Commercial Interiors v. Pinkerton & Laws

Decision Date02 October 2009
Docket NumberNo. 5D08-1493.,5D08-1493.
PartiesCOMMERCIAL INTERIORS CORPORATION OF BOCA RATON, A Florida Corporation, Appellant, v. PINKERTON & LAWS, INC., A Florida Corporation and Hartford Fire, etc., Appellees.
CourtFlorida District Court of Appeals

John Y. Benford, of John Y. Benford, P.A., Orlando, and Barry L. Simons, of Barry L. Simons, P.A., Miami, for Appellant.

Donald E. Karraker, of De Renzo and Karraker, P.A., Maitland, for Appellees.

MONACO, C.J.

In this appeal we are required once again to examine the interplay between a trial court and an arbitrator. In the present case the arbitrator denied a defense motion to dismiss, finding that although the plaintiff may have violated a local ordinance, it had not violated section 489.128, Florida Statutes (2002), and finding further that the contract under which the arbitration arose was not illegal. When the trial court set aside the arbitrator's order and dismissed the case with prejudice, this appeal ensued. We reverse.

The facts in their most attenuated form begin with two subcontracts under which the appellant, Commercial Interiors Corporation of Boca Raton ("Commercial Interiors"), agreed with the appellee, Pinkerton & Laws, Inc. ("P & L"), that Commercial Interiors would provide certain interior painting and certain other extra work on a Hampton Inn hotel being constructed by P & L in Pinellas County. The subcontracts were on a form drafted by P & L, and each contained an arbitration provision requiring arbitration upon proper demand under the rules of the American Arbitration Association in the event of a dispute. Commercial Interiors eventually brought suit claiming that P & L unjustifiably failed to pay it $51,209 for work done under the subcontracts. P & L filed a motion to compel arbitration and to abate the lawsuit. Commercial Interiors agreed and the case moved into the arbitration forum, the lawsuit having been abated.

P & L then filed a motion to dismiss the claim in arbitration, asserting that Commercial Interiors was not entitled to recover any amount under the subcontracts because the subcontracts were themselves illegal. P & L alleged accordingly that it was relieved of the obligation to pay any amount to Commercial Interiors because Commercial Interiors did not have a contractor's license. Because of the odd threshold issue that was raised, the parties decided to bifurcate the arbitration into two evidentiary hearings, the first of which would consider P & L's motion to dismiss, while the second would focus on the merits of the claim.

At the conclusion of the first evidentiary hearing the arbitrator issued a detailed order in which he ruled in favor of Commercial Interiors, and thus denied the motion to dismiss. The arbitrator found, among other things, that Commercial Interiors did not violate section 489.128, and that P & L was estopped from asserting (and had waived its right to assert) the claimed illegality of the subcontracts.

P & L promptly moved in the trial court to set aside or vacate the order of the arbitrator denying the motion to dismiss. The trial court heard arguments on the motion and entered an order setting aside the arbitrator's order and dismissing the case with prejudice. The trial court held, in particular, that while it accepted the findings of fact made by the arbitrator, it was holding that the subcontracts, including the arbitration provision, were not enforceable, and that the arbitrator had misapplied section 489.128. Commercial Interiors appeals this ruling.1

In Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 126 S.Ct. 1204, 163 L.Ed.2d 1038 (2006), the United States Supreme Court held in broad terms that under the Federal Arbitration Act an arbitration provision of a contract is severable from the remainder of the contract, and, more importantly for our purposes, that unless there is a challenge to the arbitration clause itself, the issue of a contract's validity must be considered "in the first instance" by the arbitrator, not the court. Moreover, the Supreme Court held that the arbitration law that it announced applies in state court, as well as federal court. In a case quite factually similar to the present case, this court followed suit and applied those principles. See Charles Boyd Const., Inc. v. Vacation Beach, Inc., 959 So.2d 1227 (Fla. 5th DCA 2007).

Here, the arbitrator properly considered the illegality of the subject contract in the "first instance." The issue we must now confront is what standard the trial court should use if asked to review the arbitrator's ruling on illegality. We begin our examination of this question by considering section 682.13, Florida Statutes (2007), which deals with a party's request for a trial court to vacate an arbitration award. That statute dictates that a court shall vacate an award when: (a) the award was procured by corruption, fraud or other undue means; (b) there was evident partiality by the arbitrator appointed, corruption in any of the arbitrators or umpire, or misconduct prejudicing the rights of any party; (c) the arbitrators or the umpire in the course of exercising jurisdiction exceeded their powers; (d) the arbitrators or the umpire in the course of her or his jurisdiction refused to postpone the hearing upon...

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6 cases
  • Visiting Nurse Ass'n of Fla., Inc. v. Jupiter Med. Ctr., Inc.
    • United States
    • Florida Supreme Court
    • November 6, 2014
    ...it expressly and directly conflicts with a decision of the Fifth District Court of Appeal in Commercial Interiors Corp. of Boca Raton v. Pinkerton & Laws, Inc., 19 So.3d 1062 (Fla. 5th DCA 2009), on a question of law. We have jurisdiction. See art. V, § 3(b)(3), Fla. Const. For the followin......
  • Visiting Nurse Ass'n of Fla., Inc. v. Jupiter Med. Ctr., Inc.
    • United States
    • Florida Supreme Court
    • July 10, 2014
    ...it expressly and directly conflicts with a decision of the Fifth District Court of Appeal in Commercial Interiors Corp. of Boca Raton v. Pinkerton & Laws, Inc., 19 So. 3d 1062 (Fla. 5th DCA 2009), on a question of law. We have jurisdiction. See art. V, § 3(b)(3), Fla. Const. For the followi......
  • UBS Fin. Servs. v. Walzer, CASE NO. 9:19-CV-81161-ROSENBERG/REINHART
    • United States
    • U.S. District Court — Southern District of Florida
    • December 26, 2019
    ...FAC applies only to the extent that it is not in conflict with the FAA"); see also Commercial Interiors Corp. of Boca Raton v. Pinkerton & Laws, Inc., 19 So. 3d 1062, 1064 n.2 (Fla. 5th Dist. Ct. App. 2009) (noting that the grounds to vacate an arbitration award under the FAA and the FAC "a......
  • Felger v. Mock
    • United States
    • Florida District Court of Appeals
    • July 26, 2011
    ...issue submitted to arbitration, an “award cannot be vacated under section 682.13(1)(c)”); Commercial Interiors Corp. of Boca Raton v. Pinkerton & Laws, Inc., 19 So.3d 1062, 1064 (Fla. 5th DCA 2009) (“[I]t appears that the trial court simply disagreed with the arbitrator's application of the......
  • Request a trial to view additional results

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