NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NOS. A-5601-18T1
A-5602-18T1
PREETI SHARMA and
RAJKUMAR SHARMA,
her husband,
Plaintiffs-Appellants,
v.
SKY ZONE, LLC, SKY ZONE
FRANCHISE GROUP, LLC,
CIRCUSTRIX HOLDINGS, LLC,
UDAAN NJ, INC., d/b/a SKY ZONE
INDOOR TRAMPOLINE PARK
HAMILTON, and RPSZ
CONSTRUCTION, LLC,
Defendants-Respondents.
_________________________________
SAEDDA FARRAJ, a minor, by her
parents and guardians ad litem, SAEDD
FARRAJ, and SALHEAH FARRAJ,
Plaintiffs-Appellants,
v.
SKY ZONE, LLC, SKY ZONE
FRANCHISE GROUP, LLC,
CIRCUSTRIX HOLDINGS, LLC,
UDAAN NJ, INC., d/b/a SKY ZONE
INDOOR TRAMPOLINE PARK
HAMILTON, and RPSZ
CONSTRUCTION, LLC,
Defendants-Respondents.
_________________________________
Argued telephonically April 22, 2020 –
Decided June 4, 2020
Before Judges Koblitz, Gooden Brown and Mawla.
On appeal from the Superior Court of New Jersey, Law
Division, Mercer County, Docket Nos. L-0930-19 and
L-0931-19.
David K. Chazen argued the cause for appellants
(Chazen & Chazen, attorneys; David K. Chazen, on the
briefs).
Samuel G. John argued the cause for respondents
(Wood Smith Henning & Berman, LLP, attorneys;
Kelly A. Waters, of counsel and on the briefs, Jill A.
Mucerino and Samuel G. John, on the brief).
PER CURIAM
In these back-to-back appeals, which we consolidate for purposes of
issuing a single opinion, Preeti Sharma and her husband, Rajkumar Sharma,
(collectively, Sharma plaintiffs), and Saedda Farraj, a minor, by her parents and
guardians ad litem, Saedd Farraj and Salheah Farraj (collectively, Farraj
A-5601-18T1
2
plaintiffs), appeal from the July 15, 2019 Law Division order dismissing their
complaints with prejudice and compelling arbitration of their disputes with
defendants Sky Zone, LLC, Sky Zone Franchise Group, LLC, Circustrix
Holdings, LLC, Udaan NJ, Inc., D/B/A Sky Zone Indoor Trampoline Park
Hamilton, and RPSZ Construction, LLC (collectively, Sky Zone).1 We affirm
the order compelling arbitration.
We glean these facts from the allegations contained in the complaints.
Sky Zone is an "indoor trampoline park" located in Hamilton Township. Sky
Zone is a self-proclaimed "fun fitness" recreational facility designed for
"workouts," which include "bouncing, flipping, and landing in a pit filled with
10,000 foam cubes." On June 30 and December 30, 2018, respectively, Saedda,2
age fifteen, and Preeti, age forty-one, "purchased admission" to Sky Zone and
"executed the Sky Zone Agreement" which "permitted [them] to use the
trampoline and other facilities and participate in the activities promoted by . . .
[d]efendants." While using Sky Zone's facility, Saedda "sustain[ed] an injury to
1
Defendants allegedly "designed, constructed, franchised, owned, controlled,
maintained, operated, managed, trained, supervised, marketed, and solicited
business" for Sky Zone "by advertising its attractions, activities[,] and events
throughout . . . New Jersey and elsewhere."
2
We use first names in this opinion for clarity and ease of reference and intend
no disrespect.
A-5601-18T1
3
the right knee requiring surgery with ACL reconstruction with autograft
hamstrings," and Preeti "sustain[ed] . . . displaced fractures of her left foot
requiring surgery with open reduction and internal fixation."
