NOT FOR PUBLICATION WITHOUT THE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