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Hojnowski v. Vans Skate Park

March 10, 2005

ANDREW HOJNOWSKI, A MINOR, THROUGH HIS PARENTS AND GUARDIANS AD LITEM, JERRY HOJNOWSKI AND ANASTASIA HOJNOWSKI, AND JERRY HOJNOWSKI AND ANASTASIA HOJNOWSKI, IN THEIR OWN RIGHT, PLAINTIFFS-APPELLANTS,
v.
VANS SKATE PARK, DEFENDANT-RESPONDENT, AND MCCOWN DELEEUW COMPANY, DEFENDANT.



On appeal from Superior Court of New Jersey, Law Division, Burlington County, L-2447-03.

Before Judges Fall, Payne and C.S. Fisher.

The opinion of the court was delivered by: Payne, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Submitted October 20, 2004

Plaintiffs Andrew Hojnowski, a minor, and his parents, Jerry and Anastasia Hojnowski, appeal from an order of the trial court dismissing without prejudice the personal injury complaint filed by the parents on behalf of Andrew and themselves against Vans Skate Park (properly known as Vans, Inc.) to permit an arbitration to take place under rules established by the American Arbitration Association (AAA). On appeal, plaintiffs argue that the pre-tort release signed by Anastasia Hojnowski on behalf of her son, which contains an arbitration provision as well as a limitation of liability, is not enforceable against the son. Its enforceability against the parents is not raised as an issue.

On January 3, 2003, Andrew Hojnowski, age twelve, fractured his femur while skateboarding at a skatepark facility operated by Vans. He has subsequently undergone two surgeries for the repair of the injury. In a complaint filed against Vans and its alleged corporate owner, plaintiffs claimed that Vans was liable for Andrew's injuries as the result of its negligent failure to supervise activities at the park, to control activities of aggressive skateboarders, to warn Andrew's parents that the activities of aggressive skateboarders would not be monitored, and to provide a safe place to skateboard.

Prior to Andrew's accident, on December 26, 2002, as a condition of use of the park, Andrew's mother executed on Andrew's behalf a document entitled"Release and Waiver of Liability and Jury Trial with Indemnity (For All Vans Skateparks, Stores and Facilities (Collectively,"Parks") in New Jersey)." The document commenced by stating:

Please read this document. It affects Your legal rights against Vans, Inc. if you are injured. Do not sign this document unless you understand it. If You are a minor, Your parent or guardian is required to sign this legal document.

Additionally, the document, at its conclusion, required a"yes" or"no" response to the following question:"Do You understand that You are giving up rights by signing this document if You are hurt?" Andrew's mother responded"yes" to this question.

The body of the document commenced with a description of the dangers of skateboarding, in-line skating and bicycle riding. It then set forth the following provisions of relevance to this litigation:

2. Can You Make A Claim For Money If You Are Injured?

If you are injured and want to make a claim, you must file a demand before the American Arbitration Association (the"AAA").... You agree that any dispute between You and Vans will be decided by the AAA. Vans, Inc. will pay all costs of the arbitration for You....

3. Vans Is Asking You To Give Up Legal Rights in Order to Enter This Park.

Because using Vans' Park... may increase your risk of harm, Vans is asking you to give up certain valuable legal rights. Here are the rights you are giving up when you sign this document:

(a) You give up your right to sue Vans in a court of law.

(b) You give up your right to a trial by jury.

(c) You give up the right to claim money from Vans if you are injured unless Vans intentionally failed to prevent or correct a hazard caused by unsafe equipment or devices.

(d) You give up the right to claim money from Vans if you wait more than one year from the injury in order to make a claim.

(e) You give up the right to claim money from Vans, Inc. if you are injured by another person. (f) You give up the right to recover damages to punish or make an example of Vans, Inc.

4. Rights You Do Not Give Up You do not give up the right: (a) To have safe equipment, structures and devices at the Park for Your intended use.

(b) To claim compensation for Your injury from Vans, Inc. if you are hurt because the equipment, structures and devices at the Park are not safe for Your intended use.

(c) To have a neutral arbitrator decide your rights fairly, quickly and completely.

5. Who is Bound By This Document? You are bound by this document. Anyone who has or can obtain Your rights is also bound by this document, such as Your family, relatives, guardians, executors or anyone responsible for You....

6. Other Information Important For You To Know

You have the right to demand money if You believe Vans, Inc. intentionally caused You harm. If parts of this document are determined to be invalid, then that portion will be unenforceable and the remainder of the document will continue in full legal force and effect.... Following the institution of suit, Vans filed for commercial arbitration with the AAA. Plaintiffs then moved to enjoin the arbitration and to invalidate the pre-tort release signed by Andrew's mother. Vans cross-moved for summary judgment. The court granted Vans' motion, dismissing plaintiffs' complaint without prejudice*fn1 and ordering that the parties submit to arbitration. It made no ruling on the validity of the contract's limitation of liability, finding that the issue was within the jurisdiction of the arbitrator.

We are informed that the parties have selected as arbitrator a person with significant experience in tort law, thereby rendering irrelevant any argument by plaintiffs that the arbitration cannot proceed under the auspices of an organization whose focus is upon commercial matters--an argument that we find in any event to be factually unsupported.

I.

