Grant W. Morgan v. Raymours Furniture Company, Inc. , 443 N.J. Super. 338 ( 2016 )


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  •                 NOT FOR PUBLICATION WITHOUT THE
    APPROVAL OF THE APPELLATE DIVISION
    SUPERIOR COURT OF NEW JERSEY
    APPELLATE DIVISION
    DOCKET NO. A-2830-14T2
    GRANT W. MORGAN,
    APPROVED FOR PUBLICATION
    Plaintiff-Respondent,
    January 7, 2016
    v.
    APPELLATE DIVISION
    RAYMOURS FURNITURE COMPANY, INC.,
    PATRICK HYNES, and WENDY
    GREENWALD,
    Defendants-Appellants.
    ________________________________________________
    Argued November 17, 2015 – Decided January 7, 2016
    Before    Judges    Fisher,      Espinosa      and
    Rothstadt.
    On appeal from the Superior Court of New
    Jersey, Law Division, Burlington County,
    Docket No. L-2257-14.
    James G. Fannon argued the cause for
    appellants (Law Office of James G. Fannon,
    and Edward T. Groh, attorneys; Mr. Fannon
    and Mr. Groh, on the brief).
    Alan   H.  Schorr   argued   the  cause   for
    respondent (Alan H. Schorr & Associates,
    P.C., attorneys; Mr. Schorr, on the brief).
    Andrew Dwyer argued the cause for amicus
    curiae     National    Employment Lawyers
    Association of New Jersey (The Dwyer Law
    Firm, L.L.C., attorneys; Mr. Dwyer, of
    counsel and on the brief).
    William D. Wright argued the cause for
    amicus curiae New Jersey Association for
    Justice (The Law Office of William Wright
    LLC, attorneys; Mr. Wright, on the brief).
    The opinion of the court was delivered by
    FISHER, P.J.A.D.
    In this appeal, we consider whether plaintiff is bound to
    arbitrate his claims against his former employer.                         Because the
    employee handbook, which contains an arbitration clause and a
    purported waiver of plaintiff's right to sue, clearly conveyed
    that its "rules, regulations, procedures and benefits . . . are
    not    promissory   or   contractual       in    nature     and    are    subject       to
    change by the company," we agree with the motion judge that
    plaintiff did not clearly and unambiguously waive his right to
    sue defendants in court.
    On September 19, 2014, plaintiff Grant W. Morgan commenced
    this    action   against   his   former         employer,    defendant       Raymours
    Furniture Company, and two Raymours representatives, alleging a
    violation of the Law Against Discrimination, N.J.S.A. 10:5-1 to
    -49, wrongful termination, and other similar causes of action.
    After    unsuccessfully     moving     for       a   change       of     venue      —    an
    application that might fairly suggest a waiver of the right to
    2                                         A-2830-14T2
    arbitrate1 — defendants moved to compel arbitration.      That motion
    was denied as well, and defendants appeal, as is their right
    despite the interlocutory nature of the order in question. See
    R. 2:2-3(a).
    In appealing, defendants present the following arguments:
    I. THE TRIAL COURT ERRED BY FAILING TO
    ENFORCE THE PARTIES' AGREEMENT TO ARBITRATE,
    WHICH   SATISFIES   ALL  OF   THE  CUSTOMARY
    CONTRACT FORMATION ELEMENTS.
    A. The FAA[2] Requires Application
    of Ordinary State-Law Principles
    Governing The Formation Of Con-
    tracts in Determining Whether Par-
    ties Have Agreed to Arbitrate.
    B. Raymour & Flanigan Made A
    Clear, Unmistakable And Unambig-
    uous   Offer   of   [Its   Employee
    Arbitration Program (EAP)].
    C. Plaintiff Accepted The EAP on
    Multiple  Occasions  in  Multiple
    Ways.
    D. Sufficient Consideration       Sup-
    ported The EAP.
    E. Plaintiff's Claims   Are   Within
    The Scope Of The EAP.
    II. THE TRIAL COURT ERRED BY FOCUSING
    EXCLUSIVELY ON PLAINTIFF'S SIGNATURE ON THE
    2013 COMMISSION AGREEMENT AND BY HOLDING
    1
    Such an argument was not raised on appeal and we, therefore,
    offer no further view on the impact of that circumstance on the
    arbitration issue presented.
    2
    Federal Arbitration Act, 
    9 U.S.C.A. §§ 1-16
    .
    3                          A-2830-14T2
    THAT IT WAS INSUFFICIENT              TO    MANIFEST   HIS
    ASSENT TO THE EAP.
    III. THE TRIAL COURT ERRED BY DISREGARDING
    THE U.S. SUPREME COURT'S SEVERABILITY DOC-
    TRINE AND DENYING ENFORCEMENT OF THE EAP
    BASED UPON ITS ASSESSMENT OF THE SURROUNDING
    HANDBOOK.
    IV. THE TRIAL COURT ERRED BECAUSE IT APPLIED
    HEIGHTENED, ARBITRATION SPECIFIC STANDARDS
    TO THE EAP.
    V. IN THE EVENT THE COURT FINDS GENUINE
    DISPUTES OF MATERIAL FACT REMAIN, DEFENDANTS
    REQUEST THAT THE ACTION BE REMANDED WITH
    INSTRUCTIONS   TO  CONDUCT  AN   EVIDENTIARY
    HEARING (Not Raised Below).
    In   light   of     well-established      legal     principles      governing     the
    availability        of    arbitration    in    this      and   similar    settings,
