Court Opinion

ID: 4090900
Source: CourtListenerOpinion
Date Created: 2016-10-19 21:07:46.183952+00
Date Added: 2024-06-11T14:36:07.167953
License: Public Domain

Supreme Court of Louisiana
FOR IMMEDIATE NEWS RELEASE                                           NEWS RELEASE #057

FROM: CLERK OF SUPREME COURT OF LOUISIANA

The Opinions handed down on the 19th day of October, 2016, are as follows:

BY JOHNSON, C.J.:

2016-CC-0818        JAMES DUHON v. ACTIVELAF, LLC, D/B/A SKYZONE LAFAYETTE        AND
                    UNDERWRITERS AT LLOYDS, LONDON (Parish of E. Baton Rouge)

                    Accordingly, we find the court of appeal erred in reversing the
                    district court’s ruling on Sky Zone’s exception of prematurity.
                    Therefore, the ruling of the court of appeal is reversed, and the
                    ruling of the district court is reinstated.
                    REVERSED AND REMANDED TO THE DISTRICT COURT FOR FURTHER
                    PROCEEDINGS.

                    WEIMER, J., dissents and assigns reasons.
                    GUIDRY, J., dissents and assigns reasons.
                    CLARK, J., concurs with reasons.
                    HUGHES, J., concurs with reasons.
                    CRICHTON, J., additionally concurs and assigns reasons.
10/19/2016

                      SUPREME COURT OF LOUISIANA

                                 No. 2016-CC-0818

                                  JAMES DUHON

                                      VERSUS

          ACTIVELAF, LLC, D/B/A SKYZONE LAFAYETTE AND

                  UNDERWRITERS AT LLOYDS, LONDON

        ON WRIT OF CERTIORARI TO THE COURT OF APPEAL,
          FIRST CIRCUIT, PARISH OF EAST BATON ROUGE

JOHNSON, CHIEF JUSTICE

      Patrons of Sky Zone Lafayette, an indoor trampoline park, are required to

complete a “Participant Agreement, Release and Assumption of Risk” document

(“Agreement”) prior to entering the facility. The Agreement contains a clause waiving

the participant’s right to trial and compelling arbitration. Plaintiff, James Duhon, was

a patron at Sky Zone and was injured in the course of participating in the park’s

activities. After Mr. Duhon filed suit seeking damages, Sky Zone filed an exception

of prematurity seeking to compel arbitration pursuant to the Agreement. The district

court overruled Sky Zone’s exception, but the court of appeal reversed, finding the

arbitration provision should be enforced.

      For the following reasons, we reverse the ruling of the court of appeal, holding

the arbitration clause in the Sky Zone agreement is adhesionary and therefore

unenforceable.

                    FACTS AND PROCEDURAL HISTORY

      On April 19, 2015, James Duhon, accompanied by three minors, went to Sky

Zone in Lafayette. Upon entering the facility, Mr. Duhon was directed by Sky Zone

staff to a computer screen to check himself and the minors into the facility. Check-in

                                            1
required all participants to complete a Participation Agreement which requested names

and dates of birth for all participants, required participants to check three boxes next

to certain terms of the Agreement, and required participants to digitally sign the

Agreement.

      The Agreement provided that in consideration for gaining access to Sky Zone

Lafayette and engaging in the services, patrons agreed:

      G      I acknowledge that my participation in [Sky Zone] trampoline
             games or activities entails known and unanticipated risks that
             could result in physical or emotional injury including, but not
             limited to broken bones, sprained or torn ligaments, paralysis,
             death, or other bodily injury or property damage to myself my
             children, or to third parties. I understand that such risks simply
             cannot be eliminated without jeopardizing the essential qualities
             of the activity. I expressly agree and promise to accept and assume
             all of the risks existing in this activity. My and/or my children’s
             participation in this activity is purely voluntary and I elect to
             participate, or allow my children to participate in spite of the risks.
             If I and/or my children are injured, I acknowledge that I or my
             children may require medical assistance, which I acknowledge
             will be at my own expense or the expense of my personal insurers.
             I hereby represent and affirm that I have adequate and appropriate
             insurance to provide coverage for such medical expense.

      G      In consideration for allowing me and the minor child(ren)
             identified herein to participate in the [Sky Zone] activities and use
             the [Sky Zone] facility, I expressly and voluntarily agree to
             forever release, acquit, indemnify and discharge [Sky Zone] and
             agree to hold [Sky Zone] harmless on behalf of myself, my
             spouse, my children, my parents, my guardians, and my heirs,
             assigns, personal representative and estate, and any and all other
             persons and entities who could in any way represent me, or the
             minor children identified herein or act on our respective halves,
             from any and all actions or omissions, cause and causes of action,
             suits, debts, damages, judgments, costs, including, but not limited
             to attorney’s fees, and claims and demands whatsoever, in law or
             in equity, for any personal injury, death, or property damages that
             I and/or the minor children’s use of [Sky Zone] activities, [Sky
             Zone] premises or at offsite and camp activities related to [Sky
             Zone]. This waiver is intended to be a complete release of any and
             all responsibility or duties owed by [Sky Zone] as indemnitees for
             personal injuries, death and/or property loss/damage sustained by
             myself or any minor children identified herein while on the [Sky
             Zone] premises, or with respect to [Sky Zone] activities, whether
             using [Sky Zone] equipment or not, even if such injury or damage
             results from [Sky Zone] negligence, [Sky Zone] employee

                                        2
      negligence, improper supervision, improper maintenance of [Sky
      Zone] equipment or premises or negligence by other [Sky Zone]
      guests.

