Court Opinion

ID: 4258517
Source: CourtListenerOpinion
Date Created: 2018-03-27 18:47:58.51706+00
Date Added: 2024-06-11T14:28:25.526413
License: Public Domain

J-A03006-18

                               2018 PA Super 75

 HOWARD F. GRIEST, III                  :   IN THE SUPERIOR COURT OF
                                        :        PENNSYLVANIA
                   Appellant            :
                                        :
              v.                        :
                                        :
 KEVIN GRIEST                           :
                                        :
                   Appellee             :         No. 2262 EDA 2017

                 Appeal from the Order Dated June 26, 2017
              In the Court of Common Pleas of Chester County
                    Civil Division at No(s): 16-04054-RC

BEFORE:    GANTMAN, P.J., McLAUGHLIN, J., and PLATT*, J.

OPINION BY GANTMAN, P.J.:                          FILED MARCH 27, 2018

      Appellant, Howard F. Griest, III, appeals from the order entered in the

Chester County Court of Common Pleas, which overruled his preliminary

objections in the nature of a motion to assert arbitration and compel

bifurcation of the counterclaim of Appellee, Kevin Griest, in this partition

action. We reverse and remand for further proceedings.

      The parties to this action are brothers. On April 12, 2000, the parties’

mother transferred two parcels of property to Appellant and Appellee as joint

tenants with the right of survivorship: (1) real property at 265 Killian Road,

Chester County, Pennsylvania (“Farm Property”); and (2) real property at 251

Killian Road, Chester County, Pennsylvania (“Rental Property”). On April 29,

2016, Appellant commenced this partition action against Appellee by writ of

summons.    Appellant filed a complaint on January 3, 2017.       Specifically,

____________________________________
* Retired Senior Judge assigned to the Superior Court.
J-A03006-18

Appellant alleged that, since August of 2006, Appellee has retained exclusive

possession of the Farm Property. Appellant claimed Appellee refused to rent

the Farm Property, which prevented Appellant from collecting a fair rental

value for that land. Appellant conceded that Appellee has rented the Rental

Property to tenants since 2004, but Appellant insisted the rental income is

inadequate to pay for the taxes, insurance and maintenance expenses for both

properties. As a result, Appellant has had to contribute to those payments

while Appellee has paid nothing.    Appellant sought partition of the Farm

Property and Rental Property so the parties can sell the properties, pay the

expenses of the sales, and equitably divide the net proceeds of the sales.

Appellant further requested an order assessing charges against Appellee for

the fair market rental value arising from Appellee’s exclusive use and

occupancy of the Farm Property, as well as reimbursement of the amounts

Appellant has paid for taxes, maintenance, and insurance for the properties.

      On February 10, 2017, Appellee filed an answer and counterclaim,

introducing a third parcel of real property at 50 West Conestoga Road,

Elverson, Pennsylvania (“Elverson Property”). Appellee claimed the parties

entered into an agreement dated May 5, 2006 (“Agreement”), which is

relevant to the partition action. The Agreement provides, in pertinent part,

as follows:

                               AGREEMENT

         THIS AGREEMENT made by and between [Appellant] and
         [Appellee], both of Chester County, Pennsylvania

                                    -2-
J-A03006-18

       (hereinafter collectively referred to as the “Partners”):

       WHEREAS, the Partners are individuals and co-owners of
       [the Farm Property]; and

       WHEREAS, [Appellant] owns personal property separate and
       distinct from the Farm Property; and

       WHEREAS, [Appellee] owns personal property separate and
       distinct from the Farm Property;

       WHEREAS, [Appellant] desires to utilize the Partners’
       interest in the Farm Property as collateral for purposes of
       purchasing [the Elverson Property]; and

       WHEREAS, [Appellee] is not a party to the purchase of the
       [Elverson] Property; and

       WHEREAS, [Appellee] has been asked by [Appellant] to sign
       as a limited surety for [Appellant’s] purchase of the
       [Elverson Property], which Surety Agreement will pledge
       [Appellee’s] interest in the Farm Property as collateral for
       [Appellant’s] purchase of the [Elverson] Property;

       WHEREAS, [Appellee] is willing to sign a Limited Surety
       Agreement, provided his personal property, which is
       separate and distinct from the Farm Property, is exempt
       from the Limited Surety Agreement; and

