Timber Pines Plaza, LLC v. Zabrzyski

IN THE DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FIFTH DISTRICT
NOT FINAL UNTIL TIME EXPIRES TO
FILE MOTION FOR REHEARING AND
DISPOSITION THEREOF IF FILED
TIMBER PINES PLAZA, LLC,
Appellant,
v. Case No. 5D16-3275
RICHARD ZABRZYSKI and
GRAZYNA B. MACHNIK,
Appellees.
________________________________/
Opinion filed March 10, 2017
Non-Final Appeal from the Circuit Court
for Hernando County,
Donald E. Scaglione, Judge.
Randall P. Mueller and Michael P. Quinn,
of Carey, O'Malley, Whitaker & Mueller,
P.A., Tampa, for Appellant.
George G. Angeliadis, of The Hogan Law
Firm, Spring Hill, for Appellees.
WALLIS, J.
Timber Pines Plaza, LLC ("Timber Pines"), appeals the trial court's order denying
its motion to compel arbitration on a counterclaim brought by Richard Zabrzyski and
Grazyna B. Machnik (collectively, "Appellees"). For reasons that follow, we reverse the
trial court's order and remand with instructions to grant Timber Pines' motion to compel
arbitration.
Timber Pines owns the Shopping Outlet Mall in Spring Hill, Florida (the "Outlet
Mall"). The Outlet Mall contains two outparcels, the North Outparcel and the South
Outparcel. In April 2014, Timber Pines contracted to sell the North Outparcel to Appellees
for $550,000. The contract contains the following broad arbitration provision:
14. DISPUTE RESOLUTION: This Contract will be construed
under Florida law. All controversies, claims, and other matters
in question arising out of or relating to this transaction or
Contract or its breach will be settled as follows:
(a) Disputes concerning entitlement to deposits made
and agreed to be made: Buyer and Seller will have 30 days
from the date conflicting demands are made to attempt to
resolve the dispute through mediation. . . .
(b) All other disputes: Buyer and Seller will have 30 days
from the date a dispute arises between them to attempt to
resolve the matter though mediation, failing which the parties
will resolve the dispute through neutral binding arbitration in
the county where the Property is located. The arbitrator may
not alter the Contract terms or award any remedy not provided
for in this Contract. . . .
Before the purchase and sale closed, Timber Pines imposed Amended Deed
Restrictions (the "ADR") on the North Outparcel, which provide:
All future buildings or structures, property or building uses or
ancillary or related uses, plans, site plans, on site parking,
remodeling, renovations or additions as to building type,
construction and set backs, Tract replats or subdivisions and
the like must be previously submitted to and approved by
[Timber Pines], its successors, heirs, assigns or successors
in title in its sole discretion without necessity of consent of any
other tract owner. Failure of [Timber Pines] to grant approval
shall not be considered a waiver. [Timber Pines] also reserves
for itself, its assignees and successors the right to approve
and make any such changes described above for any
property it owns, at any time without consent or approval by
any tract owner.
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(emphasis added). Appellees signed an acknowledgment form consenting to the ADR's
terms. The transaction closed in October 2014, after which Appellees obtained building
permits for the construction of a 6124 square foot building on the North Outparcel.
Crucially, the contract for the sale of the North Outparcel does not reference, much less
incorporate, the ADR.
In October 2015, Timber Pines filed a complaint for injunctive relief and damages,
alleging that Appellees commenced construction on the North Outparcel without obtaining
approval pursuant to the ADR. Timber Pines requested that Appellees cease construction
and comply with the restrictions, but Appellees refused. The trial court denied Timber
Pines' request for an injunction, and our court per curiam affirmed the trial court's ruling.
Timber Pines Plaza, LLC v. Zabrzyski, No. 5D16-95, 2016 WL 7405671, at *1 (Fla. 5th
DCA Dec. 20, 2016).
In March 2016, Appellees answered the original complaint and included a counter-
claim for breach of contract, alleging that Timber Pines "failed or refused to object or
otherwise provide any input on the building plans." Appellees further argued Timber Pines
breached the contract by failing to provide them with a cross-parking easement. Timber
Pines responded by moving to dismiss and compel arbitration on Appellees' counterclaim
pursuant to the contract's arbitration provision. Appellees responded that Timber Pines
waived its right to compel arbitration by asserting claims under the ADR that were
"inextricably intertwined" with the contract. Neither party requested a hearing on Timber
Pines's motion to compel arbitration, and the trial court ultimately denied Timber Pines's
motion. The trial court's order does not include any factual findings or detail its reasons
for denying the motion.
3
contained an arbitration provision covering "any dispute" with the employer "arising under
[the employee's] employment." The court found that, although the employee's worker's
compensation claim arose from his employer-employee relationship, that claim was
separate and distinct from the employment agreement containing the arbitration
provision. Id. Similarly, Timber Pines's claim arose in part because it agreed to sell the
North Outparcel to Appellees. However, once that sale closed, the ADR controlled the
relationship between the parties regarding approval of construction plans—the only claim
Timber Pines asserts in this case.
Based on the foregoing, we find that Timber Pines did not waive its right to compel
arbitration on Appellees' counterclaim. Therefore, we reverse and remand with
instructions to grant Timber Pines's motion to stay litigation of Appellees' counterclaim1
and to compel arbitration.
