June 24, 2013
JOSEPH N. AMORE, Plaintiff-Respondent,
GROUP ONE AUTOMOTIVE, INC., RUBEN SANTIAGO, EARL HESTERBERG, BROOKS O'HARA, DARYL KENNINGHAM, and DARRYL L. BURMAN, Defendants-Appellants, and RICK ZIBILICH, Defendant.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted April 23, 2013
On appeal from the Superior Court of New Jersey, Law Division, Ocean County, Docket No. L-987-12.
Fisher & Phillips, LLP, attorneys for appellants (David E. Strand, of counsel; David J. Treibman, on the briefs).
DeNoia & Tambasco, attorneys for respondent (G. John Germann, on the brief).
Before Judges Lihotz and Ostrer.
Plaintiff Joseph N. Amore filed an eight-count complaint alleging wrongful termination against his former employer, defendant Mercedes Benz of Freehold (MBF), incorrectly denominated Group One Automotive, Inc.,  and several officers and employees, including Ruben Santiago, Earl Hesterberg, Brooks O'Hara, Daryl Kenningham, and Darryl L. Burman (collectively defendants). The trial court denied defendants' motion to dismiss plaintiff's complaint and compel arbitration. Defendants appeal and we reverse.
Plaintiff was offered employment as a general sales manager with MBF on April 20, 2011. On that date, plaintiff executed a two-page "Pay Plan, " which detailed the terms of his compensation, and a two-page "Job Description/Performance-Based Competency Assessment Form, " which outlined his essential duties and responsibilities. Plaintiff commenced employment on April 22, 2011. That morning, MBF's human resources representative provided plaintiff with additional documents, including an employee handbook. Plaintiff acknowledged receipt of the handbook and documentation by signing a document entitled "EMPLOYEE ACKNOWLEDGEMENT AND AGREEMENT" (EAA). This two-page document included three boldfaced headings on the first page. The first two, entitled "1. Handbook Receipt" and "2. At-Will Employment[, ]" were on the upper half of the page. The third heading was placed in the middle of the page and was entitled "3. Arbitration Agreement." The following language was included in capital letters, immediately above the signature line on the second page: "MY SIGNATURE BELOW ATTESTS TO THE FACT THAT I HAVE READ, UNDERSTAND, AND AGREE TO BE LEGALLY BOUND TO ALL OF THE ABOVE TERMS. MY SIGNATURE FURTHER ACKNOWLEDGES THAT I HAVE HAD THE OPPORTUNITY TO ASK QUESTIONS ABOUT THE TERMS OF THIS AGREEMENT" (emphasis in original).
Plaintiff was terminated from his employment on August 5, 2011. He filed his wrongful termination complaint, alleging various statutory and tort-based claims against defendants. Relying on the arbitration agreement contained in the EAA executed by plaintiff, defendants moved to dismiss the complaint and compel arbitration. Defendants supported the motion with a certification from Laura Hannen, Human Resources Manager for the NY/NJ/MD area, which merely attached the EAA and certified it was signed by plaintiff on April 22, 2011.
Plaintiff opposed the motion, contending the arbitration agreement was not a valid and enforceable contract. Specifically, plaintiff maintained he was not informed of the issue of arbitration during the hiring process. Further, with respect to when he was approached by the human resources personnel and asked to sign the EAA on his first day of work, plaintiff averred:
I was not given the opportunity to read the employee manual at the time, nor was it suggested that I review this matter carefully or have it reviewed by an attorney before signing it. In fact, the first paragraph of the document was labeled "Handbook Receipt." . . . . There was no representation that this acknowledgment contained an arbitration agreement or that I was waiving any rights. It was expressly represented that I was merely signing an acknowledgment of receipt of the employee handbook.
Although the handbook included an addendum specifically directed to New Jersey law, neither the main document nor the addendum contained provisions addressing termination from employment or arbitration of disputes.
During oral argument, the Law Division judge focused on the circumstances surrounding the execution of the EAA, stating:
[T]here's a fairly narrow area of inquiry . . . that I think still needs to be flushed out . . . in this case, and that is the circumstances surrounding his relatively brief encounter with H.R. that led to the execution of this document. If I . . . just tak[e] [p]laintiff's case and [p]laintiff's argument here, . . . [h]e's saying that H.R. comes to him with the employee handbook and with this document for signature, and the caption of the document doesn't say arbitration agreement. It says Employee Acknowledgment and Agreement. . . . [I]t doesn't say an arbitration agreement. So their argument is H.R. says to him here's your manual. I need you to sign this acknowledgment . . . . Takes the signature. Folds up the arbitration agreement. Stuffs it in the back of the employee handbook. The employee handbook never references arbitration anywhere and he doesn't read it.