G     I certify that I and/or my child(ren) are physically able to
      participate in all activities at the Location without aid or
      assistance. I further certify that I am willing to assume the risk of
      any medical or physical condition that I and/or my child(ren) may
      have. I acknowledge that I have read the rules, (the “Sky Zone
      Rules”) governing my and/or my child(ren)’s participation in any
      activities at the Location. I certify that I have explained the [Sky
      Zone] Rules to the child(ren) identified herein. I understand that
      the [Sky Zone] Rules have been implemented for the safety of all
      guests at the Location. I agree that if any portion of this
      Agreement is found to be void and unenforceable, the remaining
      portions shall remain in full force and effect. If there are any
      disputes regarding this agreement, I on behalf of myself and/or my
      child(ren) hereby waive any right I and/or my child(ren) may have
      to a trial and agree that such dispute shall be brought within one
      year of the date of this Agreement and will be determined by
      binding arbitration before one arbitrator to be administered by
      JAMS pursuant to its Comprehensive Arbitration Rules and
      Procedures. I further agree that the arbitration will take place
      solely in the state of Louisiana and that the substantive law of
      Louisiana shall apply. If, despite the representations made in this
      agreement, I or anyone on behalf of myself and/or my child(ren)
      file or otherwise initiate a lawsuit against [Sky Zone], in addition
      to my agreement to defend and indemnify [Sky Zone], I agree to
      pay within 60 days liquidated damages in the amount of $5,000 to
      [Sky Zone]. Should I fail to pay this liquidated damages amount
      within the 60 day time period provided by this Agreement, I
      further agree to pay interest on the $5,000 amount calculated at
      12% per annum.

I further grant [Sky Zone] the right, without reservation or limitation, to
videotape, and/or record me and/or my children on closed circuit
television.

I further grant [Sky Zone] the right, without reservation or limitation, to
photograph, videotape, and/or record me and/or my children and to use
my or my children’s name, face, likeness, voice and appearance in
connection with exhibitions, publicity, advertising and promotional
materials.

I would like to receive free email promotions and discounts to the email
address provided below. I may unsubscribe from emails from Sky Zone
at any time.

By signing this document, I acknowledge that if anyone is hurt or
property is damaged during my participation in this activity, I may be
found by a court of law to have waived my right to maintain a lawsuit

                                 3
      against [Sky Zone] on the basis of any claim from which I have released
      them herein. I have had sufficient opportunity to read this entire
      document. I understand this Agreement and I voluntarily agree to be
      bound by its terms.

      I further certify that I am the parent or legal guardian of the children
      listed above on this Agreement or that I have been granted power of
      attorney to sign this Agreement on behalf of the parent or legal guardian
      of the children listed above.

Mr. Duhon electronically completed the Agreement on behalf of himself and the

minors by checking the three boxes provided in the agreement, furnishing the relevant

personal identifying information, and clicking on an “accept” button. Mr. Duhon and

the minors then entered the facility.

      Mr. Duhon asserts he was injured at the facility due to Sky Zone’s negligence.

On August 12, 2015, Mr. Duhon filed suit against Activelaf, L.L.C., d/b/a Sky Zone

Lafayette and its insurer (“Sky Zone”). In response, Sky Zone filed several exceptions,

including an exception of prematurity. Sky Zone alleged that the Agreement contained

a mandatory arbitration clause, thereby rendering Mr. Duhon’s suit premature. Mr.

Duhon asserted he did not knowingly consent to arbitration, and argued the

Agreement was adhesionary and ambiguous.

      Following a hearing, the district court determined there was a lack of mutuality

in the Agreement relative to the arbitration clause because only Mr. Duhon was bound

to arbitrate claims. Thus, relying on this court’s decision in Aguillard Auction

Management Corp., 04-2804 (La. 6/29/05), 908 So. 2d 1 and the Third Circuit’s

opinion in Sutton Steel & Supply, Inc. v. Bellsouth Mobility, Inc., 07-146 (La. App.

3 Cir. 12/12/07), 971 So. 2d 1257, the district court refused to enforce the arbitration

agreement and overruled Sky Zone’s exception of prematurity.

      The court of appeal granted Sky Zone’s writ and reversed the district court’s

ruling:

      There is a strong presumption favoring the enforceability of arbitration

                                           4
      clauses. The weight of this presumption is heavy and arbitration should
      not be denied unless it can be said with positive assurance that an
      arbitration clause is not susceptible of an interpretation that could cover
      the dispute at issue. Aguillard v. Auction Management Corp., 2004-2804
      (La. 6/29/05), 908 So. 2d 1. We find that plaintiff failed to establish that
      this arbitration provision is adhesionary, and accordingly, the arbitration
      provision should be enforced.

Judge Theriot dissented without reasons, stating he would deny the writ application.

Duhon v. ActiveLaf, LLC, 16-0167 (La. App. 1 Cir. 4/5/16) (unpublished).

      On Mr. Duhon’s application, we granted certiorari to review the correctness of

the court of appeal’s ruling. Duhon v. ActiveLaf, LLC, 16-0818 (La. 6/17/16), 192 So.

3d 762.

                                   DISCUSSION

      This case involves the legal questions of whether the court of appeal erred in

its “contract of adhesion” analysis of the arbitration clause in the Agreement, and

whether the arbitration clause is unenforceable on general contract principles of

consent or adhesion. Thus, we review the matter de novo. See Aguillard, 908 So. 2d

at 3; Prasad v. Bullard, 10-291 (La. App. 5 Cir. 10/12/10), 51 So. 3d 35, 39;

Horseshoe Entertainment v. Lepinski, 40,753 (La. App. 2 Cir. 3/8/06), 923 So. 2d 929,

934, writ denied, 06–792 (La. 6/2/06), 929 So. 2d 1259.