       WHEREAS, in exchange for signing a           Limited Surety
       Agreement, [Appellee] has requested of       [Appellant] the
       right to receive Twenty Percent (20%)        interest in the
       [Elverson Property], under certain terms     and conditions;
       and

       WHEREAS, [Appellant] is agreeable to meeting [Appellee’s]
       requests in exchange for [Appellee’s] signing a Limited
       Surety Agreement; and

       WHEREAS, the Partners desire to set forth in this Agreement
       the arrangement between them;

       NOW THEREFORE, the Partners, intending to be legally
       bound, mutually agree as follows:

                                   -3-
J-A03006-18

       1. Pledge of Farm Property as Collateral for Purchase of
          [Elverson] Property:

          The Partners hereby agree to pledge the Farm Property
          as collateral for [Appellant’s] purchase of the [Elverson]
          Property. In making this pledge, [Appellee] will sign the
          Limited Surety Agreement attached hereto and marked
          as Exhibit “A”. The Partners acknowledge that [Appellee]
          owns personalty, which is to be exempted from that
          property being pledged as collateral. …

       2. Refinancing of Loan for Purchase of [Elverson] Property:

          The Partners acknowledge that [Appellant] has or will
          receive financing to complete his purchase of the
          [Elverson] Property. [Appellant] agrees that on June 2,
          2011 or as soon as reasonably possible thereafter,
          [Appellant] will apply for refinancing of any outstanding
          loan encumbering the Farm Property.           In seeking
          refinancing, [Appellant] will make all reasonable efforts
          to complete the refinancing without pledging any of the
          Farm Property as collateral for the refinanced loan(s).

       3. Consideration to [Appellee] for Signing Limited Surety
          Agreement:

          In exchange for [Appellee’s] signing the Limited Surety
          Agreement, [Appellee] shall receive from [Appellant] a
          Twenty Percent (20%) interest in [the Elverson
          Property]. [Appellant] agrees that he will be solely
          responsible for payment of all costs associated with the
          ownership and maintenance of the real property
          including, but not limited to taxes, water and sewer
          rents, insurance, repairs and maintenance of the
          property. Unless the property is sold to a third party on
          or before June 2, 2011, [Appellee] agrees he will not seek
          to sell his interest in the property or request any payment
          from [Appellant] for [Appellee’s] interest in said property
          until June 2, 2011. …

       4. Farm Bank Account:

          The Partners agree that all funds received by the Partners

                                   -4-
J-A03006-18

          arising out of their operation of the Farm Property shall
          be kept separate and distinct from any money received
          by either [Appellant] or [Appellee] from other ventures
          in which either partner may invest or otherwise be
          involved. …

       5. Farm Operation:

          Each Partner shall devote as much time as is reasonably
          possible to the operation of the Farm Property. Each
          Partner understands that the other is involved in
          businesses separate and distinct from the Partnership.
          Each Partner will endeavor to work with the other to
          further the interests of the Partnership, understanding
          that time constraints and other commitments may
          involve one partner contributing more time and/or effort
          towards the operation of the Partnership than the other.

       6. Profit and Loss:

          The net profits or losses of the Partnership shall be
          divided equally between the Partners; provided that if
          one partner fails to materially contribute to the operation
          of the Farm Property, appropriate adjustments shall be
          made between the Partners to reflect the contribution
          made by each partner toward the operation and
          maintenance of the Farm Property.

       7. Legal Fees and Costs:

          In the event any claim or litigation is initiated against
          [Appellee] by virtue of his signing the Limited Surety
          Agreement or receiving a 20% interest in the [Elverson
          Property], [Appellant] agrees to [indemnify] [Appellee]
          for all legal costs [Appellee] incurs in defending himself
          against any such claim or litigation. …

       8. Choice of Law:

          This Agreement shall be construed in accordance with the
          laws of the Commonwealth of Pennsylvania.

       9. Arbitration:

                                   -5-
J-A03006-18

            Any disputes which arise from this Agreement shall be
            submitted to binding arbitration in accordance with the
            Rules of the American Arbitration Association and any
            judgment on the award rendered by the arbitrator may
            be entered in any court having jurisdiction thereof.

