Florida Courts Issue Three Arbitration-Related Opinions in November 2018

Arbitration Mediation

Florida cases involving disputes over the enforcement of arbitration most frequently arise out of auto sales or long term care facility contracts.  These three cases from late November 2018 fit the bill.  The topics are: waiver of the right to arbitration, parties to the agreement, and severance clauses.  Shamelessly, one of the cases is mine.

Peter Adkins v. Memorial Motors, Inc. dba Lakeland Toyota (Second District): Plaintiff bought a car from the defendant dealership under a broad sales contract which included an arbitration clause that did not specify which arbitration rules applied.  The Plaintiff independently filed his arbitration claim with the AAA which declined because the defendant had failed to pay in a prior case.  Once the Defendant learned what had happened, they paid the prior bill and advised the Plaintiff he could proceed.  Instead, Plaintiff filed suit claiming that the Defendant’s actions amounted to waiver of the right to arbitrate.

The Second District held that, under the Seifert test, the third prong (waiver) needed to arise from actions “in this proceeding” (emp. original).  Moreover, it held that the Defendant’s failure to pay the prior arbitration bill and its effort to resolve that were not inconsistent with the right to arbitrate the instant matter.  Take away: an attempt to broaden the definition of “waiver” of arbitration was not successful.

Coventry Health Care of Florida, Inc. v. Crosswinds Rehab, Inc., LLC et al. (Third District): A number of (typical) issues regarding the evasion of arbitration were raised in this action but the court focused on a single issue.  One of the parties was a successor to Crosswinds and had not signed the Agreement which contained the arbitration clause.  The only reference to the Agreement being binding on successors related to the other party, Coventry.  Therefore the Agreement was not an enforceable and arbitration was not mandatory.  Take away: in any contract, a statement that the agreement is binding on successors, heirs, etc needs to apply to all parties, not just one.

Estate of Ramsey v. Northport Health Services of Florida, LLC et al (Fifth District): in this second long term care case, the Plaintiff sought to evade arbitration despite the fact it was executed by the resident’s guardian.  The Plaintiff further argued that some terms regarding applicable rules and laws should not apply due to Florida public policy.  This agreement, however, included a severance clause and several prior decisions from the same court have severed the same clauses from the same agreement.  Not surprisingly, the Fifth DCA followed the same approach again.  Other grounds to avoid arbitration were deemed waived.

Clauses from Contracts
Is a Forum Selection Clause Mandatory When It Says Both “Exclusive” and “May Be Brought in…”? (Ecovirux, LLC v. Biolpedge)

The parties negotiated a contract and, in the final form, the forum selection clause read as follows: The debate over whether this clause was PERMISSIVE or MANDATORY came down to a question whether the phrase “exclusive venue” controlled over “may be brought in…” Other issues were whether this was a …

Clauses from Contracts
Florida Court Declines to Apply Exculpatory Clause to Strict Products Liability Clause, Citing (Never Seen Before) “Clear” Public Policy (Harrell v. BMS Partners LLC dba Broward Motorsports)

Florida’s Fourth District Court of Appeal opined yesterday that Florida has a “clear” public policy prohibiting the use of exculpatory clauses to avoid claims of strict products liability despite the fact that no Florida court had ever determined such a policy existed. Relying upon federal and non-Florida precedent, the Court …

Arbitration Mediation
Arbitration Clause Enforced in Legal Malpractice Case, Even with Fee-Shifting Discovery Clause

Florida’s Third District Court of Appeal enforced an arbitration clause in a law firm’s engagement letter even though the clause also included a shifting of fees for discovery. See Annie-Sophie Gonthiez Mavroleon v. Fernando Orrego and OC Estate and Elder Law, P.A. Here is the arbitration clause which the Court …