      Louisiana and federal law explicitly favor the enforcement of arbitration clauses

in written contracts. Aguillard, 908 So. 2d at 7. Louisiana Binding Arbitration Law

(“LBAL”) is set forth in La. R.S. 9:4201 et seq. and expresses a strong legislative

policy favoring arbitration. La. R.S. 9:4201 provides:

      A provision in any written contract to settle by arbitration a controversy
      thereafter arising out of the contract, or out of the refusal to perform the
      whole or any part thereof, or an agreement in writing between two or
      more persons to submit to arbitration any controversy existing between
      them at the time of the agreement to submit, shall be valid, irrevocable,
      and enforceable, save upon such grounds as exist at law or in equity for
      the revocation of any contract.

As this court recognized in Aguillard, “[s]uch favorable treatment echos the Federal

                                           5
Arbitration Act (“FAA”), 9 U.S.C. § 1, et seq.” 908 So. 2d at 7. We noted the LBAL

is virtually identical to the FAA, and determinations regarding the viability and scope

of arbitration clauses are the same under either law, thus federal jurisprudence

interpreting the FAA may be considered in construing the LBAL. Id. at 18. Further,

to the extent that federal and state law differ, the FAA preempts state law as to any

written arbitration agreement in a contract involving interstate commerce. Hodges v.

Reasonover, 12-0043 (La. 7/2/12), 103 So. 3d 1069, 1072; FIA Card Services, N.A.

v. Weaver, 10-1372 (La. 3/15/11), 62 So. 3d 709, 712; Collins v. Prudential Ins. Co.

of America, 99-1423 (La. 1/19/00), 752 So. 2d 825, 827.

      The FAA makes arbitration agreements “valid, irrevocable, and enforceable,

save upon such grounds as exist at law or in equity for the revocation of any contact.”

9 U.S.C. §2 (emphasis added). The United States Supreme Court has explained that

this provision reflects both a “liberal federal policy favoring arbitration,” and the

“fundamental principle that arbitration is a matter of contract.”

AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 339, 131 S. Ct. 1740, 1745, 179

L.Ed. 2d 742 (2011) (citing Moses H. Cone Memorial Hospital v. Mercury Constr.

Corp., 460 U.S. 1, 24, 103 S.Ct. 927, 74 L.Ed. 2d 765 (1983) and Rent–A–Center,

West, Inc. v. Jackson, 561 U.S. 63, 67, 130 S.Ct. 2772, 2776, 177 L.Ed. 2d 403

(2010)). The Supreme Court has instructed that in line with these principles, courts

must place arbitration agreements on an equal footing with other contracts.

Concepcion, 563 U.S. at 339 (citing Buckeye Check Cashing, Inc. v. Cardegna, 546

U.S. 440, 443, 126 S.Ct. 1204, 163 L.Ed. 2d 1038 (2006)). Despite this policy

favoring enforcement of arbitration agreements, the Supreme Court has also

recognized that, under the savings clause in §2, general state contract principles still

apply to assess whether those agreements to arbitrate are valid and enforceable, just

as they would to any other contract dispute arising under state law. Doctor’s

                                           6
Associates, Inc. v. Casarotto, 517 U.S. 681, 686–87, 116 S.Ct. 1652, 1656, 134 L. Ed.

2d 902 (1996). Accordingly, ordinary state-law principles that govern the formation

of contracts are applied when deciding whether the parties agreed to arbitration. First

Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944, 115 S.Ct. 1920, 1924, 131

L.Ed. 2d 985 (1995). Importantly, the savings clause in § 2 does not permit courts to

invalidate an arbitration agreement under a state law applicable only to arbitration

provisions. Concepcion, 563 U.S. at 339; Aguillard, 908 So. 2d at 8.

      With these principles in mind, we consider whether the arbitration clause in the

Sky Zone Agreement should be invalided under Louisiana law. As an initial matter,

we note the electronic nature of the Agreement in this case is of no legal consequence

and does not fundamentally change the principles of contract. Louisiana law gives

legal effect to both electronic contracts and signatures. See La. R.S. 9:2607. We

interpret and analyze the terms of the Agreement using the same rules that we would

apply to oral and written contracts.

      Aguillard is the seminal case from this court addressing the validity of an

arbitration agreement in a standard form contract. In Aguillard, the winning bidder at

a real estate auction brought suit to enforce the auction sales agreement. This court,

pursuant to its authority under La. R.S. 9:4201 and 9 U.S.C. § 2, applied a “contract

of adhesion” analysis to determine the enforceability and validity of an arbitration

agreement in the auction contract. In discussing the “contract of adhesion” doctrine,

we explained: “Broadly defined, a contract of adhesion is a standard contract, usually

in printed form, prepared by a party of superior bargaining power for adherence or

rejection of the weaker party. Often in small print, these contracts sometimes raise a

question as to whether or not the weaker party actually consented to the terms.” 908

So. 2d at 10. This court further stated that “although a contract of adhesion is a

contract executed in a standard form in the vast majority of instances, not every

                                          7
contract in standard form may be regarded as a contract of adhesion. Therefore, we

are not willing to declare all standard form contracts adhesionary; rather, we find

standard form serves merely as a possible indicator of adhesion.” Id. (Internal citations

removed). We made clear that the “real issue in a contract of adhesion analysis is not

the standard form of the contract, but rather whether a party truly consented to all the

printed terms. Thus, the issue is one of consent.” Id. (Internal citations removed). The

court explained:

      Consent is called into question by the standard form, small print, and
      most especially the disadvantageous position of the accepting party,
      which is further emphasized by the potentially unequal bargaining
      positions of the parties. An unequal bargaining position is evident when
      the contract unduly burdens one party in comparison to the burdens
      imposed upon the drafting party and the advantages allowed to that
      party. Once consent is called into question, the party seeking to
      invalidate the contract as adhesionary must then demonstrate the
      non-drafting party either did not consent to the terms in dispute or his
      consent was vitiated by error, which in turn, renders the contract or
      provision unenforceable.

