Best Interiors, Inc. v. MILLIE AND SEVERSON, INC.

SUMMARY

Under Code of Civil Procedure section 1281.2, the trial court denied a petition to compel arbitration. That section gives the court the discretion to deny enforcement of an arbitration agreement, and to order all parties to litigate in a single action, if the court determines that (1) a party to the arbitration agreement is also a party to a pending court case with a third party arising out of the same transaction, and (2) there is a possibility of conflicting rulings on a common issue of law or fact. We find no abuse of discretion in the trial court’s decision. We also reject the contention that the Federal Arbitration Act prevents the trial court from exercising its discretion under Code of Civil Procedure section 1281.2.

FACTUAL AND PROCEDURAL BACKGROUND

Millie and Severson, Inc. (M&S), is a general contractor. M&S contracted with Presbyterian Intercommunity Hospital, Inc. (Presbyterian), to construct a facility in Whittier, California. M&S in turn contracted with Best Interiors, Inc. (Best), for the construction and installation of metal framing, gypsum board, and Portland cement plaster construction for the facility, for a contract price of…