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Arbitration: Losing Your Day in Court with a Click of the Mouse?

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Almost everyone has signed a phone contract, home-repair agreement, or other contract filled with terms and provisions they might not fully understand, or navigated a website only to receive a prompt to “accept these terms and conditions” before continuing. Most, and hopefully all attorneys, have that moment of hesitation – right before they click “yes.” 

If you clicked “yes” or signed the contract, and the contract included an “arbitration clause,” you may have just signed away your right to access the court system; and you didn’t even know it. But are such arbitration agreements enforceable? Generally, these clauses are enforceable and found to be consistent with a strong public policy in favor of arbitration. However, a recent decision from the Louisiana Supreme Court  places arbitration clauses in consumer transactions under scrutiny and may render arbitration provisions unenforceable in some cases.

In Duhon v. Activelaf, LLC, 2016-0818 (La. 10/19/16), the plaintiff brought a negligence suit against an indoor trampoline park. In an effort to prevent a formal trial, the defendants attempted to enforce the arbitration clause found in the Participant Agreement, Release, and Assumption of Risk document that was electronically signed by plaintiff to gain entry into the trampoline park. In this setting, the Court applied a “contract of adhesion” analysis to test the validity of the arbitration clause.

The Court set forth the following factors to gauge the enforceability of the arbitration clause:  (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.

Under the facts in Duhon, the Court found that the lack of distinguishing features and the specific placement of the text served to conceal the arbitration clause from the plaintiff. While the arbitration language was consistent in size and font with the other contractual provisions, the clause was located in the eleventh line of a paragraph that covered multiple topics. The arbitration agreement also required only the plaintiff to arbitrate any dispute. Further, it required the plaintiff to pay $5,000 if he ignored the arbitration clause and instead filed a lawsuit. According to the Court, this “lack of mutuality” supported its conclusion that the arbitration clause was adhesionary. 

Ultimately, the Duhon Court struck down the arbitration clause. While courts generally uphold arbitration clauses, especially in a commercial setting, Duhon shows that arbitration clauses are not per se valid and that the consumer, in some cases, still may have their day in court.

 

One More Reason: Louisiana’s “Drunk Driving” Immunity

A conviction for DWI brings the consequences you might expect, such as the loss of driving privileges, expensive attorneys’ fees, and public embarrassment. However, there is one additional, less-obvious consequence of which many are unaware; Louisiana provides immunity from claims brought by a drunk driver who was at least 25% at fault in the accident which caused his injuries, no matter how severe the injuries.

Generally stated, if you are driving drunk and are in an accident that is mostly someone else’s fault, you will not be able to recover for the injuries you sustain.  Similarly, if your fault injures a drunk driver, the statute may shield you from liability.  The “drunk driving” immunity is found in La. R.S. 9:2798.4. The statute provides immunity against the claims of a driver with a blood alcohol level of .08 or higher. 

The immunity may even apply to defendants who were not directly involved in the accident. In Stewart v. Daiquiri Affair, Inc., 20 So.3d 1041 (La. App. 1st Cir. 2009), writ denied, 19 So.3d 477 (La. 2009), the immunity was found to apply to claims brought by an 18-year-old employee who consumed alcohol on the premises and was subsequently injured in a motor vehicle accident. Rejecting the argument that immunity should not apply when the employer arguably contributed to the under-age plaintiff’s consumption of alcohol, the appellate court in Stewart concluded that the statute’s language required immunity because the employee was more than 25% at fault and her blood alcohol content was over the legal limit.

Because the “drunk driving” immunity statute is supported by the legislature’s strong and long-standing interest in protecting citizens against drunk driving, it has been upheld and applied in many instances. Although you should not need another reason to not drive drunk, you now have one.

 

UMM, SHOULD I BUY UM?

 

It’s a question you will have to answer if you purchase automobile liability insurance in Louisiana. While the question may appear simple, many people, even sophisticated people, do not fully understand the purpose of uninsured motorist coverage. 

 

Uninsured motorist coverage (or “UM”) is a form of insurance that can be purchased to protect you, your family, your passengers and/or your workers in the event they are injured in an automobile accident when the at-fault driver is uninsured. Your auto liability policy will not cover your bodily injuries, lost wages and other damages caused by the fault of another. 

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When the Phone Rings: Responding to the Workplace Accident

            Having a response plan in place before an accident is important. It can improve safety, save time, reduce distraction, and limit exposure.”

It will happen, maybe today, maybe tomorrow, maybe six years from now; but if you are an employer of any size, the call will come, and the co-worker, passerby, or caller- in a panicked voice- will inform you that there’s been an accident. You cannot control what has just happened. You can control what you do about it.

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Supreme Court Emphasizes “Error-Correcting” as Proper Role of Appellate Courts

In a 68 page decision, the Louisiana Supreme Court in Hayes Fund for the First United Methodist Church of Welsh, LLC, et al. v. Kerr-McGee Rocky Mountain LLC, et al. forcefully explained the role of an appellate court. It is axiomatic that Louisiana appellate courts are courts of review.  Louisiana law specifically sets the standard of review an appellate court must apply when reviewing a trial court’s factual decisions (manifest error) or its legal decisions (de novo). According to Hayes Fund, a failure to faithfully apply the “manifest error” standard of review where applicable causes an appellate court to function as a “choice-making court” when its proper role is to serve as an “errors-correcting court.”

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Now You See Us

Keogh Cox is proud to announce the placement of a new sign and logo on the exterior of our office building in Baton Rouge, Louisiana.

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