      In summation, a contract is one of adhesion when either its form, print,
      or unequal terms call into question the consent of the non-drafting party
      and it is demonstrated that the contract is unenforceable, due to lack of
      consent or error, which vitiates consent. Accordingly, even if a contract
      is standard in form and printed in small font, if it does not call into
      question the non-drafting party’s consent and if it is not demonstrated
      that the non-drafting party did not consent or his consent is vitiated by
      error, the contract is not a contract of adhesion.

Id. at 10-11. Thus, the question we consider is whether Mr. Duhon truly consented to

the arbitration provision in the Agreement.

      In concluding the arbitration provision in Aguillard was not adhesionary, we

noted (1) the arbitration provision was contained in a short, two-page document and

was contained in a single sentence paragraph; (2) the arbitration provision was not

concealed; (3) the contract did not lack mutuality because defendants did not reserve

their right to litigate issues arising from the contract; and (4) the parties did not have

a significant difference in bargaining power because a real estate auction is not a

                                            8
necessary transaction that plaintiff was compelled to enter. Id. Thus, while not

declaring a definitive test, this court effectively established a framework for

examining the validity of an arbitration clause within a standard form contract by

generally describing the characteristics of an unenforceable adhesionary agreement.

Finding our analysis in Aguillard instructive, we consider the following factors to

determine the enforceability of the arbitration clause in the Sky Zone Agreement: (1)

the physical characteristics of the arbitration clause, (2) the distinguishing features of

the arbitration clause, (3) the mutuality of the arbitration clause, and (4) the relative

bargaining strength of the parties. After our review of the Agreement in light of the

above factors, we hold the arbitration clause is adhesionary and not enforceable

because of its placement in the Agreement and its lack of mutuality.

      Examining the physical characteristics of the arbitration clause, we observe the

arbitration language is consistent in size and font with the other provisions in the

Agreement. However, the lack of distinguishing features and the specific placement

of the arbitration clause serve to conceal the arbitration language from Sky Zone

patrons. The Agreement is structured with check boxes next to the first three

paragraphs, followed by five additional paragraphs without corresponding check

boxes. The first check box is placed next to a single, six-sentence paragraph generally

discussing participants’ risks of injuries and assumption of those risks. The second

check box is placed next to a single paragraph containing two long sentences

purporting to release Sky Zone from any liability. The third check box is placed next

to one long paragraph discussing multiple topics. Specifically, the arbitration language

is located starting in the eleventh line of this third paragraph, following provisions

regarding patrons’ physical ability to participate in the activities, assumption of the

risks, certification that Sky Zone’s rules have been explained to any children, and

expressing agreement to follow those rules.

                                            9
      In Aguillard, we noted “the arbitration provision, although not distinguished,

was not concealed in any way, but rather was contained in a single sentence paragraph

separated from the preceding and following paragraphs by double spacing.” 908 So.

2d at 16. Sky Zone argues the paragraph containing the arbitration clause was

sufficiently distinguished and brought to patrons’ attention through the use of the

check box feature. We disagree. Although patrons are required to check a box adjacent

to the top of the third paragraph, significantly no check box was placed next to the

arbitration language. In contrast, the other two check boxes in the Agreement were

placed next to paragraphs limited to one subject matter. The Agreement also contains

five additional paragraphs following the third paragraph that do not include

corresponding check boxes. Each of these are short one-topic paragraphs addressing

such items as Sky Zone’s right to videotape and record patrons and to use recordings

for promotional materials. Thus, looking at the Agreement as a whole, the arbitration

language appears to be the only specific provision not relegated to a separate

paragraph or set apart in some explicit way. Here, the two-sentence provision

mandating arbitration is camouflaged within the confines of an eleven sentence

paragraph, nine of which do not discuss arbitration. The effect of the placement of the

arbitration language is to cloak it within a blanket of boilerplate language regarding

rules and risks of participating in the Sky Zone activities. Thus, although it is

undisputed that Mr. Duhon electronically signed the Agreement, purportedly

demonstrating an acceptance of its terms, under Louisiana contract law, we find Mr.

Duhon did not truly consent to the arbitration provision.

      Additionally, the lack of mutuality in the arbitration clause fortifies our finding

that it is adhesionary. The arbitration provision requires only Sky Zone patrons to

submit their claims to arbitration. The entire contract, including the arbitration clause,

repeatedly includes “I acknowledge” and “I agree” language, with the “I” referencing

                                           10
the “applicant” – here, Mr. Duhon. Specifically, the Agreement provides if there are

any disputes regarding this agreement “I … hereby waive any right … to a trial and

agree that such dispute shall be … determined by binding arbitration ….” Although

Sky Zone does not expressly reserve itself the right to pursue litigation, nowhere in

the Agreement are “the parties” or Sky Zone particularly bound to arbitration. This is

in stark contrast to the arbitration clause in Aguillard which clearly applied to both

parties by providing: “Any controversy or claim arising from or relating to this

agreement or any breach of such agreement shall be settled by arbitration administered

by the American Arbitration Association under is [sic] rules, and judgment on the

award rendered by the arbitrator may be entered in any court having jurisdiction

thereof.” 908 So. 2d at 4. Thus, in Aguillard, we found the arbitration clause did not

lack sufficient mutuality to invalidate the clause as adhesionary because the arbitration

clause severely limited both the defendants’ and the plaintiff’s right to litigate, and the

defendants did not reserve their right to litigate in the document. Id. at 16. Even more

troublesome in this case is the punitive provision compelling patrons to pay Sky Zone

liquidated damages of $5,000 within sixty days should the patron file suit, with legal

interest added at 12% per year. Sky Zone has no mutual obligation in the Agreement.

