Austin Cornelius, Resp V. Wa State U, Alpha Kappa Lambda, Et Ano., Apps ( 2021 )

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
AUSTIN CORNELIUS, an individual, No. 82264-1-I
Respondent, DIVISION ONE
v.
ALPHA KAPPA LAMBDA, a national UNPUBLISHED OPINION
organization, ETA CHAPTER OF
ALPHA KAPPA LAMBDA, a
Washington corporation d/b/a ALPHA
KAPPA LAMBDA, and ETA OF ALPHA
KAPPA LAMBDA, a Washington
corporation,
Appellants,
WASHINGTON STATE UNIVERSITY, a
public university,
Defendant.
CHUN, J. — Austin Cornelius sued the national fraternity Alpha Kappa
Lambda and its local chapter, Eta of Alpha Kappa Lambda, (collectively “AKL”)
for negligence. AKL moved to compel arbitration under an arbitration agreement
(the Agreement) Cornelius signed when he joined the fraternity. The trial court
denied the motion, deeming the Agreement procedurally unconscionable. AKL
appeals, contending that the Agreement is not procedurally unconscionable and
covers all of Cornelius’s claims. In the alternative, AKL requests remand for an
evidentiary hearing and limited discovery on the circumstances surrounding the
Citations and pin cites are based on the Westlaw online version of the cited material.
No. 82264-1-I/2
execution of the Agreement. For the reasons discussed below, we reverse and
remand, and the trial court may address whether to allow any limited discovery.
I. BACKGROUND
Cornelius began attending Washington State University (WSU) in August
2017 when he was 18 years old. He participated in “rush week” and received
“bids”—or invitations to join—from at least five fraternities. He decided to
“pledge” Alpha Kappa Lambda, a national fraternity with a local chapter, Eta, at
WSU.
Cornelius attended his first AKL event on August 20, 2017. He alleges
that AKL members hazed him during this event, leading to his hospitalization for
“acute alcohol intoxication.”
As for the arbitration agreement at issue, Cornelius claims as follows: On
August 28, 2017, during a fraternity study session, AKL members instructed him
to create a profile on the fraternity’s online membership portal. He did so. On
August 30, 2017, during another study session, AKL members directed Cornelius
to “sign off” on “some paperwork” on the online portal. The pledges “were rushed
through this process and told [they] needed to complete the approval right there
at the study tables session before [they] left for the evening.” The senior
members “never [gave] any explanation as to what specifically [the pledges] were
signing, what the agreements entailed, or even a summary of what was
contained in the agreements.” The pledges “were not told or encouraged to
spend more than about a minute or two at most to review the agreements before
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No. 82264-1-I/3
checking the box.” The senior members told the pledges that if they did not “sign
off” on the agreements, they “could not pledge the fraternity and would not be
allowed at the house.” “There was no opportunity to ask questions, seek clarity,
review, or otherwise get a meaningful understanding of what it was [the pledges]
were being asked to approve.”
The portal contained a four-page document called the “New Member
Agreements” (NMA). On the last page of the NMA is the Agreement, which is
titled “AKL CLAIM AND DISPUTE RESOLUTION PROGRAM” in bold lettering. It
includes the following provision: “If you are unable to resolve a claim or dispute
arising out of your membership or participation in any Fraternity of Alpha Kappa
Lambda-related activity, under the terms of the Program the claim or dispute will
be submitted to binding arbitration instead of through the courts.” (Emphasis
added.) The Agreement then provides in bold lettering:
YOUR DECISION TO JOIN OR ACCEPT MEMBERSHIP OR
CONTINUE YOUR CURRENT MEMBERSHIP IN THE
FRATERNITY . . . MEANS YOU HAVE AGREED TO AND ARE
BOUND BY THE TERMS OF THIS PROGRAM AS CONTAINED IN
THE PLAN DOCUMENT AND RULES, A COMPLETE COPY OF
WHICH IS AVAILABLE FOR YOU TODAY, AND CAN BE FOUND
ON THE ALPHA KAPPA LAMBDA NATIONAL WEBSITE.