    reiterated in a number of recent cases, see, e.g., Atalese v.
    U.S. Legal Servs. Grp., L.P., 
    219 N.J. 430
    , 444-45 (2014), cert.
    denied, __ U.S. __, 
    135 S. Ct. 2804
    , 
    192 L. Ed. 2d 847
     (2015);
    Barr v. Bishop Rosen & Co., __ N.J. Super. __, __ (App. Div.
    2015)   (slip       op.    at   6-9),3   we    find      insufficient     merit   in
    defendants' arguments to warrant further discussion in a written
    opinion.     R. 2:11-3(e)(1)(E).          We add only the following brief
    comments.
    The circumstances at hand are relatively simple.                    Plaintiff
    contends     that    upon   complaining       of   age   discrimination     in    the
    3
    These are but a few and only two of the most recent; our
    jurisprudence suffers no shortage of case law on this subject.
    4                                 A-2830-14T2
    workplace, defendants confronted him with an ultimatum — that he
    either sign a stand-alone arbitration agreement or defendants
    would terminate his employment.            Plaintiff refused to sign the
    agreement and defendants carried out their threat. Plaintiff was
    terminated and this suit followed.
    Despite       plaintiff's   refusal        to    sign     an    arbitration
    agreement, defendants moved to compel arbitration on the basis
    of the company handbook.        Although plaintiff disputes that he
    actually   read    or   acknowledged       receipt   of     the    handbook,   he
    consented to the trial court's consideration of these issues on
    the assumption that he acknowledged receipt of the handbook and
    EAP in August 2011, February 2012, and April 20134; like the
    trial judge, we find these circumstances unavailing.
    For example, the handbook is prefaced with the employer's
    disclaimer as to the nature of the parties' undertaking:
    Nothing in this Handbook or any other
    Company    practice  or   communication   or
    document, including benefit plan descript-
    tions,   creates   a promise   of  continued
    employment, [an] employment contract, term
    4
    Plaintiff allegedly signed in December 2013 another document
    relating to the commission rate by which he would be
    compensated; in signing, plaintiff expressed that he "agree[d]"
    disputes would be subject to the EAP.   We agree with the trial
    judge that this document, if actually signed, would only give
    rise to the possibility that a dispute about commissions — not
    discrimination or wrongful termination claims — would be
    arbitrable.
    5                                A-2830-14T2
    or obligation of any kind on the part of the
    Company.
    [Emphasis added.]
    In addition, when electronically acknowledging receipt of this
    documentation,      an    employee    signifies        only    that   he    or    she
    "received a copy of the Associate Handbook" (emphasis added),
    and, further, that he or she
    understand[s] that the rules, regulations,
    procedures and benefits contained therein
    are not promissory or contractual in nature
    and are subject to change by the company.
    [Emphasis added.]
    These disclaimers were likely included because of Woolley v.
    Hoffman-LaRoche, Inc., 
    99 N.J. 284
    , 309, modified, 
    101 N.J. 10
    (1985),    where    the   Court   determined         that   company   manuals     may
    create implied contractual rights and duties, but that employers
    —   to    avoid    this   possibility         —   could     include   a    prominent
    disclaimer of the contractual nature of a handbook.
    Here,    the    employer     would       seek   both   the   benefit    of   its
    disclaimer in most instances, while insisting that the handbook
    was contractual when it suits its purposes — a proposition to be
    rejected if for no other reason than it runs counter to the
    ancient English proverb: "wolde ye bothe eate your cake, and
    haue your cake?" John Heywood, Dialogue of Proverbs (1546), as
    well as its corollary, which may have originated with Aesop,
    6                                 A-2830-14T2
    "sauce for the goose is sauce for the gander." Of course, our
    decisions are not governed by clichés, but these in particular
    can be found at the root of the court's equity jurisdiction.
    For     example,        estoppel    principles           preclude        a     party     from
    disavowing        a   previous     position       if    repudiation           violates     the
    demands      of   justice    and   good     conscience.          Carlsen       v.    Masters,
    Mates    &   Pilots      Pension    Plan    Tr.,       
    80 N.J. 334
    ,    339   (1979);
    Connell v. Am. Funding, Ltd., 
    231 N.J. Super. 409
    , 416 (Ch. Div.
    1987), aff’d o.b., 
    231 N.J. Super. 202
     (App. Div. 1989).                                     In
