John Vernetti and Global Trustee Services, Inc. v. America-Indian Enterprises, Inc., Kumar Rajagopalan, Joseph Archiprete and Raghav L. Seth , 152 So. 3d 856 ( 2014 )

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT
JOHN VERNETTI and GLOBAL TRUSTEE SERVICES, INC.,
a Nevada Corporation,
Appellants,
v.
AMERICA-INDIAN ENTERPRISES, INC., a Wyoming Corporation,
KUMAR RAJAGOPALAN, JOSEPH ARCHIPRETE, and
RAGHAV L. SETH,
Appellees.
No. 4D14-2360
[December 17, 2014]
Appeal of non-final order from the Circuit Court for the Seventeenth
Judicial Circuit, Broward County; Dale Ross, Judge; L.T. Case No.
13-9557 (08).
Mark F. Booth of Rogers, Morris & Ziegler LLP, Fort Lauderdale, for
appellants.
John F. O’Donnell, Fort Lauderdale, for appellees Kumar Rajagopalan,
Joseph Archiprete and American-Indian Enterprises, Inc.
DAMOORGIAN, C.J.
John Vernetti and Global Trustee Services, Inc. (“Global Trustee”)
appeal the trial court’s non-final order denying their motion to compel
arbitration of a cross-claim filed by Appellees, America-Indian
Enterprises, Inc. (“America-Indian”), Kumar Rajagopalan, and Joseph
Archiprete.1 Vernetti and Global Trustee maintain that the cross-claim is
arbitrable because it arose out of and is directly related to their
agreement with Appellees. We agree and reverse.
1 Raghav Seth is named as an appellee in the style of this case because he
is the plaintiff in the underlying litigation that forms the basis for the cross-
claim. However, he is not a party to this appeal and for the purposes of this
opinion, the term “Appellees” only refers to America-Indian, Rajagopalan, and
Archiprete.
By way of background, Global Trustee and America-Indian entered
into a Specific Service Agreement (“the Agreement”) in August 2007.
Rajagopalan and Archiprete signed the Agreement as co-owners of
America-Indian and Vernetti signed as president of Global Trustee. The
Agreement authorized Global Trustee to provide pass-through consulting
services to America-Indian and to disburse funds from a Bank of America
Client Trust Account to America-Indian at America-Indian’s discretion.
The Agreement contains the following arbitration clause:
4. DISPUTE: In the event of any dispute arising out of or in
connection with this Agreement, the parties agree to resolve
such dispute through binding arbitration to be held in the
domicile of [Global Trustee], in accordance with the rules of
the Arbitration Board in Las Vegas, Nevada. The prevailing
party in such arbitration shall be entitled to recover its legal
fees and costs, which shall be awarded by the arbitrator,
whose award shall be final and binding.
In April 2013, Raghav Seth filed an action for damages against
Vernetti, Global Trustee, and Appellees. The complaint alleged that
Appellees induced Seth to invest $1,000,000 in a business venture
involving the purchase and sale of gold. Seth advanced the funds to
America-Indian pursuant to a promissory note. The funds were to be
held in trust by Vernetti and Global Trustee. When Seth did not receive
payment of the amounts due and owing under the note he initiated the
underlying lawsuit, asserting claims for fraud in the inducement, breach
of contract, civil conspiracy, breach of fiduciary duty, and violation of the
Florida and Federal RICO statutes. Appellees filed a cross-claim against
Vernetti and Global Trustee for fraud, indemnity, and breach of fiduciary
duty. Vernetti and Global Trustee moved to compel arbitration of the
cross-claim based on the Dispute clause in the Agreement. The trial
court denied their motion. This appeal follows.
We review an order granting or denying a motion to compel arbitration
de novo. Ibis Lakes Homeowners Ass’n, v. Ibis Isle Homeowners Ass’n,
102 So. 3d 722, 727 (Fla. 4th DCA 2012) (quoting Best v. Educ. Affiliates,
Inc., 82 So. 3d 143, 145 (Fla. 4th DCA 2012)). “[T]here are three
elements for courts to consider in ruling on a motion to compel
arbitration of a given dispute: (1) whether a valid written agreement to
arbitrate exists; (2) whether an arbitrable issue exists; and (3) whether
the right to arbitration was waived.” Seifert v. U.S. Home Corp., 750 So.
2d 633, 636 (Fla. 1999). This appeal only concerns the second element—
whether the cross-claim is arbitrable.
-2-
A claim is arbitrable if, “‘at a minimum, [it] raise[s] some issue the
resolution of which requires reference to or construction of some portion
of the contract itself’ and there [is] some nexus between the claim and
the contract containing the arbitration clause.” Kolsky v. Jackson
Square, LLC, 28 So. 3d 965, 969 (Fla. 3d DCA 2010) (quoting Seifert, 750
So. 2d at 638). “‘To determine whether a claim falls within the scope of
an arbitration agreement, we must look beyond the legal cause of action
and examine the factual allegations of the complaint.’” Florida Envtl.
Servs., Inc. v. Rentoumis, 950 So. 2d 466, 470 (Fla. 4th DCA 2007)
(quoting Singer v. Gaines, 896 So. 2d 851, 854 (Fla. 3d DCA 2005)). Any
doubt concerning the scope of an arbitration clause should be resolved in
favor of arbitration. Kolsky, 28 So. 3d at 969 (citing Zager Plumbing, Inc.
v. JPI Nat’l Constr., Inc., 785 So. 2d 660, 662 (Fla. 3d DCA 2001)).
In this case, the factual allegations in the cross-claim mirror the
terms of the Agreement. Without directly referring to the Agreement, the
cross-claim asserts that Global Trustee released funds from a Bank of
America trust account established in August 2007 without
America-Indian’s permission. The Agreement is dated August 6, 2007
and specifically established a Bank of America Client Trust Account for
America-Indian’s benefit. Appellees cannot escape their agreement to
arbitrate simply because they asserted claims for common law
indemnity, fraud, and breach of fiduciary duty instead of breach of
contract. See Florida Envtl. Servs., Inc., 950 So. 2d at 470.
The cross-claim cannot be resolved without reference to the Agreement
because the Agreement defines the duties Global Trustee owed to
America-Indian. See Kolsky, 28 So. 3d at 969. For these reasons, we
conclude that the cross-claim is arbitrable. We reverse and remand for
the trial court to enter an order granting the motion to compel arbitration
of the cross-claim.
Reversed and Remanded.
GROSS and MAY, JJ., concur.
* * *
Not final until disposition of timely filed motion for rehearing.
-3-