Finally, the Agreement provides,
[Y]ou and the Fraternity of Alpha Kappa Lambda are both waiving all
rights which either may have with regard to trial by jury for personal
injury, property damage, contract or any other related matters in state
or federal court. This Plan covers any legal or equitable claim for
personal injury, property damage, equity or breach of contract,
arising out of any tort, statute, contract or law.
(Emphasis added.) The Agreement incorporates the “Claim and Dispute
Resolution Plan and Rules” (the Plan) by reference and informs that the Plan is
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available on the fraternity’s website. The Plan provides that the Federal
Arbitration Act1 (FAA) applies to the Agreement.
Cornelius signed the NMA on August 30. The online portal provider’s
records show that Cornelius created his profile on August 28, 2017. It also
shows that he logged onto his profile around 11:20 p.m. on August 30 and signed
the NMA around 11:32 p.m. the same night. AKL allegedly continued to haze
Cornelius as a pledge until October 2017.
On July 30, 2020, Cornelius sued AKL for negligence. AKL moved to
compel arbitration and for a stay of proceedings. Cornelius opposed the motion,
claiming that the Agreement does not apply to claims arising from events
predating its execution and that the Agreement is procedurally unconscionable.
During a hearing on the matter, AKL requested an evidentiary hearing in the
alternative. The trial court denied AKL’s motion to compel arbitration. It
determined that an evidentiary hearing was unnecessary and concluded that the
Agreement was procedurally unconscionable because Cornelius lacked a
“meaningful choice regarding his entry into the agreement.” AKL appeals.
II. ANALYSIS
AKL says the trial court erred by denying its motion to compel arbitration
because the Agreement is not procedurally unconscionable and covers the
claims arising from events before the execution of the Agreement.2 Cornelius
1
9 U.S.C. §§1–16.
2
AKL says that the contract defense of duress does not apply here. But
Cornelius does not argue duress on appeal nor did the trial court deny arbitration on
such grounds. Thus, we do not address the issue.
4
No. 82264-1-I/5
responds that the Agreement is procedurally unconscionable and does not apply
retroactively to all of his claims. Because we cannot resolve the issue of
procedural unconscionability on the record before us, we remand for an
evidentiary hearing.
We review de novo a trial court’s denial of arbitration. Burnett v. Pagliacci
Pizza, Inc., 196 Wn.2d 38, 46–47, 470 P.3d 486 (2020). “Unconscionability is
also a question of law we review de novo.” McKee v. AT&T Corp., 164 Wn.2d
372, 383, 191 P.3d 845 (2008).
“[T]he party moving to compel arbitration must make a threshold showing
that a written agreement to arbitrate exists and that the contract at issue involves
interstate commerce.”3 Walters v. A.A.A. Waterproofing, Inc., 120 Wn. App. 354,
358, 85 P.3d 389 (2004), review granted, cause remanded, 153 Wn.2d 1023,
108 P.3d 1227 (2005). Once that party meets that threshold, the burden shifts to
the party opposing arbitration “to show that the arbitration clause is
unenforceable.” Gandee v. LDL Freedom Enters., Inc., 176 Wn.2d 598, 602–03,
293 P.3d 1197 (2013).
The parties do not dispute that the FAA governs here. The FAA provides
that written arbitration agreements “shall be valid, irrevocable, and enforceable,
save upon such grounds as exist at law or in equity for the revocation of any
contract.” 9 U.S.C. § 2. “When the validity of an agreement to arbitrate is
challenged, courts apply ordinary state contract law.” McKee, 164 Wn.2d at 383.
3
Cornelius contends that this language from Walters shows that AKL bears the
burden to prove that a legally binding and valid arbitration agreement exists and covers
all of his claims; but it clearly does not support such a contention.
