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In affirming a lower court order denying a motion to compel arbitration, the Florida District Court of Appeal applied the Florida rule that waiver of the right to arbitrate does not require a showing of prejudice.
In Coastal Systems Development, Inc. v. Bunnell Foundation, Inc., Nos. 3D06-1188, 3D06-982, 2007 WL 982438 (Fla. Dist. Ct. App. Apr. 4, 2007), Coastal and Bunnell had a profit-sharing agreement. Bunnell brought suit when Coastal refused to provide relevant financial statements.
Coastal moved for dismissal pursuant to a mediation provision in the agreement without any mention of the agreement's arbitration provision. The trial court denied the motion to dismiss. Approximately two years later, Coastal filed a motion to compel arbitration. The trial court denied the motion.
On appeal, the Court held that the trial court properly denied the motion to compel arbitration because Coastal waived its right to arbitrate by waiting two years to demand arbitration. Coastal argued that there was no waiver because Bunnell had not demonstrated any prejudice. In rejecting this argument, the Court noted that Florida law does not require a showing of prejudice.
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