SECOND DIVISION

FEBRUARY 1, 2011

No. 1-10-0436

QUICKCLICK LOANS, LLC, ) Appeal from the 

) Circuit Court of 

Plaintiff and Counterdefendant-Appellant, ) Cook County 

)

)

 v. ) No. 08 MI 180139

)

)

MELODY A. RUSSELL, ) Honorable

) Kathleen Pantle,

Defendant and Counterplaintiff-Appellee. ) Judge Presiding.

JUSTICE HARRIS delivered the judgment of the court, with opinion.

Justices Karnezis and Connors concurred in the judgment and opinion.

OPINION

Plaintiff QuickClick Loans, LLC, initiated collection proceedings against defendant,

Melody Russell, alleging that Russell had defaulted under a loan agreement and promissory note

agreed to by the parties. Russell filed a counterclaim for herself and a putative class of similarly

situated Illinois consumers against QuickClick alleging violations of the Truth in Lending Act (15

U.S.C. §1601 et seq. (2006)), Regulation Z (12 C.F.R. §226.1 et seq. (2008)), the Illinois

Consumer Installment Loan Act (205 ILCS 670/1 et seq. (West 2008)), and the Illinois Interest

Act (815 ILCS 205/1 et seq. (West 2008)). QuickClick then filed a motion to compel arbitration

and stay proceedings, which the circuit court denied. QuickClick appeals. 
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 Russell had the opportunity to reject the Arbitration Agreement by submitting a written

objection to QuickClick within 15 days of signing the promissory note. Russell did not reject the

Arbitration Agreement and does not contest the Arbitration Agreement’s subsequent

incorporation into the loan agreement and promissory note. 

2

We affirm the judgment of the circuit court, finding that the agreement between the parties

to arbitrate allows for only two organizations to administer any dispute between the parties in

arbitration, neither of which was available. The two exclusive administrators were unavailable

due to external constraints, and therefore, the arbitration agreement between the parties was

impossible to enforce. Additionally, we find that an alternative administrator cannot be named by

this court because the designation by the parties of two exclusive arbitration organizations was an

integral part of the agreement between the parties. 

JURISDICTION

On January 14, 2010, the circuit court denied QuickClick’s motion to compel individual

arbitration and to stay the proceedings. On February 9, 2010, QuickClick filed its interlocutory

appeal. Accordingly, this court has jurisdiction pursuant to Illinois Supreme Court Rule 307(a)(1)

governing interlocutory appeals as of right. Ill. S. Ct. R. 307(a)(1) (eff. Feb. 26, 2010).

BACKGROUND

On December 2, 2006, Russell obtained a loan from QuickClick by executing a loan

agreement and a promissory note. The loan agreement contained an arbitration provision, titled

“Arbitration Agreement.”1 The Arbitration Agreement states that either party may require the

claim to be arbitrated. It defines what claims are covered, how to start the arbitration, and which

of two predetermined arbitration organizations may be selected. The sections of the Arbitration
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Agreement that are at the center of the parties’ dispute state in relevant part:

“b. What Claims Are Covered: ‘Claim’ means any claim

dispute or controversy between you and us that in any way arises

from or relates to the Note. ‘Claim’ has the broadest possible

meaning, and includes initial claims, counterclaims, cross-claims

and third-party claims. It includes disputes based upon contract,

tort, consumer rights, fraud and other intentional torts, constitution,

statute, regulation, ordinance, common law and equity (including

any claim for injunctive or declaratory relief). *** It also includes

disputes about the validity, enforceability, arbitrability or scope of

this Arbitration Agreement or the Note *** However, we will not

choose to arbitrate an individual Claim that you bring against us in

small claims court or your state’s equivalent court, if any. But if

that Claim is transferred, removed or appealed to a different court,

we then have the right to choose arbitration.