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No. 82264-1-I/6
“General contract defenses such as unconscionability may invalidate arbitration
agreements.” Id.; see also Volt Info. Scis., Inc. v. Bd. of Trs. of Leland Stanford
Junior Univ., 489 U.S. 468, 475–76, 109 S. Ct. 1248, 103 L. Ed. 2d 488 (1989)
(“in applying general state-law principles of contract interpretation to the
interpretation of an arbitration agreement within the scope of the Act, due regard
must be given to the federal policy favoring arbitration, and ambiguities as to the
scope of the arbitration clause itself resolved in favor of arbitration.” (citations
omitted)). “[B]oth state and federal law strongly favor arbitration and require all
presumptions to be made in favor of arbitration.” Gandee, 176 Wn.2d at 602–03.
When reviewing a motion to compel arbitration, we consider “(1) ‘whether the
arbitration agreement is valid,’ and (2) ‘whether the agreement encompasses the
claims asserted.’” Cox v. Kroger Co., 2 Wn. App. 2d 395, 404, 409 P.3d 1191(2018) (quoting Wiese v. CACH, LLC, 189 Wn. App. 466, 474, 358 P.3d 1213(2015)).
A. Procedural Unconscionability
“Procedural unconscionability is ‘the lack of meaningful choice,
considering all the circumstances surrounding the transaction.’” Zuver v.
Airtouch Commc’ns, Inc., 153 Wn.2d 293, 303, 103 P.3d 753 (2004)
(quoting Nelson v. McGoldrick, 127 Wn.2d 124, 131, 896 P.2d 1258 (1995)). To
determine whether an agreement is procedurally unconscionable, courts look at
“(1) the manner in which the contract was entered, (2) whether [the signatory]
had a reasonable opportunity to understand the terms of the contract, and
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No. 82264-1-I/7
(3) whether the important terms were hidden in a maze of fine print.” Burnett,
196 Wn.2d at 54. “‘[T]hese three factors [should] not be applied mechanically
without regard to whether in truth a meaningful choice existed.’” Zuver, 153
Wn.2d at 303 (second alteration in original) (quoting Nelson, 127 Wn.2d at 131).
An arbitration agreement may be procedurally unconscionable if it is an
adhesion contract. Burnett, 196 Wn.2d at 54. Adhesion contracts are standard-
form contracts presented on a “take it or leave it basis” by a party with
disproportionately more bargaining power. Zuver, at 305 (internal quotation
marks omitted) (quoting Yakima County (W. Valley) Fire Prot. Dist. No. 12 v. City
of Yakima, 122 Wn.2d 371, 393, 858 P.2d 245 (1993)). But “[a]n adhesion
contract is not necessarily procedurally unconscionable.” Burnett, 196 Wn.2d at
54–55. “The key inquiry is whether the party lacked meaningful choice.” Id.
1. The manner in which Cornelius entered the Agreement and whether he
had a reasonable opportunity to understand the terms of the
Agreement
Cornelius contends that circumstances surrounding his entry into the
Agreement deprived him of a meaningful opportunity to read and understand the
Agreement. An evidentiary hearing is necessary to assess his claims.
a. Time to consider the Agreement
AKL contends that Cornelius had access to the NMA when he first created
his profile on August 28. While Cornelius does not appear to dispute that he may
have had access to the NMA starting on August 28, he contends he did not know
of its existence until August 30.
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No. 82264-1-I/8
Assuming that Cornelius did not know about the NMA until August 30, it is
still unclear how much time he had to review and sign it that day. Cornelius says
the senior members “rushed” him through the process and that the pledges were
not “encouraged” to spend more than “a minute or two” reviewing the NMA. But
he does not say that the senior members limited his review to two minutes. And
the online portal provider’s records show that he signed onto his profile for about
12 minutes before he signed the NMA.
