COLORADO COURT OF APPEALS 2016COA130
Court of Appeals No. 15CA1252
Montrose County District Court No. 14CV30176
Honorable Mary E. Deganhart, Judge
Amy Fischer and Roger Fischer,
Plaintiffs-Appellees,
v.
Colorow Health Care, LLC; QP Health Care Services, LLC, d/b/a Vivage;
Beverly Cole; Michael Reinhardt; and Travis Young,
Defendants-Appellants.
ORDER AFFIRMED
Division II
Opinion by JUDGE WEBB
Ashby and Márquez*, JJ., concur
Announced September 8, 2016
Laszlo & Associates, LLC, Theodore E. Laszlo, Jr., Michael J. Laszlo, Boulder,
Colorado, The Meyer Law Firm, P.C., William R. Meyer, Boulder, Colorado, for
Plaintiff-Appellee
Fennemore Craig, David Gelman, Troy R. Rackham, Denver, Colorado, for
Defendant-Appellants Colorow Health Care, LLC, QP Health Care Services,
LLC, Beverly Cole, and Michael Reinhardt
Senter Goldfarb & Rice, L.L.C., Tiffaney A. Norton, Denver, Colorado, for
Defendant-Appellant Travis Young
*Sitting by assignment of the Chief Justice under provisions of Colo. Const. art.
VI, § 5(3), and § 24-51-1105, C.R.S. 2015.
¶1 In deciding the enforceability of an agreement to arbitrate
under the Health Care Availability Act (HCAA), should the test be
strict compliance or substantial compliance with the textual and
typographical requirements of section 13-64-403, C.R.S. 2015?
And if the test is strict compliance, does the absence of bold-faced
type, required under section 13-64-403(4), doom the agreement?
Neither of these questions has been answered in Colorado.
¶2 Plaintiffs, Amy Fischer and Roger Fischer, pleaded tort claims
arising from the death of Charlotte Fischer (the decedent).
Defendants, Colorow Health Care, LLC, QP Health Care Services,
LLC, d/b/a Vivage, Travis Young, Beverly Cole, and Michael
Reinhardt, appeal the trial court’s order denying their motions to
compel arbitration. Applying the strict compliance test, we
conclude that because the arbitration agreement did not satisfy the
bold-faced type requirement, it is unenforceable. Therefore, we
affirm.
I. Facts and Procedural History
¶3 Colorow Health Care, LLC, and its management company, QP
Health Care Services, LLC, d/b/a Vivage, operate a long-term
health care facility. When the decedent was admitted to the facility,
1
her daughter, acting under a power of attorney, signed an
arbitration agreement. The decedent passed away while a resident
of the facility. The circumstances of her death are disputed.
¶4 After plaintiffs brought this action, defendants moved to
compel arbitration. Plaintiffs opposed the motions based on
discrepancies between the wording and typography of the
arbitration agreement and the requirements of section 13-64-403(3)
and (4). Initially, the trial court granted the motion, but set a
hearing on plaintiffs’ attempt to rescind the agreement.
¶5 Following that hearing and additional briefing, the court
reversed itself. It noted that while the arbitration agreement
included most of the language required by section 13-64-403(3),
“there are some typos and words omitted.” It also pointed out that
the agreement “contains the required language from section
13-64-403(4),” but this language is only in capital letters and is not
in bold-faced type, as the statute requires. Explaining that “the
entity seeking to enforce the arbitration agreement must be held to
strict compliance with [the statutory] requirements,” the court held
that the agreement “is not valid and the Motions to Compel
Arbitration are denied.” However, the court did not make any
2
findings whether the decedent’s attorney-in-fact had misunderstood
the agreement when she signed it.
¶6 Defendants then filed this interlocutory appeal as of right
under section 13-22-228(1)(a), C.R.S. 2015.
II. Preservation and Standard of Review
¶7 The parties’ motions, briefs, and arguments below preserved
the issue of the validity of the arbitration agreement.
¶8 Statutory interpretation is subject to de novo review. Lewis v.