                                   *     *   *

(Agreement, dated 5/6/06, at 1-4; R.R. at 71a-74a). Essentially, Appellee

averred he agreed to “pledge” the Farm Property as collateral so that

Appellant’s business entity, 50 West Conestoga Road, LP, could purchase the

Elverson Property. In exchange, Appellee was to receive a twenty percent

(20%) interest in the Elverson Property. Appellee insisted Appellant failed to

pay him the amount owed.       Under the Agreement, Appellee claimed the

parties decided to operate the Farm Property jointly and to devote as much

time as possible to the operation of the Farm Property. Appellee maintained

Appellant devoted no time to the Farm Property since 2005, leaving Appellee

to tend to the Farm Property on his own by raising livestock, harvesting crops,

and hiring someone to assist with the farm management.           Appellee also

claimed he had expended substantial funds for maintenance of the Farm

Property and Rental Property. Appellee conceded the Agreement contains a

provision requiring any disputes arising from the Agreement to proceed to

binding arbitration. Nevertheless, Appellee suggested that all issues involving

the parties and the Farm Property, Rental Property, and Elverson Property

should be resolved together in one forum, the trial court. Appellee sought

partition of the Farm Property and the Rental Property, payment of his twenty

                                       -6-
J-A03006-18

percent (20%) interest in the Elverson Property, and reimbursement for the

expenses Appellee had paid to manage/operate the Farm Property and Rental

Property, as well as an order assessing charges against Appellant for his failure

to contribute to the management and operation of the Farm Property and/or

Rental Property.

       Appellant filed preliminary objections to Appellee’s counterclaim on

March 1, 2017, under Pa.R.C.P. 1028(a)(6), based on the arbitration clause

in the parties’ Agreement.1          Appellant insisted the Elverson Property is

separate and distinct from the other properties, and Appellee’s claim for a

twenty percent (20%) interest in the Elverson property must proceed to

arbitration. Appellee responded to the preliminary objections on March 20,

2017, claiming the parties’ Agreement sets forth the parties’ obligations to the

Farm Property, which is part of the partition action. Appellee renewed his

request for a “global resolution” of all claims in the trial court.

       By order dated June 26, 2017, and filed the next day, the court

overruled Appellant’s preliminary objections, stating:

          [Appellant’s] Complaint raises a partition action regarding
          two properties owned by the parties.            [Appellee’s]
          Counterclaim involves inter alia a written agreement
          between the parties with regard to a third property. That
          agreement contains an arbitration clause. [Appellant’s]
          Preliminary Objection is based on that arbitration
          agreement. Normally, we would sustain that Objection.
____________________________________________

1 See Pa.R.C.P. 1028(a)(6) (explaining preliminary objections may be filed by
any party to any pleading based on agreement for alternative dispute
resolution).

                                           -7-
J-A03006-18

        However, the agreement also contains provisions related to
        the two properties at issue in the instant action and could
        impact the parameters of any partition.         Finally, the
        Counterclaim itself, in addition to mentioning the third
        property, also makes averments that could impact any
        partition.

(Order, filed 6/27/17, at 1 n.1; R.R. at 98a) (internal citation omitted).

Appellant timely filed a notice of appeal on July 14, 2017. On July 18, 2017,

the court ordered Appellant to file a concise statement of errors complained

of on appeal pursuant to Pa.R.A.P. 1925(b); Appellant timely complied on

August 7, 2017.

     Appellant raises three issues for our review:

        WHETHER THE CHESTER COUNTY COURT OF COMMON
        PLEAS ABUSED ITS DISCRETION AND/OR ERRED AS A
        MATTER OF LAW AND/OR          ITS DECISION WAS
        UNSUPPORTED BY COMPETENT EVIDENCE IN OVERRULING
        APPELLANT’S PRELIMINARY OBJECTION TO APPELLEE’S
        COUNTERCLAIM,    WHICH    PRELIMINARY     OBJECTION
        ASSERTED THE EXISTENCE OF AN AGREEMENT TO
        ARBITRATE UNDER PA.R.C.P. 1028(A)(6), IN A PARTITION
        ACTION WHEREIN THE COMPLAINT INVOLVES TWO
        PROPERTIES OWNED BY THE PARTIES, WHEN THE
        COUNTERCLAIM INVOLVES AN ENTIRELY DISTINCT THIRD
        PROPERTY THAT HAS DIFFERENT OWNERSHIP, AND THE
        ISSUES ASSERTED IN THE COUNTERCLAIM ARE GOVERNED
        BY A WRITTEN AGREEMENT THAT, BY THE COURT’S
        ACKNOWLEDGEMENT, SUBJECTS THE MATTERS IN THE
        COUNTERCLAIM     TO   BINDING     ARBITRATION     IN
        ACCORDANCE WITH THE RULES OF THE AMERICAN
        ARBITRATION ASSOCIATION.

