Court Opinion

ID: 4214959
Source: CourtListenerOpinion
Date Created: 2017-10-26 13:11:51.938691+00
Date Added: 2024-06-11T08:46:31.695799
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE
                      APPROVAL OF THE APPELLATE DIVISION
     This opinion shall not "constitute precedent or be binding upon any court."
      Although it is posted on the internet, this opinion is binding only on the
        parties in the case and its use in other cases is limited. R. 1:36-3.

                                       SUPERIOR COURT OF NEW JERSEY
                                       APPELLATE DIVISION
                                       DOCKET NO. A-2272-16T1

KUASHEMA RILEY,

        Plaintiff-Appellant,

v.

RAYMOUR & FLANIGAN and
MOSHIN CHUNAWALA,

        Defendants-Respondents.

__________________________________

              Argued September 26, 2017 – Decided October 20, 2017

              Before Judges Carroll and Mawla.

              On appeal from Superior Court of New Jersey,
              Law Division, Hudson County, Docket No. L-
              4100-16.

              Mark Mulick argued the cause for appellant.

              Ivan R. Novich and Tyler A. Sims argued the
              cause for respondents (Littler Mendelson, PC,
              attorneys; Mr. Novich and Mr. Sims, on the
              brief).

PER CURIAM

        Plaintiff Kuashema Riley appeals from a January 20, 2017

order granting a motion by Raymour & Flanigan (R&F) and Moshin
Chunawala   (collectively     defendants)   compelling    arbitration      of

plaintiff's employment discrimination claims and dismissing her

Law Division complaint without prejudice.         We affirm.

       The following facts are taken from the record.         Plaintiff was

employed by R&F in December 2012, as a furniture salesperson.            She

alleged several incidents of hostile work environment in violation

of the New Jersey Law Against Discrimination (LAD), N.J.S.A. 10:5-

1 to -49.      Specifically, she asserted that her store manager

frequently played music that included the words "nigger," "bitch,"

"ho," and "slut."     She claimed that Chunawala and other employees

frequently used the word "nigger" and "faggot" in her presence.

Plaintiff alleged Chunawala threatened to bring a firearm into the

workplace after the storeroom windows of the store had been shot

out.    She claimed Chunawala emailed a photograph of his penis to

a fellow co-worker, and that the incident became common knowledge

throughout the workplace.

       Plaintiff   asserts   she   complained   about   the   hostile   work

environment to her supervisors, but the discriminatory conduct

continued, and she was terminated in retaliation.         Plaintiff filed

a complaint in the Law Division alleging her termination was in

violation of LAD.      She also alleged defendants were responsible

for the hostile work environment and the discrimination plaintiff

experienced while an employee at R&F.

                                     2                              A-2272-16T1
      Defendants filed a motion to compel arbitration and stay the

litigation in the Law Division pursuant to the Federal Arbitration

Act, 9 U.S.C. § 1.      Defendants argued plaintiff entered into an

agreement to arbitrate all claims against R&F when she signed a

document known as the "Associate's Agreement & Consent," during

her employment.    This form expressly stated employees who signed

it consented to dispute resolution of all claims under the Employee

Arbitration Program (EAP).

      Plaintiff opposed defendants' motion and argued the EAP was

unenforceable,    unconscionable,        and    violated   public    policy.

Specifically, plaintiff claimed she was forced to sign the EAP

under duress and she did not fully understand the EAP.

      The trial court enforced the agreement to arbitrate, noting

the   strong   public   policy   favoring      arbitration,   and   the   fact

plaintiff had thirty days to review the EAP before signing it.

The trial court granted defendants' motion, ordered arbitration,

and dismissed plaintiff's complaint without prejudice.

      On appeal, plaintiff claims the EAP violates public policy

because it requires her to pay the filing fees for arbitration,

which she cannot afford.         Plaintiff claims the fee provision of

the EAP renders the whole agreement to arbitrate unenforceable.

She asserts the EAP is unenforceable and violates public policy

because she entered into it under duress, and because its terms

                                     3                                A-2272-16T1
are complex and incomprehensible.            Plaintiff also challenges the

trial    court's    order    because   it   required     R&F   to   pay   for   the

arbitration fees beyond the initial filing fee, and therefore

would bias the arbitration process in favor of the party funding

it.     Plaintiff also urges reversal because the trial court order

was entered without oral argument.