Without more information, it is unclear whether how long Cornelius had to
consider the Agreement supports a determination that the Agreement is
procedurally unconscionable. In Tjart v. Smith Barney, Inc., this court saw no
procedural unconscionability although the plaintiff executed the arbitration
agreement “relatively rapidly.” 107 Wn. App. 885, 890, 896–97, 28 P.3d 823(2001). But Tjart does not clarify the term “relatively rapidly.” AKL also relies on
Hoober v. Movement Mortg., LLC, in which the court noted concern about
pressure the employer placed on the employee to quickly sign the agreement,
leading her to return the forms the same day she received them, but still
concluded that there was no procedural unconscionability. 382 F. Supp. 3d
1148, 1154, 1157 (W.D. Wash. 2019) (applying Washington law).4 But here the
record is unclear whether Cornelius had more than one day, or much less than
one day, to consider the Agreement.
4
Neither Hoober nor other federal case law we cite in this opinion constitute
binding precedent.
8
No. 82264-1-I/9
b. Explanation of the Agreement
Cornelius says that the senior members told him to just “sign off” without
explaining what he was signing or what the documents contained. But this court
rejected a similar argument in Tjart when the plaintiff complained that no one
explained to her what types of claims would be covered by the arbitration
agreement. 107 Wn. App. at 890, 896–97. Cornelius cites no law requiring an
explanation. This contention does not support a determination of procedural
unconscionability.
c. Questions about the Agreement
Cornelius says that he had no opportunity to ask questions about the
agreement. Relying on Hoober, AKL responds that because Cornelius does not
claim that he tried to ask questions, he cannot claim the Agreement is
procedurally unconscionable. 382 F. Supp. 3d at 1156–57 (“neither Plaintiff
argues that they asked questions” in rejecting a claim of procedural
unconscionability).5 Because Cornelius does not explain how he lacked an
opportunity to ask questions, further factual development is needed to determine
whether he had a reasonable opportunity to understand the terms of the
Agreement.
5
See also Simpson v. Inter-Con Sec. Sys., Inc., No. C12-1955RAJ, 2013 WL
1966145, at *3 (W.D. Wash. May 10, 2013) (“Although Plaintiffs contend they had little
time to consider the agreement, they do not contend that they attempted to consider it,
attempted to ask questions about it, or even that they would have asked questions if
they had more time. The agreement is not procedurally unconscionable.”); see GR
14.1(c).
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No. 82264-1-I/10
2. Whether important terms were hidden in the Agreement
Citing Burnett, Cornelius contends that because he did not see the Plan
before signing the NMA, which incorporated the Plan by reference, the essential
terms of the Agreement were hidden. Our Supreme Court held in Burnett that an
employment contract that incorporated an arbitration policy by reference was
procedurally unconscionable. 196 Wn.2d at 57. The employment contract “did
not mention arbitration.” Id. at 56–57. After Burnett signed the employment
contract, he received an employee handbook containing the arbitration policy but
“the arbitration policy was not identified in the handbook’s table of contents.” Id.
The court held that “because essential terms were hidden and Burnett had no
reasonable opportunity to understand the arbitration policy before signing the
employment contract, the manner in which the contract was entered
demonstrated that Burnett lacked a meaningful choice regarding the arbitration
policy.” Id. at 57.
Here, on the record before us, the essential terms do not appear to have
been hidden. The Agreement appears on the fourth and final page of the NMA.
See Tjart, 107 Wn. App. at 898–99 (“the arbitration provision was obvious in the
fairly short contract”). The Agreement is titled “AKL CLAIM AND DISPUTE
RESOLUTION PROGRAM” and states that claims and disputes arising out of
membership or fraternity-related activities will be submitted to arbitration and that
both parties are waiving their right to go to court. See Romney v. Franciscan
Med. Grp., 186 Wn. App. 728, 740, 349 P.3d 32 (2015) (“arbitration clause is
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No. 82264-1-I/11
understandable and is printed in the same size font as the rest of the agreement
under a bolded heading”).