      The party seeking to enforce an arbitration provision has the burden of showing

the existence of a valid contract to arbitrate. FIA Card Services, 62 So. 3d at 719. Sky

Zone has failed to meet this burden. Considering the lack of mutuality together with

the obscure placement of the arbitration language in the Agreement, and in

comparison to the contract in Aguillard, we are compelled to find the arbitration

clause in the Sky Zone Agreement is adhesionary and unenforceable.

      In finding this arbitration clause invalid, we have carefully considered the

Supreme Court’s admonition that, under the doctrine of preemption, state courts

                                            11
cannot adopt defenses that apply only to arbitration or that derive their meaning from

the fact that an agreement to arbitrate is at issue. See, e.g., Concepcion, 563 U.S. at

339; Casarotto, 517 U.S. at 687. Nor can we apply state law rules that stand as an

obstacle to the accomplishment of the FAA’s objectives. Concepcion, 563 U.S. at 343.

We are mindful that setting forth a legal requirement relative to a particular form or

method of distinguishing or highlighting arbitration clauses, or requiring term-for-

term mutuality in an arbitration clause could risk running afoul of the FAA. However,

the Supreme Court has made it clear that state courts may apply standard state law

contract defenses to arbitration agreements. Id. at 339. Our application of Louisiana

contract law to invalidate the arbitration provision in the instant case is consistent with

§ 2 of the FAA, and we find no conflict between our holding today and Supreme

Court decisions discussing preemption.

       As explained earlier, consideration of enforceability of contracts of adhesion

is an issue of consent, and determining whether a party truly consented to the contract

terms. Consideration of consent is not limited to arbitration clauses; we consider the

issue of consent in any contract. Lack of consent is a generally applicable contract

defense. See La. C.C. art. 1927. The factors discussed in Aguillard simply provided

a template for considering consent to an arbitration clause contained in a standard

contract. Aguillard did not create a per se rule that any degree of non-mutuality in an

arbitration agreement renders it unenforceable, nor did Aguillard prescribe a definitive

rule that arbitration agreements must be delineated a particular way to be enforceable.

Considering the Aguillard analysis in its entirety, it is clear we viewed the arbitration

provision in the context of the overall contract and the surrounding circumstances, and

our determination was based on weighing several factors. Were we not to consider

factors relative to consent when examining the validity of an arbitration agreement,

we would be operating in contravention to the mandate of the Supreme Court by

                                            12
treating arbitration agreements differently from other contracts. Thus, we find our

application of Louisiana contract law to invalidate the arbitration provision in this case

is consistent with the savings clauses in § 2 of the FAA and La. R.S. 9:4201.

                                        CONCLUSION

       The determination of whether an arbitration clause in a standard form contract

is adhesionary is necessarily made on a case by case basis. Based on the facts of this

case, the concealment of the arbitration clause and the lack of mutuality compels us

to find the arbitration clause in the Sky Zone Agreement is adhesionary and

unenforceable. Accordingly, we find the court of appeal erred in reversing the district

court’s ruling on Sky Zone’s exception of prematurity.1 Therefore, the ruling of the

court of appeal is reversed, and the ruling of the district court is reinstated.

                                            DECREE

    REVERSED AND REMANDED TO THE DISTRICT COURT FOR
FURTHER PROCEEDINGS.

       1
         Because we hold the arbitration clause is adhesionary and unenforceable based on
consideration of the factors set forth in Aguillard, we pretermit discussion of Mr. Duhon’s additional
arguments relative to ambiguity of the Agreement or whether the scope of the arbitration clause
covers personal injury.

                                                 13
10/19/16

                       SUPREMECOURT OF LOUISIANA

                                       NO. 2016-CC-0818

                                        JAMES DUHON

                                              VERSUS

                ACTIVELAF, LLC, D/B/A SKYZONE LAFAYETTE

                  AND UNDERWRITERS AT LLOYDS, LONDON

           ON WRIT OF CERTIORARI TO THE COURT OF APPEAL, FIRST CIRCUIT,
                           PARISH OF EAST BATON ROUGE

WEIMER, J., dissenting.

         I agree with the majority’s assessment that the factors outlined in Aguillard v.

Auction Management Corp., 04-2804 (La. 6/29/05), 908 So.2d 1, are an appropriate

starting point for analyzing the issue presented in this matter.1 See Duhon v.

ActiveLaf, LLC, 16-0818, slip op. at 7 (La. 10/__/16). However, I respectfully

disagree with the majority’s conclusion that analysis of the Sky Zone Agreement

using Aguillard’s four-factor “framework” supports a finding that the arbitration

clause is adhesionary and not enforceable. To the contrary, I find the arbitration

clause to be valid and enforceable. I also find that analysis of the clause using

Aguillard’s factors, viewed in light of the strong and, as Aguillard describes it,

“heavy” presumption in favor of arbitration, dictates that finding of enforceability.

Aguillard, 04-2804 at 25, 908 So.2d at 18.

          As the majority recognizes, a contract of adhesion is broadly defined as “a

    standard contract, usually in printed form, [often in small print,] prepared by a party
1
  While I dissented in Aguillard, I did so solely on grounds that there was a threshold legal question
that I believed needed to be resolved before reaching the issue of the enforceability of the arbitration
clause: whether the arbitration clause at issue even applied in light of the fact that the Auction
Agreement for the Purchase and Sale of Real Estate had been completed. Aguillard, 04-2804 at 1,
980 So.2d at 20-21 (Weimer, J., dissenting.).
of superior bargaining power for adherence or rejection of the weaker party.”

Duhon, 16-0818, slip op. at 7-8 (quoting Aguillard, 04-2804 at 9, 908 So.2d at 8-9.)

(Emphasis added.) Pursuant to this definition, a predicate factor to consider in

determining whether a contract is adhesionary is the existence of unequal bargaining

power. Indeed, this is one of the four factors delineated in the Aguillard analysis.