      There    is    a   strong    preference     to     enforce     arbitration

agreements    because       "arbitration    is   [the]    favored     method     of

resolving disputes."          See Garfinkel v. Morristown Obstetrics &

Gynecology Assocs., P.A., 168 N.J. 124, 131 (2001); see also

Hojnowski v. Vans Skate Park, 187 N.J. 323, 341-42 (2006).                      The

standard of review of the validity of an arbitration agreement and

the legal determinations made by the trial court is de novo.

Morgan v. Sanford Brown Inst., 225 N.J. 289, 302-03 (2016); see

also Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J.

366, 378 (1995).         Having considered plaintiff's claims and the

record, we find no error in the trial court's decision to compel

arbitration and we affirm.

                                       I.

      Plaintiff claims the EAP violates public policy since it

requires her to pay the fees to initiate the arbitration process.

Plaintiff states she has limited resources and cannot finance an

arbitration.       She argues the trial court erred in concluding the

                                        4                                 A-2272-16T1
EAP was enforceable without taking these claims into account.

Instead, she asserts the EAP is unconscionable.

     Arbitration   agreements   are   afforded   the   same   contract

defenses of fraud, duress and unconscionability.       Delta Funding

Corp. v. Harris, 189 N.J. 28, 39 (2006).     The Court has held an

arbitration agreement may be unconscionable where it results in a

litigant funding the arbitration costs because it would deter a

litigant from vindicating his or her rights.     Id. at 44.

     We disagree the EAP is unconscionable because it requires

plaintiff, as the complainant, to pay the initial filing fee.       The

EAP states the costs and fees are paid "in accordance with the

rules of the Administrator for resolving disputes under employer-

promulgated programs."   The EAP defines "Administrator" as the

American Arbitration Association (AAA) or Judicial Arbitration and

Mediation Services, Inc. (JAMS).      Pursuant to AAA's Employment

Arbitration Rules and Mediation Procedures (AAA Rules), plaintiff

would pay a $200 filing fee. Under the JAMS Employment Arbitration

Rules and Procedures (JAMS Rules), plaintiff would be responsible

for a $1,200 filing fee.        These fees do not render the EAP

unconscionable as plaintiff would have to bear the filing fees and

other costs of a litigation in the Law Division were there no

arbitration agreement.

                                  5                            A-2272-16T1
      We also note nothing bars the arbitrator from re-allocating

fees to the prevailing party, especially considering plaintiff's

claims are grounded in the LAD, which is a fee shifting statute.

N.J.S.A. 10:5-27.1; see also Rendine v. Pantzer, 141 N.J. 292,

332-33 (1995).       Therefore, the EAP is not unconscionable because

of   its   fee    provisions.   Also,    because   we   conclude   the   fee

provisions of the EAP are valid, we reject plaintiff's claim the

EAP as a whole should be deemed unenforceable.

                                   II.

      Plaintiff also challenges the validity of the EAP claiming

she signed it under duress and without a proper understanding of

its terms.       We find no support in the record for these claims.

            Economic duress occurs when the party alleging
            it is "the victim of a wrongful or unlawful
            act or threat," which "deprives the victim of
            his unfettered will."        "[T]he 'decisive
            factor' is the wrongfulness of the pressure
            exerted. The term 'wrongful' in this context
            encompasses more than criminal or tortious
            acts, for conduct may be legal but still
            oppressive." The acts or threats constituting
            the duress "'are wrongful, not necessarily in
            a legal, but in a moral or equitable sense.'"
            In   addition,   duress   entails   inadequate
            consideration.

            [Quigley v. KPMG Peat Marwick, LLP, 330 N.J.
            Super. 252, 263 (App. Div. 2000) (citations
            omitted).]

      R&F provided the EAP to all employees in February 2014.

Plaintiff refused to immediately sign the document, and claims she

                                    6                               A-2272-16T1
was pressured to do so.    Notwithstanding, she certified that she

took the EAP home, "read it carefully," and signed it "about one

month later."   Plaintiff alleges if she did not sign the EAP she

feared she would lose her job, which constitutes evidence of

duress.