And in Burnett, the plaintiff did not receive the handbook containing the
arbitration clause until after he signed the document incorporating it. Cornelius
contends this case is similar because he did not recall seeing the Plan, which
discusses the arbitration rules in detail, before he signed the NMA. But here, the
arbitration clause itself was in the NMA, and while he says that it is “unclear”
whether he had access to the Plan before signing, he does not contend he
lacked such access. The Agreement states the Plan is on AKL’s website. See
Tjart 107 Wn. App. at 896–99 (holding that, though the plaintiff complained that
she never received a copy of the rules referred to in the agreement, the
agreement was not procedurally unconscionable).
3. Adhesion contract
a. Offered on a “take it or leave it” basis
Cornelius says that there was no opportunity to negotiate terms. He says
the senior members told him that if he did not sign the Agreement, he could not
continue to be in the fraternity. AKL does not dispute this. Instead, it correctly
emphasizes that whether the Agreement is an adhesion contract is not
determinative. See Burnett, 196 Wn.2d at 54–55.
AKL relies on Hoober and Romney to contend that this adhesion contract
was not procedurally unconscionable. In Hoober, the court noted that the
plaintiffs would lose their new job opportunity if they refused to sign the
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No. 82264-1-I/12
arbitration agreement, but still determined the agreement was enforceable. 382
F. Supp. 3d at 1157. The court also noted that “understanding that the terms
could not be changed is substantively different from asking questions about the
terms and being refused an answer and has not been found in Washington
courts to be a basis for procedural unconscionability.” Id. at 1156. And in
Romney, this court determined that the plaintiffs had a meaningful choice in
agreeing to an arbitration clause in an adhesion employment contract because
they “could choose employment elsewhere.” 186 Wn. App. at 740.
Given the foregoing, the fact that Cornelius could not negotiate the terms
of the Agreement is not determinative. But his contention that, if he did not agree
to its terms, he would be unable to join the fraternity and not be allowed back to
the house may suggest a lack of meaningful choice.
b. Unequal bargaining power
Cornelius says a disparity exists in bargaining power between the parties.
He made the same claim below, without explaining the dynamics leading to such
a disparity. During the hearing, the trial court noted:
So that, and coupled with the fact that you have a plaintiff who
is 18/19 years old -- and I understand, obviously, that he was college
bound and that he was a pre-med student, but if to sort of continue
the examination as to the totality of the circumstances or the true
context of how this all occurred, you know, even though I never
rushed a fraternity, I’m well aware of what goes on during Rush, and
I, again, acknowledge that not all fraternities are created equal and
not all fraternities behave in the same way, but there’s clearly a
disparity of power between the fraternity and the pledge.
You know, the fraternities, I think -- I believe hold the
overwhelming advantage because they generally know incoming
freshman are desiring a group setting, a social setting to which they
can belong, whether it’s for just fitting in, assimilation purposes,
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No. 82264-1-I/13
whether it’s to have cheaper housing or access to housing, whether
it’s because of peer pressure to have a good social life, there’s a
clear, I think, disparity in the relationship between pledges and
fraternities which I would argue is how these types of situations arise.
In its written order, the court similarly found a “clear disparity” in bargaining
power.
The record does not appear to support this finding. It appears to be based
instead on the trial court’s personal experience.6 ER 605 prohibits a judge from
inserting their “own personal experience into the decision-making process.” In re
Est. of Hayes, 185 Wn. App. 567, 599, 342 P.3d 1161 (2015). Cornelius
contends that his claim below that no equality of bargaining power existed and
his statement that he sought to join a fraternity to make friends render this finding
proper. But these contentions alone do not establish a disparity in bargaining
power. Further evidentiary development is needed to assess the disparity in
bargaining power in this particular case.
4. Meaningful choice
The core inquiry is whether Cornelius had a meaningful choice in entering
the Agreement. We cannot make this determination based on the record before
us. AKL requests that if we are not inclined to order arbitration, we remand for
an evidentiary hearing.7 We agree an evidentiary hearing is necessary. See
6
AKL claims the trial court violated Section 2.2 of the Code of Judicial Conduct
but offers no argument on the issue. Thus, we do not address the claim. See Prostov v.
