HOLDINGS: [1]-A narrowly worded arbitration provision in business operating agreements that applied only to controversies arising out of the agreements did not encompass tort claims based upon violation of an independent duty or right originating outside of the agreements; [2]-Legal malpractice, breach of fiduciary duty, and rescission claims did not arise out of the operating agreements and should not have been included in the trial court’s order compelling arbitration under Code Civ. Proc., ยง 1281.2, because an attorney-client relationship between owners of the business did not arise out of the operating agreements or the parties’ decision to go into business together, and the alleged wrongdoing involved duties owed by virtue of the attorney-client relationship rather than any duty created by the operating agreements.
California Business Lawyer & Corporate Lawyer, Inc. provides counsel on Operation Disclosure
Outcome
Affirmed in part and reversed in part.
