[Cite as GB AZ 1, L.L.C. v. Arizona Motors, L.L.C., 2011-Ohio-1808.]

 Court of Appeals of Ohio

EIGHTH APPELLATE DISTRICT 

COUNTY OF CUYAHOGA

JOURNAL ENTRY AND OPINION 

No. 95502

GB AZ 1, LLC 

PLAINTIFF-APPELLEE 

vs. 

ARIZONA MOTORS, LLC, ET AL. 

DEFENDANTS-APPELLANTS 

JUDGMENT: 

AFFIRMED

Civil Appeal from the 

Cuyahoga County Court of Common Pleas 

Case No. CV-719497 

BEFORE: Keough, J., Boyle, P.J., and Sweeney, J. 

RELEASED AND JOURNALIZED: April 14, 2011 
ATTORNEYS FOR APPELLANTS 

Stephen B. Doucette 

Mark R. Koberna 

Rick D. Sonkin 

Sonkin & Koberna, Co., LPA 

3401 Enterprise Parkway 

Suite 400 

Cleveland, OH 44122 

ATTORNEYS FOR APPELLEE 

For GB AZ 1, LLC 

J. Kurt Denkewalter 

J. Kurt Denkewalter, LLC 

110 South Huntington Street 

Medina, OH 44256 

Also listed:

For Volkswagen of America, Inc.

David A. Schaefer 

McCarthy, Lebit, Crystal & Liffman Co. 

1800 Midland Building 

101 Prospect Avenue 

Cleveland, OH 44115
KATHLEEN ANN KEOUGH, J.: 

{¶ 1} Defendants-appellants, Arizona Motors, LLC, Joseph Huang, 

Kevin Whalen, and Seth Severin (collectively “appellants”), appeal from the 

trial court’s decision denying their motion to compel arbitration and stay all 

proceedings pending arbitration. Finding no merit to the appeal, we affirm. 

{¶ 2} In May 2010, plaintiff-appellee, GB AZ 1, LLC (“appellee”), filed 

an amended complaint against Volkswagen of America, Inc., Joseph Abbass, 

and appellants alleging breach of contract, promissory estoppel, fraud, unjust 

enrichment/quantum meruit, fraudulent inducement, civil conspiracy, and 

negligent misrepresentation. These causes of action arose out of a business 

deal whereby appellee and appellants agreed to purchase and develop 

property in Peoria, Arizona for the purposes of establishing a Volkswagen car 

dealership. The terms and conditions of the agreement were set forth in a 

Joint Venture Agreement that all parties executed in 2007. Appellee 

terminated the business relationship and filed its amended complaint 

alleging damages. 

{¶ 3} In response, appellants filed their answer and a motion to compel 

arbitration and stay proceedings pending arbitration. Appellants demanded 

that the matter be submitted to arbitration pursuant to an arbitration 

provision contained in a Lease Agreement executed only by appellee and 

appellant Arizona Motors. 
{¶ 4} Appellee maintained, however, that the Lease Agreement was not 

at issue and did not control this matter. Instead, appellee argued that the 

Joint Venture Agreement executed by all parties was the contract in dispute 

and upon which the amended complaint was based. Because the Joint 

Venture Agreement did not contain an arbitration provision, appellee 

requested that the court deny the motion to compel. The trial court agreed 

with appellee and denied appellants’ motion to compel arbitration and stay 

proceedings pending arbitration. 

{¶ 5} Appellants appeal, raising as their sole assignment of error that 

the trial court erred in denying their motion to compel arbitration and stay all 

proceedings pending arbitration. 

{¶ 6} This court has previously been split as to the standard of review 

for the granting or denial of a motion to compel arbitration and to stay 

proceedings pending arbitration. See Shumaker v. Saks Inc., 163 Ohio 

App.3d 173, 2005-Ohio-4391, 837 N.E.2d 393, citing Vanyo v. Clear Channel 

Worldwide, 156 Ohio App.3d 706, 2004-Ohio-1793, 808 N.E.2d 482 (holding 

that the question of whether a party has agreed to submit an issue to 

arbitration is a question of law requiring de novo review). Cf. Bevan v. 