We construe the document executed by Anastasia Hojnowski on behalf of her son Andrew as bipartite, consisting of an agreement to arbitrate and a pre-tort liability waiver. We first address, as a matter entirely separate from the issue of the validity of the liability waiver, whether in the circumstances presented, a parent can enter into an enforceable contract, binding on the parent's minor child, that waives the right to trial by jury of the minor's bodily injury claims and requires submission of"any dispute" to arbitration. We hold that a parent has such power.

Public policy has long favored arbitration. See, e.g., Martindale v. Sandvik, 173 N.J. 76, 84-85 (2002); Garfinkel v. Morristown Obstetrics & Gynecology Associates, 168 N.J. 124, 131 (2001); Barcon Assocs. v. Tri-County Asphalt Corp., 86 N.J. 179, 186 (1981) (discussing long history of arbitration); Jansen v. Salomon Smith Barney, 342 N.J. Super. 254, 257 (App. Div.), certif. denied, 170 N.J. 205 (2001).

The ancient practice of arbitration"[i]n its broad sense, [] is a substitution, by consent of the parties, of another tribunal for the tribunal provided by the ordinary processes of law. The object of arbitration is the final disposition, in a speedy, inexpensive, expeditions and perhaps less formal manner, of the controversial differences between the parties." [Garfinkel, supra, 168 N.J. at 131 (quoting Carpenter v. Bloomer, 54 N.J. Super. 157, 162 (App. Div. 1959) (quoting Eastern Eng'g Co. v. City of Ocean City, 11 N.J. Misc. 508, 510-00 (Sup. Ct. 1933)).]

We read an agreement relating to arbitration liberally to find arbitrability if that is reasonably possible. Garfinkel, supra, 168 N.J. at 132; Marchak v. Claridge Commons, Inc., 134 N.J. 275, 282 (1993); Jansen, supra, 342 N.J. Super. at 257-58.

In this case, the agreement signed by Andrew's mother on his behalf provided that:"If you are injured and want to make a claim, you must file a demand before the American Arbitration Association." The agreement further eliminated the right to sue in a court of law."A provision in a written contract to settle by arbitration a controversy that may arise therefrom... shall be valid, enforceable and irrevocable, except upon such grounds as exist at law or in equity for the revocation of a contract." N.J.S.A. 2A:24-1.*fn2 The fact that the claim arises in tort, not contract, is immaterial. Garfinkel, supra, 168 N.J. at 137; Jansen, supra, 342 N.J. Super. at 258.

No New Jersey case has determined whether a parent, as a condition to her minor child's entry into a commercial recreational facility and participation in its activities, has the power to agree on behalf of that child that any claim for the minor's bodily injuries at the facility will be subject to arbitration. However the issue of the binding effect on non parties of a contractual arbitration clause has been addressed."[N]on-signatories of a contract... may... be subject to arbitration if the nonparty is an agent of a party or a third party beneficiary to the contract." Garfinkel v. Morristown Obstetrics & Gynecology Assoc., 333 N.J. Super. 291, 308 (App. Div. 2000), rev'd on other grounds, 168 N.J. 124 (2001)(quoting Mutual Benefit Life Ins. Co. v. Zimmerman, 783 F.Supp. 853, 865 (D.N.J.), aff'd, 970 F.2d 899 (3d Cir. 1992)). See also Jansen, supra, 342 N.J. Super. at 261."The principle that determines the existence of a third party beneficiary status focuses on whether the parties to the contract intended others to benefit from the existence of the contract, or whether the benefit so derived arises merely as an unintended incident of the agreement." Broadway Maintenance Corp. v. Rutgers, The State Univ., 90 N.J. 253, 259 (1982)."[T]he real test is whether the contracting parties intended that a third party should receive a benefit which might be enforced in the courts." Borough of Brooklawn v. Brooklawn Housing Corp., 124 N.J.L. 73, 77 (E. & A. 1940). See also Restatement (Second) of Contracts § 302 (1979).

In this case, it is clear that Andrew's mother intended that Andrew benefit from the contract that she signed on his behalf. Indeed, her execution of the agreement had no purpose other than to gain for her son the benefit of entry into the skatepark. That the entry was conditioned upon a relinquishment of the right to trial and its replacement with the right to mandatory arbitration does not render the contract against public policy or otherwise avoidable.

The substitution of one forum for another, in and of itself, has never been declared against the public policy of this State.*fn3 We recognize that commentators have found fault with the arbitration process, focusing on concerns such as its cost, limitations upon discovery, the absence of an adequate evidentiary record to support the arbitrator's decision, the elimination of the right to a jury trial, and severe restrictions upon appellate review. See, e.g., Elizabeth G. Thornberg, Contracting with Tortfeasors: Mandatory Arbitration Clauses and Personal Injury Claims, 67 Law and Contemporary Problems 253 (Winter/Spring 2004).*fn4 Nonetheless, those complaints have not gained a foothold in New Jersey's jurisprudence. A"State interest in favoring arbitration" has instead been recognized. Martindale, supra, 173 N.J. at 85. We perceive no rational basis for according additional weight in this case to the concerns enumerated by others, simply because the arbitration provision at issue governs the claims of a minor.

We derive support for our conclusion from Allgor v. Travelers Ins. Co., 280 N.J. Super. 254 (App. Div. 1995), although we recognize in that case that the benefit to the child was of greater significance than that accorded here, and the father's right to enter into a contract affecting the welfare of his son was concomitantly stronger. There, we found that a father's contractual agreement to submit underinsured motorist's (UIM) claims to arbitration bound his minor son, ...


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