Thereafter, the Sharma plaintiffs and the Farraj plaintiffs separately filed
complaints alleging they sustained "serious and permanent personal injuries" as
a result of defendants' "negligence, recklessness, gross negligence, wanton . . .
and intentional conduct" in the design and operation of Sky Zone. Plaintiffs also
alleged "[d]efendants' misrepresentations in the Sky Zone Agreement"
constituted "an unconscionable commercial practice, fraud, false pretense and
deception in violation of the New Jersey Truth-In-Consumer Contract, Warranty
and Notice Act, N.J.S.A. 56:12-14 and N.J.S.A. 56:12-15." On June 18, 2019,
defendants moved to dismiss the complaints with prejudice and compel
arbitration. With defendants' consent, the motion judge granted plaintiffs'
request to consolidate the matters for purposes of the motion only.
To support its motion to compel arbitration, defendants relied on the Sky
Zone Agreement, which is a participant agreement, release and assumption of
risks standardized form signed by all patrons, including plaintiffs, to gain
admission to Sky Zone. The agreement includes a "voluntary assumption of risk
acknowledgement" provision, acknowledging that patrons "are participating
A-5601-18T1
4
voluntarily [and] at [their] own risk," and that they could "die or become
paralyzed, partially or fully, through their use of the Sky Zone facility and
participation in Sky Zone activities." The agreement also includes a "release of
liability" provision, stating that patrons "forever, irrevocably and
unconditionally release, waive, relinquish, discharge from liability and covenant
not to sue [Sky Zone]" for
any and all claims . . . of whatever kind or nature, in
law, equity or otherwise, . . . related to or arising,
directly or indirectly, from [their] access to and/or use
of the Sky Zone [f]acility, . . . including, without
limitation, any claim for negligence, failure to warn or
other omission, . . . personal injury, . . . [or] bodily harm
....
Finally, the agreement includes an "arbitration of disputes" provision,
which plaintiffs acknowledged with a check mark, indicating they understood
that they were "waiving [their] right, and the right(s) of . . . minor child(ren) . . .
to maintain a lawsuit against [Sky Zone] . . . for any and all claims covered by
th[e a]greement." Further,
[b]y agreeing to arbitrate, [plaintiffs] understand that
[they] will not have the right to have [their] claim[s]
determined by a jury . . . . Reciprocally, [defendants]
. . . waive their right to maintain a lawsuit against
[plaintiffs] . . . for any and all claims covered by th[e
a]greement, and they will not have the right to have . . .
claim(s) determined by a jury. ANY DISPUTE,
CLAIM OR CONTROVERSY ARISING OUT OF OR
A-5601-18T1
5
RELATING TO [PLAINTIFFS'] . . . ACCESS TO
AND/OR USE OF THE SKY ZONE PREMISES
AND/OR ITS EQUIPMENT, INCLUDING THE
DETERMINATION OF THE SCOPE OR
APPLICABILITY OF TH[E] AGREEMENT TO
ARBITRATE, SHALL BE BROUGHT WITHIN ONE
YEAR OF ITS ACCRUAL (i.e., the date of the alleged
injury) FOR AN ADULT AND WITHIN THE
APPLICABLE STATUTE OF LIMITATIONS FOR A
MINOR AND BE DETERMINED BY
ARBITRATION IN THE COUNTY OF THE SKY
ZONE FACILITY . . . BEFORE ONE ARBITRATOR.
THE ARBITRATION SHALL BE ADMINISTERED
BY [JUDICIAL ARBITRATION AND MEDIATION
SERVICES (JAMS)] PURSUANT TO ITS RULE 16.1
EXPEDITED ARBITRATION RULES AND
PROCEDURES. JUDGMENT ON THE AWARD
MAY BE ENTERED IN ANY COURT HAVING
JURISDICTION. THIS CLAUSE SHALL NOT
PRECLUDE PARTIES FROM SEEKING
PROVISIONAL REMEDIES IN AID OF
ARBITRATION FROM A COURT OF
[3]
APPROPRIATE JURISDICTION. This [a]greement
shall be governed by, construed and interpreted in
accordance with the laws of . . . New Jersey, without
regard to choice of law principles. Notwithstanding the
provision with respect to the applicable substantive
law, any arbitration conducted pursuant to the terms of
this [a]greement shall be governed by the Federal
Arbitration Act (9 U.S.C., Sec. 1-16).
Additionally, the agreement contains a severability clause, providing
This [a]greement constitutes and contains the entire
agreement between [Sky Zone] and [plaintiffs'] . . . use
of the Sky Zone [f]acility. There are no other
3
The capitalized text of the agreement also appeared in bold print.
