STEVEN GREENBERG, MITCHELL C. FOGEL, AND ROBERT CHESTMAN, APPELLANTS,
v.
STEVEN SELLERS AND OLD WORLD RENAISSANCE, INC., A FLORIDA CORPORATION, APPELLEES
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Plaintiffs appealed an order compelling arbitration of all claims arising from a business dispute. The court reversed in part, holding that a claim for equitable accounting relief was expressly excepted from the arbitration provision and must proceed in court, while affirming that other claims were properly subject to arbitration.
The court reversed the order insofar as it compelled arbitration of Count I (accounting), holding that the notwithstanding clause in the arbitration agreement expressly excepted equitable relief from mandatory arbitration. The court affirmed the order compelling arbitration of Counts II through V (breach of contract, breach of fiduciary duty, conversion, and FDUTPA violation).
[1] An arbitration provision allowing for injunctive and/or equitable relief in a court of competent jurisdiction preserves a party's right to seek an accounting in court.
[2] Claims for breach of contract, breach of fiduciary duty, conversion, and violation of the Florida Deceptive and Unfair Trade Practices Act are subject to arbitration when…
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Join FLexlaw to unlock all legal intelligence“Any dispute, claim or controversy concerning the management and operation of the Company (including, without limitation, the rights and liabilities of the members under this Agreement) will be settled by arbitration in Boca Raton, Florida.... Notwithstanding this provision, the aggrieved party shall be entitled to injunctive and/or equitable relief in a court of competent jurisdiction.”
The operative arbitration clause establishing the broad arbitration requirement but explicitly carving out equitable relief from mandatory arbitration.
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Join FLexlaw to unlock all legal intelligenceGreenberg, Fogel, and Chestman entered into an operating agreement with Sellers to form a company for a land development project, with Sellers as mana…
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Steven Greenberg, Mitchell C. Fogel, and Robert Chestman (Plaintiffs) are appealing the order granting Steven Sellers and Old World Renaissance, Inc.’s (Sellers) motion to compel arbitration. We reverse that part of the order that requires arbitration of the claim for equitable relief of accounting (Count I) and affirm the order in all other respects.
Plaintiffs and Sellers entered into an operating agreement to form a company, with Sellers acting as the company manager. The purpose of the company was to operate a land development project. The operating agreement contained the following arbitration provision:
Any dispute, claim or controversy concerning the management and operation of the Company (including, without limitation, the rights and liabilities of the members under this Agreement) will be settled by arbitration in Boca Raton, Florida.... Notwithstanding this provision, the aggrieved party shall be entitled to injunctive and/or equitable relief in a court of competent jurisdiction.
After a dispute arose between the parties, Plaintiffs filed a five-count complaint for Accounting (Count I); Breach of Contract (Count II); Breach of Fiduciary Duty (Count III); Conversion (Count IV); and Violation of the Florida Deceptive and Unfair Trade Practices Act (Count V). In response, the Sellers moved to compel arbitration of all claims pursuant to the arbitration provision. Ultimately, the trial court concluded that all of Plaintiffs’ claims were arbitrable and ordered the parties to arbitration.
Our review of an order on a motion to compel arbitration is de novo. See Hospicecare of Se. Fla., Inc. v. Major, 968 So.2d 117, 118 (Fla. 4th DCA 2007). We agree with the trial court’s conclusion that Plaintiffs’ claims for Breach of Contract (Count II); Breach of Fiduciary Duty (Count III); Conversion (Count IV); and Violation of the Florida Deceptive and Un*383fair Trade Practices Act (Count V) are subject to arbitration and affirm that part of the order.
However, with respect to the demand for accounting (Count I), the arbitration provision agreement provides that “[n]ot-withstanding this [arbitration] provision, the aggrieved party shall be entitled to injunctive and/or equitable relief in a court of competent jurisdiction.” Because in count one, Plaintiffs sought the equitable relief of accounting, the trial court erred in granting Sellers’ motion to compel arbitration in its entirety. Cf. Info. Tech. & Eng’g Corp. v. Reno, 813 So.2d 1053, 1055-56 (Fla. 4th DCA 2002). Therefore, we reverse as to this issue only, and remand to allow the trial court to retain jurisdiction over Plaintiffs’ request for accounting.
Affirmed in part; reversed in part; and remanded.
WARNER and MAY, JJ., concur.
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Apt. Inv. & Mgmt. Co. v. Flamingo/South Beach 1 Condo. Ass'n, Inc., 84 So. 3d 1090 (Fla. 3d DCA 2012)…rmanent injunctive relief, are clearly governed by the plain language of the Agreement’s arbitration exception. In addition, equitable accounting (Count V) is a remedy falling under the Agreement’s exception to arbitration. See Greenberg v. Sellers, 2 So. 3d 381, 383 (Fla. 4th DCA 2008) (holding that equitable accounting was a non-arbitrable issue where the agreement provided that “[njotwithstand-ing this [arbitration] provision, the aggrieved party shall be entitled to injunctive and/or equitable relief in…
Authorities Cited
- Info. Tech. & Eng'g Corp. v. Bart Reno, 813 So. 2d 1053 (Fla. 4th DCA 2002)
- Hospicecare OF Se. Fla., Inc. v. Malcolm Major, M.D., 968 So. 2d 117 (Fla. 4th DCA 2007)