       The Supreme Court has held that employment is sufficient

consideration for an employer to require employees to execute

employment related contracts such as arbitration agreements.          See

Martindale v. Sandvik, Inc., 173 N.J. 76, 90 (2002) (holding "the

[United States] Supreme Court obviously contemplated avoidance of

the arbitration clause only upon circumstances more egregious than

the ordinary economic pressure faced by every employee who needs

the job" (quoting Young v. Prudential Ins. Co. of Am., Inc., 297

N.J. Super. 605, 688 (App. Div. 1997))).          "[C]ourts that have

considered this issue [of whether the threat of termination of

employment for refusing to agree to arbitration is oppressive]

have   consistently   determined   that   the   economic   coercion    of

obtaining or keeping a job, without more, is insufficient to

overcome an agreement to arbitrate statutory claims."         Muhammad

v. Cty. Bank of Rehoboth Beach, 379 N.J. Super. 222, 240 (App.

Div. 2005) (quoting Quigley v. KPMG Peat Marwick, LLP, 330 N.J.

Super. 252, 263 (App. Div. 2000)).

                                   7                            A-2272-16T1
     The record lacks objective evidence of duress exerted by R&F.

Furthermore, R&F requiring plaintiff to execute the EAP as a

condition of ongoing employment is not duress.       For these reasons,

we reject plaintiff's claim of duress.

                                  III.

     Plaintiff   asserts   the   EAP   is   unenforceable   and   violates

public policy because it is written in an incomprehensible manner.

The record does not support such a claim.

     In Garfinkel, supra, 168 N.J. at 131-32, the Supreme Court

stated:

          Because of the favored status afforded to
          arbitration, "[a]n agreement to arbitrate
          should be read liberally in favor of
          arbitration." That favored status, however,
          is not without limits. The Court has stressed
          that "[i]n the absence of a consensual
          understanding, neither party is entitled to
          force the other to arbitrate their dispute.
          Subsumed in this principle is the proposition
          that only those issues may be arbitrated which
          the parties have agreed shall be." In respect
          of specific contractual language, "[a] clause
          depriving a citizen of access to the courts
          should clearly state its purpose. The point
          is to assure that the parties know that in
          electing arbitration as the exclusive remedy,
          they are waiving their time-honored right to
          sue." As we have stressed in other contexts,
          a party's waiver of statutory rights "must be
          clearly and unmistakably established, and
          contractual language alleged to constitute a
          waiver will not be read expansively." In the
          same vein, a "court may not rewrite a contract
          to broaden the scope of arbitration[.]"

                                   8                               A-2272-16T1
            [citations omitted.]

       "A party who enters into a contract in writing, without any

fraud or imposition being practiced upon him, is conclusively

presumed to understand and assent to its terms and legal effect."

Rudbart v. N. Jersey Dist. Water Supply Comm'n, 127 N.J. 344, 353

(1992) (quoting Fivey v. Pennsylvania R.R. Co., 67 N.J.L. 627, 632

(E. & A. 1902)). An employee who signs but claims to not understand

an arbitration agreement will not be relieved from an arbitration

agreement on those grounds alone. See Booker v. Robert Half Int'l,

Inc., 315 F. Supp. 2d 94, 101 (D.D.C. 2004); see also Friedman v.

Tappan Dev. Corp., 22 N.J. 523, 531 (1956).

       Plaintiff's assertion the EAP was difficult to understand,

rendering it unenforceable, lacks merit.                   The EAP states, in

pertinent part, "[u]nder this Program, you and we waive all rights

to have a Claim decided by a court, judge, jury and, where

permitted by law, an administrative agency." The EAP then explains

what   arbitration        is   and   how   it   is   different      from   a     court

proceeding.         The    document     sets    forth    detailed    instructions

regarding     the    arbitration       process.         Therefore,    plaintiff's

argument    the      EAP       is    ambiguous,      confusing,      and   drafted

incomprehensibly is not supported by the record.

                                           9                                   A-2272-16T1
                                  IV.

     Finally,    plaintiff's   claims   that   the   arbitrator   will   be

biased because defendant was ordered to fund the arbitration

proceeding, and her claim the trial court order should be reversed

because there was no oral argument, lack sufficient merit to

warrant discussion in a written opinion.        R. 2:11-3(e)(1)(E).

     Affirmed.

                                  10                              A-2272-16T1