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Agreements to arbitrate “contractual disputes” between realtors do not encompass tortious interference claims, according to a federal district court in Illinois.
In Hackman v. Dickerson Realtors, Inc., No. 06 C 50240, 2007 WL 2570297 (N.D. Ill. Aug. 31, 2007), Hackman brought a complaint against fellow real estate agent Parvin for tortious interference with business expectancy. Parvin moved to compel arbitration of the claim. Parvin maintained that she and Hackman were signatories to a real estate association agreement which required arbitration of all disputes between the parties. Hackman opposed the motion, stating that the claim against Parvin fell outside the scope of the real estate association agreement.
The Court found that the parties had only agreed to arbitrate certain contractual claims within the association agreement, claims that arose out of their relationship as real estate agents. While Parvin maintained that all aspects of Hackman’s claim were within the scope of the agreement, the Court found that “contractual dispute,” as used within the agreement, only contemplated “disputes between parties to [the] contract about that contract.”
The Court then drew a distinction between the specific allegations made in Hackman’s complaint against Parvin. According to the Court, Hackman’s allegation that Parvin had violated the rules of the association agreement arose out of a contractual relationship between the parties, and was therefore arbitrable. However, the Court found Hackman’s allegation that Parvin had made derogatory statements about him to potential clients, amounting to tortious interference with business expectancy, did not arise out of a contractual relationship with Parvin, and was not arbitrable as a “contractual dispute” as defined in the association agreement.
In closing, the Court refused to stay the tort claim proceedings, noting that the tortious interference claim was “a discrete claim that involve[d] no other parties” and could proceed concurrently with arbitration of the contractual allegations.
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