Dep’t of Licensing, 186 Wn. App. 795, 823, 349 P.3d 874 (2015) (“A party abandons
assignments of error unsupported by argument and will not be considered on appeal.”).
7
AKL also requests that we order a limited deposition of Cornelius on remand. It
is not readily apparent to us why discovery is necessary for either party. The trial court
may in its discretion allow discovery if it deems it necessary.
Cornelius contends AKL had prior opportunities to conduct discovery and failed
to do so and says that such a failure precludes remand for an evidentiary hearing or
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No. 82264-1-I/14
Adler v. Fred Lind Manor, 153 Wn.2d 331, 350, 103 P.3d 773 (2004) (“When
disputes exist as to the circumstances surrounding an agreement, we remand to
the trial court to make additional findings.”). We remand this case to the trial
court for an evidentiary hearing on the issue of procedural unconscionability.
B. Application of the Agreement to Cornelius’s claims
Cornelius says the Agreement does not apply to all his claims because
some of them, specifically those based on his alleged hazing, arose from events
before he signed the Agreement. Emphasizing the FAA’s policy favoring
arbitration, AKL responds that the Agreement is broad and encompasses
Cornelius’s claims arising from events before its execution. We agree with AKL.
“[W]hen a court interprets such provisions in an agreement covered by the
FAA, ‘due regard must be given to the federal policy favoring arbitration.’”
Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52, 62, 115 S. Ct.
1212, 131 L. Ed. 2d 76 (1995) (quoting Volt, 489 U.S. at 475–76). Any doubt
about the “‘scope of arbitrable issues’” should be resolved “‘in favor of
arbitration.’” Green Tree Fin. Corp. v. Bazzle, 539 U.S. 444, 445, 123 S. Ct.
2402, 156 L. Ed. 2d 414 (2003) (quoting Mitsubishi Motors Corp. v. Soler
Chrysler–Plymouth, Inc., 473 U.S. 614, 626, 105 S. Ct. 3346, 87 L. Ed. 2d 444(1985)). “Both state and federal courts must enforce [the FAA’s] body of
substantive arbitrability law.” Zuver, 153 Wn.2d at 301.
limited discovery. But he cites no law supporting his position. See Prostov, 186 Wn.
App. at 823 (“The failure of an appellant to provide argument and citation of authority in
support of an assignment of error precludes appellate consideration of an alleged
error.”).
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The Agreement provides, “If you are unable to resolve a claim or dispute
arising out of your membership or participation in any Fraternity of Alpha Kappa
Lambda-related activity, under the terms of the Program the claim or dispute will
be submitted to binding arbitration instead of through the courts.” The Plan
defines “claim” as
any legal or equitable claim, demand or controversy for any personal
injury, equitable relief or property damage arising out of any tort,
statute (local, state or federal) or breach of contract involving the
Fraternity. This includes but is not limited to any type of allegation of
negligence, intentional acts, defamation, discrimination, contribution
or indemnity.
(Emphasis added.) The Plan defines “dispute” as “a claim, demand or
controversy to which this Plan applies, between persons bound by the Plan or by
an agreement to resolve disputes under the Plan, or between a person bound by
the Plan and a person or entity otherwise entitled to its benefits.” Cornelius
brought negligence claims against AKL, based in part on AKL’s alleged hazing.
