Court Opinion

ID: 9522110
Source: CourtListenerOpinion
Date Created: 2023-08-07 02:18:06.923774+00
Date Added: 2024-06-11T13:02:18.695189
License: Public Domain

Burgess, J.,
¶ 36. concurring and dissenting. Certainly BrickKicker’s one-sided and practically impossible arbitration clause is as unenforceable as its self-defeating terms were undisclosed and unconscionable. This clause is so ridiculously unfair that it defies reformation and should be simply foreclosed, entitling plaintiffs to pursue, and BrickKicker to respond to, traditional civil remedies. There is no basis upon which to reform the clause, since the parties have no other underlying agreement. “Vermont law and public policy strongly favor arbitration as an alternative to litigation for the ‘efficient resolution of disputes,’ ” but only when parties adopt arbitration by mutual and “voluntary agreement.” Lamell Lumber Corp. v. Newstress Int’l, Inc., 2007 VT 83, ¶ 9, 182 Vt. 282, 938 A.2d 1215 (internal citations omitted). Courts “cannot order parties to submit to arbitration absent a voluntary agreement ... or a statute authorizing such an order.” Id. (citing Gates v. Gates, 168 Vt. 64, 72, 716 A.2d 794, 800 (1998). Neither circumstance obtains here. This arbitration clause cannot be revised in a manner fairly reflecting any mutually bargained-for expectation of the parties and so should be severed from the contract. Therefore, I concur with the majority’s decision to strike the arbitration provision.
¶37. On the other hand, and just as certainly, the liability cap and other limitations agreed to by plaintiffs have yet to be proven unfair, oppressive, or unconscionable. The undisputed evidence is that plaintiffs were under no compulsion whatsoever to get a home inspection, hire BrickKicker, or agree to its terms. In the disputed evidence so far, plaintiffs claim BrickKicker directed Heidi Glassford to sign the contract without explanation, while *20BrickKicker denies this and claims Mrs. Glassford declined even to read the contract. It may well be that, once proven, the “totality of the circumstances” referred to in Dalury v. S-K-I, Ltd. will justify holding all of BrickKicker’s contract limitations unconscionable. 164 Vt. 329, 334, 670 A.2d 795, 798 (1995). Because the facts are not yet established to satisfy the legal standard for unconscionability, I dissent from what is a premature judgment that the contract’s liability cap and claims limitations are contrary to public policy and unenforceable.2
¶ 38. The undisputed facts, as follows, are sparse and not enough to support summary judgment at this time. Plaintiffs contracted to buy a house contingent upon a satisfactory home inspection. Not knowledgeable about construction, plaintiffs -were given a list of home inspectors and called BrickKicker because it was the first name on the list. The inspector asked Mrs. Glassford to sign the contract before he began work. In addition to the unworkable arbitration clause, the contract contained express limitations on liability and explicit deadlines for performance complaints. Mrs. Glassford signed the contract without reading it and paid the $285 inspection fee. Not yet factually settled were that plaintiffs were vulnerable, that BrickKicker took any advantage of them, that Mrs. Glassford failed to realize or misunderstood what she signed and apparently agreed to, or that plaintiffs received any less (aside from the arbitration clause) than what they contracted for. Later dissatisfied with their house compared to the positive inspection report, plaintiffs sued BrickKicker for faulty performance and to avoid the contract’s arbitration clause and liability and time limitations.
¶ 39. The trial court granted BrickKicker’s motion to dismiss, erroneously ruling that arbitration was binding. Plaintiffs’ other claims were not addressed because, as the court noted, plaintiffs proffered no record to support unconscionability in the making of *21the contract, nor law that the contract’s limitations were substantively unconscionable per se. Except for the arbitration issue, none of plaintiffs’ claims of unconscionability, adhesion, negligence, CFA violations, time limitations, or liability cap were subject to final adjudication on a fully developed factual record. Similarly, the court did not reach BrickKicker’s defenses at law or under the contract. All of these matters should be remanded to the superior court for summary judgment or, if the facts remain in dispute, for trial.
¶40. The majority proceeds as if these issues were sufficiently joined below, but the superior court was quite correct in pointing out that plaintiffs cited no authority for their proposition that the liability cap was unenforceable or unconscionable under the facts of this particular case. Instead, plaintiffs claimed, generally, that such a cap was unenforceable just because it was part of an adhesion contract. It is settled, however, that contracts of adhesion — typically nonnegotiated standardized forms — are not unreasonable per se. See Muhammad v. Cnty. Bank of Rehoboth Beach, 877 A.2d 340, 349 (N.J. Super. Ct. App. Div. 2005) (reiterating that “the mere fact that a contract is adhesive does not render it unenforceable,” and instructing that “a finding . . . of adhesion is the ‘beginning, not the end, of the inquiry" ”) (internal citations omitted) (rev’d on other grounds, 912 A.2d 88 (N.J. 2006)); see also Vermont Mut. Ins. Co. v. Parsons Hill P’ship, 2010 VT 44, ¶¶ 28-29, 188 Vt. 80, 1 A.3d 1016 (applying the plain language of an insurance contract that favored insurer, despite insurance contracts being adhesive).
¶ 41. Plaintiffs also invoked Dalury, 164 Vt. at 332, 670 A.2d at 797, as authority against enforcing an exculpatory clause, but Dalury was a negligence case and plaintiffs failed to establish that the critical principles of negligence law and public safety concerns underlying Dalury apply to the breach of contract performance claimed here. When, as here, economic loss without physical injury is claimed by plaintiff, the obligation of defendant is governed by the contract terms, and not the law of negligence. See EBWS, LLC v. Britly Corp., 2007 VT 37, ¶ 30, 181 Vt. 513, 928 A.2d 497 (reiterating that “[t]he economic-loss rule prohibits recovery in tort for purely economic losses”).
