Sherman v. Barrett

Filed 2/21/07  Sherman v. Barrett CA2/4

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b).  This opinion has not been certified for publication or ordered published for purposes of rule 977.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FOUR

          APPEAL from an order of the Superior Court of Los Angeles County, Susan Bryant-Deason, Judge.  Affirmed.

          Jacks & Maybaum and Jerid R. Maybaum for Defendant and Appellant.

          Farano and Kieviet and Charles M. Farano for Plaintiff and Respondent.

introduction

          Defendant Robert Barrett appeals from the trial court's order denying his petition to compel arbitration.  Barrett contends the trial court abused its discretion when it declined to enforce the contractual arbitration agreement between Barrett and plaintiff David Sherman, based on Barrett's delay in filing his petition to compel arbitration, and based on the fact that the litigation also involves claims against a third party codefendant, Ivan Mendoza, which are not subject to the arbitration agreement.[1]  We conclude that the trial court did not abuse its discretion in deciding, pursuant to Code of Civil Procedure section 1281.2, subdivision (c),[2] to deny arbitration because of the possibility of conflicting rulings on common issues of law or fact.  We affirm.

factual and procedural background

          The operative first amended complaint named as defendants Barrett, Mendoza, Omega Environmental Services, Inc. (OES), and Omega Contracting, Inc. (OCI).[3]  The following alleged facts are taken from the first amended complaint:  Sherman alleged that in January 2004, Sherman and Mendoza retained Barrett to provide legal services regarding the purchase, incorporation, organization and management of OES and OCI.[4]  Sherman and Mendoza each held 50 percent of the shares of each corporation.

          In May 2004, Mendoza and Barrett told Sherman to transfer some shares from each corporation to Mendoza to make him the majority shareholder, with 51 percent of the stock in each corporation, in order to receive a minority business enterprise classification for purposes of bidding on state and federal government contracts.  Mendoza and Barrett told Sherman he would retain a 50 percent controlling interest in the corporations, and would retain his positions as President of OES and vice-president of OCI.  Sherman alleged these representations were false, and that Barrett and Mendoza instead intended to â€