REVERSED and REMANDED with Instructions
ORFINGER, J., and JACOBUS, B.W., Senior Judge, concur.
1 See § 682.03(7), Fla. Stat. (2016) ("If the court orders arbitration, the court on
just terms shall stay any judicial proceeding that involves a claim subject to the arbitration.
If a claim subject to the arbitration is severable, the court may limit the stay to that claim.").
7
A "significant relationship" between a claim and an arbitration
provision does not necessarily exist merely because the
parties in the dispute have a contractual relationship. Rather,
a significant relationship is described to exist between an
arbitration provision and a claim if there is a "contractual
nexus" between the claim and the contract. A contractual
nexus exists between a claim and a contract if the claim
presents circumstances in which the resolution of the disputed
issue requires either reference to, or construction of, a portion
of the contract. More specifically, a claim has a nexus to a
contract and arises from the terms of the contract if it
emanates from an inimitable duty created by the parties'
unique contractual relationship. In contrast, a claim does not
have a nexus to a contract if it pertains to the breach of a duty
otherwise imposed by law or in recognition of public policy,
such as a duty under the general common law owed not only
to the contracting parties but also to third parties and the
public.
Jackson v. Shakespeare Found., Inc., 108 So. 3d 587, 593 (Fla. 2013) (citations omitted).
The determination as to whether a party waived the right to arbitrate "should be
analyzed much the same way as in any other contractual context. The essential question
is whether, under the totality of the circumstances, the . . . party has acted inconsistently
with the arbitration right." Raymond James Fin. Servs., Inc. v. Saldukas, 896 So. 2d 707,
711 (Fla. 2005) (quoting Nat'l Found. for Cancer Research v. A.G. Edwards & Sons, Inc.,
821 F.2d 772, 774 (D.C. Cir. 1987)). A party acts inconsistently with the arbitration right
by prosecuting or defending "a lawsuit on issues subject to arbitration." Green Tree
Servicing, LLC v. McLeod, 15 So. 3d 682, 687 (Fla. 2d DCA 2009) (quoting Seville Condo.
#1, Inc. v. Clearwater Dev. Corp., 340 So. 2d 1243, 1245 (Fla. 2d DCA 1976)). Once a
party waives the right to arbitrate, "the party may not reclaim the arbitration right without
the consent of his or her adversary." Id.
We find that there exists no significant relationship between Timber Pines's claims
under the ADR and the arbitration clause contained in the contract for the purchase and
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sale of the North Outparcel. Accordingly, we find that Timber Pines did not waive its right
to compel arbitration on Appellees' counterclaim. See id. Timber Pines referenced the
contract in its complaint only to provide context for the parties' relationship and events
leading up to the dispute. Timber Pines sought relief on the sole basis that Appellees
commenced construction on the North Outparcel without obtaining approval as required
by the ADR. The Florida Supreme Court has stressed that a "contractual nexus" requires
that the claim "emanate[] from an inimitable duty created by the parties' unique contractual
relationship." Jackson, 108 So. 3d at 593. Here, the contract creates no "inimitable duty"
concerning prior approval before commencing construction; the contract is silent on this
issue. See id. Only the ADR provides that Appellees must obtain approval before
beginning construction on the North Outparcel. Thus, we agree with Timber Pines that
there exists no significant relationship between its claim for injunctive relief under the ADR
and Appellees' counterclaim under the contract because resolution of Timber Pines's
claims does not require any "reference to or construction of some portion of the contract
itself." Kolsky v. Jackson Square, LLC, 28 So. 3d 965, 969 (Fla. 3d DCA 2010) (quoting
Seifert, 750 So. 2d at 638).
Of course, the instant dispute would not exist had the parties not contracted for the
purchase and sale of the North Outparcel, but "the mere fact that the dispute would not
have arisen but for the existence of the contract and consequent relationship between the
parties is insufficient by itself to transform a dispute into one 'arising out of or relating to'
the agreement." Seifert, 750 So. 2d at 638. The Fourth District Court addressed
analogous facts in AMS Staff Leasing, Inc. v. Taylor, 158 So. 3d 682, 685 (Fla. 4th DCA
2015), where the employer and employee had an existing employment agreement that
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contained an arbitration provision covering "any dispute" with the employer "arising under
[the employee's] employment." The court found that, although the employee's worker's
compensation claim arose from his employer-employee relationship, that claim was
separate and distinct from the employment agreement containing the arbitration
provision. Id. Similarly, Timber Pines's claim arose in part because it agreed to sell the
North Outparcel to Appellees. However, once that sale closed, the ADR controlled the
relationship between the parties regarding approval of construction plans—the only claim
Timber Pines asserts in this case.
Based on the foregoing, we find that Timber Pines did not waive its right to compel
arbitration on Appellees' counterclaim. Therefore, we reverse and remand with
instructions to grant Timber Pines's motion to stay litigation of Appellees' counterclaim1
and to compel arbitration.
REVERSED and REMANDED with Instructions
ORFINGER, J., and JACOBUS, B.W., Senior Judge, concur.
1 See § 682.03(7), Fla. Stat. (2016) ("If the court orders arbitration, the court on
just terms shall stay any judicial proceeding that involves a claim subject to the arbitration.
If a claim subject to the arbitration is severable, the court may limit the stay to that claim.").
7