c. How Arbitration Is Started: Either you or we may

require any Claim to be arbitrated. Arbitration is started by giving

written notice to the other party of the intent to start or compel

arbitration. This notice may be given before or after a lawsuit has

been started over the Claim or with respect to other Claims brought

later in the lawsuit. The notice may be in the form of a motion or
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petition to compel arbitration. Arbitration of a Claim must comply

with this Arbitration Agreement and, to the extent not inconsistent

or in conflict with this Arbitration Agreement, the applicable rules

of the arbitration administrator. 

d. Choosing the Administrator: The party requiring

arbitration must choose one of the following arbitration

organizations as the Administrator: American Arbitration

Association (‘AAA’), *** or National Arbitration Forum (‘NAF’),

***. In all cases, the arbitrator(s) must be a lawyer with more

than 10 years of experience. If for any reason the chosen

organization is unable or unwilling or ceases to serve as the

Administrator, the party requiring arbitration will have 20 days to

choose a different Administrator consistent with the requirements

of this Arbitration Agreement.” (Emphasis added) 

If the parties choose arbitration, they are prohibited from participating in a class action in

court or a class-wide arbitration under the Arbitration Agreement. Additionally, the Arbitration

Agreement states that it is governed by the Federal Arbitration Act (Act)(9 U.S.C. § 1 et seq.

(2006). 

On July 17, 2009, the NAF, one of the two administrators permitted under the Arbitration

Agreement, entered a consent judgment with the State of Minnesota for the purpose of requiring
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“the complete divestiture by the NAF entities of any business related to the arbitration of

consumer disputes.” Pursuant to this consent judgment, the NAF ceased administering consumer

arbitrations, including the counterclaim in this case. After the NAF ceased administering

consumer arbitrations, the AAA issued a moratorium on consumer debt collection arbitrations. 

The AAA posted a notice on its Web site describing which claims the moratorium covered, the

time frame of the moratorium, and the reasons for the moratorium. Specifically, the notice, in

relevant part, states:

“Matters included in this moratorium are: consumer debt

collections programs or bulk filings and individual case filings in

which the company is the filing party and the consumer has not

agreed to arbitrate at the time of the dispute and the case involves

*** a consumer finance matter. 

The AAA will continue to administer all demands for

arbitration filed by consumers against businesses, and all other types

of consumer arbitrations.” 

The notice states the moratorium will be in effect until the “AAA determines that adequate

and broadly acceptable due process protocols specific to these cases are in place.” 

On November 6, 2008, QuickClick began collection proceedings against Russell alleging

that she had defaulted under the loan agreement and promissory note. In its complaint,

QuickClick sought judgment against Russell in the amount of $980.48, plus the costs of the suit. 
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On January 29, 2009, a default judgment was entered against Russell. On March 3, 2009, the

circuit court granted Russell’s motion to vacate the January 29, 2009, default judgment and to

quash service of the complaint. On March 4, 2009, Russell filed a counterclaim for herself and a

putative class of similarly situated Illinois consumers against QuickClick alleging violations of the

Truth in Lending Act (15 U.S.C. §1601 et seq. (2006)), Regulation Z (12 C.F.R. §226.1 et seq.

(2008)), the Illinois Consumer Installment Loan Act (205 ILCS 670/1 et seq. (West 2008)), and

the Illinois Interest Act (815 ILCS 205/1 et seq. (West 2008)). On March 6, 2009, QuickClick

filed a citation to discover assets, which the circuit court dismissed without prejudice on March

11, 2009. 

On July 24, 2009, QuickClick filed its motion to compel arbitration of Russell’s

counterclaims and to stay proceedings pending the completion of arbitration. In its motion,

QuickClick asserted that the Act applies to this case and that Russell’s counterclaims fall within

the scope of the Arbitration Agreement between the parties. QuickClick further argues that under

the Arbitration Agreement of the loan, Russell’s counterclaims must be arbitrated on an

individual, as opposed to a class action, basis. QuickClick named the AAA as the administrator

for the requested arbitration. Russell responded that arbitration is impossible in this case because

under the Arbitration Agreement, the parties must choose either the NAF or the AAA, both of

which were unavailable. Specifically, the NAF was unavailable due to its settlement agreement to

not participate in consumer arbitrations and the AAA was unavailable because QuickClick’s

claims fall within the AAA’s moratorium on consumer arbitrations. Russell also responded that

QuickClick waived its arbitration rights and that the alleged class action waiver is unenforceable. 
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In its reply, QuickClick agreed that the NAF could not administer the arbitration, but contended

that the AAA could because the AAA moratorium on new consumer debt collection arbitration

filings, where the company is the filing party and the consumer has not agreed to arbitration, did

not apply to the parties. 