Now, I understand what you're saying . . . and under most circumstances you sign a document, you're bound by the document. It's crystal clear. I agree with you. But there could be an exception to that where someone makes . . . effectively a misrepresentation or an omission to someone by leading them to believe that the document is other than what it is.
And if you're looking at this, if you were looking at this in a quick cursory fashion, it says Employee Acknowledgment at the top. You read the first line here, it says my signature below acknowledges that I have received my copy of the employee handbook.
Although the judge explained he was not ruling in plaintiff's favor on the ultimate merits of the validity and enforceability of the arbitration agreement, as plaintiff was "still swimming upstream[, ]" the judge denied defendants' motion, finding there was "enough of a factual issue" to require further discovery. Defendants appealed. The judge supplemented his determination pursuant to Rule 2:5-5, suggesting the order was not final for purposes of appeal.
Initially, we conclude the July 13, 2012 order is subject to appellate review, regardless of the trial court's suggestion that it "did not rule in [p]laintiff's favor in denying [d]efendant[s'] request for arbitration . . . [but instead] ruled that there were factual issues and relevant discovery . . . that had to be resolved[.]" Rule 2:2-3(a)(3) provides an "order compelling or denying arbitration . . . shall . . . be deemed a final judgment of the court for appeal purposes." Noting this State's strong public policy favoring arbitration, Garfinkel v. Morristown Obstetrics & Gynecology Assocs., P.A., 168 N.J. 124, 131 (2001), the courts must not frustrate or ignore the goal of arbitration agreements to provide a speedy and inexpensive final disposition of disputes, Barcon Assocs., Inc. v. Tri-County Asphalt Corp., 86 N.J. 179, 187 (1981).
Whether the parties have agreed to arbitrate is a question of law. Bd. of Educ. of Bloomfield v. Bloomfield Educ. Ass'n, 251 N.J.Super. 379, 383 (App. Div. 1990) ("Whether the parties are contractually obligated to arbitrate a particular dispute is a matter for judicial resolution." (citation omitted)), aff'd o.b., 126 N.J. 300 (1991). Legal issues, including the trial court's decision regarding the applicability of an arbitration agreement, are subject to our plenary review. Frumer v. Nat'l Home Ins. Co., 420 N.J.Super. 7, 13 (App. Div. 2011); EPIX Holdings Corp. v. Marsh & McLennan Cos., 410 N.J.Super. 453, 472 (App. Div. 2009) (citation omitted). We accord no deference to the trial judge's legal conclusions, Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995), which are reviewed de novo, Dep't of Envtl. Prot. v. Kafil, 395 N.J.Super. 597, 601 (App. Div. 2007).
In this matter, defendants argue the unambiguous terms of the parties' EAA, which prominently included an agreement to arbitrate disputes, must be favored and enforced. Plaintiff, on the other hand, insists a question exists regarding whether at the time he executed the EAA, he understood it included an arbitration agreement.
"As a matter of both federal and state law, 'arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.'" Angrisani v. Fin. Tech. Ventures, L.P., 402 N.J.Super. 138, 148 (App. Div. 2008) (quoting AT&T Techs., Inc. v. Commc'ns Workers of Am., 475 U.S. 643, 648, 106 S.Ct. 1415, 1418, 89 L.Ed.2d 648, 655 (1986)). Absent a consensual understanding and agreement between the parties, "'neither party is entitled to force the other to arbitrate their dispute.'" Garfinkel, supra, 168 N.J. at 132 (quoting In re Arbitration Between Grover and Universal Underwriters Ins. Co., 80 N.J. 221, 228 (1979)). An arbitration agreement is only enforceable if it "constitutes a valid contract to arbitrate." Martindale v. Sandvik, Inc., 173 N.J. 76, 86 (2002). See also N.J.S.A. 2A:23B-6 (providing an agreement to arbitrate is "valid, enforceable, and irrevocable except upon a ground that exists at law or in equity for the revocation of a contract").
