SHOMA DEVELOPMENT CORP., APPELLANT,
v.
JORGE RODRIGUEZ, ET AL., APPELLEES
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Shoma Development Corp. appealed a trial court's denial of its motion to compel arbitration in a homeowner class action lawsuit. The court held that Shoma waived its right to arbitration by actively participating in litigation for seven months before seeking to enforce the arbitration clause, thereby prejudicing the homeowners.
Shoma waived its right to arbitration through active participation in the litigation over seven months and prejudiced the homeowners by forcing them to incur legal fees and costs that could have been avoided had Shoma sought arbitration promptly upon receiving notice of the lawsuit.
[1] A party may waive its contractual right to arbitration by actively participating in litigation or taking actions inconsistent with that right.
[2] Active participation in litigation, including answering interrogatories and filing motions, can constitute a waiver of the right to compel arbitration.
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Join FLexlaw to unlock all legal intelligence“A party's contractual right to arbitration may be waived by actively participating in a lawsuit or taking action that is inconsistent with that right.”
Establishes the legal standard for waiver of arbitration rights through active participation in litigation.
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Join FLexlaw to unlock all legal intelligenceIn September 1997, homeowners Jorge and Marlene Rodriguez filed a class action lawsuit against Shoma Development. Over the following seven months, Sho…
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PER CURIAM.
Shoma Development Corp. appeals from a non-final order denying its motion to compel arbitration. For the following reasons, we affirm.
In September, 1997, Jorge and Marlene Rodriguez filed a class action law suit against Shoma Development on behalf of themselves and other homeowners who purchased houses from the developer. In October, 1997, the developer was notified of the lawsuit. During the following seven months, the developer engaged in activity associated with the litigation, including: answering interrogatories propounded by the homeowners; moving to require the homeowners to post a bond; moving to strike the homeowners’ claim for attorney’s fees; objecting to the homeowners’ first and second set of interrogatories; objecting to the homeowners’ first and second request for production; moving for protective orders; and moving to dismiss the action for failure to state a cause of action and failure to meet the. requirements for class representation. After seven months, the developer finally sought to enforce an arbitration clause contained in the contract between itself and the Rodriguezes by filing a motion to compel arbitration.
A party’s contractual right to arbitration may be waived by actively participating in a lawsuit or taking action that is inconsistent with that right. See Klosters Rederi A/S v. Arison Shipping Co., 280 So. 2d 678, 681 (Fla.1973). However, in this district, that participation must also result in prejudicing the non-moving party. See Lane v. Sarfati, 691 So. 2d 5 (Fla. 3d DCA 1997); Gray Mart, Ine. v. Fireman’s Fund Ins. Co., 703 So. 2d 1170 (Fla. 3d DCA 1997). Here, the developer’s considerable filings and involvement in discovery constituted active participation in the litigation. See Phillips v. General Accident Ins. Co. of Am., 685 So. 2d 27 (Fla. 3d DCA 1996) (holding that active participation in litigation is action inconsistent with the use of arbitration to resolve the dispute); Lapidus v. Arlen Beach Condo. Ass’n Inc., 394 So. 2d 1102 (Fla. 3d DCA 1981). Moreover, engaging in this type of activity over a seven month period prejudiced the homeowners by resulting legal fees and costs that would have otherwise been avoided had the developer elected arbitration once it had notice of the homeowners’ claim.
Affirmed.
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Marine Env't P'rs, Inc. v. Johnson, 863 So. 2d 423 (Fla. 4th DCA 2003)…right to arbitrate. The first district and the third district hold that a showing of prejudice is required before a waiver can be found. See Benedict v. Pensacola Motor Sales, Inc., 846 So. 2d 1238 (Fla. 1st DCA 2003); Shoma Dev. Corp. v. Rodriguez, 730 So. 2d 838 (Fla. 3d DCA 1999). This court, the second, and fifth districts hold that no prejudice need be shown. See [*428] Owens & Minor Med., Inc. v. Innovative Mktg. & Distribution Servs., Inc., 711 So. 2d 176, 177 (Fla. 4th DCA 1998); Raymond James, 851 So…
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Mariano R. Gonzalez and Rene Gonzalez v. State Farm Fire & Cas. Co., 805 So. 2d 814 (Fla. 3d DCA 2000)…y judgment, before the insurer requested appraisal. On those facts, this court found waiver of the right to appraisal, where there had been unreasonable delay and prejudice to the insured. See id. at 1173. Likewise in Shoma Dev. Corp. v. Rodriguez, 730 So. 2d 838 (Fla. 3d DCA 1999), [*818] the parties engaged in litigation and discovery for seven months, before one of the parties invoked the arbitration clause. This court held that there had been a waiver of the right to arbitration, given the delay and a de…
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ARI Mut. Ins. Co. v. Hogen, 734 So. 2d 574 (Fla. 3d DCA 1999)…on the trial court should have considered whether she actively participated in the lawsuit or took action inconsistent with her right to appraisal, and whether such action resulted in prejudice to the non-moving party. Shoma Dev. Corp. v. Rodriguez, 730 So. 2d 838, 24 Fla. L. Weekly D938 (Fla. 3d DCA 1999); Lane v. Sarfati, 691 So. 2d 5 (Fla. 3d DCA 1997). After reviewing the record before us, it is apparent that Hogen aggressively litigated this cause below and that such action over a nine-month period preju…
Previewing 3 of 6 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Klosters Rederi A/S v. Arison Shipping Co., 280 So. 2d 678 (Fla. 1973)
- Lapidus v. Arlen Beach Condo. Ass'n, Inc., 394 So. 2d 1102 (Fla. 3d DCA 1981)
- Lane v. Ilana Sarfati, 691 So. 2d 5 (Fla. 3d DCA 1997)
- Sutherland v. State, 703 So. 2d 1170 (Fla. 2d DCA 1997)
- Gray Mart, Inc. v. Fireman's Fund Ins. Co., 703 So. 2d 1170 (Fla. 3d DCA 1997)
- Castro v. State, 685 So. 2d 27 (Fla. 4th DCA 1996)
- Phillips v. Gen. Accident Ins. Co. of Am., 685 So. 2d 27 (Fla. 3d DCA 1996)