On January 14, 2010, the circuit court entered a written order denying QuickClick’s

motion to compel arbitration. The circuit court found that “the Parties’ agreement to arbitrate

falls within the purview of the [Act]; however, legal constraints external to the Parties’ agreement

forecloses the arbitration of Russell’s Counterclaims.” The circuit court reasoned that the

Arbitration Agreement limited the parties’ choices of arbitrators to either the NAF or the AAA,

neither of which was able to administer the arbitration. The circuit court found that the AAA

moratorium applied to the parties, because QuickClick was the filing party for purposes of

arbitration. The circuit court rejected QuickClick’s argument that the Arbitration Agreement

allows parties 20 days to select a non-AAA or NAF arbitrator where both are unable to serve as

administrator, instead finding that the Arbitration Agreement is clear that the parties can choose

only the AAA or the NAF, not a third-party administrator. The circuit court similarly rejected

QuickClick’s argument that section 5 of the Act allows QuickClick to petition the circuit court to

name an alternative administrator. The circuit court ruled that section 5 of the Act does not apply

in the instant case because the parties’ specific designation of an exclusive arbitration forum,

either the AAA or the NAF, was “an integral part of the arbitration clause in the agreement.” 

On January 19, 2010, counsel for QuickClick sent a letter to the AAA asking the AAA to

confirm QuickClick’s belief that the AAA moratorium on consumer debt collection matters does
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not apply to the parties. On January 20, 2010, counsel for Russell sent a letter to the AAA urging

the AAA to take no action on QuickClick’s letter or, in the alternative, to reject the arguments

QuickClick put forth in its January 19, 2010, letter. On March 23, 2010, counsel for the AAA

acknowledged receiving both parties’ communications and stated:

“Although the [AAA] has not taken any action in response

to the request that we present our views on the applicability of the

debt collection arbitration moratorium as it relates to the above

referenced litigation, I wanted to confirm our position on the

matter. After reviewing the parties’ communications, attached

documents and transcripts, it is apparent that the applicability of the

moratorium has been thoroughly litigated. As such, absent mutual

agreement of the parties or a direction from a court to do so, it

would be innappropriate for the AAA to become involved in this

matter.” 

On February 9, 2010, QuickClick timely filed its notice of interlocutory appeal pursuant to

Supreme Court Rule 307(a) seeking reversal of the circuit court’s January 14, 2010, order

denying its motion to compel arbitration and to stay proceedings. Ill. S. Ct. R. 307(a)(1) (eff.

Feb. 26, 2010). 

ANALYSIS

On appeal, QuickClick argues the circuit court erred by denying its motion to compel
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arbitration and stay the proceedings. Specifically, QuickClick argues that the AAA’s moratorium

does not apply to this case because Russell, as the filer of the counterclaim, initiated the

arbitration. QuickClick further argues that under the Arbitration Agreement, the AAA and the

NAF are not the exclusive arbitration administers. Finally, QuickClick argues that the circuit

court erred in finding that section 5 of the Act (9 U.S.C. §5)(2006)) does not apply in this case. 

For these reasons, in addition to QuickClick’s position that the Arbitration Agreement contains a

class action waiver, QuickClick argues that this court should compel Russell to submit to

arbitration on an individual, non-class-action basis.

