Waterhouse Const. Group v. 5891 Sw 64th St.

949 So. 2d 1095, 2007 WL 403721
CourtDistrict Court of Appeal of Florida
DecidedFebruary 7, 2007
Docket3D06-1452
StatusPublished
Cited by10 cases

This text of 949 So. 2d 1095 (Waterhouse Const. Group v. 5891 Sw 64th St.) is published on Counsel Stack Legal Research, covering District Court of Appeal of Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Waterhouse Const. Group v. 5891 Sw 64th St., 949 So. 2d 1095, 2007 WL 403721 (Fla. Ct. App. 2007).

Opinion

949 So.2d 1095 (2007)

WATERHOUSE CONSTRUCTION GROUP, INC., Ofer Zosman, individually, Carlos DeLeon, individually, and Adrian Triana, individually, Appellants,
v.
5891 SW 64TH STREET, LLC., and Thomas Hoffman, individually, Appellees.

No. 3D06-1452.

District Court of Appeal of Florida, Third District.

February 7, 2007.
Rehearing Denied March 27, 2007.

*1096 Diane S. Perera and James C. Kellner, for appellants.

Gustavo Gutierrez, Coconut Grove; Seth Loft; Kimberly L. Boldt, for appellees.

Before WELLS and CORTIÑAS, JJ., and SCHWARTZ, Senior Judge.

CORTIÑAS, Judge.

This is an appeal from the portion of an order denying the defendants', Waterhouse Construction Group, Inc. ("Waterhouse"), Ofer Zosman ("Zosman"), Carlos DeLeon ("DeLeon"), and Adrian Triana ("Triana") (collectively "defendants"), motion to dismiss or motion to stay litigation pending arbitration and motion to compel arbitration of plaintiffs' claims and defendants' counterclaims. We reverse.

5891 SW 64th Street, LLC ("Street"), owned the property which is the subject of this litigation. Thomas Hoffman ("Hoffman"), a real estate developer, and Street (collectively "plaintiffs") agreed to develop the subject property. Subsequently, in April 2004, Street and Hoffman entered into a joint venture agreement (the "JV Agreement") with defendants Zosman and DeLeon to build various homes on the subject property. The JV Agreement specified that defendant Waterhouse would act as the general contractor in the development project. Notably, defendants Zosman and DeLeon are both officers and *1097 directors of Waterhouse, and defendant Triana is an agent of Waterhouse. Several months after the parties entered into the JV Agreement, Street entered into a construction contract (the "Construction Contract") with Waterhouse for the construction of a single family residence on the subject property.

In January 2006, the plaintiffs filed a complaint against Zosman, DeLeon, and Triana for alleged breaches of the JV Agreement. Count I of the complaint alleged that Zosman and DeLeon failed to provide an accounting and diverted joint venture funds by entering into side agreements. Count V of the complaint alleged that Zosman, DeLeon, and Triana violated section 772.103, Florida Statutes, by engaging in a pattern of fraudulent racketeering activity, including forging two Release/Waiver of Liens ("RICO claims"). The remaining counts of the complaint included damages against Waterhouse for numerous breaches of the Construction Contract with Street; however, at a subsequent hearing on the defendants' motions to stay litigation and compel arbitration, the plaintiffs voluntarily dismissed all of their claims against Waterhouse. Therefore, the remaining counts of the plaintiffs' complaint are Count I for breach of the JV Agreement and Count V for the RICO claims.

Defendants Waterhouse, Zosman, and DeLeon filed counterclaims against the plaintiffs for breaches of the Construction Contract and the JV Agreement. Additionally, based on paragraph 15.8 of the Construction Contract, Waterhouse simultaneously moved to stay the litigation and compel arbitration of its counterclaims.[1] Similarly, based on paragraph 21(f) of the JV Agreement, Zosman and DeLeon moved to stay the litigation and compel arbitration of the plaintiffs' remaining claims and their individual counterclaims.[2]

Thereafter, the trial court held a hearing on the defendants' motions to compel arbitration. The trial court denied the defendants' motions as to the plaintiffs' claims and also denied the motions as to the defendants' counterclaims for breach of the Construction Contract and the JV Agreement.[3] The defendants now appeal the trial court's denial of their request to stay litigation and compel arbitration.

