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Eric Baker Architecture, P.C. v. Mehmel

Superior Court of New Jersey, Appellate Division

November 26, 2013

ERIC BAKER ARCHITECTURE, P.C., Plaintiff-Appellant,
v.
ROBERT F. MEHMEL and BARBARA A. MEHMEL, Defendants-Respondents.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued November 19, 2013

On appeal from Superior Court of New Jersey, Law Division, Somerset County, Docket No. L-1085-12.

Thomas G. DeLuca argued the cause for appellant (DeLuca & Forster, attorneys; Mr. DeLuca, on the brief).

John P. Michalski argued the cause for respondents (McElroy, Deutsch, Mulvaney & Carpenter, attorneys; Mr. Michalski, on the brief).

Before Judges Ostrer and Carroll.

PER CURIAM

Plaintiff, Eric Baker Architecture, P.C. (Baker), appeals from a September 27, 2012 Law Division order denying Baker's request to compel defendants, Robert F. Mehmels and Barbara A. Mehmels (the Mehmels), to submit their claims to arbitration. The Mehmels had asserted those claims against Baker in a separate action dealing with alleged defects in a home the Mehmels purchased from Louis F. Molinari and Linda Molinari (the Molinaris), which was designed by Baker (the underlying action). The trial judge found that no agreement existed between the Mehmels and Baker that would require the Mehmels' claims against Baker be arbitrated. We affirm.

This matter has its genesis in the construction of a new home by the Molinaris. In April 2004, the Molinaris entered into a written agreement with Baker (the architectural contract), pursuant to which the Molinaris engaged Baker to provide architectural services for the design of the new home. The architectural contract contained a broad arbitration provision, which required Baker and the Molinaris to arbitrate "[a]ny controversy or claim arising out of or relating to this contract, or breach of this contract."

Following construction of the home, the Molinaris resided in it for several years, until they sold the home to the Mehmels in September 2010. The Mehmels thereafter discovered several alleged structural and design defects in the home. Consequently, they commenced the underlying action, in which they sought damages from the Molinaris, various contractors, the real estate broker, and the attorney who represented them in the purchase.

The Molinaris answered, and filed a third-party complaint against Baker and others. The Molinaris and Baker then entered into a consent order, requiring that the Molinaris arbitrate their claim against Baker, pursuant to the arbitration provision contained in the architectural contract.

The Mehmels subsequently amended their complaint to include claims directly against Baker, including negligence, malpractice, breach of warranties, and breach of the implied covenant of good faith and fair dealing. Baker answered, denying the material allegations of the complaint, and raising arbitration as a defense, predicated on the arbitration provision contained in the architectural contract. Baker then filed this summary action against the Mehmels to compel arbitration of their dispute.

After hearing oral argument, Judge Edward M. Coleman denied Baker's application. In a cogent written decision which accompanied his September 27, 2012 order, the judge began by expressing the well-settled public policy favoring arbitration as a means of settling disputes. The judge then distinguished certain authority cited by Baker in support of its contention that non-signatories to arbitration provisions can be compelled to submit a dispute to arbitration, including Bruno v. Mark MaGrann Assocs., Inc., [1] 388 N.J.Super. 539, 546 (App. Div. 2006). Judge Coleman concluded:

[U[like the plaintiffs in Bruno, here the Mehmels [] have never signed an arbitration agreement. They were not a party, nor a signatory, to the contract between the Molinaris and Baker, and they have no nexus to that contract other than the fact that they bought the Molinaris' home. "In the absence of a consensual understanding, neither party ...

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