Cornelius does not dispute that the Agreement otherwise applies to his
claims; the question is whether the law prohibits the retroactive application of the
Agreement. Though Washington courts have not addressed this issue, other
jurisdictions have consistently held that, absent language in an agreement to the
contrary, the retroactive application of an arbitration agreement is permitted.8
8
See Allbaugh v. Perma-Bound, No. C08-5713-JCC, 2009 WL 10676437, at *1,
10 (W.D. Wash. Aug. 14, 2009) (applying an arbitration agreement retroactively under
Washington law where the agreement stated that it applied to any claim “arising out of or
relating to this Agreement, or the breach, termination, or invalidity thereof”); see GR
14.1; In re Verisign, Inc., Derivative Litig., 531 F. Supp. 2d 1173, 1224 (N.D. Cal. 2007)
(retroactively applying an arbitration agreement that covered “not just services provided
under the agreement, but also ‘any other services provided by KPMG,’” and rejecting
plaintiffs’ contention that the agreement must contain explicit language authorizing
retroactive application); Zink v. Merrill Lynch Pierce Fenner & Smith, Inc., 13 F.3d 330,
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Cornelius emphasizes that Washington courts interpret contracts
according to the “objective manifestation theory,” and contends that this theory
bars the retroactive application of the Agreement. The “objective manifestation
theory of contracts” directs courts to “focus on the agreement’s objective
manifestations to ascertain the parties’ intent.” Healy v. Seattle Rugby, LLC, 15
Wn. App. 2d 539, 544, 476 P.3d 583 (2020) (quoting Martin v. Smith, 192 Wn.
App. 527, 532, 368 P.3d 227 (2016)). “When considering the language of a
written agreement, we ‘impute an intention corresponding to the reasonable
meaning of the words used.’” Id. (quoting Hearst Commc’ns, Inc. v. Seattle
Times Co., 154 Wn.2d 493, 503, 115 P.3d 262 (2005)). Cornelius says that
because the Agreement does not explicitly permit retroactive application, such
application is prohibited. But the Agreement similarly does not prohibit
retroactive application. Moreover, any doubts about the scope of an arbitration
clause are resolved in favor of arbitration. See Green Tree Fin. Corp., 539 U.S.
at 445 (quoting Mitsubishi Motors Corp., 473 U.S. at 626).
331–32 (10th Cir. 1993) (holding that an arbitration agreement applying to any
controversy “arising out of your business or this agreement” was “clearly broad enough
to cover the dispute at issue despite the fact that the dealings giving rise to the dispute
occurred prior to the execution of the agreement.”); Smith/Enron Cogeneration Ltd.
P’ship, Inc. v. Smith Cogeneration Int’l, Inc., 198 F.3d 88, 99 (2d Cir. 1999) (“As the
arbitration clause here similarly does not contain any temporal limitation, the relevant
inquiry is whether SCI’s claims ‘relat[e] to any obligation or claimed obligation under’ the
1994 Agreement, not when they arose.” (alteration in original)); Kristian v. Comcast
Corp., 446 F.3d 25, 33–34 (1st Cir. 2006) (rejecting an argument against retroactive
application of an arbitration agreement because “the phrase ‘or the services provided’
covers claims or disputes that do not arise ‘out of this agreement’ and hence are not
limited by the time frame of the agreements.”); Levin v. Alms & Assocs., Inc., 634 F.3d
260, 267 (4th Cir. 2011) (“Although the arbitration clause does not specifically state that
it applies to claims accruing before the 2007 Agreement, courts have generally applied
broad ‘any dispute’ language retroactively, especially when combined with language that
refers to all dealings between the parties.”).
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No. 82264-1-I/17
Cornelius also contends that interpreting the Agreement as retroactively
applicable would render the Agreement substantively unconscionable. He says
such retroactive application to the claims of an 18-year-old who was hazed would
be “shocking to conscience [sic], monstrously harsh, and exceedingly calloused.”
Burnett, 196 Wn.2d at 57 (“In determining if a contractual provision is one-sided
or overly harsh, courts have considered whether the provision is shocking to the
conscience, monstrously harsh, and exceedingly calloused.”). But he cites no
cases supporting a determination of substantive unconscionability in this context.
Given the cases permitting retroactive application of arbitration agreements, we
disagree with Cornelius.
We reverse and remand for an evidentiary hearing.
WE CONCUR:
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