A-5601-18T1
6
agreements, oral, written, or implied, with respect to
such matters. . . . If any term or provision of th[e
agreement] shall be held illegal, unenforceable, or in
conflict with any law governing th[e agreement] the
validity of the remaining portions shall not be affected
thereby.
The agreement refers plaintiffs to a website to review "the JAMS Arbitration
Rules to which [plaintiffs] agree[d]."
JAMS is "an independent alternative dispute resolution (ADR) and third-
party neutral services provider," consisting of "lawyers and retired judges who
serve as mediators or arbitrators (third-party neutrals)." On May 1, 2017, prior
to plaintiffs' execution of Sky Zone's agreement, in response to an inquiry by
JAMS's attorney, the New Jersey Advisory Committee on Professional Ethics,
Committee on the Unauthorized Practice of Law, and Committee on Attorney
Advertising determined that JAMS's operating procedure was not compliant
with New Jersey law because, as "third-party neutrals," JAMS's "lawyers and
retired judges . . . are providing legal services" and are therefore required to
"abide by the pertinent Court Rules and Rules of Professional Conduct."
During oral argument on the motion, referring to the May 1, 2017 advisory
opinion, the parties agreed there was "no dispute" that JAMS was not "licensed
to operate in New Jersey." Thus, defendants posited that "the main issue" was
whether JAMS's unavailability "vitiate[d] the entire agreement to arbitrate."
A-5601-18T1
7
Arguing that it did not, defendants urged the court to compel arbitration because
the agreement did not specify that JAMS was the "exclusive[]" forum for
arbitration, the provision requiring arbitration was "in a separate sentence" from
the provision selecting "JAMS as a forum for arbitration," and there was "a
severability clause" that allowed "the remaining portions" of the agreement to
remain unaffected "if any part of" the agreement was deemed "unenforceable."
Defendants asserted that "under the case law, . . . if the arbitration forum is not
available, the [c]ourt can appoint an arbitrator."
Plaintiffs countered that Kleine v. Emeritus at Emerson, 445 N.J. Super.
545, 552 (App. Div. 2016) controlled and mandated invalidating the entire
arbitration provision. As in Kleine, where the order compelling arbitration was
reversed because the exclusive arbitral forum was unavailable, plaintiffs
asserted that given JAMS's unavailability, "[t]here was no meeting of the minds
here" and "therefore the provision is void." Additionally, plaintiffs argued that
"[t]he arbitration provision itself . . . is unconscionable," and the "expedited
procedures" under the JAMS rules are unduly restrictive and unfair. Defendants
responded that plaintiffs' tangential claims regarding "the JAMS rules allegedly
being . . . improper, or the contract as a whole being void" are "questions under
the case law [that] have to be resolved by the arbitrator."
A-5601-18T1
8
In an oral decision, the judge granted defendants' motion. Acknowledging
that "[t]he key issue" was "whether plaintiff[s] entered into a valid mutual
agreement to arbitrate any personal injury claims," the motion judge
painstakingly scrutinized the agreement, underscoring plaintiffs' assent
indicated by "placing a checkmark next to the . . . arbitration" provision, and
defendants highlighting portions of the arbitration provision by reciting them
"in bold print and caps." Applying the applicable legal principles, the judge
determined
that the arbitration provision satisfies the rigorous tests
set forth in the leading New Jersey precedent. . . .
[H]ere, plaintiff[s] checked a marked box directly next
to the arbitration provision of the agreement. Further,
the language in the arbitration provision is clear and
unambiguous to the extent that it indicates that it
subjects the parties to arbitration and release of any
rights to a trial by jury.
The language, though not perfect, provides and
indicates clear evidence of mutual assent of the terms.
