Court Opinion

ID: 9353225
Source: CourtListenerOpinion
Date Created: 2023-01-11 15:04:16.74919+00
Date Added: 2024-06-11T17:09:17.140339
License: Public Domain

STATE OF LOUISIANA

                            COURT OF APPEAL

                               FIRST CIRCUIT

                              NO. 2022 CA 0840

                         JESSICA HOPE BROWNE

                                    VERSUS

     GORDON MCKERNAN INJURY ATTORNEYS, LLC, ET AL

                                             Judgment Rendered: JAN 1 12023

                               On Appeal from the
                           21 st Judicial District Court
                        In and for the Parish of Livingston
                                State of Louisiana
                             Trial Court No. 171591

                     Honorable Erika Sledge, Judge Presiding

David L. Bateman                            Attorneys for Plaintiff A
                                                                    - ppellant,
J. Michael McDonald                         Jessica Hope Browne
Baton Rouge, LA
 and-

Ashley A. Traylor
Hammond, LA

Leah C. Cook                                Attorneys for Defendant -Appellee,
David J. Shelby II                          Gordon McKernan Injury Attorneys,
Tom S. Easterly                             LLC
Jill L. Craft
Baton Rouge, LA
and-

Leslie A. Burns
Denham Springs, LA

                BEFORE: THERIOT, CHUTZ, AND HESTER, JJ.
HESTER, J.

         In this matter arising out of an employment contract, plaintiff appeals the trial

court' s judgment granting defendant' s motion to compel arbitration and motion for

protective     order;
                        sustaining defendant' s dilatory exception of prematurity;    and

dismissing plaintiff' s petition for declaratory judgment. For the following reasons,

we affirm the judgment of the trial court.

                        FACTS AND PROCEDURAL HISTORY

         In January 2019, Jessica Browne began her employment with Gordon

McKernan Injury Attorneys, LLC (" GMIA")            as an attorney. Thereafter, the GMIA

human resources department sent an email to Ms. Browne directing her to sign and
return    an   employment     agreement,    and Ms. Browne     signed and returned the

agreement. In May 2020, GMIA held meetings with its attorneys to discuss changes

to their employment agreements, and GMIA' s decision to have them sign new

employment agreements because of a decline in cases due to the COVID pandemic.

On May 29, 2020, Ms. Browne signed the Gordon McKernan Injury Attorneys, LLC
Attorney Employment Agreement ( the Employment Agreement) with an effective

date of June 1, 2020. On April 27, 2021, Ms. Browne' s employment with GMIA

was terminated.

         On September 15, 2021, Ms. Browne filed a Petition for Declaratory Relief
pursuant to La. Code Civ. P.         art.
                                            1871 seeking a judgment declaring that the

Employment Agreement, including the arbitration clause, is void and unenforceable
as a matter of law.
                          GMIA responded to the petition by filing GMIA' s Dilatory

Exception of Prematurity and Alternative Motion to Compel Arbitration and for Stay
of Proceedings contending that Browne' s claims against GMIA are subject to

binding arbitration and are premature. GMIA attached to its exception and motion

the Employment Agreement.         During the pendency of its motion, GMIA also filed

GMIA' s Motion to Stay All Proceedings, and Alternatively, for Protective Order
                                               2
prohibiting the taking of discovery unless and until there has been a determination

of arbitrability.    GMIA attached to its motion the Association of Professional

Arbitrators & Mediators Rules.
                                    On April 11, 2022, GMIA' s Dilatory Exception of

Prematurity and Alternative Motion to Compel Arbitration and for Stay of

Proceedings as well as GMIA' s Motion to Stay All Proceedings, and Alternatively,
for Protective Order came before the trial court. At the beginning of the hearing,

GMIA introduced the Employment Agreement containing the arbitration clause as

well as an email from Perry Dampf Dispute Solutions confirming that an arbitration
claim was filed.    After the hearing, the trial court ruled in favor of GMIA, and in its

ruling noted " that [ it is] not just one issue of the employment contract that is being
challenged, in particular the arbitration clause in the employment contract, but rather

whether the employment contract itself is a valid contract, [ it is] this Court' s position

that that determination would need to go to arbitration for the arbitrator to

determine... the issue of the dispute of the contract in and of itself."

