Ytech 180 Units v. CERTAIN UNDERWRITERS AT LLOYD'S

359 F. Supp. 3d 1253
CourtDistrict Court, S.D. Florida
DecidedFebruary 12, 2019
DocketCase No. 18-24770-CV-GRAHAM
StatusPublished
Cited by7 cases

This text of 359 F. Supp. 3d 1253 (Ytech 180 Units v. CERTAIN UNDERWRITERS AT LLOYD'S) is published on Counsel Stack Legal Research, covering District Court, S.D. Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ytech 180 Units v. CERTAIN UNDERWRITERS AT LLOYD'S, 359 F. Supp. 3d 1253 (S.D. Fla. 2019).

Opinion

DONALD L. GRAHAM, UNITED STATES DISTRICT JUDGE

*1258THIS CAUSE comes before the Court upon Defendants Certain Underwriters At Lloyd's, London et al. 's Motion to Compel Arbitration [D.E. 3], and Plaintiff Ytech 180 Units Miami Beach Investments LLC's Motion for Remand and Incorporated Memorandum of Law [D.E. 4].

THE COURT has considered the motions, responses thereto, pertinent portions of the record, and is otherwise fully advised in the premises. Based thereon, Defendants' Motion to Compel Arbitration [D.E. 3] is GRANTED and Plaintiff's Motion for Remand and Incorporated Memorandum of Law [D.E. 4] is DENIED.

THIS MATTER arises from a series of all-risk insurance contracts collectively referred to as the "Policy." [See D.E. 1-2; 1]. Defendants issued the Policy to Plaintiff. [See D.E. 1-2]. Plaintiff is a U.S. limited liability company. [D.E. 1-3]. At least two Defendants are not U.S. citizens. [D.E. 1].

The Policy insures 22 buildings owned by Plaintiff and known as the Grand Beach Apartments located in Miami Beach, Florida (the "Property"). [D.E. 1-3]. The Property suffered significant damages on September 10, 2017 because of Hurricane Irma. [D.E. 1-3]. Plaintiff sought coverage under the Policy for the damages sustained and requested that the claim be submitted to appraisal. [D.E. 1]. Defendants denied Plaintiff's request, arguing that the Policy does not provide for an appraisal. [D.E. 1]. According to Defendants, Plaintiff's claim must be resolved through arbitration. [D.E. 1].

The Policy contains an arbitration clause, which states in pertinent part:

SECTION VII - CONDITIONS
***
C. ARBITRATION CLAUSE: All matters in difference between the Insured and the Companies (hereinafter referred to as "the parties") in relation to this insurance, including its formation and validity, and whether arising during or after the period of this insurance, shall be referred to an Arbitration Tribunal in the manner hereinafter set out.
***
The seat of the Arbitration shall be in New York and the Arbitration Tribunal shall apply the law of New York as the proper law of this insurance.

[D.E. 1-2 at 39 (hereinafter, the "Arbitration Clause") ].

I. PROCEDURAL BACKGROUND AND CONTENTIONS OF THE PARTIES

Plaintiff filed a single-count complaint in the Eleventh Judicial Circuit of Miami-Dade County alleging that the Policy's Arbitration Clause is ambiguous and seeking various declarations from the Court. [D.E. 1-3]. The gravamen of Plaintiff's claim is that the Service of Suit Provision, Applicable Law Provision, and the Suits Against Us Provision (collectively, the "Provisions") conflict with the Arbitration Clause rendering the Arbitration Clause unenforceable.

Defendants removed this action to this Court pursuant to 28 U.S.C. § 1441 citing federal question jurisdiction, 28 U.S.C. § 1331, pursuant to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the "Convention"), 9 U.S.C. §§ 201 - 208. In its Motion for Remand, *1259Plaintiff avers that removal is premature, and the Convention's jurisdictional prerequisites are not met.

Shortly after removal, Defendants moved under the Convention to stay or dismiss this action and compel arbitration pursuant to the terms of the Arbitration Clause. According to the Defendants, the clear and unmistakable terms of the Arbitration Clause commits issues of validity and enforceability to an arbitrator. Plaintiff disagrees. Furthermore, Plaintiff submits that the Motion to Compel is also premature.

II. DISCUSSION

A. The Motion to Remand

Plaintiff moves to remand this action arguing that this Court cannot exercise subject-matter jurisdiction unless and until the state court determines that the Arbitration Clause is valid and enforceable. Highlighting the purported inconsistencies between the Provisions and the Arbitration Clause, Plaintiff avers that the Policy is ambiguous. According to Plaintiff, the Defendants' contention that the Convention's jurisdictional prerequisites are met is based on the conclusory assumption that the Arbitration Clause is valid. Notably, Plaintiff cites no case for the proposition that a state court must find that the Arbitration Clause is valid and enforceable before a district court may exercise federal subject-matter jurisdiction under the Convention.

Contrary to Plaintiff's contentions, federal courts have original jurisdiction over any action or proceeding falling under the Convention regardless of the amount in controversy. Indus. Risk Insurers v. M.A.N. Gutehoffnungshutte GmbH, 141 F.3d 1434, 1440 (11th Cir. 1998) (citing 9 U.S.C. § 203 ; H.R.Rep. No. 91-1181, at 2 (1970), reprinted in 1970 U.S.C.C.A.N. 3601, 3602). Such cases confer original subject-matter jurisdiction upon a district court because they are "deemed to arise under the laws and treaties of the United States." 9 U.S.C. § 203 ; Bautista v. Star Cruises, 396 F.3d 1289, 1294 (11th Cir. 2005). Furthermore, the Convention "does not require a district court to review the putative arbitration agreement-or investigate the validity of the signatures thereon-before assuming jurisdiction: 'The language of § 205 strongly suggests that Congress intended that district courts continue to be able to assess their jurisdiction from the pleadings alone.' " Bautista, 396 F.3d at 1301 (citing Beiser v. Weyler,

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Bluebook (online)
359 F. Supp. 3d 1253, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ytech-180-units-v-certain-underwriters-at-lloyds-flsd-2019.