This determination requires application of ordinary contract principles. Singer v. Commodities Corp. (U.S.A.), 292 N.J.Super. 391, 402 (App. Div. 1996). The court determines the validity of a written agreement "by considering the intentions of the parties as reflected in the four corners of the written instrument." Leodori v. CIGNA Corp., 175 N.J. 293, 302, cert. Denied, 540 U.S. 938, 124 S.Ct. 74, 157 L.Ed.2d 250 (2003). Generally, parties are bound by the contracts they make for themselves. "Of course, a meeting of the minds is an essential element to the valid consummation of any contract." Ctr. 48 L.P. v. May Dep't Stores Co., 355 N.J.Super. 390, 406 (App. Div. 2002) (citing Gross v. Yeskel,
100 N.J.Eq. 293, 294, (E. & A. 1926)). In determining whether there was an agreement, objective manifestations of intent control, and subjective understandings are largely inconsequential. Friedman v. Tappan Dev. Corp., 22 N.J. 523, 530-31 (1956). Accord Quigley v. KEMG Peat Marwick, LLP, 330 N.J.Super. 252, 266 (App. Div.), certif. denied, 165 N.J. 527 (2000). "[A] party's signature to an agreement is the customary and perhaps surest indication of assent." Leodori, supra, 175 N.J. at 306-07.
In this matter, denial of the motion to compel arbitration was based on a finding that plaintiff's certification raised factual disputes surrounding the circumstances of his encounter with a human resources representative and his execution of the EAA, thus warranting further discovery. The inference suggested is plaintiff was possibly tricked or forced to sign the EAA. After review of plaintiff's certification, and considered in the light most favorable to plaintiff, we reject this notion, as nothing supports the proposition he was forced or coerced to execute the EAA.
Plaintiff's certification first states: "I was not given the opportunity to read the employee manual at the time[.]" This fact is specifically contemplated by the EAA. Paragraph one, encaptioned "Handbook Receipt[, ]" includes the employee's acknowledgment he or she was provided the handbook and will familiarize himself or herself with its terms. Moreover, it is undisputed that the manual does not contain or otherwise make reference to the arbitration agreement, making its review immaterial; the entirety of the agreement regarding arbitration is contained in the EAA. Plaintiff never states he was denied the opportunity to review the EAA itself.
Next, plaintiff asserts "nor was it suggested that I review this matter carefully or have it reviewed by an attorney before signing it." This claim is belied by the prominent, unmistakable statement immediately preceding plaintiff's signature on the EAA, as well as the unambiguous arbitration provisions. Plaintiff's signature follows an explicit affirmation, which states he read and agreed to be bound by the agreement, and had full opportunity to ask questions about its terms. That he declined to do so does not render the agreement involuntary. Henningsen v. Bloomfield Motors, Inc., 32 N.J. 358, 386 (1960) ("[I]n the absence of fraud, one who does not choose to read a contract before signing it, cannot later relieve himself of its burdens." (citation omitted)).
Plaintiff's final contention is he was told he was merely acknowledging receipt of the employee handbook. Even if such a characterization was offered by a human resources representative, the written document refutes any inference that plaintiff thought it was merely an acknowledgement of receipt of the employee handbook. In this regard, the content of the attestation above his signature; the first sentence of the first paragraph of the Arbitration Agreement section, which states, "I agree to utilize binding arbitration pursuant to the Federal Arbitration Act as the exclusive means to resolve all covered claims"; and the bold heading centered on the first page, entitled "Arbitration Agreement, " all describe the contents of the document as more than a receipt for the handbook.
"When a party enters into a signed, written contract, that party is presumed to understand and assent to its terms, unless fraudulent conduct is suspected." Stelluti v. Casapenn Enters., 203 N.J. 286, 305 (2010) (citation omitted). Accordingly, a party's failure "to read a contract does not excuse performance unless fraud or misconduct by the other party prevented one from reading." Gras v. Assocs. First Capital Corp., 346 N.J.Super. 42, 56 (App. Div. 2001) (internal quotation marks and citations omitted), certif. denied, 171 N.J. 445 (2002). See also Riverside Chiropractic Group v. Mercury Ins. Co., 404 N.J.Super. 228, 238 (App. Div. 2008) ("The fact that plaintiff did not read the contract before [signing it] is immaterial.").