        WHETHER THE CHESTER COUNTY COURT OF COMMON
        PLEAS ABUSED ITS DISCRETION AND/OR ERRED AS A
        MATTER OF LAW AND/OR        ITS DECISION WAS
        UNSUPPORTED BY COMPETENT EVIDENCE IN OVERRULING
        APPELLANT’S PRELIMINARY OBJECTION TO APPELLEE’S
        COUNTERCLAIM,    WHICH  PRELIMINARY   OBJECTION

                                    -8-
J-A03006-18

         ASSERTED THE EXISTENCE OF AN AGREEMENT FOR
         BINDING ARBITRATION IN ACCORDANCE WITH THE RULES
         OF THE AMERICAN ARBITRATION ASSOCIATION UNDER
         PA.R.C.P. 1028(A)(6), WHEN APPELLEE/COUNTERCLAIM
         PLAINTIFF ADMITTED THE EXISTENCE OF A WRITTEN
         AGREEMENT FOR BINDING ARBITRATION WITH RESPECT
         TO THE ISSUES SET FORTH IN THE COUNTERCLAIM.

         WHETHER THE CHESTER COUNTY COURT OF COMMON
         PLEAS ABUSED ITS DISCRETION AND/OR ERRED AS A
         MATTER OF LAW AND/OR         ITS DECISION WAS
         UNSUPPORTED BY COMPETENT EVIDENCE IN OVERRULING
         APPELLANT’S PRELIMINARY OBJECTION TO APPELLEE’S
         COUNTERCLAIM,    WHICH   PRELIMINARY    OBJECTION
         ASSERTED THE EXISTENCE OF AN AGREEMENT FOR
         ARBITRATION UNDER PA.R.C.P. 1028(A)(6), WHEN THE
         COURT FOUND THAT THE SUBJECT AGREEMENT
         CONTAINED AN AGREEMENT TO SUBMIT ALL DISPUTES TO
         BINDING ARBITRATION, AND ACKNOWLEDGED THAT IT
         WOULD NORMALLY SUSTAIN THE OBJECTION BASED ON
         THE ARBITRATION AGREEMENT, BUT NONETHELESS
         PROCEEDED TO OVERRULE THE PRELIMINARY OBJECTION
         ON [THE] BASIS THAT THE AGREEMENT COULD
         PURPORTEDLY IMPACT THE PARTITION ACTION AND THE
         COUNTERCLAIM MENTIONS THE THIRD PROPERTY AND
         MAY PURPORTEDLY IMPACT THE PARTITION.

(Appellant’s Brief at 5-6).

      For purposes of disposition, we combine Appellant’s issues. Appellant

argues his claims for partition are separate and distinct from Appellee’s

allegations in the counterclaim relating to the Elverson Property and the

parties’ Agreement, so the parties should litigate Appellant’s partition

complaint in the trial court and Appellee’s counterclaim in arbitration.

Appellant asserts the parties’ Agreement contains a clear and valid agreement

to arbitrate claims arising out of the Agreement.       Appellant avers the

Agreement pertains mainly to the Elverson Property, as entirely distinct from

                                    -9-
J-A03006-18

the Farm Property and Rental Property, which are subjects of the partition

action. Appellant emphasizes that neither Appellant nor Appellee individually

owns the Elverson Property; instead, an entity called 50 West Conestoga

Road, LP owns the Elverson Property. Appellant stresses 50 West Conestoga

Road, LP is not even a party to this action. Appellant suggests that litigating

Appellee’s counterclaim in the partition action would deprive that entity of due

process. Appellant complains Appellee is attempting to utilize the partition

action to bypass the binding arbitration clause in the parties’ Agreement.

