate only the
narrow issue of liability and intended to waive or vary the
arbitrator’s authority to order remedies.
	        Tenant’s primary argument, like landlords’, is that
the parties’ stipulation is unambiguous. Tenant contends
that the terms of the stipulation can only be understood as
submitting an entire claim to the arbitrator for resolution—
tenant’s claim that landlords are liable for the cost of storm
water drainage improvements required by the DEQ. In
response to landlords’ arguments, tenant contends that the
words “only” and “issue” were used to describe the single
claim that the parties intended to submit for arbitration
and to make clear that the parties had not agreed to submit
other claims that had been pleaded in the parties’ original
complaints, such as landlords’ claim for eviction or tenant’s
claim for intentional interference with economic relations.
When an arbitrator has authority to decide a claim, tenant
contends, that authority includes the authority to order
remedies.
	        Tenant’s alternative argument is that, if the parties’
stipulation is ambiguous, we should resolve that ambiguity
in favor of arbitration. Tenant contends that ORS 36.695(3)
gives the arbitrator authority to order remedies, and we
should not infer an intent to waive or vary that authority
under ORS 36.610(1).
	        The parties’ differences demonstrate the impor-
tance of the starting point in an analysis of substantive arbi-
trability. ORS 36.620(2) requires a court to decide whether
a controversy is subject to an agreement to arbitrate. The
fact that parties have agreed to arbitrate a dispute does not
necessarily mean that the arbitrator may order remedies,
triggering ORS 36.695(3). As noted, ORS 36.695(3) pro-
vides that arbitrators have broad authority to order reme-
dies “appropriate under the circumstances of the arbitration
proceeding.”
134	                    Couch Investments, LLC v. Peverieri

	        Parties to an arbitration agreement may describe
the dispute that they agree to submit to arbitration in a way
that clearly indicates that an award of remedies is not appro-
priate. As a simplistic example, imagine a negligence case
in which the plaintiff contends that the traffic light was red,
and the defendant that it was green. If those parties were to
agree to arbitrate only that single factual question, a court
could decide the nature of the controversy subject to the
agreement to arbitrate without considering the default rule
in ORS 36.695(3) allowing the arbitrator to determine rem-
edies, or whether the parties had waived or varied that rule
pursuant to ORS 36.610(1). If, however, the parties agreed
to submit the plaintiff’s negligence claim to the arbitrator,
ORS 36.695(3) would grant the arbitrator authority to order
remedies, unless the parties waived or varied the effect of
that provision in accordance with ORS 36.610(1). In some
circumstances, the controversy submitted to arbitration will
be described in such a way that the scope of the arbitrator’s
authority is clear without reference to ORS 36.610(1) or ORS
36.695(3).
	        In this case, however, the parties’ stipulation is sus-
ceptible to more than one reasonable interpretation and is,
therefore, ambiguous. See, e.g., St. Paul Fire v. McCormick
& Baxter Creosoting, 324 Or 184, 216, 923 P2d 1200 (1996)
(concluding contract provision susceptible to more than one
reasonable interpretation is ambiguous). The controversy
that the parties agreed to arbitrate may have been limited,
as landlords argue, to a determination of a single question—
which party is responsible for the costs of storm water drain-
age improvements—or it may have included resolution of a
broader claim permitting the arbitrator to order remedies
unless the parties waived or varied that authority.
	        Because the stipulation to arbitrate is facially
ambiguous, its meaning was a question of fact, and the trial
court was entitled to consider extrinsic evidence to deter-
mine the parties’ intent. Evenson Masonry, Inc., 273 Or at
772. The parties submitted such evidence to the trial court,
including affidavits and supporting documents, and argued
that the court should consider those facts in interpreting
the stipulation. Although the court did not specify the basis
for its decision denying landlords’ motion to vacate the
Cite as 359 Or 125 (2016)	135

arbitrator’s award, landlords did not request special find-
ings of fact and conclusions of law under ORCP 62 A, and
the court was not required to explain the basis for its deci-
sion. Had landlords made a timely request under ORCP 62
A, the court would have been required to explain whether
it concluded that the stipulation to arbitrate was ambigu-
ous and therefore considered the evidence presented by the
parties, and, if so, the factual determinations that it made.
Because landlords made no such request, we presume that
the trial court considered the extrinsic evidence presented
and decided the facts in a manner consistent with the ulti-
mate legal conclusion that it reached—that the arbitrator
did not exceed the scope of his authority. See Ball v. Gladden,
250 Or 485, 487, 443 P2d 621 (1968) (post-conviction court
presumed to have decided facts in manner consistent with
legal conclusion that admission was voluntary).
	        We review the trial court’s findings to determine
whether there is any evidence to support them. Evenson
Masonry, Inc., 273 Or at 772. Landlords do not contend that
the evidence adduced in the trial court was legally insuffi-
cient, and for good reason. The evidence that tenant sub-
mitted included evidence from which the trial court could
find that parties intended to submit the entire DEQ claim to
the arbitrator and that the parties did not intend to waive
the arbitrator’s statutory authority to order remedies. That
evidence is sufficient to support the trial court’s conclusion
that the arbitrator acted within his authority in ordering
remedies.
	       The decision of the Court of Appeals and the judg-
ment of the circuit court are affirmed.