We review an order denying a motion to compel arbitration de novo. Briceno v. Sprint Spectrum, L.P., 911 So.2d 176, 179 (Fla. 3d DCA 2005) (citing Tropical Ford, Inc. v. Major, 882 So.2d 476, 478 (Fla. 5th DCA 2004)). There are "three elements for courts to consider in ruling on a motion to compel arbitration of a given dispute: (1) whether a valid written agreement to arbitrate exists; (2) whether an *1098 arbitrable issue exists; and (3) whether the right to arbitration was waived." Seifert v. U.S. Home Corp., 750 So.2d 633, 636 (Fla.1999) (citing Terminix Int'l Co., L.P. v. Ponzio, 693 So.2d 104, 106 (Fla. 5th DCA 1997)). At issue in this case are the last two elements of the analysis set forth in Seifert.[4]

However, in this case we are also confronted with the issue of whether Zosman, DeLeon, and Triana can compel Hoffman and Street to arbitrate the RICO claims. We must address this issue first because if we determine that a party may not be compelled to arbitrate, the issues of whether the plaintiffs' claims are arbitrable and whether the defendants have waived the right to arbitrate need not be reached.

A. Whether a Non-Signatory Can Compel a Signatory to Arbitrate

Florida courts have clearly recognized that a non-signatory may compel a signatory to arbitration when the non-signatories received rights and assumed obligations under the agreement. Koechli v. BIP Intern., Inc., 870 So.2d 940, 946 (Fla. 1st DCA 2004) (where non-signatories who received rights and obligations under a contract were permitted to compel signatories to arbitration, despite the express language in the contract that only "parties hereto" were subject to arbitration); see also Tenet Healthcare Corp. v. Maharaj, 787 So.2d 241 (Fla. 4th DCA 2001); Ocwen Fin. Corp. v. Holman, 769 So.2d 481 (Fla. 4th DCA 2000). In Turner Construction Co. v. Advanced Roofing, Inc., 904 So.2d 466 (Fla. 3d DCA 2005), we recognized the principle set forth in Koechli, Tenet, and Ocwen, and concluded that, in addition to receiving rights and assuming obligations under the agreement, the non-signatory party must also be an agent, officer, or director of a signatory. Turner, 904 So.2d at 470 (citing MS Dealer Serv. Corp. v. Franklin, 177 F.3d 942, 947 (11th Cir. 1999)).

Because there are two agreements at issue, which involve five parties, we begin by setting forth all the claims and all the parties that can potentially arbitrate each claim before we begin the analysis set forth in Seifert. We conclude that all the defendants may compel the plaintiffs to arbitration. Zosman and DeLeon may compel Hoffman and Street to arbitrate their counterclaims for breach of the JV Agreement because all parties to the counterclaims are also signatories to the JV Agreement. Similarly, Waterhouse's counterclaims are clearly arbitrable as the parties to those counterclaims, Waterhouse and Street, are also signatories to the Construction Contract. We also find that Zosman, DeLeon, and Triana can rely on the arbitration provisions in either the Construction Contract or the JV Agreement to compel Hoffman and Street to arbitrate the RICO claims against them. As noted above, the parties to the Construction Contract are Waterhouse and Street, and the parties to the JV Agreement are Zosman, DeLeon, Hoffman, and Street. Pursuant to the Construction Contract, Waterhouse had a duty to furnish Street with the Release/Waiver of Liens at issue, in order to receive the necessary funds to continue construction. Moreover, the JV Agreement created a duty on Waterhouse, Zosman, and DeLeon to provide documentation directly relating *1099 to the Release/Waiver of Liens.[5]

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Bluebook (online)
949 So. 2d 1095, 2007 WL 403721, Counsel Stack Legal Research, https://law.counselstack.com/opinion/waterhouse-const-group-v-5891-sw-64th-st-fladistctapp-2007.