Berman

Defendants Dean Witter & Co. (Witter) and Norman Sobel (Sobel) appeal from an order denying their petition to compel arbitration and to stay proceedings in the action brought against them by plaintiffs Jack and Leona Berman.

Plaintiffs who are husband and wife commenced this action with the filing of a complaint captioned “Complaint for Negligence; Complaint for a Breach of a Fiduciary Relationship” which alleged that Leona Berman maintained an account with Witter, a securities broker, and that on May 16, 1972, Jack Berman purchased on margin for Leona’s account five short-term future contracts for Japanese yen. The order and purchase were handled by Sobel as agent of Witter.

The complaint further alleges that Witter and Sobel acquired the future contracts at a grossly excessive price and negligently concealed from plaintiffs certain market information and the fact that Witter and Sobel were inexperienced in the currency market. As a result of relying on Sobel and Witter’s advice, plaintiffs suffered a financial loss which they would not have suffered but for such advice.

Defendants simultaneously answered, denying their liability, and petitioned to compel arbitration.…