Taylor, 2016 CO 48, ¶ 14.
III. The Statute
¶9 Section 13-64-403 is a gatekeeper. It sets out specific
language that an arbitration agreement must include to comply
with the HCAA. Subsection 403(4) provides language that must
appear “[i]mmediately preceding the signature lines for such an
agreement, . . . [and] shall be printed in at least ten-point,
bold-faced type . . . .” § 13-64-403(4). And “an agreement may . . .
be declared invalid by a court if it is shown by clear and convincing
evidence that . . . [t]he agreement failed to meet the standards for
such agreements.” § 13-64-403(10)(a).
3
IV. The Arbitration Agreement
¶ 10 The arbitration agreement between defendants and the
decedent’s daughter, as her representative, covers two-and-a-half
pages. The first page and two-thirds of the second page define the
claims and the parties subject to the agreement. Next, the
agreement parrots the required language from subsection 403(3), in
regular typeface, but with a few typographical errors and minor
departures from the statutory text.
¶ 11 After the subsection 403(3) text, the agreement quotes the
required language from subsection 403(4). This text was
capitalized, and in twelve-point font, but in regular — as opposed to
bold — typeface:
NOTE: BY SIGNING THIS AGREEMENT YOU
ARE AGREEING TO HAVE ANY ISSUE OF
MEDICAL MALPRACTICE DECIDED NY [sic]
NEUTRAL BINDING ARBITRATION RATHER
THAN [sic] JURY OR COURT TRAIL [sic].
YOU HAVE THE RIGHT TO SEEK LEGAL
COUNSEL AND YOU AND [sic] RIGHT TO
RESCIND THIS AGREEMENT WITHIN NINETY
DAYS FROM THE DATE OF SIGNATURE BY
BOTH PARTIES UNLESS THE AGREEMENT
WAS SIGNED IN CONTEMPLATION OF
HOSPITALIZATION IN WHICH CASE YOU
HAVE NINETY DAYS AFTER DISCHARGE OR
4
RELEASE FROM THE HOSPITAL TO RESCIND
THIS AGREEMENT.
Except as noted, this language nearly mirrors the text required by
subsection 403(4).
V. Validity of the Arbitration Agreement
¶ 12 Defendants concede that the text required by subsection
403(4) is not in bold-faced type and that this text, as well as the
text required by subsection 403(3), contained some typographical
errors. But they contend section 13-64-403 requires only
substantial compliance with its provisions. And according to
defendants, the arbitration agreement satisfies a substantial
compliance test because the errors were minor and the language
that should have been in bold-faced type was in all caps and in a
larger font than the statute requires — twelve-point, while the
statute only requires “at least ten-point.”
¶ 13 Plaintiffs respond that the arbitration agreement must strictly
comply with section 13-64-403, and because admittedly it did not,
it is invalid. We agree with plaintiffs that the statute requires strict
compliance. And based on the complete lack of bold-faced type, we
also agree that the agreement is invalid. By affirming denial of the
5
motions to compel arbitration on this basis, however, we need not
consider whether other anomalies in the agreement — dismissed by
defendants as trivial typographical errors — would survive a strict
compliance test.
A. Statutory Construction Principles
¶ 14 When interpreting a statute, a court’s primary goal is to
discern the legislature’s intent. See Pinnacol Assurance v. Hoff,
2016 CO 53, ¶ 48. “To divine this intent, our first recourse is the
plain language of the statute, and we refrain from rendering
judgments that are inconsistent with the intent evidenced by such
language.” Colo. Motor Vehicle Dealer Bd. v. Freeman, 2016 CO 44,
¶ 8. A court may discern the legislature’s intent by examining the
plain language “within the context of the statute as a whole.”
Lewis, ¶ 20.
¶ 15 If a statute is ambiguous, a court may examine its legislative
history to discern legislative intent. United Guar. Residential Ins.
Co. v. Dimmick, 916 P.2d 638, 641 (Colo. App. 1996). Wherever
possible, a statute should be construed “in a manner that gives
effect to all its . . . policy objectives, and not in a way that renders
one or more of its . . . goals inoperative.” Copeland v. MBNA Am.