      Thereafter,
                     the trial court signed a judgment on May 3,           2022, granting

GMIA' s motion to compel arbitration and motion for protective order; sustaining
GMIA' s dilatory exception of prematurity; and dismissing Ms. Browne' s petition
for declaratory judgment.       The judgment ordered Ms. Browne' s Petition for

Declaratory Relief and any other claims and disputes between the parties referred to

mandatory arbitration and ordered that Ms.         Browne' s Petition for Declaratory

Judgment be dismissed. The judgment stated that there were no other claims against

the defendant remaining, and the judgment was designated as a final appealable

judgment with no just reason for delay. It is from this judgment that Ms. Browne

appeals, contending that the trial court erred in finding that Ms. Browne did not

specifically challenge the validity of the arbitration clauses of the Employment

Agreement she signed.

                                            3
                                       LAW AND ANALYSIS

         The determination of whether to compel arbitration is a question of law,

therefore,       appellate      courts conduct a de novo review. Courville v. Allied

Professionals Ins. Co.,           2013- 0976 ( La. App. 1st Cir. 6/ 5/ 15),   174 So. 3d 659, 663,

writ denied, 2015- 1309 ( La. 10/ 30/ 15), 179 So. 3d 615.

         The defense that a plaintiff is not entitled to judicial relief because of a valid

agreement to submit claims to arbitration may be raised by the dilatory exception of

prematurity.       When the issue of failure to arbitrate is raised by the exception of

prematurity, the defendant pleading the exception has the burden of showing the
existence of a valid contract to arbitrate, by reason of which the judicial action is

premature.
                 Cook v. AAA Worldwide Travel Agency, 360 So. 2d 839, 841 (                   La.

1978).
           An exception of prematurity raises a question of law subject to de novo

review. Bridges v. Citimortgage, Inc., 2011- 1508 ( La. App. 1st Cir. 5/ 24/ 12), 2012

WL 1922457 at * 1 (          unpublished),   writ denied, 2012- 1739 ( La. 11/ 2/ 12), 99 So. 3d

673.

         Pursuant to La. R.S. 9: 4202, a court shall stay the trial of an action in order

for arbitration to proceed if any party applies for such a stay and shows ( 1) that there
is a written arbitration agreement, and ( 2) the issue is referable to arbitration under

that arbitration agreement, as long as the applicant is not in default in proceeding
with arbitration.     Coleman v. Jim Walter Homes, Inc., 2008- 1221 ( La. 3/ 17/ 09),           6

So. 3d    179,    182 (   per    curiam).
                                             There is a strong presumption favoring the

enforceability of arbitration clauses, both under Louisiana and federal law. Any

doubt concerning the scope of arbitrable issues should be resolved in favor of
arbitration.      See Aguillard v.          Auction Management Corp.,            2004- 2804 ( La.

6/ 29/ 05), 908 So. 2d 1, 25.

         In Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 126 S. Ct. 1204,
163 L.Ed.2d 1038 ( 2006), the United States Supreme Court held that a challenge to

                                                   11
the validity of a contract as a whole, and not specifically to the arbitration clause,

must go to the arbitrator.
                                    In Cambas Electric, Inc. v. The McDonnel Group,

L.L.C., 2016- 1774 ( La. 10/ 28/ 16), 208 So. 3d 377, the Louisiana Supreme Court,

citing Buckeye, granted an exception of prematurity.                    The one -paragraph opinion

states: "
              Plaintiff's allegations regarding the validity of the arbitration clause are

intertwined with its arguments relating to the validity of the entire subcontract.

Therefore, the issue is properly presented to arbitrator, not the court."              Accord Vishal

Hosp., LLC v. Choice Hotels Int' l, Inc., 2004- 0568 ( La. App. 1 Cir. 6/ 28/ 06),                  939

So. 2d 414, 418, writ denied, 2006- 2517 ( La. 1/ 12/ 07), 948 So. 2d 152, wherein,

citing Buckeye, the court stated "[ Plaintiff] is challenging the agreement itself and

is not specifically challenging its arbitration provisions. Because the challenge by

 plaintiff) is to the contract as a whole, and not specifically to the arbitration clause,

the challenge to the contract must be considered by an arbitrator and not by a court."

