211 So. 3d 1147
Fla. Dist. Ct. App.2017Background
- Timber Pines Plaza, LLC sold the North Outparcel of a shopping mall to Zabrzyski and Machnik in April 2014; the sale contract contained a broad arbitration clause covering "all other disputes."
- After closing, Timber Pines unilaterally recorded Amended Deed Restrictions (ADR) on the North Outparcel requiring Timber Pines' prior approval for building plans; the sales contract did not reference or incorporate the ADR.
- Appellees obtained building permits and began constructing a 6,124 sq. ft. building; Timber Pines sued for injunctive relief and damages, alleging construction without ADR-required approval.
- Appellees answered and asserted a counterclaim for breach of the purchase contract (failure to provide input on plans and a cross-parking easement).
- Timber Pines moved to dismiss and to compel arbitration of the counterclaim under the contract arbitration clause; the trial court denied the motion without factual findings.
- The Fifth District reversed, holding Timber Pines had not waived arbitration because its ADR-based suit was not significantly related to the contractual claims subject to arbitration.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a valid arbitration agreement covers Appellees' counterclaim | Contract contains broad arbitration clause covering "all other disputes" arising from the transaction | Counterclaim arises from the purchase contract and thus is arbitrable under the clause | Arbitrable issue exists (contract contains valid arbitration provision) |
| Whether Timber Pines waived its right to compel arbitration by suing to enforce the ADR | Timber Pines' litigation of the ADR concerns the parties' relationship and therefore waived arbitration | Timber Pines argued its ADR claims are separate from the contract and did not waive arbitration | No waiver; filing ADR-based suit did not act inconsistently with arbitration right |
| Whether Appellees' counterclaim has a "significant relationship" (contractual nexus) to the contract arbitration clause | Appellees: counterclaim arises from the contractual relationship and thus falls within arbitration clause | Timber Pines: counterclaim requires construction of the purchase contract and so is for arbitration only if nexus exists; its ADR claims do not require contract construction | Court held no significant relationship between Timber Pines' ADR claims and the contract arbitration clause; arbitration for counterclaim is appropriate because counterclaim does relate to the contract terms |
| Whether court should stay litigation and compel arbitration | N/A (remedy issue follows finding of arbitrability and no waiver) | Timber Pines sought stay and arbitration of the counterclaim | Court reversed trial court and remanded with instructions to stay litigation of the counterclaim and compel arbitration |
Key Cases Cited
- Seifert v. U.S. Home Corp., 750 So.2d 633 (Fla. 1999) (framework for determining arbitrability and "significant relationship" test)
- Jackson v. Shakespeare Found., Inc., 108 So.3d 587 (Fla. 2013) (defining "contractual nexus"—when a claim requires reference to or construction of the contract)
- Raymond James Fin. Servs., Inc. v. Saldukas, 896 So.2d 707 (Fla. 2005) (waiver of arbitration analyzed under totality of circumstances; inconsistent conduct standard)
- Kolsky v. Jackson Square, LLC, 28 So.3d 965 (Fla. 3d DCA 2010) (arbitration required only when resolution requires reference to contract language)