Yet, the majority opinion does not mention, much less weigh, this factor in

conducting its analysis–this, despite the fact that there must be unequal bargaining

power for the contract to meet the definitional hurdle of a contract of adhesion in the

first instance.

       In this case, it is clear that, as in Aguillard, there was not “such a difference

in bargaining positions between the parties so as to justify the application of the

principle of contract of adhesion to the arbitration clause.” Aguillard, 04-2804 at 22,

908 So.2d at 16-17. As Aguillard explained in defining a contract of adhesion,

“[o]wing to the necessities of modern life a particular kind of contract has been

developed where one of the parties is not free to bargain.” Id., 04-2804 at 10, 908

So.2d at 9 (quoting Saul Litvinoff, Consent Revisited: Offer, Acceptance, Option,

Right of First Refusal, and Contracts of Adhesion in the Revision of the Louisiana

Law of Obligations, 74 La.L.Rev. 699, 757-59 (1986-1987)). Such a lack of

bargaining power exists where “[t]he party in the weaker position is left with no other

choice than to adhere to the terms proposed by the other.” Id. (Emphasis added.)

Typical examples of such contracts include those entered into with “airlines, public

utilities, railroad or insurance companies.” Id.

       In Aguillard, this court recognized that the relative bargaining positions of the

real estate auctioneer and the individual auction participant involved in that case were

not so unequal as to justify invalidating the arbitration clause on grounds of adhesion,

                                           2
reasoning that, although the participant was required to sign the agreement containing

the arbitration clause in order to participate in the auction, “the underlying

transaction, the real estate auction, [was] not ... such a necessary transaction” that the

participant “was compelled to enter it.” Id., 04-2804 at 22-23, 908 So.2d at 16-17.

Indeed, the participant could have avoided arbitration by not signing the agreement,

not participating in the auction, and simply walking away. See id. 04-2804 at 22, 908

So.2d at 17. Under such circumstances, the court found “nothing sufficient to

establish the [auctioneers] were in such a superior bargaining position as to render the

[auction participant] a far weaker party or the contract adhesionary.” Id. 04-2804 at

23, 908 So.2d at 17.

      The rationale of the court in Aguillard applies with equal force to the Sky

Zone Agreement at issue in this case. Here, the Agreement concerns not a “necessity

of modern life,” but a purely voluntary recreational activity. The plaintiff was not

compelled–physically, economically or otherwise–to visit the trampoline park, jump

on its trampolines, or sign the Agreement containing the arbitration clause. Jumping

on a trampoline is simply not a practical necessity of modern living like water,

electricity, or even airline flight. Like the auction participant in Aguillard, the

plaintiff, here, retained the ultimate bargaining chip in this situation: he could have

refused to sign Sky Zone’s Agreement, walked away, and pursued an alternative form

of recreational activity. Given these circumstances, there is simply no evidence to

establish that Sky Zone was in such a superior bargaining position as to render the

plaintiff a far weaker party or the contract adhesionary.

      Further, and also contrary to the majority, I find nothing in the Sky Zone

Agreement, itself, that would call into question the validity of the plaintiff’s consent

to the terms of the Agreement. This determination is based on my analysis of the

                                            3
three factors that are addressed in the majority’s Aguillard analysis–(1) the physical

characteristics of the arbitration clause; (2) the distinguishing features of that clause;

and (3) the mutuality of the clause–and my differing conclusions as to each.

         In addressing the first Aguillard factor–the physical characteristics of the

arbitration clause–the majority acknowledges that “the arbitration language is

consistent in size and font with the other provisions in Agreement.” Duhon, slip op.

at 9. In fact, the clause is not in small print or otherwise unreadable, but is just as

legible as every other word in the Agreement. The majority apparently concedes,

therefore, and I agree, that the physical characteristics of the arbitration clause weigh

in favor of finding the clause enforceable.

         In addressing the second of the Aguillard factors–the distinguishing features

of the clause–the majority, in my view, falls into error. It downplays the very feature

that distinguishes the arbitration clause and calls its attention to the participant: the

box located next to the paragraph in which the clause appears, a box which must be

affirmatively checked before the Agreement can be completed. The majority chooses,

instead, to focus solely on the fact that the arbitration language is not set out in a

stand-alone paragraph to reach the conclusion that it is “camouflaged” and “cloak[ed]

... within a blanket of boilerplate language” to such an extent that plaintiff could not

have not consented to its terms, despite affirmatively indicating by checking the

electronic box that he did just that. See Duhon, 16-0818, slip op. at 10. While it is

true that the arbitration clause appears in a paragraph not limited to the single topic

of arbitration, more than one-half of that paragraph concerns the agreed-upon

arbitration, its procedure, its locale, governing law, and the consequences for refusing

or otherwise breaching the agreement to arbitrate.2 The arbitration language is hardly

2
    See Duhon, 16-0818, slip op’n at 3.

                                            4
camouflaged. Further, the majority’s suggestion, that failure to set the arbitration

language out in a stand-alone paragraph fails to sufficiently distinguish the arbitration

clause, ignores the check box. See Duhon, 16-0818, slip op. at 10. The presence of

that box is akin to, and has the same legal force and effect as, requiring the plaintiff

to initial next to the paragraph, a requirement that affirmatively alerts the participant

to the contents and significance of the paragraph.3 Like the arbitration provision in

Aguillard, and contrary to the majority, I find the arbitration language in the Sky

Zone Agreement was not concealed in any way and that the use of the electronic

check boxes reasonably distinguished the clause.