         Conversely, when the challenge is directed to the arbitration clause,                      the

district court generally has the authority, under 9 U.S. C. §               4, to decide the issue.

Jasper Contractors, Inc. v. E- Claim.com, LLC, 2011- 0978 (                        La. App.      1 Cir.

5/ 4/ 12),    94 So.3d 123, 132. 1 In this instance, ordinary state law principles of contract

interpretation are used to decide whether a valid arbitration agreement exists.

  uon v. Activelaf, LLC, 2016- 0818 ( La. 10/ 19/ 16),                        So. 3d       2016 WL

6123820, * 3, cert. denied.             U.S. ,      137 S. Ct. 2268, 198 L.Ed.2d 700 ( 2017).

         Ms. Browne does not dispute that she signed and returned the Employment

Agreement.           Furthermore,   she does not appear to dispute that the Employment

Agreement provides for arbitration or that the dispute is within the scope of this

1 As the Louisiana Supreme Court recognized, Louisiana Binding Arbitration Law ( LBAL),              set

forth in La. R.S. 9:4201- 4217, expresses a strong legislative policy favoring    arbitration.   See La.
R.S. 9: 4201.     Such favorable treatment echoes the Federal Arbitration Act (FAA), set forth in 9
U. S. C. §§
              1- 16. Indeed, the LBAL is virtually identical to the FAA, and determinations regarding
the viability and scope of arbitration clauses are the same under either law.           See Duhon v.
Activelaf, LLC, 2016- 0818 ( La. 10/ 19/ 16), _         So. 3d ,        2016 WL 6123820, at * 3, cert.
denied, _       U. S. ,    137 S. Ct. 2268, 198 L.Ed. 2d 700 ( 2017).

                                                    5
 arbitration   provision.        Rather she contends that the arbitration provision is

 unenforceable because her consent to the Employment Agreement was vitiated by
 duress.
           The Employment Agreement contains the following provision:
        13.    Exclusive     Dispute         Resolution (      Binding Mediation             and

        Arbitration):       Except      as   provided       in Section 10. e, GMIA              and

        ATTORNEY agree that any and all                        otheror  claims,     disputes,
        controversies by or among GMIA, the ATTORNEY and/ or any other
        employee     of GMIA, (         except    claims      for workers'         compensation

        benefits, unemployment benefits and those not subject to arbitration
        specified below) shall first be submitted to mediation and referred to
        Perry-Dampf Mediation Services in Baton Rouge, Louisiana pursuant
        to the then -current rules of the Association of Professional Arbitrators
        and Mediators, L.L.C. (" APAM")[.][               2] If mediation fails to resolve the
        claim, dispute, or controversy, the claim, dispute or controversy shall
        be resolved by binding arbitration and referred to Perry-Dampf
        Mediation Services in Baton Rouge, Louisiana pursuant to the APAM
        rules. If Perry-Dampf Mediation Services are no longer in business,
        GMIA      and   ATTORNEY             shall
                                                         mutually     agree   on   an   alternate

        mediation/ arbitration dispute firm to handle the dispute resolution.

        The arbitrators shall determine the validity and outcome of the claims,
        disputes, and controversies. GMIA and ATTORNEY will abide by and
        perform any decision rendered. A judgment may be entered on any
        arbitration decision in any court having jurisdiction. Any mediation
        and/ or   arbitration,                                                          be
                                  and    any     settlement      or    award   shall         kept
        confidential by the parties.

        By executing this Agreement, GMIA and ATTORNEY give up
        either Party' s right to litigate in court any and all claims, disputes
        and controversies between them unless specifically excluded from
        arbitration herein.

       This Agreement shall survive the termination of the employment
       relationship between the Parties so that disputes must be mediated and
       arbitrated even if instituted after the employment relationship has
       ended.

       Nothing in this Agreement shall be construed as limiting the at -will
       nature of the employment relationship between the Parties.                            The

       ATTORNEY may terminate his/ her employment at any time for
       any reason or for no reason with seven days' notice and GMIA may
       terminate the ATTORNEY' s employment at any time for any
       reason or no reason with no notice.