6
Bank, N.A., 907 P.2d 87, 90 (Colo. 1995). But in all events, a court
must avoid an interpretation that “leads to an absurd result.”
Concerned Parents of Pueblo, Inc. v. Gilmore, 47 P.3d 311, 313 (Colo.
2002).
¶ 16 These principles are familiar. But applying them to section
13-64-403 involves several twists.
B. Application
¶ 17 According to plaintiffs, the arbitration agreement fails because
it did not strictly comply with section 13-64-403 in two ways: first,
the statutory language was not in bold-faced type, and, second, the
text did not precisely mirror the statutory language.
¶ 18 The initial contention raises two related questions of first
impression. Colorado courts have not decided whether section
13-64-403 demands strict compliance. Nor have they addressed
whether failure to satisfy a statutory bold-faced type requirement
means that the document must be invalidated under a strict
compliance test.1 We begin with the first question, as answering it
1 Out-of-state authority is mixed. Compare Caspe v. Aaacon Auto
Transp., Inc., 658 F.2d 613, 616 (8th Cir. 1981) (noting that a
clause without bold-faced type did not achieve the purpose of
standing out and attracting the reader’s attention), and Niewind v.
7
in the negative would moot the second question, considering the
criteria of plain language, context, and purpose.
1. Whether Section 13-64-403 Demands Strict Compliance
a. Plain Language
¶ 19 Section 13-64-403 says that an arbitration agreement “shall”
satisfy the statute’s various requirements. See, e.g.,
§ 13-604-403(3) (“Any such agreement shall have the following
statement . . . .”) (emphasis added); § 13-64-403(4) (noting that the
“notice shall be printed in at least ten-point, bold-faced type”)
(emphasis added); § 13-64-403(6) (“The patient shall be provided
with a written copy . . . .”) (emphasis added).
Carlson, 628 N.W.2d 649, 652 (Minn. Ct. App. 2001) (“If the
legislature had merely intended to require that notice be set out in a
manner likely to bring it to the attention of the buyer, it would have
said so.”), with Cavalier Homes of Ala., Inc. v. Sec. Pac. Hous. Servs.,
Inc., 5 F. Supp. 2d 712, 718 (E.D. Mo. 1997) (“[T]he Court
concludes that substantial compliance with the statute is sufficient
and the failure to place the statutory notice in bold type does not
preclude application of the statute.”), and Fabulous Fur Corp. v.
United Parcel Serv., 664 F. Supp. 694, 697-98 (E.D. N.Y. 1987)
(“[D]efendant’s only failure to comply with the ICC order consisted
of the failure to use a bold-print type on its bill of lading. We find
that as a matter of law this was equivalent to substantial
compliance with the ICC order.”), and People v. Williams, 972
N.E.2d 1265, 1269-70 (Ill. App. Ct. 2012) (bail bond form
substantially complied with statute even though text was not in
bold-faced type as required by statute; party was not prejudiced by
noncompliance with the statute).
8
¶ 20 “The word ‘shall’ connotes a mandatory requirement.” Willhite
v. Rodriguez-Cera, 2012 CO 29, ¶ 17. Colorado courts have held
that mandatory statutory language requires strict compliance with
its terms. See, e.g., E. Lakewood Sanitation Dist. v. Dist. Court, 842
P.2d 233, 236 (Colo. 1992) (“The presence of the word ‘shall’ in the
clause . . . dictates th[e] unambiguous reading[,]” which is strict
compliance.); Postlewait v. Midwest Barricade, 905 P.2d 21, 23-24
(Colo. App. 1995) (concluding that a party must strictly comply with
a statute that uses “shall”); see also 3 Norman J. Singer & J.D.
Shambie Singer, Sutherland Statutory Construction § 57:12 (7th ed.
