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Karen Cole v. Jersey City Medical Center

March 29, 2012

KAREN COLE, PLAINTIFF-APPELLANT,
v.
JERSEY CITY MEDICAL CENTER, DEFENDANT, AND LIBERTY ANESTHESIA ASSOCIATES, LLC, DEFENDANT-RESPONDENT, AND JERSEY CITY MEDICAL CENTER, THIRD-PARTY PLAINTIFF,
v.
LIBERTY ANESTHESIA ASSOCIATES, LLC, THIRD-PARTY DEFENDANT.



On appeal from Superior Court of New Jersey, Law Divison, Bergen County, Docket No. L-7033-07.

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

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

APPROVED FOR PUBLICATION

Argued March 9, 2011

Before Judges Fuentes, Ashrafi and Nugent.

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

Plaintiff Karen Cole was terminated from her position as a nurse anesthetist and subsequently brought suit for unlawful termination alleging retaliatory discharge in violation of the Conscientious Employee Protection Act (CEPA), N.J.S.A. 34:19-1 to -8; defamation; tortious interference with contract; and disability discrimination in violation of the Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -42. Plaintiff named as defendants her immediate employer, Liberty Anesthesia Associates, LLC (Liberty), and the hospital where she worked, Jersey City Medical Center (Medical Center).

Plaintiff settled her claims against the Medical Center. At that point, the trial court granted Liberty's summary judgment motion as to the counts alleging defamation and termination in violation of pubic policy. The trial court thereafter granted Liberty's motion to enforce an arbitration clause in plaintiff's employment agreement and dismissed plaintiff's remaining claims against Liberty. Plaintiff now appeals, arguing that Liberty waived its right to compel arbitration by failing to raise this affirmative defense in a timely manner and by actively participating in the litigation until the eve of trial. Independent of this objection, plaintiff also argues that the arbitration clause is unconscionable and unenforceable.

Based on the record before us, we hold that Liberty is precluded from enforcing the arbitration provision in its employment contract with plaintiff. As a matter of litigation strategy, Liberty opted to participate in the suit brought in the Superior Court for a period of twenty months and did not raise the issue of arbitration until three days before the case was scheduled for trial. During this time, the parties completed their reciprocal discovery obligations and the case was ready for trial. This indicates a knowing and deliberate decision by Liberty to forgo raising arbitration as a forum to adjudicate plaintiff's claims. Under these circumstances, Liberty is equitably estopped from compelling plaintiff to submit her claims to arbitration. In this light, we do not reach plaintiff's argument attacking the enforceability of the arbitration provision based on unconscionability.

I

A

Plaintiff began her association with the Medical Center in April 2004 as a per diem Certified Registered Nurse Anesthetist (CRNA). At that time, she was also working in the same capacity at Overlook Hospital in Summit. In September 2004, the Medical Center offered plaintiff a full-time position as a CRNA. Because Liberty had an exclusive contract to provide anesthesia services to the Medical Center, plaintiff's offer of employment came directly from Liberty.

By letter dated September 20, 2004, Liberty sent plaintiff an employment agreement ("the Agreement" or "the Employment Agreement"), stating that plaintiff was being hired as a full-time employee commencing on October 1, 2004. The Agreement contained twelve numbered sections and multiple addenda describing the terms and conditions of plaintiff's employment with Liberty, including salary rate, vacation and sick days, health insurance benefits, and malpractice insurance coverage.

With respect to termination, the Agreement provided, in pertinent part:

5. Either of us may terminate your employment relationship at any time for any reason or no reason (with or without cause) on sixty (60) automatically and immediately terminate your employment if

(b) Your staff privileges at any hospital or your privileges are suspended, revoked, ...


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