Russell replies that arbitration in this case is impossible because the Arbitration Agreement

clearly bars selection of an arbitrator other than the AAA or the NAF, both of which are

unavailable. Specifically, the NAF is unavailable because it no longer arbitrates consumer debt

arbitrations and the AAA is unavailable because of its self-imposed moratorium. Russell asserts

that the AAA moratorium applies to the parties because QuickClick is the filing party for

purposes of arbitration. Russell also argues that QuickClick should not be entitled to rewrite the

Arbitration Agreement in order to choose an alternative administrator under section 5 of the Act. 

9 U.S.C. §5 (2006). Russell claims an alternative administrator is forbidden under the Arbitration

Agreement based on the express language of the agreement requiring that an administrator

“consistent with the requirements of this Arbitration Agreement” be selected. In the alternative,

Russell argues that QuickClick has waived its right to arbitrate due to its inconsistent conduct.

Specifically, that QuickClick sought to litigate its collection claims in circuit court, but force

Russell to submit to arbitration. Russell additionally argues that both the Arbitration Agreement
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and the purported class action waiver in the loan agreement are unconscionable and contrary to

public policy. 

Typically, review of interlocutory appeals is conducted under an abuse of discretion

standard. Vassilkovska v. Woodfield Nissan, Inc., 358 Ill. App. 3d 20, 24 (2005)(citing Peregrine

Financials & Securities v. Hakakha, 338 Ill. App. 3d 197, 202 (2003)). However, where the

circuit court did not hold an evidentiary hearing and based its decision on a purely legal analysis,

the applicable standard of review of the circuit court’s decision is de novo. Id. See also Czarnik

v. Wendover Financial Services, 374 Ill. App. 3d 113, 116 (2007) (“where the trial court made no

factual findings and its decision was based purely on a question of law, the decision to deny [a]

motion to compel arbitration is reviewable de novo”). In addition, issues of contractual

construction and statutory construction are reviewed de novo. Avery v. State Farm Mutual

Automobile Insurance Co., 216 Ill. 2d 100, 129 (2005) (“the construction, interpretation, or legal

effect of a contract” is a question of law, and, thus, appellate review is de novo); Weather-Tite,

Inc. v. University of St. Francis, 233 Ill. 2d 385, 389 (2009) (issues of statutory construction are

reviewed de novo). In this interlocutory appeal, we must determine “whether there was a

sufficient showing to sustain the circuit court’s order denying the motion to compel arbitration.” 

Vassilkovska, 358 Ill. App. 3d at 24.

It is well established that agreements to submit to arbitration, as an alternative method of

dispute resolution, are favored at both the state and federal level. Board of Managers of the

Courtyards at the Woodlands Condominium Ass’n v. IKO Chicago, Inc., 183 Ill. 2d 66, 71

(1998). Congress passed the Act to “overcome the historical reluctance of courts to enforce
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agreements to arbitrate” and with the intent to “place such agreements on the same footing as

other contracts.” Carter v. SSC Odin Operating Co., 237 Ill. 2d 30, 41 (2010). The Act applies

to both state and federal courts. Perry v. Thomas, 482 U.S. 483, 489 (1987). 

Although arbitration is favored, an agreement to submit to arbitration is a matter of

contract. Salsitz v. Kreiss, 198 Ill. 2d 1, 13 (2001). Parties to an agreement to arbitrate disputes

“are bound to arbitrate only those issues they have agreed to arbitrate, as shown by the clear

language of the agreement and their intentions expressed in that language.” Id. Thus, “[a]n

arbitration agreement will not be extended by construction or implication.” Id. Unambiguous

contract terms must be given their plain and ordinary meaning. Barth v. State Farm Fire &

Casualty Co., 228 Ill. 2d 163, 174 (2008). To determine whether arbitration should be

compelled, a court must first determine whether the arbitration agreement reached the statutory

issues. Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 628 (1985). If

the arbitration agreement does reach the statutory issues, then a court must determine whether

any “legal constraints external to the parties’ agreement foreclosed the arbitration of those

claims.” Id. 