We additionally note this is not a case where "[t]he size of the print and the location of the arbitration provision" might nullify plaintiff's assent. See, e.g., Rockel v. Cherry Hill Dodge, 368 N.J.Super. 577, 585-86 (App. Div.), certif. denied, 181 N.J. 545 (2004). The arbitration provisions were prominently placed on the first page of the EEA, and headed in bold print by the label "Arbitration Agreement[, ]" isolated from any text above and below. The terms of arbitration are neither hidden nor elusive. Furthermore, standing out on page one is the stipulation: "I UNDERSTAND THAT BY AGREEING TO SUBMIT COVERED CLAIMS TO ARBITRATION, BOTH THE COMPANY AND I GIVE UP OUR RIGHTS TO A JURY TRIAL." Thus, there is "language on the first page of the document, in print distinguishable by its greater size or different color from the rest of the words on the page, which warns that . . . the right to trial by jury will be . . . eliminated by provisions contained elsewhere in the document." Contra Rockel, supra, 368 N.J.Super. at 586.
Plaintiff's signature is the beginning and end of the analysis, and under the circumstances presented, the undisputed facts do not permit a conclusion that fraud occurred. Young v. Prudential Ins. Co. of Am., 297 N.J.Super. 605, 618-19 (App. Div.), certif. denied, 149 N.J. 408 (1997). Rather, we conclude plaintiff's signature manifests his assent to the express terms of the agreement. On this record, we find no support for the assertion that plaintiff's signature on the EAA was the result of something other than what it purports to be.
We also determine the terms of arbitration unambiguously include those claims alleged in plaintiff's complaint. The EAA states arbitration is required for
all covered claims which may arise from, relate to, or have any relationship or connection whatsoever with my seeking employment with, employment or termination by, or other association with the Company, whether based on tort, contract, statutory, or equitable law, or otherwise, . . .
. . . "[C]overed claims" which the Company and I agree to arbitrate include, but may not be limited to, claims, disputes, and/or controversies including but not limited to claims related to harassment, discrimination, and wrongful discharge based on or arising from [constitutional or enumerated federal statutory claims] . . . as well as all other federal, state, or local statutory or common laws or regulations which would otherwise require or allow resort to any court or other governmental dispute resolution forum between me and the Company.
This language alerts the parties of the existence of various statutory rights and remedies arising in tort and contract, including but not limited to claims related to harassment, discrimination, and wrongful discharge. The clause expressly provides arbitration as the exclusive means of resolving any disputes arising from, relating to, or having "any relationship or connection whatsoever" with plaintiff's "seeking employment with, employment or termination by, or other association with" MBF. Guided by our case law, we conclude this language is clear and unambiguous, encompassing plaintiff's statutory state law claims.
Over the years, the Court has reviewed arbitration clauses to discern their scope. An agreement to waive access to the courts "'should clearly state its purpose[, ]'" so that "'the parties know that in electing arbitration as the exclusive remedy, they are waiving their time-honored right to sue.'" Garfinkel, supra, 168 N.J. at 132 (quoting Marchak v. Claridge Commons, Inc., 134 N.J. 275, 282 (1993)). The waiver of statutory rights "'must be clearly and unmistakably established, and contractual language alleged to constitute a waiver will not be read expansively.'" Ibid. (quoting Red Bank Reg'l Educ. Ass'n v. Red Bank Reg'l High Sch. Bd. of Educ., 78 N.J. 122, 140 (1978)). Certainly an employee who intends to waive the right to pursue statutory actions against an employer must do so in an agreement in unambiguous terms. Id. at 135.
In order for the arbitration provisions pass muster as unambiguous, it is not necessary that the written agreement include an exhaustive recitation of every right or statutory cause of action subject to arbitration. In fact, the Court has advised:
[W]e do not suggest that a party need refer specifically to the LAD or list every imaginable statute by name to effectuate a knowing and voluntary waiver of rights To pass muster however a waiver-of-rights provision should at least provide that the employee agrees to arbitrate all statutory claims arising out of the employment relationship or its termination It should also reflect the employee's general understanding of the type of claims included in the waiver eg workplace discrimination claims
Further in Martindale supra 173 N.J. at 94-96 the Court concluded language of an arbitration clause which did not contain limiting references to statutory claims was "clear and unambiguous" as it was "sufficiently broad to encompass reasonably plaintiff's statutory causes of action"
The terms of the arbitration agreement under review include expansive language that provides sufficient notice to any signatory including plaintiff that all claims relating to his employment and possible termination from employment are to be addressed in an arbitral forum