    this setting, it is simply inequitable for an employer to assert
    that, during its dealings with its employee, its written rules
    and regulations were not contractual and then argue, through
    reference to the same materials, that the employee contracted
    away     a    particular      right.        See        also     2      Pomeroy's       Equity
    Jurisprudence § 385, at 52 (5th ed. 1941) (recognizing "that
    whatever be the nature of the controversy between two definite
    parties, and whatever be the nature of the remedy demanded, the
    court    will     not    confer    its     equitable          relief    upon     the    party
    seeking its interposition and aid, unless he had acknowledged
    and conceded, or will admit and provide for, all the equitable
    rights, claims and demands justly belonging to the adversary
    7                                        A-2830-14T2
    party, and growing out of or necessarily involved in the subject
    matter of the controversy").5
    In any event, our Supreme Court has made clear that an
    employee in this circumstance must "clearly and unambiguously"
    agree to a waiver of the right to sue. Atalese, supra, 219 N.J.
    at 443.      By inserting such a waiver provision in a company
    handbook, which, at the time, the employer insisted was not
    "promissory or contractual," an employer cannot expect — and a
    court, in good conscience, will not conclude — that the employee
    clearly and unambiguously agreed to waive the valued right to
    sue.     And,     by   the   same   token,    in   obtaining    the   employee's
    signature    on    a   rider,   which   stated      only   that     the   employee
    "received"      and    "underst[ood]"       the    contents    of   the   company
    handbook or rules and regulations, the employer cannot fairly
    contend the employee "agreed" to a waiver of the right to sue
    that might be found within those materials.                   Leodori v. CIGNA
    Corp., 
    175 N.J. 293
    , 307, cert. denied, 
    540 U.S. 938
    , 
    124 S. Ct. 74
    , 
    157 L. Ed. 2d 250
     (2003); Barr, supra, __ N.J. Super. at __
    n.5 (slip op. at 13 n.5).           These principles preclude enforcement
    of the arbitration provision and waiver of the right to sue
    5
    Make no mistake, although the dispute about the parties'
    transactions evoke questions of law, defendants seek a mandatory
    injunction — a stay of this lawsuit and an order compelling of
    arbitration — that triggers the court's equity jurisdiction.
    8                                 A-2830-14T2
    contained       within   Raymours'     company   handbook    and     related
    documents.6
    We also reject defendants' forceful argument that such a
    determination conflicts with federal law. We disagree on the
    strength of our Supreme Court's own prior rulings, cited above,
    regarding the relationship between federal and state law in such
    matters.    We also note that one week after we heard argument in
    this    case,    a   federal   court   of   appeals   came   to    the   same
    conclusion that we now reach in nearly identical circumstances.
    Lorenzo v. Prime Commc'ns, L.P., __ F.3d __ (4th Cir. 2015).
    We lastly recognize that had plaintiff executed the stand-
    alone arbitration agreement presented to him when a rift formed
    in the parties' relationship, a different outcome would likely
    6
    In Rodriguez v. Raymours Furniture Co., 
    436 N.J. Super. 305
    (App. Div. 2014), the plaintiff's execution of a job application
    — and its incorporated "agreement" to limit to six months the
    applicant's time for filing any future lawsuit against Raymours
    —   was   found   enforceable.   The    Supreme  Court   granted
    certification, 
    220 N.J. 100
     (2014), heard oral argument on
    December 1, 2015, and has yet to file an opinion. Although our
    colleagues' published opinion in Rodriguez was filed eight
    months before this appeal was filed, neither plaintiff nor
    defendants — nor able amici — referred to Rodriguez in any of
    their written or oral submissions. Consequently, we invited and
    have received the parties' letters explaining their thoughts on
    Rodriguez. We agree with plaintiff that the many distinguishing
    features between this case and Rodriguez demonstrate its
    inapplicability here.   We also take — with more than a modicum
    of salt — defendants' sudden contention that Rodriguez is
    supportive of the arguments they pose here.
    9                            A-2830-14T2
    have followed.   To that we only need say, "if my grandmother had
    wheels, she'd be a bicycle."
    Affirmed.
    10                       A-2830-14T2
    

Document Info

Docket Number: A-2830-14T2

Citation Numbers: 443 N.J. Super. 338, 128 A.3d 1127

Filed Date: 1/7/2016

Precedential Status: Precedential

Modified Date: 1/7/2016