TEDESCHI et al v. D.N DESIMONE CONSTRUCTION, INC. et al
Filing
53
MEMORANDUM OPINION & ORDER denying 34 Motion to Dismiss ; denying without prejudice 37 Motion for Sanctions; denying as moot 7 Motion to Vacate, etc. Signed by Judge Noel L. Hillman on 8/4/16. (js)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
JOHN TEDESCHI and
GERALDINE TEDESCHI,
CIVIL NO. 15-8484 (NLH/JS)
Plaintiffs,
v.
MEMORANDUM OPINION & ORDER
D.N. DESIMONE CONSTRUCTION,
INC., DENNIS DESIMONE, ALBERT
DESIMONE, and ANTHONY
DESIMONE,
Defendants.
APPEARANCES:
DAVID T. SHULICK
1500 JFK BLVD.
SUITE 1030
PHILADELPHIA, PA 19102
On behalf of plaintiffs
FRANK D. DERIENZO
LEARY BRIDE TINKER & MORAN
7 RIDGEDALE AVENUE
CEDAR KNOLLS, NJ 07927
THOMAS H. WARD
JOHN H. SHINDLE
WARD LAW FIRM
196 GROVE AVENUE
SUITE A
WEST DEPTFORD, NJ 08086
On behalf of defendants
HILLMAN, District Judge
WHEREAS, plaintiffs, John and Geraldine Tedeschi, filed a
complaint against defendants, D.N. DeSimone Construction, Inc.,
Dennis DeSimone, Albert DeSimone, and Anthony DeSimone, relating to
the reconstruction of a home in Longport, New Jersey damaged during
Hurricane Sandy in October 2012; and
WHEREAS, plaintiffs’ complaint alleges that they withheld
payment to defendants because of, inter alia, poor craftsmanship and
false representations, and as a result, defendants (1) filed a lien
against plaintiffs in the amount of $144,733.36, and (2) instituted
an arbitration proceeding against plaintiff; and
WHEREAS, one of plaintiffs’ claims in their complaint requests
that the Court vacate the arbitration proceeding because the
parties’ contract did not contain a valid arbitration provision; and
WHEREAS, the following motions are pending:
• Plaintiffs’ motion to vacate arbitration [Docket No. 7]
• Defendants’ motion to dismiss plaintiffs’ complaint in
favor of arbitration [Docket No. 34]
• Plaintiffs’ “motion for sanctions per Rule 11” [Docket No.
37]; and
WHEREAS, plaintiffs’ motion to vacate arbitration is moot
because the parties have stipulated that plaintiffs’ motion to
vacate arbitration will serve as their opposition to defendants’
motion to dismiss [Docket No. 27]; and
WHEREAS, plaintiffs’ motion for sanctions is procedurally
improper because it was filed as a cross-motion contained in their
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supplemental opposition to defendants’ motion to dismiss, rather
than as a separate stand-alone motion, see Fed. R. Civ. P. 11(c)(2)
(“A motion for sanctions must be made separately from any other
motion and must describe the specific conduct that allegedly
violates Rule 11(b). The motion must be served under Rule 5, but it
must not be filed or be presented to the court if the challenged
paper, claim, defense, contention, or denial is withdrawn or
appropriately corrected within 21 days after service or within
another time the court sets.”); and
WHEREAS, defendants’ motion to dismiss plaintiffs’ complaint in
favor of arbitration must be denied because (1) it is unclear from
the face of plaintiffs’ complaint that they contractually agreed to
have their claims against defendants resolved through arbitration,
and (2) in response to defendants’ motion, plaintiffs have provided
additional facts sufficient to demonstrate that the agreement to
arbitrate is in dispute, see Guidotti v. Legal Helpers Debt
Resolution, L.L.C., 716 F.3d 764, 771, 776 (3d Cir. 2013):
Because “[a]rbitration is a matter of contract between the
parties,” a judicial mandate to arbitrate must be predicated
upon the parties' consent. Par–Knit Mills, Inc. v.
Stockbridge Fabrics Co., Ltd., 636 F.2d 51, 54 (3d Cir.
1980). The Federal Arbitration Act (the “FAA”), 9 U.S.C. § 1,
et seq., enables the enforcement of a contract to arbitrate,
but requires that a court shall be “satisfied that the making
of the agreement for arbitration ... is not in issue” before
it orders arbitration. Id. § 4. “In the event that the
making of the arbitration agreement is in issue, then ‘the
court shall proceed summarily to the trial’ of that issue.”
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Par–Knit Mills, 636 F.2d at 54 (quoting 9 U.S.C. § 4).
“[T]he party who is contesting the making of the agreement
has the right to have the issue presented to a jury.” Id.
. . .
[W]hen it is apparent, based on “the face of a complaint, and
documents relied upon in the complaint,” that certain of a
party's claims “are subject to an enforceable arbitration
clause, a motion to compel arbitration should be considered
under a Rule 12(b)(6) standard without discovery's delay.”
But if the complaint and its supporting documents are unclear
regarding the agreement to arbitrate, or if the plaintiff has
responded to a motion to compel arbitration with additional
facts sufficient to place the agreement to arbitrate in
issue, then “the parties should be entitled to discovery on
the question of arbitrability before a court entertains
further briefing on [the] question.” After limited
discovery, the court may entertain a renewed motion to compel
arbitration, this time judging the motion under a summary
judgment standard. In the event that summary judgment is not
warranted because “the party opposing arbitration can
demonstrate, by means of citations to the record,” that there
is “a genuine dispute as to the enforceability of the
arbitration clause,” the “court may then proceed summarily to
a trial regarding ‘the making of the arbitration agreement or
the failure, neglect, or refusal to perform the same,’ as
Section 4 of the FAA envisions.”
Guidotti, 716 F.3d at 771, 776 (some internal citations omitted);
and
WHEREAS, the Court accordingly directs that, under the guidance
of the Magistrate Judge, the parties shall undertake expedited
discovery limited to the issue of the arbitrability of plaintiffs’
claims against defendants;
THEREFORE,
IT IS on this
4th
day of
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August
, 2016
ORDERED that plaintiffs’ motion to vacate arbitration [Docket
No. 7] be, and the same hereby is, DENIED AS MOOT; and it is
further
ORDERED that defendants’ motion to dismiss plaintiffs’
complaint in favor of arbitration [Docket No. 34] be, and the same
hereby is, DENIED; and it is further
ORDERED that, under the guidance of the Magistrate Judge, the
parties undertake expedited discovery limited to the issue of the
arbitrability of plaintiffs’ claims against defendants; and it is
further
ORDERED that after the limited discovery described about,
either party, or both, may move for summary judgment pursuant to
Fed.R.Civ.P. 56 and L.Civ.R. 56.1 on the issue of the arbitrability
of plaintiffs’ claims against defendants; and it is further
ORDERED that plaintiffs’ “motion for sanctions per Rule 11”
[Docket No. 37] be, and the same hereby is, DENIED WITHOUT
PREJUDICE.
s/ Noel L. Hillman
NOEL L. HILLMAN, U.S.D.J.
At Camden, New Jersey
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