RAFAEL A. SANCHEZ AND LOURDES P. SANCHEZ, APPELLANT,
v.
MICHAEL CRIDEN AND MICHELE CRIDEN, APPELLEE
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Sellers appealed an order denying their motion to compel arbitration of a residential real estate dispute. The buyers sought rescission of the purchase agreement based on mutual mistake, but the sellers argued the matter should be resolved through arbitration as required by the contract. The court reversed the lower court's denial and ordered the dispute to arbitration.
The court held that because the buyers' claims attack the validity of the entire agreement rather than the arbitration clause itself, the entire dispute falls within the scope of the arbitration clause and must be submitted to arbitration. Actions to rescind an agreement are subject to arbitration unless the attack is specifically and exclusively directed at the arbitration clause.
[1] An action to rescind an agreement in its entirety is subject to arbitration when the alleged grounds for avoidance or invalidity of the contract are directed at the entir…
[2] A court should try the issue of the validity of an arbitration clause only if the attack is specifically and exclusively directed toward the arbitration clause or a separ…
Previewing 2 of 4 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“Where fraud or some other ground for avoidance or invalidity of contract is alleged as to an entire agreement rather than specifically as to the arbitration clause contained within that agreement, the entire matter should be resolved by arbitration.”
Establishes the governing legal standard that arbitration covers attacks on entire agreements, not just arbitration clauses
Previewing 1 of 3 key quotes on this case — the court’s exact language, pinpointed for members.
Join FLexlaw to unlock all legal intelligenceSellers Rafael and Lourdes Sanchez entered into a residential real estate purchase and sale agreement with buyers Michael and Michele Criden. The buye…
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WELLS, Judge.
Rafael and Lourdes Sanchez (sellers) appeal an order denying their motion to compel arbitration of a dispute arising out of a residential real estate purchase and sale agreement. The buyers, claiming mutual mistake, sought a declaration as to whether they were entitled to rescission of the agreement and return of their deposit or whether the sellers were entitled to specific performance, and if so, whether the buyers were entitled to equitable abatement of the purchase price.1 The sellers’ attempt to compel arbitration was denied. We reverse.
This court has previously held that an action to rescind an agreement in its entirety is subject to arbitration:
Where fraud or some other ground for avoidance or invalidity of contract is alleged as to an entire agreement rather than specifically as to the arbitration clause contained within that agreement, the entire matter should be resolved by arbitration. Only if the attack is specifically and exclusively directed toward the arbitration clause or a separate agreement to arbitrate may the court try the issue before submitting the balance of the dispute to arbitration.
Medident Constr., Inc. v. Chappell, 632 So. 2d 194, 195 (Fla. 3d DCA 1994) (citations omitted). Because the buyers do not attack the validity of the arbitration clause, but instead seek to invalidate the entire agreement, “[t]he relief [the buyers seek] falls within the scope of the arbitration clause and should be submitted to arbitration.” Id.
We find the decision in Diez-Sierra v. Aguera, 762 So. 2d 557 (Fla. 3d DCA 2000), distinguishable on at least two grounds. First, the only relief sought in Diez-Sierra was rescission. The buyers in this case sought rescission or alternatively specific performance combined with consideration of entitlement to an equitable adjustment or abatement of the purchase price. See Simpson v. Cohen, 812 So. 2d 588, 590 (Fla. 4th DCA 2002) (distinguishing Diez-Sierra on this ground). Second, Diez-Sierra, in significant part, turns on the fact that the parties agreed that the arbitrator had no authority to order rescission. No similar agreement exists here.
Accordingly, the order under review is reversed, and the litigation stayed pending the outcome of arbitration.
. The buyers also sued the brokers for fraud and negligent misrepresentation.
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Cited By
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Beazer Homes Corp. v. Bailey, 940 So. 2d 453 (Fla. 5th DCA 2006)…rbitration provision in the contract itself is not enforceable. The rationale is similar to that employed by the Prima Paint minority quoted above: If there is no contract, there can be no arbitration clause “of the contract.” See Sanchez v. Criden, 899 So. 2d 326 (Fla. 3d DCA 2005); Diez-Sierra v. Aguera, 762 So. 2d 557 (Fla. 3d DCA 2000); Borck v. Holewinski, 459 So. 2d 405 (Fla. 4th DCA 1984). A trial court, as well as the appellate court, must determine whether “true rescission” is sought, as opposed to p…
Authorities Cited
- Medident Constr., Inc. v. Chappell, 632 So. 2d 194 (Fla. 3d DCA 1994)
- Simpson v. Cohen, 812 So. 2d 588 (Fla. 4th DCA 2002)
- Diez-Sierra v. Aguera, 762 So. 2d 557 (Fla. 3d DCA 2000)