Arbitration & Mediation

Arbitration Clause Does Not Need to "Leap Off The Page" Per Florida's Third DCA

By Christopher B. Hopkins, Esq.

An "simple, self-contained" arbitration clause in a four page document does not need to "leap off the page," says a Panel from the Third District in National Financial Services, LLC, Bank of America Corporation, Bank of America Investment Services, Inc. v. James W. Mahan.

In this case, a bank customer opened two related accounts by completing a four page application which stated the same arbitration provision twice in same-size, italicized print. The arbitration clause was also set out in its own paragraph.

The trial court reportedly "invalidated the arbitration language... because its formatting made it procedurally unconscionable." Taking the issue in steps, the Panel (Cortinas, Shepherd, and Lagoa) noted that the format of the application was not procedurally unconscionable and there was no corresponding substantive unconsionability.

In a move which may unnecessarily open doors best left closed, the Panel compared the situation to Romano v. Manor Care and Prieto v. Healthcare (discussed here) where, prior to completing the paperwork, one side was already performing under the contract and, in the other case, where the signor complained they were given a "packet" of documents to sign.

Full post as published by Florida Arbitration Law on October 19, 2009 (boomark / email).