2012) (“The effect of holding a statute mandatory is to require strict
compliance with its letter in order to uphold proceedings or acts
pursuant thereto or to enable persons to acquire rights under it.”).2
2 Courts outside of Colorado are in accord. See, e.g., State v.
Banks, ___ A.3d ____, 2016 WL 3521973, at *12 (Conn. July 5,
2016) (“When a statutory provision involving the power of a public
officer or body is mandatory, strict compliance is required and the
failure to strictly comply invalidates all further proceedings.”);
Bendell v. Educ. Officers Electoral Bd. for Sch. Dist. 148, 788 N.E.2d
173, 178 (Ill. App. Ct. 2003) (“Inasmuch as section 10-4 is
mandatory, compliance with its provisions must be strict rather
than substantial.”); Brown v. Harper, 761 S.E.2d 779, 780 (S.C. Ct.
App. 2014) (“The plain and mandatory language of section 63-9-340
indicates the legislature intended strict compliance.”), aff’d, 766
S.E.2d 375 (S.C. 2014).
9
¶ 21 Undaunted, defendants cite several Colorado cases holding
that statutes containing mandatory language required only
substantial compliance. But none of these cases interpreted
section 13-64-403. As well, their facts are distinguishable.3 Even
so, while the repeated use of “shall” favors interpreting section
13-64-403 to demand strict compliance, this arguably contrary
authority at least cautions that “shall” alone should not end the
inquiry.
¶ 22 Continuing with the plain language of the statute, section
13-64-403 sets forth the requirements for a valid arbitration
agreement. Such an agreement “divests the trial court of
3 In Woodsmall v. Regional Transportation District, 800 P.2d 63, 67
(Colo. 1990), for example, the court concluded that a statute with
mandatory language only required substantial compliance.
However, the legislative history of the statute “clearly indicate[d]
that the sponsor of the [statute] did not intend to create a standard
of absolute or literal compliance with the notice requirement[.]” Id.
at 68. By contrast, here, the parties do not cite any relevant
legislative history, and our review reveals none. Hence, we need not
decide whether to follow cases espousing the minority view that a
court may consider legislative history, without first holding a
statute to be ambiguous. See, e.g., Lot Thirty-Four Venture, L.L.C. v.
Town of Telluride, 976 P.2d 303, 306 (Colo. App. 1998) (“If the
statutory language is clear and unambiguous, the statute should be
applied as written. Nevertheless, we may also consider other indicia
of legislative intent, such as the object to be attained, the legislative
history, and the consequences of the particular construction.”)
(citation omitted), aff’d, 3 P.3d 30 (Colo. 2000).
10
jurisdiction over all the questions that are submitted to arbitration,
pending the conclusion of arbitration.” City & Cty. of Denver v. Dist.
Court, 939 P.2d 1353, 1370 (Colo. 1997). Thus, section 13-64-403
can be characterized as a jurisdictional statute. And jurisdictional
statutes typically demand strict compliance. See, e.g., Finnie v.
Jefferson Cty. Sch. Dist. R-1, 79 P.3d 1253, 1255-56 (Colo. 2003)
(noting that a statute that set out “jurisdictional prerequisite[s] to
suit” demands strict compliance with its terms).
¶ 23 At the same time, as defendants point out, section 13-64-403
— and for that matter, the rest of the HCAA — is silent whether
strict compliance or mere substantial compliance will satisfy its
requirements. Even so, dozens of other Colorado statutes expressly
permit substantial compliance. See, e.g., § 8-47-104, C.R.S. 2015
(“Substantial compliance with the requirements of articles 40 to 47
of this title shall be sufficient . . . .”); § 31-12-107(1)(e), C.R.S. 2015
(“All petitions which substantially comply with the requirements set
forth . . . shall be deemed sufficient.”). By contrast, only six
Colorado statutes demand strict compliance. See, e.g., § 10-3-302,
C.R.S. 2015 (insurance companies must “strictly comply” with
section 10-3-201, C.R.S. 2015). This imbalance shows that the
11
General Assembly is much more likely to clarify its intent by
addressing substantial compliance than strict compliance.