         Finally, as to the third Aguillard factor, the mutuality of the obligation to

arbitrate, the majority acknowledges that “Aguillard did not create a per se rule that

any degree of non-mutuality in an arbitration agreement renders it unenforceable,”4

and that “requiring term-for-term mutuality in an arbitration clause could risk running

afoul of the [Federal Arbitration Act],”5 but then inexplicably invalidates the

arbitration clause in the Sky Zone Agreement precisely because it lacks the term-for-

term mutuality that it acknowledges the law does not require, and may even prohibit.6

In truth, the only difference between the arbitration clause in Aguillard and the one

in the Sky Zone Agreement is the use of the “I” in the Sky Zone Agreement.

However, the mere use of the word “I” does not render the clause non-mutual,

3
  Modern technology has introduced what is referred to as a “clickwrap” agreement as a mechanism
for having a “user manifest his or her assent to the terms of the ... agreement by clicking on an icon.”
See Register.com, Inc. v. Verio, Inc., 356 F.3d 393, 429 (2nd Cir. 2004).
4
    See Duhon, 16-0818, slip op. at 13.
5
    See Duhon, 16-0818, slip op. at 12.
6
    See Duhon, 16–0818, slip op. at 11-13.

                                                   5
particularly in light of the fact, acknowledged by the majority, that the Agreement

does not reserve to Sky Zone the right to pursue litigation.7

          Consequently, unlike the majority, I find an analysis of all four of the factors

outlined in Aguillard leads to the conclusion that the Sky Zone Agreement is not

adhesionary and is valid and enforceable. This conclusion is strengthened, not only

by the strong legislative policy that favors arbitration,8 but also by the long-standing

principle that signatures to documents are not mere ornaments.9 As Aguillard notes:

“It is well[-]settled that a party who signs a written instrument is presumed to know

its contents and cannot avoid its obligations by contending that he did not read it, that

he did not understand it, or that the other party failed to explain it to him.” Id., 04-

2804 at 22, 908 So.2d at 17. In this case, as in Aguillard, the plaintiff signed the

Agreement acknowledging that he “had sufficient opportunity to read this entire

document ... understand this Agreement and ... voluntarily agree to be bound by its

terms.”10 As in Aguillard, there was no evidence that the plaintiff was not in an

equal bargaining position with Sky Zone because the plaintiff could have avoided

arbitration and the contractual provisions as a whole by simply not signing the Sky

Zone Agreement and pursuing an alternative recreational activity. Also as in

Aguillard, there is nothing in the Sky Zone Agreement itself–its physical or

distinguishing characteristics–that would call into question the validity of the

plaintiff’s consent to the terms of the Sky Zone Agreement as indicated by his

signature. I would affirm the decision of the court of appeal.

7
     See Duhon, 16-0818, slip op. at 11.
8
     See Duhon, 16-0818, slip op. at 5 (citing La. R.S. 9:4201, et seq.).
9
 See Tweedel v. Brasseaux, 433 So. 2d 133, 137 (La. 1983) (quoting Boullt v. Sarpy, 30 La.Ann.
494, 495 (La. 1878)).
10
     See Duhon, 16-0818, slip op. at 4.

                                                    6
10/19/2016

                      SUPREME COURT OF LOUISIANA

                                 NO. 2016-CC-0818

                                  JAMES DUHON

                                       VERSUS

             ACTIVELAF, LLC, D/B/A SKYZONE LAFAYETTE
              AND UNDERWRITERS AT LLOYDS, LONDON

                ON WRIT OF CERTIORARI TO THE COURT OF APPEAL,
                  FIRST CIRCUIT, PARISH OF EAST BATON ROUGE

GUIDRY, J., dissents and assigns reasons.

      I respectfully dissent from the majority’s reversal of the ruling of the court of

appeal. In my view, the arbitration clause in the Sky Zone Agreement is not part of

a contract of adhesion which would render it unenforceable.

      As the majority correctly states, a contract of adhesion is a “standard contract,

usually in printed form, prepared by a party of superior bargaining power for

adherence or rejection of the weaker party.” Aguillard v. Auction Management Corp.,

2004-2804, 2004-2857, p.9 (La. 6/29/05), 908 So.2d 1, 8-9. It is undisputed that the

real issue in a contract of adhesion analysis is consent, whether the non-drafting party,

considered to be the weaker party, truly consented to all the printed terms. Id. In

addressing the issue of consent, a court must look to the form, print, or unequal terms

of the contract by considering the factors set forth in Aguillard, namely, the physical

characteristics and distinguishing features of the arbitration clause, the relative

bargaining position of the parties, and the mutuality or lack thereof in the arbitration

clause. Id., 2004-2804, 2004-2857, p. 9, 908 So.2d at 17.

      As an initial matter, I disagree with the majority’s finding that the arbitration

clause was hidden and camouflaged within the Sky Zone Agreement in such a way

that would indicate the plaintiff’s consent to the agreement could be called into
question. Neither the print nor the font size of the arbitration clause differed from

that of the remainder of the contract executed by the plaintiff. The standard form

agreement was relatively short and straightforward, consisting of a total of nine

paragraphs, three of which were set off with boxes to be checked to signify the

patron’s consent. The arbitration clause, while not set off alone, consisted of one-half

of a paragraph that was required to be checked off. The clause commenced midway

through the paragraph and ran until the end of the paragraph. The plaintiff does not

dispute that he checked off the box reflecting his consent to the terms of the arbitration

clause.

      Furthermore, the record is absent any evidence that the plaintiff was not in an

equal bargaining position with the defendants. At the heart of the transaction, the

plaintiff was seeking admittance to a recreational facility. Indisputably, this was not

a contract to which the plaintiff was compelled to enter into the terms. He could have

simply elected to not sign the agreement and bypass the recreational activity. Instead,

the plaintiff signed the arbitration agreement acknowledging that he had sufficient

opportunity to read the entire document and understood its terms. Having signed the

agreement, the plaintiff cannot seek to avoid his obligations by contending that he did

not read or understand it. Basic contract law dictates that a party who signs a written

instrument is presumed to know its contents and cannot avoid its obligations by

contending that he did not read it, that he did not understand it, or that the other party

failed to explain it to him. Coleman v. Jim Walter Homes, Inc., 2008-1221, p. 7 (La.