Owens-Illinois, Inc., Cuyahoga App. No. 84776, 2005-Ohio-2323; Sikes v. 

Ganley Pontiac Honda (Sept. 13, 2001), Cuyahoga App. No. 79015 (holding 

that the appropriate standard of review is abuse of discretion). 
{¶ 7} In Taylor v. Bldg. Corp. of Am. v. Benfield, 117 Ohio St.3d 352, 

2008-Ohio-938, 884 N.E.2d 12,, the Ohio Supreme Court clarified this issue 

and held that when determining the alleged unconscionability of an 

arbitration clause, the reviewing court must conduct a de novo review. 

{¶ 8} However, the issue before this court does not involve an 

allegation of unconscionability or enforceability of an arbitration clause. 

Rather, the issue is whether the allegations in the amended complaint 

pertain to the Lease Agreement, thereby invoking the arbitration provision 

contained therein, or whether the allegations arise from the Joint Venture 

Agreement, which does not contain an arbitration provision. Resolving this 

issue requires us to simply review the factual allegations contained in the 

amended complaint and determine what document gives rise to the 

controversy between the parties. 

{¶ 9} Regardless of which standard of appellate review this court 

applies, abuse of discretion or de novo, we find that the trial court did not err 

in denying appellants’ motion to compel arbitration and stay proceedings 

pending arbitration. 

{¶ 10} Appellants contend that the claims and facts alleged in the 

amended complaint “fall squarely within the language of the arbitration 

provision, which covers ‘any dispute, controversy or claim arising out of or 

relating to’ the Lease.” Reviewing the amended complaint, we disagree and 
find that no dispute, controversy or claim alleged in the amended complaint 

arises out of the Lease Agreement. 

{¶ 11} The allegations contained in the amended complaint pertain 

solely to the Joint Venture Agreement, wherein the parties agreed to 

purchase and develop property in Peoria, Arizona for the purposes of 

establishing a Volkswagen car dealership. Paragraph 37 of the amended 

complaint alleges that appellee terminated the Joint Venture Agreement in 

January 2008 and demanded reimbursement for monies expended in 

connection with purchasing the Peoria site. This termination was prior to 

the execution of the Lease Agreement. 

{¶ 12} Additionally, paragraph 49 of the amended complaint alleges that 

the Lease Agreement was executed in July 2008, but that it never “(1) 

commenced, (2) became effective or (3) became an enforceable contract for 

many reasons including, without limitation, the Defendants [sic] inability to 

provide the tri-party agreement with Defendant Volkswagen.” Although the 

Lease Agreement was executed between appellee and appellant Arizona 

Motors, the amended complaint contains no allegation that damages resulted 

from nonperformance under the Lease Agreement. In fact, appellants 

maintain in their appellate brief that “[i]t is undisputed that Arizona Motors 

was not awarded the Volkswagen franchise that would have made the 

dealership successful and the Lease marketable.” After reviewing the terms 
of the Lease Agreement, it is questionable whether the Lease Agreement 

commenced or became effective for the appellee to even assert a claim against 

it. 

{¶ 13} Therefore, we find that the allegations and causes of action giving 

rise to the amended complaint pertain to the Joint Venture Agreement, which 

does not contain an arbitration provision. “[A]rbitration is a matter of 

contract and, in spite of the strong policy in its favor, a party cannot be 

compelled to arbitrate any dispute which he has not agreed to submit.” 

Stillings v. Franklin Twp. Bd. of Trustees (1994), 97 Ohio App.3d 504, 508, 

646 N.E.2d 1184. Accordingly, the trial court did not err in denying 

appellants’ motion to compel arbitration and stay proceedings. The 

assignment of error is overruled. 

Judgment affirmed. 

It is ordered that appellee recover from appellants costs herein taxed. 

The court finds there were reasonable grounds for this appeal. 

It is ordered that a special mandate be sent to said court to carry this 

judgment into execution. 

A certified copy of this entry shall constitute the mandate pursuant to 

Rule 27 of the Rules of Appellate Procedure. 

KATHLEEN ANN KEOUGH, JUDGE 
MARY J. BOYLE, P.J., and 

JAMES J. SWEENEY, J., CONCUR