non-final order

Equitable Estoppel Circumstances to Allow Non-Signatory to Compel Arbitration

Posted by David Adelstein on June 23, 2018
Appeal, Trial Perspectives / Comments Off on Equitable Estoppel Circumstances to Allow Non-Signatory to Compel Arbitration

Arbitration is a creature of contract, meaning if you want your disputes to be resolved by arbitration through an arbitrator (as opposed to litigation with a judge and/or jury), you need to include an arbitration provision in your contract.   A trial court granting or denying a party’s motion to compel arbitration is a non-final order that is immediately appealableSee Fla.R.App.P. 9.130(a)(3)(C)(iv).

There are times that a non-signatory to a contract with an arbitration provision wants to compel arbitration.  For example, a signatory to a contract (with an arbitration provision) files suit against a non-party and the non-party moves to compel arbitration based on the contract.  A dispute arises because the non-party is not a party to that contract, and thus, it needs a legal basis to compel arbitration under that contract.  That legal basis to allow a non-party to a contract to compel arbitration against a signatory to the contract is equitable estoppel: 

Courts have recognized that this [compelling arbitration] can be appropriate (1) when the signatory’s claims [against the non-party to the contract] allege “substantially interdependent and concerted misconduct” by the signatory and the non-signatory or (2) when the claims relate directly to the contract and the signatory is relying on the contract to assert its claims against the non-signatory

Beck Auto Sales, Inc. v. Asbury Jax Ford, LLC, 43 Fla.L.Weekly D1380a (Fla. 1st DCA 2018).

However, “even when a non-signatory can rely on equitable estoppel ‘to access [the arbitration] clause,’ the non-signatory can compel arbitration only if the dispute at issue ‘falls within the scope of the arbitration clause.’”  Beck Auto Sales, Inc., supra (citation omitted).  Even if one of the above equitable estoppel circumstances apply, the non-signatory still will not be able to compel arbitration if the scope of its dispute falls outside of the arbitration provision.

An example of the first circumstance was raised in Beck Auto Sales where a car dealership sued its former employee and the former employee’s new dealership/employer for a number of theories relating to their concerted effort to prevent the car dealership from winning a contract with a public entity. 

The former employee had an employment agreement with the car dealership that included an arbitration provision.  The trial court granted arbitration between the car dealership and former employee.  The new employer/dealership, a non-signatory to the employment contract, moved to compel the car dealership’s claims against it to arbitration under the employment contract.  It argued that the car dealership’s claims against it and the former employee (a signatory to the contract) allege substantially interdependent and concerted misconduct by the former employee (signatory) and it (non-signatory). The problem for the new dealership/employer, however, was that the arbitration provision in the employment contract was limited to disputes between the parties to the arbitration agreement.  The scope of the arbitration provision would not cover disputes involving the new dealership/employer; hence, it was unable to take advantage of an equitable estoppel argument to compel arbitration as a non-signatory to the employment contract.

 

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

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Forum Selection / Venue Provisions in Contracts are Enforceable

Posted by David Adelstein on March 31, 2018
Appeal, Trial Perspectives / Comments Off on Forum Selection / Venue Provisions in Contracts are Enforceable

If you have a dispute, one of the first considerations should be “where do I sue?” If the dispute may arise out of or relate to a contract, you want to look at your contract.  Many contracts contain forum selection or venue provisions identifying the exclusive venue governing your dispute. 

For instance, the provision may say something to the effect, “The exclusive venue for any dispute arising out of or relating to this contract shall be in Miami-Dade County Florida.”   This means that if you plan to sue you need to do so in a court located in Miami-Dade County, Florida, even if you have an argument that the venue should be in a different, more preferred location.  Venue and forum selection provisions are important provisions because they contemplate where a lawsuit must be brought in the event such a lawsuit occurs down the road.  While of course you hope for the best with any agreement, you know that disputes occur, so you plan for the potentiality of that risk.

As a contracting party, you have the right to contractually agree to a forum selection / venue provision; you can contractually agree to the forum governing your dispute.  Baker v. Economic Research Services, Inc. 43 Fla.L.Weekly D643a (Fla. 1st DCA 2017).  Absent limited exceptions, these provisions will be deemed enforceable.  Id.   A judicial order as to venue is also the type of non-final order that can be appealed immediatelyId.  Thus, even if you sued in a venue contrary to the forum selection provision in your contract and the trial court agreed with you, the other side can appeal this order immediately arguing that the forum selection provision places venue in a different location.

In Baker, employees entered an employment agreement that contained a forum selection provision that placed venue in Delaware.  The employees left to work for a competitor and the employer sued its former employees in Leon County, Florida.  An argument the employees raised was that the lawsuit should have been filed in Delaware, not Florida, based on the forum selection provision.  The trial court denied the motion.  But, remember, an order as to venue can be appealed immediately so the employees appealed.  The appellate court reversed the trial court finding that claims arising out of or relating to the agreements need to be filed in Delaware based on the forum selection provision.  The forum selection provision survives any termination of the agreements such that if the employer’s claims have a significant relationship (nexus) to the agreement, then the claims must be brought in Delaware.

As you can see, forum selection provisions are important because they will largely dictate where a party must sue or be sued.  Take such provisions into consideration when entering an agreement.

For more information on forum selection / venue provisions, you can also check out this article.

 

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

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Not All Non-Final Orders are Immediately Appealable

Posted by David Adelstein on July 30, 2017
Appeal / Comments Off on Not All Non-Final Orders are Immediately Appealable

Many non-final orders are NOT immediately appealable. The immediate right to appeal non-final orders are enumerated in Florida Rule of Appellate Procedure 9.130. (And, prior postings have discussed the burden in moving for a writ of certiorari based on a non-final order.) Fair or unfair. These are the rules that govern appellate proceedings. When you receive a non-final order that you believe impacts rights and decisions moving forward, make sure to review Florida Rule of Appellate Procedure 9.130 regarding those immediately appealable non-final orders.

 

In a recent insurance coverage dispute (discussed here), the trial court declared that the insurer had a duty to defend its insured in a personal injury lawsuit.   This declaration was issued in response to a motion for summary judgment. But, the order granting the summary judgment was a non-final order. The trial court did not enter a judgment against the insurer and did not declare the insurer was obligated to indemnify its insurer. Instead, the trial court simply declared that the insurer had an obligation to defend its insured in the lawsuit based on the underlying allegations in the lawsuit. The insurer did not like this declaration from the trial court and appealed.

 

The Third District dismissed the appeal holding that the trial court’s order was not an appealable non-final order.   Just because the trial court issued an order granting an insured’s summary judgment does not in of itself make that an appealable final order. If there are no words of finality concluding the dispute, the order granting summary judgment is simply a non-final order.   In this case, all the trial court declared was that the insurer had a duty to defend – but there was no declaration regarding the duty to indemnify or regarding potential damages.  Hence, the appellate court did not have jurisdiction to entertain the immediate appeal of the non-final order.

 

 

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

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