¶ 42. Unlike the ski area in Dalury selling thousands of ski lift tickets to the general public, BrickKicker has yet to be shown to have engaged in any such “substantial number” of sales from *22which could arise a significant public interest in premises liability, or something like it, justifying judicial intervention in a private contractual relationship in order to promote public safety. 164 Vt. at 334, 670 A.2d at 799. Nor was it established, as it was for the ski area in Dalury, that BrickKicker’s marketing of inspection services warrants the same judicial protections deemed necessary for a “routine business practice,” like a ski area, which “creates a foreseeable hazard [of personal injury] for its customers.” Id. Absent parallel facts, plaintiffs’ reliance on Dalury was unfounded.3
¶ 43. Assuming, for argument, that plaintiffs did raise a legal basis upon which to find their contract unconscionable, plaintiffs presented no undisputed facts to sustain their theory for purposes of summary judgment. The circumstances of making the contract are disputed. Plaintiffs claim that the contract was presented to Ms. Glassford with an order to sign it. BrickKicker denies this and contends that, given an opportunity to read the contract, Mrs. Glassford chose not to do so. Plaintiffs have yet to establish that they were put into a contractual position, as in Dalury, somehow equivalent to helplessly assuming unknown risks of personal harm without remedy so inimical to public policy as to require the same kind of court-imposed veto. Id. at 335, 670 A.2d at 799.
¶ 44. The majority’s contrary conclusion notwithstanding, plaintiffs’ evidence particularly failed to meet the so-called Tunkl factors considered in Dalury for determining whether an exculpatory agreement violates public policy. Id. at 332, 670 A.2d at 797-98. (referring to Tunkl v. Regents of Univ. of Cal., 383 P.2d 441, 444 (Cal. 1963). For example, there is no government regulation to vindicate and no undisputed evidence that BrickKicker’s services are of “great importance to the public” or are “a practical necessity” to anyone. Id. Nor is there any evidence that BrickKicker’s services were so “essential” to plaintiffs that the contractor “possessed a decisive advantage of bargaining strength,” or that plaintiffs were otherwise placed *23“under the control” of the contractor. Id. Neither plaintiffs nor the majority explain how, in this case, the sole fact that contractor was knowledgeable about new home building, while Mrs. Glassford was not, led to an unfair advantage in bargaining or an unconscionable contract.
¶ 45. On appeal, plaintiffs divert from their unconscionable-per-se argument onto a different legal tack, citing to Pitts v. Watkins, 2004-CA-00062-SCT, 905 So. 2d 558 (Miss. 2005), and Lucier v. Williams, 841 A.2d 907 (N.J. Super. Ct App. Div. 2004), declaring liability limits unenforceable when in violation of state law and arising from oppressive circumstances. Overlooking our usual convention barring new arguments for the first time on appeal, see Maguire v. Gorruso, 174 Vt. 1, 9, 800 A.2d 1085, 1092 (2002) (arguments not raised below are waived), the majority not only entertains these cases, but finds them on point, despite the absence in this case of any comparable and necessary legal or factual common denominator. In Pitts, a boilerplate claims limitation violated a statutory prohibition, and its liability cap resulted from an “absence of meaningful choice on the part of one of the parties.” 2004-CA-00062-SCT, ¶ 19 (quotations omitted). Lucier turned on the facts that the contractor conducted thousands of inspections, that he refused to negotiate a take-it-or-leave-it contract, that he enjoyed a “grossly disparate” bargaining advantage, and that the home inspection contract violated state regulations. 841 A.2d at 912.
¶ 46. If Pitts and Lucier have any point germane to the instant case, it is that predicate facts must be established before reaching a legal determination of unconscionability. No such facts are reached here. This is not unlike plaintiffs’ failure to meet the Tunkl factors. There is no statutory or regulatory violation, and plaintiffs present no undisputed facts of unequal bargaining leverage. Plaintiffs have yet to prove lack of choice between contractors, or that such a contractor had to be relied on at all. In contrast to Tunkl and contrary to the majority’s formulation, there is no evidence that home inspection services are important to the public as a matter of “practical necessity,” or “essential” to plaintiffs in particular. Tunkl, 383 P.2d at 445-46. There is no undisputed evidence that BrickKicker exercised any actual advantage in bargaining, that plaintiffs were at the contractual mercy of BrickKicker, or that the contract was otherwise arrived at unfairly. In contrast to cases cited by the majority, plaintiffs’ *24financing was not contingent upon an inspection, nor was the inspection a regulated activity.4 There is no undisputed evidence that bargaining was foreclosed.
¶ 47. Plaintiffs’ undisputed facts for purposes of summary judgment present little more than they were less knowledgeable than their contractor, but nevertheless rushed into a one-sided contract with express limitations when they did not have to, and which they did not bother to read beforehand. Those bare circumstances establish no unconscionability per se, nor any “Hobson’s choice” of unfair adhesion to render the contract otherwise unconscionable under our law or any case law cited by the majority. Plaintiffs may indeed have the evidence necessary to support the majority’s legal theory, but it should be introduced and tried prior to judgment. Absent such proof, I respectfully dissent from this part of the decision.
¶ 48. I am authorized to state that Chief Justice Reiber joins in this concurrence and dissent.