¶ 24 Confirming our understanding of “shall” and the jurisdictional
implications, section 13-64-403’s silence on substantial compliance
further suggests that strict compliance is required. See In re
Williamson Vill. Condos., 653 S.E.2d 900, 904-05 (N.C. Ct. App.
2007) (“[E]ven where the General Assembly uses mandatory
language such as ‘shall’ or ‘must,’ it may still excuse noncompliance
with the use of a ‘substantial compliance’ clause.”), aff’d, 669
S.E.2d 310 (N.C. 2008).
b. Context
¶ 25 Turning to other subsections of section 13-64-403 for context,
subsection 403(10)(a) provides:
Even where it complies with the provisions of
this section, such an agreement may
nevertheless be declared invalid by a court if it
is shown by clear and convincing evidence that
. . . [t]he agreement failed to meet the
standards for such agreements as specified in
this section[.]
Plaintiffs read this language as providing an exception to enforcing
an arbitration agreement.
12
¶ 26 True enough, Colorado cases have pointed out that a statutory
exception suggests that outside the scope of the exception, strict
compliance is required. See, e.g., Grandote Golf & Country Club,
LLC v. Town of La Veta, 252 P.3d 1196, 1201 (Colo. App. 2011)
(noting that the existence of a good cause exception suggests strict
compliance in the absence of good cause). Unlike the good cause
exception in Grandote, however, subsection 403(10)(a) does not
provide any criteria for deciding when noncompliance leads to
invalidity. And “[u]sually the word ‘may” denotes a grant of
discretion and is interpreted as permissive.” People v. Valadez,
2016 COA 62, ¶ 17.
¶ 27 Thus, this subsection could be read as creating unbridled
discretion to enforce an arbitration agreement, despite its
deficiencies. Such a reading would favor substantial compliance
over strict compliance.
¶ 28 But this reading misses the larger point — subsection
403(10)(a) is circular: the provision notes that “[e]ven where” an
agreement meets the requirements of section 13-64-403, the
agreement may be declared invalid if it does not meet the
requirements of section 13-64-403. Given this inartful drafting,
13
whether or how subsection 403(10)(a) could affect interpretation of
section 13-64-403 as a whole presents a conundrum that we
decline to unravel. See Concerned Parents of Pueblo, Inc., 47 P.3d at
314 (“If the ‘person’ performing the service, to whom the statute
refers, is the organization serving young people itself, then the
statute presents a circular conundrum.”). Instead, we seek clearer
guidance from the General Assembly’s stated purpose in enacting
section 13-64-403.
c. Statutory Purpose
¶ 29 Assessing the purpose of section 13-64-403 is “critical” in
determining the degree of compliance that the statute requires.
Wainscott v. Centura Health Corp., 2014 COA 105, ¶ 26 (citation
omitted); see also Charnes v. Norwest Leasing, Inc., 787 P.2d 145,
147 (Colo. 1990) (“We have approved of a rule of substantial
compliance with a statute when such a rule serves the purposes of
the statute.”).
¶ 30 First, consider that the overall purpose of the HCAA is to
“assure the continued availability of adequate health care services
to the people of this state by containing the significantly increasing
costs of malpractice insurance for medical care institutions and
14
licensed medical care professionals . . . .” § 13-64-102(1), C.R.S.
2015. Yet, as to this overall purpose, neither party argues, nor do
we discern, any nexus to either horn of the strict compliance versus
substantial compliance dilemma.
¶ 31 Next, consider the more specific objective that “an arbitration
agreement be a voluntary agreement between a patient and a health
care provider . . . .” § 13-64-403(1); see also Moffett v. Life Care
Ctrs. of Am., 219 P.3d 1068, 1074 (Colo. 2009) (noting that the
“precise language” of section 13-64-403’s requirements acts as a
procedural safeguard, protecting patients from unwittingly entering
into arbitration agreements); Colo. Permanente Med. Grp., P.C. v.
Evans, 926 P.2d 1218, 1227 n.17 (Colo. 1996) (same).