The plain language of the Arbitration Agreement makes clear that if a party requires

arbitration, it must choose either the NAF or the AAA. The Arbitration Agreement states “the

party requiring arbitration must choose one of the following arbitration organizations as the

Administrator: *** AAA *** or *** NAF.” (Emphasis added.) This term is unambiguous and,

thus, must be given its plain meaning. See Barth, 228 Ill. 2d at 174. The Arbitration Agreement

also makes clear that “[i]f for any reason the chosen organization is unable or unwilling or ceases
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to serve as the Administrator, the party requiring arbitration will have 20 days to choose a

different Administrator consistent with the requirements of this Arbitration Agreement.” 

(Emphasis added.) This term is also unambiguous and its plain language directs the parties to

select an alternative administrator consistent with the terms of the agreement. In order to be

consistent with the terms of the agreement, the parties “must choose” either the AAA or the NAF.

In this case, neither the AAA nor the NAF was available to perform the arbitration. The

parties agree that the NAF is unavailable, but dispute whether the AAA is available. The AAA

moratorium, however, clearly states that it will not participate in any consumer debt collection

programs “in which the company is the filing party and the consumer has not agreed to arbitrate at

the time of the dispute and the case involves *** a consumer finance matter.” Under the

moratorium, QuickClick is the filing party because it both sought the arbitration and filed the

initial complaint before the circuit court in this matter in November of 2008. Russell, as the

consumer, has not agreed to the arbitration. QuickClick seeks to litigate its claims in court while

forcing Russell to take her counterclaims to arbitration. Therefore, because QuickClick was the

filing party for both the initial dispute and the arbitration claim, the AAA moratorium applies to

the parties in this case. 

Although the parties agreed to arbitration, the exclusive administrators, as outlined in the

Arbitration Agreement, are not available to arbitrate the matter. Therefore, external events to the

parties’ agreement have foreclosed the arbitration of the parties’ claims, and thus the circuit court

could not enforce the Arbitration Agreement. See Mitsubishi Motors Corp., 473 U.S. at 628 (a

court must determine whether any “legal constraints external to the parties’ agreement foreclosed
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the arbitration of those claims”). 

QuickClick also argues that under section 5 of the Act a substitute arbitrator should be

appointed. Section 5 of the Act allows a court to appoint an arbitrator where there is a “lapse in

the naming of an arbitrator.” 9 U.S.C. §5 (2006). In Carr v. Gateway, Inc., our supreme court

analyzed an arbitration agreement that designated the NAF as the sole arbitral forum for any

disputes between the parties, and provided for penalties for disputes brought before non-NAF

forums. Carr v. Gateway, Inc., No. 109485, slip op. at 4 (Ill. Feb. 3, 2011). The court held that,

“section 5 of the Act may be applied to name a substitute arbitrator where the parties’ designated

arbitral forum fails, unless the designation of the arbitral forum is integral to the parties’

agreement to arbitrate.” (Emphasis added). Id. at 9. The court reasoned that “[w]here the

designation of an arbitral forum is only an ancillary, logistical concern and the primary

consideration is the intent to arbitrate disputes” a substitute arbitrator may be selected under

section 5 of the Act. Id. The court concluded that the designation of the NAF as the arbitral

forum was integral to the arbitration agreement between the parties. Id. at 14. 

As discussed above, it is clear that the Arbitration Agreement in this case exclusively

designates either the NAF or the AAA as the only administrators that may be chosen. The plain

language of the Arbitration Agreement cannot be read as supporting any other conclusion. It

cannot be said that the designation of the NAF or the AAA was an ancillary or a logistical

concern. The Arbitration Agreement states that the parties “must choose” either the NAF or the

AAA. The plain language of the Arbitration Agreement does not mention any other fora but,

rather, specifically directs the parties that they “must choose” either the NAF or the AAA. The
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language in the Arbitration Agreement is clear that the designation of the NAF or the AAA is an

integral part of the Arbitration Agreement. Due to our finding in this case, we need not address

Russell’s waiver or public policy arguments. 

CONCLUSION

For the foregoing reasons, the judgment of the circuit court of Cook County is affirmed. 

Affirmed.