The plaintiff in Spellman had signed an employment agreement containing an arbitration clause and the U-4 form. Plaintiff's position is, of necessity, that a ground for revocation of contract is unilateral lack of understanding. She can, so the argument goes, rescind a contract simply by proving her unilateral ignorance of the contractual terms. Plaintiff's position turns contract law on its head. No law requires that parties dealing at arm's length have a duty to explain to each other the terms of a written contract, particularly where, as here, the language of the contract expressly and plainly provides for the arbitration of disputes arising out of the contractual relationship.
Reasonable diligence requires the reading of a contract before signing it.
A party cannot use his own lack of diligence to avoid an arbitration agreement. Plaintiff counters that California courts do not have authority to create a standard for arbitration that differs from federal law. We are therefore bound by Lai, so the argument goes, despite its seeming divergence from state law principles for revocation of contract. We disagree, however, that Lai must be interpreted as making the revolutionary change in contract law that plaintiff accepts as matter of fact. In deciding the issue at hand, the Lai court did not open the door for extrinsic evidence of subjective intent inconsistent with the written words of a contract.