Appellant maintains the dispute at issue in Appellee’s counterclaim, involving

Appellant’s alleged breaches of his obligations under the Agreement, is

unquestionably within the scope of the arbitration provision. Appellant insists

the mere mention of the Farm Property in the Agreement should not permit

Appellee to evade the arbitration clause and litigate all claims at the same

time.      Appellant concludes the arbitration clause governs Appellee’s

counterclaim and this Court must reverse the trial court’s order denying

arbitration of, and retaining jurisdiction over, the counterclaim. We agree in

part but not on the grounds stated.

        Initially, as a general rule:

           [A]n order      [overruling] preliminary      objections is
           interlocutory and not appealable as of right. There exists,
           however, a narrow exception to this oft-stated rule for cases
           in which the appeal is taken from an order denying a petition
           to compel arbitration. Our decisional law has made clear
           that the issue of whether a party agreed to arbitrate a
           dispute is a threshold, jurisdictional question that must be
           decided by the court.

                                        - 10 -
J-A03006-18

Pisano v. Extendicare Homes, Inc., 77 A.3d 651, 654 (Pa.Super. 2013),

appeal denied, 624 Pa. 683, 86 A.3d 233 (2014), cert. denied, ___ U.S. ___,

134 S.Ct. 2890, 189 L.Ed.2d 838 (2014) (internal citations and quotation

marks omitted). The relevant standard and scope of review in this context

are as follows:

            Our review of a claim that the trial court improperly
            denied the appellant’s preliminary objections in the
            nature of a petition to compel arbitration is limited to
            determining whether the trial court’s findings are
            supported by substantial evidence and whether the
            trial court abused its discretion in denying the petition.

         In doing so, we employ a two-part test to determine
         whether the trial court should have compelled arbitration.
         First, we examine whether a valid agreement to arbitrate
         exists. Second, we must determine whether the dispute is
         within the scope of the agreement.

                                   *     *      *

         Whether a claim is within the scope of an arbitration
         provision is a matter of contract, and as with all questions
         of law, our review of the trial court’s conclusion is plenary.

Id. at 654-55 (internal citations and quotation marks omitted). In making

these determinations, courts must bear in mind:

            (1) arbitration agreements are to be strictly construed
            and not extended by implication; and (2) when parties
            have agreed to arbitrate in a clear and unmistakable
            manner, every reasonable effort should be made to
            favor the agreement unless it may be said with
            positive assurance that the arbitration clause involved
            is not susceptible to an interpretation that covers the
            asserted dispute.

                                       - 11 -
J-A03006-18

           To resolve this tension, courts should apply the rules of
           contractual constructions, adopting an interpretation that
           gives paramount importance to the intent of the parties and
           ascribes the most reasonable, probable, and natural conduct
           to the parties. In interpreting a contract, the ultimate goal
           is to ascertain and give effect to the intent of the parties as
           reasonably manifested by the language of their written
           agreement.

Provenzano v. Ohio Valley General Hosp., 121 A.3d 1085, 1095

(Pa.Super. 2015) (internal citations omitted).

      Pennsylvania law endorses the nationally accepted liberal policy favoring

arbitration embodied in the Federal Arbitration Act at 9 U.S.C. §§ 1-16

(“FAA”):

           [The enactment of the FAA] expresses a liberal federal
           policy favoring arbitration agreements. [Congress’] purpose
           was to overcome state legislative and judicial efforts to
           undermine the enforceability of arbitration agreements,
           inter alia, by establishing a substantive rule of federal law
           placing such agreements upon the same footing as other
           contracts. The federal statute thus requires that a written
           provision…to settle by arbitration a controversy thereafter
           arising out of such contract or transaction…shall be valid,
           irrevocable, and enforceable, save upon any grounds at law
           or in equity for the revocation of any contract.2

              2  Pennsylvania law reflects an identical policy
              embodied in the Uniform Arbitration Act. See 42
              Pa.C.S.[A]. § 7303 (“A written agreement to subject
              any existing controversy to arbitration or a provision
              in a written agreement to submit to arbitration any
              controversy thereafter arising between the parties is
              valid, enforceable, and irrevocable, save upon such
              grounds as exist at law or in equity relating to the
              validity, enforceability or revocation of any contract”).

