Bos Material Handling, Inc. v. Crown Controls Corporation

In Bos Material Handling, Inc. v. Crown Controls Corporation (1982) 137 Cal. App. 3d 99, the trial court denied the defendant's petition to compel arbitration on the ground the causes of action in the complaint were not covered by an arbitration provision in an agreement between the parties. The agreement, under which the plaintiff became an authorized dealer for the defendant, contained the following arbitration clause: "Any controversy or claim arising out of or relating to this agreement, or the breach thereof, shall be settled by arbitration in Dayton, Ohio, in accordance with the rules of the American Arbitration Association then obtaining." After the agreement terminated, the plaintiff sued the defendant. "Although bearing tort labels, the complaint essentially alleged wrongful acts, initiated by the defendant prior to the expiration of the agreement . . ., which led to wrongful termination of the dealer agreement." The plaintiff asserted six causes of action against the defendant, including tortious breach of good faith and fair dealing, interference with economic relations and fraud. The Court of Appeal reversed the trial court's order denying the petition to compel arbitration, finding the "complaint clearly has its genesis in the contractual relationship. Although cast in terms of tort, it focuses on the defendant's unilateral termination of the dealership as the conduct which is wrongful . . . ." The court concluded "the broad language of the arbitration provision here supports a reasonable inference that the parties agreed to arbitrate all controversies, including tort claims, arising out of their contractual relationship."