 What public policy and what undisputed facts support the notion that for $285, and in the face of an express disclaimer of liability beyond that fee, homebuyers should reasonably expect BrickKicker to virtually guarantee the construction and value of a new $280,500 home? What public policy suggests that, on the few undisputed facts presented so far, the modest fee is not fairly consistent with the explicitly limited service offered in the contract and accepted by Mrs. Glassford? The majority does not say. The facts do not suggest that more is at stake than what the contract represents on its face. Thus, the majority’s assumptions about what plaintiffs were buying and what BrickKicker was selling are unsupportable on the record.

 The majority’s own extension of Dalury to this case is no more sustainable. Given the facts so far established, BrickKicker has little or nothing in common with a ski resort purporting to insulate itself from selling risks of bodily injury due to its own negligence. Dalury, dealing with voluminous liability waivers in the face of common negligence, resulting injury, and a demonstrated public interest in business premises safety, is plainly distinguishable from this breaeh-of-eontraet case.

 Because Vermont does not regulate home inspections, the majority must look to home inspection regulation in other states to satisfy the Tunkl consideration of whether the commercial activity at issue is “generally thought suitable for public regulation” — thereby warranting judicial regulation of the activity by invalidating certain contract provisions. Nonetheless, Vermont public policy, as reflected by the Legislature, leaves private home inspections unregulated, suggesting a lack of perceived public importance of such inspections in this state. Thus, the majority addresses a problem that does not exist. In any event, invalidation of unconscionable conditions should depend on the terms of a contract and the circumstances of its formation, not on foreign regulation irrelevant to Vermont.