2 GMIA also argued that the APAM rules provided clear and unmistakable language delegating
the threshold issue of arbitrability to the arbitrator. The APAM rules were attached to Ms.
Browne' s motion to stay the proceedings, but were not introduced into evidence during the
hearing. In its brief, GMIA acknowledged that APAM is not currently operating. Since the rules
were not introduced into evidence and APAM no longer exists, the issue is not properly before us.
                                                     n
       This Agreement does not apply to claims for Workers' Compensation
       benefits, claims for unemployment compensation benefits,
                                                                or any
       claims that may not legally be arbitrated.

       The Employment Agreement provides that, except as provided in Section 10. e

 involving fee disputes, any and all other claims, disputes, or controversies by or
 among GMIA and the attorney shall be referred to            mediation or arbitration.   In

introducing the signed Employment Agreement into evidence, GMIA proved the

existence of a valid arbitration agreement and that the issues raised in Ms. Browne' s

petition are referable to arbitration under that arbitration agreement. Since GMIA

satisfied its burden, the burden then shifted to Ms. Browne to demonstrate that she

did not consent to the arbitration terms or consent was vitiated by error, rendering
the arbitration provision unenforceable. See Aguillard, 908 So. 2d 1, 12.

       In Ms. Browne' s petition, she alleges that at one of the meetings regarding the
new employment contracts, Mr. Gordon McKernan, the owner of GMIA, threatened

the attorneys with termination from their employment if anyone refused to sign the

new employment agreements.            She asserts in her petition that she signed the

Employment Agreement under the threat of being fired with little hope for finding
other employment.       She contends that the "[   Employment Agreement] was not freely
and voluntarily entered into by [her], but was in fact procured through the intentional

use of duress and threats by GMIA upon the employees         at GMIA ...thus consent was

 vitiated' and the [ Employment Agreement] is unenforceable."           Ms. Browne also

alleges that the Employment Agreement is unconscionable, against public policy,
and a contract of adhesion.
                                 In paragraph thirty-one of her petition, she alleges in
 further alternative"
                        that the provisions of the Employment Agreement relating to
arbitration do not allow a fair and impartial resolution of disputes for multiple

reasons including: the Employment Agreement does not allow both parties to select

the arbitrator; does not give any clearly defined rules governing the conduct of the

                                             7
arbitration; fails to provide for judicially monitored discovery; deprives Ms. Browne

of her constitutional and statutory right to trial by jury; and attempts to conceal what

would otherwise be a public proceeding.      Ms. Browne contends that the allegations

in her petition not only specifically allege the invalidity of the arbitration clause

individually but also present challenges to the formation of the agreement itself

which necessarily includes and impacts the arbitration clause.     We disagree.

      As earlier noted, a challenge brought to the very existence of the contract

containing the arbitration clause must be decided by the court, not by the arbitrator.

However, challenges to the validity of the contract as a whole must be considered

by the arbitrator, not the court. Furthermore, when plaintiff' s allegations regarding

the validity of the arbitration agreement are intertwined with its arguments relating

to the nullity of the underlying agreement, the issue is properly presented to the

arbitrator, not the court.   Here, Ms. Browne' s allegations that the Employment

Agreement was obtained under duress, is unconscionable, against public policy, and

a contract of adhesion are challenges to the validity of the Employment Agreement

as a whole.
              Any argument regarding the validity of the arbitration agreement are

intertwined with her arguments regarding the nullity of the underlying agreement.

Therefore, the issue of the validity of the Employment Agreement is properly
presented to the   arbitrator, not the   court.   Furthermore, Ms. Browne' s direct

allegations in paragraph thirty- one concerning the arbitration agreement presuppose

that arbitration applies and are allegations regarding the manner in which the

arbitration is to take place not regarding the validity of the arbitration clause or that

her consent to the arbitration clause was vitiated.     Accordingly, after a de novo

review of the record, we affirm the trial court' s judgment granting GMIA' s motion

to compel arbitration and motion for protective order; sustaining GMIA' s dilatory
exception of prematurity;    and dismissing Ms. Browne' s petition for declaratory
judgment.
                                  CONCLUSION

      For the foregoing reasons, the judgment ofthe trial court is affirmed. All costs

of the proceeding are assessed to plaintiff-appellant, Ms. Jessica Hope Browne.

      AFFIRMED.