Salley v. Option One Mortg. Corp., 592 Pa. 323, 330, 925 A.2d 115, 118-

19 (2007). See also Taylor v. Extendicare Health Facilities, Inc., 637

                                       - 12 -
J-A03006-18

Pa. 163, 194, 147 A.3d 490, 509 (2016) (stating: “Section 2 of the FAA binds

state courts to compel arbitration of claims subject to an arbitration

agreement”; this directive is mandatory); Ross Development Co. v.

Advanced Bldg. Development, Inc., 803 A.2d 194, 196 (Pa.Super. 2002)

(reiterating historical perspective in Pennsylvania law favoring arbitration);

Smith v. Cumberland Group, Ltd., 687 A.2d 1167, 1171 (Pa.Super. 1997)

(stating: “As a matter of public policy, the courts of this Commonwealth

strongly favor the settlement of disputes by arbitration”). “Under the FAA,

any doubts concerning the scope of arbitrable issues should be resolved in

favor of arbitration.”   Provenzano, supra at 1097 (internal citation and

quotation marks omitted).      Importantly: “The essential and overarching

purpose of the FAA…is to ensure the enforcement of arbitration agreements

according to their terms so as to facilitate streamlined proceedings and

resolution of claims.”   Id. at 1098 (internal citation and quotation marks

omitted).

      Instantly, Appellant’s complaint alleged Appellee: (1) retained exclusive

possession of the Farm Property since August of 2006; (2) refused to rent the

Farm Property, which prevented Appellant from collecting a fair rental value

for that land; and (3) rented the Rental Property for an amount inadequate to

pay for the taxes, insurance and maintenance expenses for both properties,

which forced Appellant to contribute to those expenses.       Appellant sought

partition of the Farm Property and Rental Property so the parties could sell the

                                     - 13 -
J-A03006-18

properties, pay the expenses of the sales, and equitably divide the net

proceeds of the sales. Appellant further requested an order assessing charges

against Appellee for the fair market rental value arising from Appellee’s

exclusive use and occupancy of the Farm Property, as well as reimbursement

of the amounts Appellant paid for taxes, maintenance, and insurance for the

properties.

      Appellee’s counterclaim alleged Appellant: (1) failed to pay Appellee the

twenty percent (20%) interest owed under the Agreement regarding the

Elverson Property; (2) devoted no time to operation of the Farm Property since

2005; and (3) caused Appellee to expend substantial funds for maintenance

of the Farm Property. Appellee also sought partition of the Farm Property and

Rental Property, payment of his twenty percent (20%) interest in the Elverson

Property,     and   reimbursement   for   the   expenses   Appellee   paid   to

manage/operate the Farm Property and Rental Property, as well as an order

assessing charges against Appellant for his failure to contribute to the

management and operation of the Farm Property and/or Rental Property.

      The parties concede the Agreement contains a valid arbitration clause.

(See Agreement at ¶ 9; R.R. at 74a). The Agreement delineates the parties’

rights and duties regarding the Elverson Property and implicates the Farm

Property. For example, the Agreement specifies that the parties will use the

Farm Property as collateral for Appellant to obtain the Elverson Property; in

exchange, Appellee will receive a twenty percent (20%) interest in the

                                    - 14 -
J-A03006-18

Elverson Property. (See id. at ¶¶ 1, 3; R.R. at 72a). The Agreement requires

Appellant to receive financing to complete the purchase of the Elverson

Property and apply for refinancing of any outstanding loan encumbering the

Farm Property, without pledging any of the Farm Property as collateral for the

refinanced loan(s).   (Id. at ¶ 2; R.R. at 72a).   Under the Agreement, the

parties must keep all funds received from operation of the Farm Property

separate and distinct from any other money either partner obtains through

individual ventures or investments. (Id. at ¶ 4; R.R. at 73a). The Agreement

instructs the parties to devote as much time as is reasonably possible to

operation of the Farm Property and to work with each other to further the

interests of the “Partnership.” (Id. at ¶ 5; R.R. at 73a). The parties agreed

that any profits or losses of the “Partnership” will be divided equally between

the “Partners”; provided that if one partner fails to contribute materially to

operation of the Farm Property, appropriate adjustments will be made

between the Partners to reflect the contribution made by each Partner toward

the operation and maintenance of the Farm Property. (Id. at ¶ 6; R.R. at

73a).

