Opinion ID: 4511938
Heading Depth: 2
Heading Rank: 2

Heading: Each of the parties further desires to set forth

Text: the terms and conditions for the conduct of the Partnership business. NOW, THEREFORE, in consideration of the premises, the parties hereby agree as follows: . . . . (Emphases added.) Accordingly, each of the Articles in the Partnership Agreement, including the arbitration clause at Section 13.10, must be viewed in the light of the “premises” stated in the recitals, i.e., the arbitration clause must be read as a “term[] and condition[] for the conduct of the Partnership business.” Further, as argued by Yamamoto, the Partnership Agreement’s “purpose” clause, Article 1.3, 23  FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER  specifically provides that “[t]he Partnership is organized solely for the purpose of rendering legal services and services ancillary thereto.” (Emphasis added.) With these considerations in mind, there are two notable points when examining the arbitration clause, which states: “In the event of any dispute between or among the Partners in connection with this Agreement, such dispute shall be resolved by arbitration . . . .” First, Yamamoto was a “Partner,” as she had signed the Partnership Agreement. Second, her signature was affixed to the Partnership Agreement “to form a limited liability law partnership,” and to “set forth the terms and conditions for the conduct of the Partnership business.” Thus, as “the Partnership business” was not to lend money or administer 401(k) plans, Chee’s arrangement falls outside “the Partnership business.” Therefore, any claims arising from the arrangement do not comprise a “dispute . . . in connection with this Agreement” and are therefore not subject to the arbitration clause.5 The ICA’s SDO focused solely on the phrase “in connection with” without considering the context of the clause within the 5 The dissent highlights portions of Article III of the Partnership Agreement governing “capital accounts,” including a provision stating that upon withdrawal, a Partner would be entitled to only the amount in that Partner’s capital account. Yamamoto’s complaint does not request relief regarding her capital account; rather she alleges conversion (Count I), fraudulent conversion (Count II), and punitive damages (Count III) based on the wrongful retention of the personal check she wrote to repay her 401(k) loan. 24  FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER  Partnership Agreement. The arbitration clause applies “to the conduct of the Partnership business” as specified in the Partnership Agreement. The ICA compared this case to Unidev, 129 Hawai‘i 378, 301 P.3d 588, and concluded that just as the court found the claims in Unidev arbitrable, so, too, should Yamamoto’s claims be deemed arbitrable. See Yamamoto, SDO at 4-5. There, the court concluded that because the arbitration clause contained in one of the agreements between the parties (a housing project developer and the County of Hawai‘i) “employed general language,” i.e., “any dispute arising under the terms of this Agreement,” “it may be inferred . . . that the parties did not intend to restrict the reach of the arbitration clause simply to claims involving construction or arbitration of the terms of the agreement.” Unidev, 129 Hawai‘i at 384, 394, 301 P.3d at 594, 604. Unidev, however, is inapposite because the Partnership Agreement here includes limiting language in its recitals such that the arbitration clause applies only “to the conduct of the Partnership business.” Thus, although “any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration,” “the mere existence of an arbitration agreement does not mean that the parties must submit to an arbitrator disputes which are outside the scope of the arbitration agreement.” 129 Hawai‘i at 25  FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER  396, 301 P.3d at 606. “An arbitration agreement is interpreted like a contract,” and “we have long expressed our disapproval of interpreting a contract such that any provision be rendered meaningless.” 129 Hawai‘i at 395, 301 P.3d at 605. The Partnership Agreement by its own terms limited the scope of its provisions, including the arbitration clause at section 13.10, to “the conduct of the Partnership business.” Yamamoto’s claim is not based on the conduct of “Partnership business,” which was “solely for the purpose of rendering legal services and services ancillary thereto.” Thus, the claims in Yamamoto’s complaint are not subject to the arbitration clause in the Partnership Agreement.