¶ 32 Section 13-64-403’s textual and typographical requirements
ensure that the signatory to an arbitration agreement receives
specific information in a prominent format. And everyone would
agree that if the signatory misunderstood such an agreement
because of content or format deficiencies, the signatory likely did
not enter into it voluntarily. Cf. People v. Alexander, 797 P.2d 1250,
1256 (Colo. 1990) (noting that to establish the voluntariness of a
plea, the record must show defendant understood the rights he was
15
waiving by pleading guilty). Thus, a closer look shows that these
typographical and textual requirements are proxies for
voluntariness.
¶ 33 Defendants do not explain how substantial compliance either
directly furthers voluntariness or indirectly advances it by
increasing understanding. Nor do we see that they could make
either showing. To the contrary, for the following reasons,
substantial compliance creates a greater risk of misunderstanding
than does strict compliance.
¶ 34 Of course, substantial compliance could sometimes achieve
the same level of understanding as strict compliance. Still, because
understanding is subjective, a substantial compliance test would
burden a patient or the patient’s representative to show that for
lack of complying language and typography, the effect of an
arbitration agreement was not understood. Thus, substantial
compliance inflicts the costs and uncertainty of litigating
understanding, as a proxy for voluntariness, on the patient or
representative. And the patient or representative would have to
carry that burden in the face of language — albeit noncompliant
with the statute — describing the agreement’s effect. Cf. In re
16
Rosen, 198 P.3d 116, 119 (Colo. 2008) (“[W]e cannot say, as a
matter of law, that no reasonable fact finder could be unconvinced
by the circumstantial evidence of the respondent’s subjective
intent.”).
¶ 35 Even worse, resolving understanding on a case-by-case basis
under a substantial compliance standard could lead to inconsistent
results. For example, one trial court might conclude that
regular-faced type, but in sixteen-point font, substantially complies
with subsection 403(4). Another court may reach the opposite
conclusion, reasoning that even sixteen-point font lacks the impact
of bold-faced type. And therein lies the problem — substantial
compliance is inherently elastic. See Grp., Inc. v. Spanier, 940 P.2d
1120, 1122 (Colo. App. 1997) (“Substantial compliance is less than
absolute, but still requires a significant level of conformity.”); see
also Myears v. Charles Mix Cty., 566 N.W.2d 470, 474 (S.D. 1997)
(“What constitutes substantial compliance with a statute is a matter
depending on the facts of each particular case.”) (citations omitted).
¶ 36 By contrast, under a strict compliance test, the burden would
fall on the health care facility to show strict compliance with section
13-64-403. After all, the facility — not the patient or the patient’s
17
representative — prepared the agreement. Unlike the patient’s
burden under a substantial compliance standard, the health care
facility’s burden would be low, given the ease of complying with
section 13-64-403’s requirements by quoting the language verbatim
and adhering to the unambiguous typographical requirements.
Thus, under this standard, voluntariness would not be at risk
merely because of a patient’s or representative’s difficulty in proving
subjective misunderstanding of an agreement.
¶ 37 As well, the results would be consistent: if section 13-64-403’s
requirements were met, the agreement would be valid. A statutory
interpretation producing consistent results is preferable over one
that produces inconsistent results. Cf. United States v. Dion, 752
F.2d 1261, 1267 (8th Cir. 1985) (noting that one analytical test is
“more desirable” because it leads to “more consistent results,”
among other reasons); Sportwear Hosiery Mills v. Comm’r, 129 F.2d
376, 379 (3d Cir. 1942) (“[W]e think that the construction offered by
the Commissioner leads to more consistent results and presumably,
therefore, is within the Congressional intent.”).
18
¶ 38 Given all this, the General Assembly’s stated purpose —
voluntariness of arbitration agreements — is better served by
demanding strict compliance with section 13-64-403.
¶ 39 In sum, based on these three factors — plain language,
context, and purpose — we conclude that section 13-64-403 calls
for strict compliance. This conclusion accords with dicta in which
the supreme court said that noncompliance with section 13-64-403
“alone would render the agreement unenforceable.” Allen v.
