Court Opinion

ID: 4588159
Source: CourtListenerOpinion
Date Created: 2020-11-19 21:09:13.599416+00
Date Added: 2024-06-11T08:48:40.004051
License: Public Domain

No. 19-0905 – Home Inspections of VA and WV, LLC v. Hardin
                                                                                FILED
                                                                           November 19, 2020
                                                                                 released at 3:00 p.m.
Workman, Justice, dissenting:                                                EDYTHE NASH GAISER, CLERK
                                                                             SUPREME COURT OF APPEALS
                                                                                  OF WEST VIRGINIA

              This Court’s arbitration jurisprudence has dutifully followed the federal

model in recent years, 1 a model that mandates such a strong preference for arbitration and

allows for such a limited scope of judicial review 2 that, although I have acceded to the

mandate of controlling federal law as required by my judicial oath, I have long been

concerned that “an average citizen’s right to a jury trial in a civil matter is vanishing before

our very eyes.” Employee Resource Group, LLC v. Harless, No. 16-0493, 2017 WL

1371287, at *8 (W. Va. April 13, 2017) (memorandum opinion) (Workman, J.,

concurring). In the instant case, however, the majority’s opinion takes a giant step too far.

I cannot agree that the single word arbitration, even capitalized and in bold font as it is, is

sufficient to turn the following twenty-seven words into an enforceable arbitration clause:

“ARBITRATION: Any dispute concerning the interpretation of this agreement or arising

       1
         See, e.g., Bayles v. Evans, 243 W. Va. 31, 842 S.E.2d 235 (2020); Rent-A-Center,
Inc. v. Ellis, 241 W. Va. 660, 827 S.E.2d 605 (2019); SWN Production Co., LLC v. Long,
240 W. Va. 1, 807 S.E.2d 249 (2017).
       2
        “In the context of cases affected by the Federal Arbitration Act, we have found that
courts are limited to weighing only two questions: does a valid arbitration agreement exist?
And do the claims at issue in the case fall within the scope of the arbitration agreement?”
Golden Eagle Res., II, L.L.C. v. Willow Run Energy, L.L.C., 242 W. Va. 372, 378, 836
S.E.2d 23, 29 (2019).

                                               1
from this inspection and report, except for inspection fee payment, shall be resolved

informally between the parties.”

             It is a fundamental principle in West Virginia law that “[a] meeting of the

minds of the parties is a sine qua non of all contracts.” Syl. Pt. 8, Chesapeake Appalachia,

L.L.C. v. Hickman, 236 W. Va. 421, 781 S.E.2d 198 (2015) (citing Syl. Pt. 1, Martin v.

Ewing, 112 W.Va. 332, 164 S.E. 859 (1932)). In this case, the notion that there was a

meeting of the minds about arbitration is laughable. The parties’ agreement, if any, is that

“[a]ny dispute . . . shall be resolved informally between the parties[,]” a phrase which could

not possibly be more vague. There is no explanation as to how this informal resolution is

to be carried out, or what happens if the parties are unable to resolve the dispute between

themselves. Left totally unanswered are the following questions, among others: Where are

the parties to meet? What are the rules? What law governs? Who pays the costs? Who is

the decider in case of an impasse, and who picks him or her? Is his or her decision binding?

If not, what’s the next step: mediation? litigation? pistols at dawn? Finally, and most

critically, who gets to answer these questions?

            Compare the so-called arbitration clause upheld by the majority in the instant

case to that upheld against a vagueness charge in Blevins v. Flagstar Bank, F.S.B., No.

3:12-CV-134, 2013 WL 3365252 (N.D.W. Va. July 3, 2013). At the outset, the court noted

                                              2
that “[t]he title “ARBITRATION” was offset from the surrounding text.” Id. at *10.

Significantly, however, that point of similarity with the instant case was the only point of

similarity between the two; the district court went on to examine the arbitration clause

itself, not just its one-word heading.

              The arbitration provision in the contract also explained the
              process to the parties. First, the provision explained that any
              claims arising from the contract or by virtue of alleged
              representations “shall be settled and finally determined by
              arbitration and not in a court of law.” Second, the provision
              stated that before “commencing arbitration, the dispute shall
              first be mediated.” This highlighted that there was a difference
              between mediation and arbitration. Last, the provision states
              that the parties “specifically acknowledge that they are and
              shall be bound by arbitration and are barred from initiating any
              proceeding or action whatsoever in connection with this
              Agreement.” This emphasizes that arbitration is a binding
              process, and that parties are prohibited from initiating other
              proceedings or actions. Therefore, the arbitration provision in
              the contract provides some explanation of the process.

Id. at *11; see also Lugenbuhl v. City of Gallup, 302 P.3d 751 (N.M. 2013) (rejecting

vagueness claim where arbitration clause specified who selects the mediator, who bears the

costs, and that the outcome is final and binding on both parties). Here, in contrast, what

explanation of anything did the respondent have?