3/17/09), 6 So.3d 179, 183 (citing Tweedel v. Brasseaux, 433 So.2d 133, 137

(La.1983)). To overcome the presumption, the party has the burden of proving with

reasonable certainty that he was deceived. Id. The plaintiff is unable to satisfy this

burden, because there is no evidence in the record that the plaintiff made any effort

to contact the defendant for an explanation or to discuss the terms of the contract in

                                            2
any respect.

      Next, the arbitration clause at issue substantially mirrors the Aguillard

arbitration clause, which this court found to be mutual. The plaintiff has not shown

anything in the clause that reserves Sky Zone’s right to litigate disputes related to the

agreement that is not equally afforded to the plaintiff. As such, the majority errs in

finding the lack of mutuality as to the parties.

      Finally, in Aguillard, this court addressed the presumption of arbitrability:

      [E]ven when the scope of an arbitration clause is fairly debatable or
      reasonably in doubt, the court should decide the question of construction
      in favor of arbitration. The weight of this presumption is heavy and
      arbitration should not be denied unless it can be said with positive
      assurance that an arbitration clause is not susceptible of an interpretation
      that could cover the dispute at issue. Therefore, even if some legitimate
      doubt could be hypothesized, this Court, in conjunction with the
      Supreme Court, requires resolution of the doubt in favor of arbitration.

                                             Id., 04-2804 at 18, 908 So.2d at 25.

In light of the controlling law indicating the favorable consideration afforded

arbitration agreements, coupled with the plaintiff’s failure to satisfy his burden of

proving the contract was adhesionary, the majority erred in invalidating the contract.

Accordingly, I respectfully dissent and would affirm the ruling of the court of appeal.

                                           3
10/19/16

                       SUPREME COURT OF LOUISIANA

                                 No. 2016-CC-0818

                                  JAMES DUHON

                                      VERSUS

           ACTIVELAF, LLC, D/B/A SKYZONE LAFAYETTE AND
                UNDERWRITERS AT LLOYDS, LONDON

           ON WRIT OF CERTIORARI TO THE COURT OF APPEAL,
             FIRST CIRCUIT, PARISH OF EAST BATON ROUGE

CLARK, J., concurring.

      I find that the contract at issue lacks mutuality to such an extent that the

contract is adhesionary.      Not only does the contract bind only patrons to

arbitration, the contract stipulates that if a patron files a lawsuit against Sky Zone,

the patron is liable for $5,000 in liquidated damages. At the same time, Sky Zone

is free to file a lawsuit against the patron without any penalty.
10/19/16

                      SUPREME COURT OF LOUISIANA

                                 No. 2016-CC-0818

                                  JAMES DUHON

                                      VERSUS

           ACTIVELAF, LLC, D/B/A SKYZONE LAFAYETTE AND
                UNDERWRITERS AT LLOYDS, LONDON

        ON WRIT OF CERTIORARI TO THE COURT OF APPEAL,
          FIRST CIRCUIT, PARISH OF EAST BATON ROUGE

Hughes, J., concurring.
      Although I do not agree that the arbitration language was hidden, I concur

that it lacked mutuality, and thus with the result.

                                           1
10/19/16

                      SUPREME COURT OF LOUISIANA

                                No. 2016-CC-0818

                                JAMES DUHON

                                     VERSUS

           ACTIVELAF, LLC, D/B/A SKYZONE LAFAYETTE AND
                UNDERWRITERS AT LLOYDS, LONDON

        ON WRIT OF CERTIORARI TO THE COURT OF APPEAL,
          FIRST CIRCUIT, PARISH OF EAST BATON ROUGE

CRICHTON, J., additionally concurs and assigns reasons.

      I agree with the majority decision, and write separately to emphasize that I

do not view this decision as a rejection of arbitration agreements. To the contrary,

Louisiana law favors the enforcement of arbitration agreements. See La. R.S.

9:4201 (Validity of arbitration agreements).        Consistent with the Federal

Arbitration Act (“FAA”), arbitration agreements must be placed “upon the same

footing” as other types of contracts.” Scherk v. Alberto-Culver Co., 417 U.S. 506,

511 (1974); see also 9 U.S.C. § 2. But just as Louisiana law should not create

obstacles to the enforceability of arbitration agreements, see AT&T Mobility LLC v.

Concepcion, 563 U.S. 333 (2011) (applying the FAA to preempt a state law

condition to the enforceability of an arbitration agreement), neither should

Louisiana law create exceptions for arbitration agreements that do not exist for

other types of contracts.

      Without question, arbitration can be a waiver of the traditional access to our

judicial system. And so, applying Aguillard v. Auction Management Corp., 04-

2804 (La. 6/29/05), 908 So. 2d 1, this waiver must be in accord with Louisiana

contract law, otherwise a party’s consent may be called into question. Thus, a

                                         1
business entity or individual seeking to draft a contract that includes an arbitration

agreement must meet all of the elements of an enforceable contract.

      By concealing the existence of the arbitration agreement, this agreement

deprives a party of redress in the justice system. To make a bad situation worse,

this agreement does not bind Sky Zone to arbitration, yet it penalizes a Sky Zone

patron—but not Sky Zone—for seeking to initiate a lawsuit.             These blatant

asymmetries exhibit a stunning lack of draftsmanship and fail to adhere to the

principles set forth in Aguillard. Accordingly, in my view, this Court is bound to

deem this agreement unenforceable.

                                          2