Court Opinion

ID: 7029036
Source: CourtListenerOpinion
Date Created: 2022-07-24 06:27:58.986351+00
Date Added: 2024-06-11T16:10:53.117600
License: Public Domain

JUSTICE O’MALLEY, specially concurring: I write separately to clarify a point regarding the FAA’s mandate that arbitration provisions cannot be revoked “save upon such grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C. §2 (2000). The majority, and the Supreme Court, have stated that this qualification is not met where the arbitration restriction at issue applies only to a specific type of contract, as opposed to “ ‘ “any contract.” ’ ” (Emphasis in original.) 391 Ill. App. 3d at 410, quoting Southland, 465 U.S. at 16 n.11, 79 L. Ed. 2d at 16 n.11, 104 S. Ct. at 861 n.ll. That is basically true — a statutory provision that applies only to a certain type of contract normally cannot be a “ground[ ] as exist[s] at law or in equity for the revocation of any contract.” 9 U.S.C. §2 (2000). However, I would add two caveats. First, even if a statute purports to apply to all types of contracts, it does not necessarily meet the FAA’s exception. The purpose of the FAA is to “ ‘place arbitration agreements upon the same footing as other contracts.’ ” Borowiec, 209 Ill. 2d at 384, quoting Gilmer, 500 U.S. at 24, 114 L. Ed. 2d at 36, 111 S. Ct. at 1651; 391 Ill. App. 3d at 401-02; cf. Casarotto, 517 U.S. at 686, 134 L. Ed. 2d at 908, 116 S. Ct. at 1655 (the FAA bars “ ‘deciding] that a contract is fair enough to enforce all its basic terms (price, service, credit), but not fair enough to enforce its arbitration clause’ ”), quoting Allied-Bruce Terminix Cos., 513 U.S. at 281, 130 L. Ed. 2d at 769, 115 S. Ct. at 843. A state statute that universally bars enforcement of arbitration provisions, even though it applies to all contracts, will nonetheless still run afoul of the FAA. Second, even a statutory provision that applies only to a certain type of contract may invalidate arbitration agreements on “grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C. §2 (2000). For example, a statute applying only to nursing home contracts could say that arbitration provisions entered into under duress are invalid. Such a statute would not run afoul of the FAA, precisely because it would confine its anti-arbitration provision to grounds as exist at law or in equity for the revocation of any contract. The purpose of the FAA is that it prohibits laws that single out arbitration agreements from other contracts, not that it prohibits laws that single out arbitration agreements in some contracts and not others. The Supreme Court’s reasoning in footnote 11 of Southland accords with that purpose only if qualified by the two caveats I raise above.