              The majority’s analysis of this issue consists of nothing more than a logical

fallacy known as ignorantio elenchi, or irrelevant conclusion. First, the majority cites

section five of the Federal Arbitration Act, 9 U.S.C. §§ 1 to 16 (2002), for the proposition

that arbitration provisions are not required to contain a method for selection of an arbitrator.
                                               3
Then, the majority cites West Virginia Code § 55-10-13 (2016) for the same proposition,

emphasizing the words “[i]f the parties have not agreed on a method” as if those words

somehow seal the deal for the sweeping conclusion that follows: “[t]he circuit court was

clearly wrong to base its conclusion on the failure of the disputed provision to include

specific terms, including how arbitrators will be selected.” The logical fallacy is readily

apparent: the fact that an arbitration clause does not have to contain a methodology for

selection of an arbitrator does not prove that the arbitration clause does not have to contain

any terms at all. In this regard, the few cases cited by the majority all involve arbitration

agreements which, although “not set[ting] forth all the procedural details . . . do clearly

evince the parties’ intent to submit future disputes to arbitration.” Robertson v. Mount

Royal Towers, 134 So.3d 862, 868 (Ala. 2013).

             Here, in contrast, nothing evinces the respondent’s intent to submit any

disputes to arbitration. The fact that the so-called arbitration provision in this case contains

no terms whatsoever is not the only problem with said provision; the twenty-seven words

that are contained therein are ambiguous. Courts are in general agreement that to be

enforceable, an arbitration clause must have “sufficient certainty of terms so that the

obligations involved can be determined.” Estate of Decamacho ex rel. Guthrie v. LaSolana

Care and Rehab, Inc., 316 P.3d 607, 610 (Ariz. 2014). In similar vein, this Court has held

that “[i]n construing the terms of a contract, we are guided by the common-sense canons

of contract interpretation. One such canon teaches that contracts containing unambiguous

                                               4
language must be construed according to their plain and natural meaning.” Fraternal

Order of Police, Lodge No. 69 v. City of Fairmont, 196 W. Va. 97, 101, 468 S.E.2d 712,

716 (1996) (citing Payne v. Weston, 195 W. Va. 502, 507, 466 S.E.2d 161, 166 (1985)).

We went on in Fraternal Order of Police to note that,

             [c]ontract language usually is considered ambiguous where an
             agreement’s terms are inconsistent on their face or where the
             phraseology can support reasonable differences of opinion as
             to the meaning of words employed and obligations undertaken.
             In note 23 of Williams [v. Precision Coil, Inc., 194 W. Va. 52,
             65, 459 S.E.2d 329, 342 (1995)], we said: “A contract is
             ambiguous when it is reasonably susceptible to more than one
             meaning in light of the surrounding circumstances and after
             applying the established rules of construction.” (Emphasis
             added).

196 W. Va. at 101, 468 S.E.2d at 716 (footnote omitted).

             In its opinion, the majority concludes that the so-called arbitration provision

in the instant case is unambiguous for two reasons: first, because the provision is headed

by the word “arbitration,” in capital letters and bold font; and second, because the word

“informally” would necessarily be understood to denote arbitration, since both the United

States Supreme Court and this Court have stated that arbitration is an informal process as

compared to litigation. 3 With respect to the first point, although I agree that the word

      3
        See AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 348 (2011) (noting that “the
principal advantage of arbitration [is] its informality.”); Cunningham v. LeGrand, 237 W.
Va. 68, 75, 785 S.E.2d 265, 272 (2016) (noting the “more informal nature of arbitration
                                             5
“arbitration” is certainly important – indeed, in most circumstances, it would be a neon

sign advertising what’s to come – it is not sufficient, standing alone, to create an

enforceable arbitration clause. With respect to the second point, it is pure sophistry to

contend that the words “shall be resolved informally between the parties” are unambiguous.

To any layman, i.e., someone such as the respondent, who cannot be expected to have read

AT&T Mobility or Cunningham, see supra note 2, the words are “reasonably susceptible to

more than one meaning in light of the surrounding circumstances[,]” Fraternal Order of

Police, 196 W. Va. at 101, 468 S.E.2d at 716. To a layman, I believe that the words would

reasonably suggest a negotiation, possibly held at the petitioner’s office, possibly at the

respondent’s home. Stretching the words as far as they could reasonably go, again to a

layman, the words might suggest a mediation. Under no reasonable construction can it be

said that to a layman, the words would clearly convey that resolution of a dispute between

the parties could only be effected through the mechanism of binding arbitration, and that

no judicial remedies would be available under any circumstances.

             The majority’s decision today strips the respondent of his right to have his

case decided by a jury of his peers in a West Virginia courtroom. Instead, he will have his

claims decided in some unknown forum, by some unknown arbitrator, under some

proceedings” due, in part, to “[d]ispensation with the formal rules of evidence and
procedure”).

                                            6
unknown rules, at some unknown cost, pursuant to the laws of some unknown jurisdiction,

and with no avenue for appeal in the event of an adverse decision. This isn’t just bad law;

it’s manifestly unfair and unjust to the respondent. Accordingly, I dissent.

                                             7