|
The District Court of Appeal of Florida held that a law firm should not have been required to arbitrate a civil conspiracy claim, since the law firm was “neither a party to, nor a third-party beneficiary of” a membership agreement containing the arbitration clause.
In Simbabear, LLC v. Muskat, No. 4D06-2511, 2006 WL 3371888 (Fla. Dist. Ct. App. Nov. 22, 2006), Muskat was an attorney who formed a limited liability company (LLC), Simbabear, with two law firm colleagues for the purpose of acquiring an office building.
When the partners of the law firm terminated Muskat’s employment, she filed a lawsuit against Simbabear, the law firm, and the individual partners to determine Muskat’s membership interest in Simbabear. Muskat’s also asserted a claim of civil conspiracy, stating that the “true purpose” of her termination from the law firm was to acquire her interest in the LLC at no cost.
Muskat successfully moved to compel arbitration of the claims. On appeal, however, Muskat conceded that the law firm should not be forced to participate in arbitration, since they were neither a party to, nor a third-party beneficiary of the LLC agreement. Moreover, the Court held that the civil conspiracy claim should not be arbitrated at all, since it was outside the scope of the arbitration agreement. The case was remanded for the purpose of arbitrating the value of Muskat’s membership interest in Simbabear.
Subscribe to a free weekly update on ADR case law and
legislation
|