        By entering the Agreement, the parties decided on a set of rules that

would govern their pursuit of Appellant’s purchase of the Elverson Property

and their joint operation of the Farm Property. All of the allegations in both

the complaint and counterclaim concerning the Farm Property and the

Elverson Property fall within the scope of the Agreement and its arbitration

                                    - 15 -
J-A03006-18

provision. (See id. at ¶¶ 1, 3, 5, 6; R.R. at 72a-73a).

      Additionally, the parties utilized the Farm Property as collateral for

Appellant’s purchase of the Elverson Property. The court cannot partition the

Farm Property in a proceeding separate from claims surrounding the Elverson

Property and the parties’ Agreement, as the lender for the loan on the Elverson

Property would have a lien on the Farm Property, in the event of a default,

thereby destabilizing the Agreement.

      Each party also asserted claims related to the Rental Property.      The

Agreement does not specifically mention the Rental Property. Nevertheless,

the Agreement repeatedly refers to the “Partnership” and makes clear “[e]ach

Partner will endeavor to work with the other to further the interests of the

Partnership, understanding that time constraints and other commitments may

involve one partner contributing more time and/or effort towards the

operation of the Partnership than the other.” (Id. at ¶ 5; R.R. at 73a). The

parties’ rights and duties concerning the Farm Property and the Elverson

Property vis-à-vis the Rental Property are so inextricably intertwined that

claims pertaining to all three properties should be adjudicated in one forum.

In other words, adjudication of claims regarding the Elverson Property

implicates claims regarding the Farm Property, which necessarily implicates

claims regarding the Rental Property.

      In light of the parties’ relationship, course of conduct in executing the

Agreement to arbitrate, and to facilitate streamlined proceedings and

                                    - 16 -
J-A03006-18

resolution of claims, we consider issues involving joint ownership of and

contribution to the Partnership and the three properties to fall within the scope

of arbitrable issues. See Provenzano, supra (reversing trial court’s order

overruling preliminary objections in form of petition to compel arbitration of

claim under Wage Payment and Collection Law (“WPCL”); WPCL claim arose

out of alleged breach of employment contract containing arbitration clause

and was temporally and factually related to appellee’s contract claim; in

overruling preliminary objections, trial court subordinated liberal policy

favoring arbitration shared in prevailing federal and state law).     Compare

Taylor, supra (holding FAA preempts application of Pa.R.C.P. 213(e)

(requiring consolidation of wrongful death and survival claims for trial);

decedent signed agreement with nursing home facility providing that any

disputes arising between parties must be submitted to arbitration; wrongful

death action had to be adjudicated in trial court, because arbitration

agreement, signed only by decedent, did not bind claims of decedent’s

wrongful death beneficiaries; wrongful death action was not derivative of

decedent’s survival claim, because wrongful death action belonged only to

statutory claimants and not to decedent; concluding wrongful death and

survival claims had to be bifurcated, with beneficiaries’ wrongful death claim

to proceed in trial court and decedent’s survival claim to proceed in

arbitration).

      Unlike Taylor, where the arbitration agreement could not bind the

                                     - 17 -
J-A03006-18

wrongful death beneficiaries, here Appellant and Appellee signed the

Agreement containing the arbitration provision. Further, nothing in the Rules

of Civil Procedure prohibits litigation of a partition action in the arbitration

forum.    See Pa.R.C.P. 1551-1574 (governing actions for partition of real

property). Therefore, we see no need to bifurcate resolution of the claims

raised in this case. Thus, we conclude all claims in this matter should proceed

in the single forum of arbitration, to avoid conflicting resolutions and/or the

potential for duplicative awards.2 Accordingly, we reverse the order overruling

Appellant’s preliminary objections to Appellee’s counterclaim and remand for

further proceedings.

       Order reversed; case remanded for further proceedings. Jurisdiction is

relinquished.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 3/27/18

____________________________________________

2 At oral argument, the Court gave the parties an opportunity to waive the
arbitration clause so all claims could proceed in the trial court. Following
argument, Appellant’s counsel notified this Court that the parties were unable
to reach a stipulation regarding a common forum for all their claims at one
time. Upon remand, the trial court might want to revisit the waiver potential.
If the parties still cannot agree, the trial court must direct all claims to proceed
to arbitration.

                                          - 18 -