When parties execute two separate contracts and only one contract contains an arbitration clause, generally the parties cannot be compelled to arbitrate disputes arising from the contract that does not call for arbitration. However, under certain circumstances courts will extend the arbitration provisions from one contract to a separate contract, and the parties may be bound to arbitrate disputes arising out of either agreement because the two agreements will be read together as one contract. Peter Mavrick has successfully represented clients in Palm Beach, Broward, and Miami-Dade business litigation and related arbitration proceedings.
Phoenix Motor Co. v. Desert Diamond Players Club, Inc. involved four agreements for the purchase of new motor vehicles. The purchase agreements contained an arbitration clause, but also stated that “[t]he Purchaser, before or at the time of delivery of the motor vehicle covered by the Order, shall execute such other forms of agreement or documents as may be required by the terms and conditions of payment indicated on the front of this Order.” Phoenix Motor Co. v. Desert Diamond Players Club, Inc., 144 So.3d 694 (Fla. 4th DCA 2014). The purchaser also signed an export policy imposing liquidated damages if Desert exported the new vehicle out of the United States within one year of purchase. The export policy stated that “[e]xecution of the purchase/lease documents by the purchaser/lessee shall constitute acceptance of these terms and conditions.”
The purchaser sued for a declaration that the export policy was invalid and unenforceable. The seller filed a motion to compel arbitration pursuant to the arbitration clause in the purchase agreements. The trial court in Phoenix Motor Co. addressed whether there was a valid agreement to arbitrate a dispute arising from the export policy. The trial court denied the seller’s motion and the seller immediately appealed.