Pacheco, 71 P.3d 375, 381 (Colo. 2003); see also Evans, 926 P.2d at
1228 (noting that an arbitration agreement “must comport with the
other measures” in section 13-64-403). But this conclusion does
not resolve the consequences of noncompliance.
2. Whether Lack of Bold-Faced Type Dooms the Agreement
a. Absurd Results
¶ 40 Defendants’ argument that invalidating an agreement based
on a lack of bold-faced type leads to an absurd result — because
the arbitration agreement still contained the requisite wording and
in a typographically prominent format — misses the mark.
¶ 41 Defendants begin with a false analogy: a strict compliance
standard would invalidate otherwise adequate agreements where,
19
for example, the agreement substituted synonyms for statutorily
required words. To avoid this absurd result, they continue, strict
compliance must excuse minor departures from statutory
requirements that could have had no practical effect on the reader.
And according to defendants, this same rationale applies to the
absence of bold-faced type: to avoid an absurd result, this anomaly
too must be excused, even under a strict compliance standard,
where it had no practical effect on the reader.
¶ 42 Not so fast. This analogy equates substituting a synonym in
an agreement with failing to use a required typeface. But we know
that by definition, substituting a synonym could not have any
effect. See Webster’s Third New Int’l Dictionary 2320 (2002) (“A
[synonym is a] word having the same meaning as another word.”).
The opposite is true for the failure to use bold-faced type. See
Caspe v. Aaacon Auto Transp., Inc., 658 F.2d 613, 616 (8th Cir.
1981) (noting that bold-faced type allows language to “stand out
and attract the reader’s attention”); Stauffer Chem. Co v. Curry, 778
P.2d 1083, 1092 (Wyo. 1989) (acknowledging that bold-faced type
allows words to “stand out prominently from surrounding words”).
20
¶ 43 In the absence of any authority holding that strict compliance
with a bold typeface requirement produces an absurd result, we
reject defendants’ contention.
b. Public Policy
¶ 44 Finally, defendants’ argument that Colorado’s “strong public
policy in favor of arbitration[,]” Braata, Inc. v. Oneida Cold Storage
Co., LLP, 251 P.3d 584, 590 (Colo. App. 2010), compels enforcing
the arbitration agreement, even in the absence of bold-faced type,
also falls short.
¶ 45 To begin, the HCAA recognizes this policy. But it also
acknowledges that noncompliant agreements are inconsistent with
public policy. See § 13-64-403(2) (“Any agreement . . . for binding
arbitration . . . that conforms to the provisions of this section shall
not be deemed contrary to the public policy of this state, except as
provided in subsection (10) of this section.”); see also Braata, Inc.,
251 P.3d at 587 (noting that the strong policy in favor of arbitration
“does not trump statutory plain language”).
¶ 46 As well, the policy favoring arbitration is a tie-breaker used to
“construe any ambiguities.” BFN-Greeley, LLC v. Adair Grp., Inc.,
141 P.3d 937, 940 (Colo. App. 2006). But the discrepancies
21
between the arbitration agreement and the statutory requirements
do not involve ambiguities. Nor do defendants cite, and we have not
found in Colorado, authority holding that that the policy favoring
arbitration tilts the playing field on which courts decide the
threshold question of whether an arbitration agreement is valid.
Thus, we conclude Colorado’s policy in favor of arbitration does not
change our conclusion.
VI. Conclusion
¶ 47 That the arbitration agreement entirely lacked bold-faced type
is undisputed, and we have concluded that section 13-64-403
demands strict compliance. Therefore, clear and convincing
evidence shows that the agreement violated section 13-64-403(4).
And invalidating it for the lack of bold-faced type neither creates an
absurd result nor violates public policy favoring arbitration. Having
invalidated the agreement on this basis, we need not determine
whether the agreement is also invalid because of typographical
errors and minor wording discrepancies.
¶ 48 The order of the trial court denying the motions to compel
arbitration is affirmed.
JUDGE ASHBY and JUDGE MÁRQUEZ concur.
22