Waiver Of Arbitration Results In Affirmance Of Denial Of Petition To Arbitrate.
The Court of Appeal affirmed denial of a petition to compel arbitration, finding substantial evidence to support appellant’s waiver of a right to arbitrate its dispute. LPT Properties, LLC v. Wystein Opportunity Fund, LLC et al., G048803 (4/3 Oct. 21, 2014) (Fybel, O’Leary, Rylaarsdam) (unpublished). Nearly a year had elapsed between the date the buyer sued the seller, alleging undisclosed defects in real property, and the date seller petitioned to compel arbitration. During that year, the seller had answered a cross-complaint without raising arbitration as a defense, demurred without mentioning arbitration, represented they needed the trial to be continued because of case complexity, and conducted discovery to gain information that could not be obtained during arbitration.
Denial Of Motion To Compel Arbitration Is Reversed, Because Agent Of Defunct Securities Brokerage Firm Is Entitled To Invoke Arbitration Clause, Even If Defunct Firm Could Not.
A securities brokerage firm member governed by the Financial Industry Regulatory Authority (FINRA) is not entitled to invoke a FINRA arbitration clause once the firm becomes defunct. FINRA Rule 12202. However, Ronay Family Limited Partnership v. Tweed, 216 Cal.App.4th 830 (2013) (Ronay), the subject of my May 28, 2013 blog post, does allow the agent or third party beneficiary of a defunct member to take advantage of the arbitration provision.
In Susoeff v. Michie, G048578 (4/3 Oct. 23, 2014) (O’Leary, Moore, Thompson) (unpublished), the trial court denied the motion to compel arbitration, brought by Michie, an agent of the defunct securities brokerage firm Welton Street Investments, LLC. Ronay required reversal. As an agent of Welton Street, Michie could successfully compel arbitration under the arbitration clause between the defunct firm and plaintiffs/respondents.