Turning to plaintiffs' argument that the agreement was unenforceable
because of the unavailability of JAMS, relying on the reasoning in Khan v. Dell
Inc., 669 F.3d 350 (3d Cir. 2012), the judge found there was no unambiguous
expression of intent not to arbitrate in the event that the designated arbitral
forum was unavailable. Thus, according to the judge, under the Federal
A-5601-18T1
9
Arbitration Act (FAA), 9 U.S.C. § 5, and the New Jersey Arbitration Act,
N.J.S.A. 2A:23B-11, the court was required to appoint a substitute arbitrator
upon the application of a party. To support this conclusion, the judge pointed
to the severability provision in the agreement as well as the provision
authorizing the parties to "seek provisional remedies" in aid of arbitration from
the court, which the judge interpreted as "including the appointment of an
arbitrator." Accordingly, the judge offered the parties an opportunity to jointly
select an arbitrator, otherwise, the court would make the selection. Additionally,
the judge determined that plaintiffs' remaining arguments regarding
unconscionability and the contract's validity "must be determined by the
arbitrator" under Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440
(2006). The judge entered a memorializing order and this appeal followed.
On appeal, plaintiffs argue that "[w]ithout a valid dispute resolution forum
in place, the arbitration provision [was] rendered void and unenforceable."
Plaintiffs contend that "[t]he decisions in Kleine and Flanzman[4] are
controlling," where this court "refused to compel arbitration because the
agreement did not specify the forum where the arbitration would be conducted
4
Flanzman v. Jenny Craig, Inc., 456 N.J. Super. 613 (App. Div. 2018), certif.
granted, 237 N.J. 310 (2019).
A-5601-18T1
10
or, alternatively, describe a process for selecting a forum." Plaintiffs assert the
judge "erred in applying Khan" because "JAMS was unavailable at the time the
agreement was executed and through the time the trial court ruled on . . .
[d]efendants' [m]otion," thus "there was 'no meeting[] of the minds as to an
arbitral forum.'"
We review orders compelling arbitration "de novo." Hirsch v. Amper Fin.
Servs., LLC, 215 N.J. 174, 186 (2013). Therefore, "we need not give deference
to the analysis by the trial court." Goffe v. Foulke Mgmt. Corp., 238 N.J. 191,
207 (2019) (citing Morgan v. Sanford Brown Inst., 225 N.J. 289, 303 (2016)).
"In reviewing such orders, we are mindful of the strong preference to enforce
arbitration agreements, both at the state and federal level." Hirsch, 215 N.J. at
186. "However, the preference for arbitration 'is not without limits.'" Id. at 187
(quoting Garfinkel v. Morristown Obstetrics & Gynecology Assocs., P.A., 168
N.J. 124, 132 (2001)).
To determine "whether a valid agreement to arbitrate exists," a "court must
first apply 'state contract-law principles.'" Ibid. (quoting Hojnowski v. Vans
Skate Park, 187 N.J. 323, 342 (2006)). In that regard, "[a]n agreement to
arbitrate 'must be the product of mutual assent, as determined under customary
principles of contract law.'" Barr v. Bishop Rosen & Co., Inc., 442 N.J. Super.
A-5601-18T1
11
599, 605-06 (App. Div. 2015) (quoting Atalese v. U.S. Legal Servs. Grp., L.P.,
219 N.J. 430, 442 (2014)). "Mutual assent requires that the parties understand
the terms of their agreement." Id. at 606.
Essentially, "[t]he key . . . is clarity; the parties must know at the time of
formation that 'there is a distinction between resolving a dispute in arbitration
and in a judicial forum.'" Id. at 607 (quoting Atalese, 219 N.J. at 445). "An
arbitration agreement that fails to 'clearly and unambiguously signal' to par ties
that they are surrendering their right to pursue a judicial remedy renders such an
agreement unenforceable." Id. at 606 (quoting Atalese, 219 N.J. at 444). Even
if an agreement contains unconscionable or otherwise unenforceable provisions,
a valid arbitration clause in a contract is severable and enforceable on its own.
Buckeye, 546 U.S. at 445; Delta Funding Corp. v. Harris, 189 N.J. 28, 46 (2006).
In Kleine, the plaintiff filed a personal injury action against the operator
of a nursing facility "that moved to compel arbitration of [the] plaintiff's claims
based on a clause contained in plaintiff's admission agreement." 445 N.J. Super.
at 547. We reversed the order compelling arbitration because
when the parties contracted, their exclusive forum for
arbitration was no longer available; there being no
agreement to arbitrate in any other forum, arbitration
could not be compelled. In short, even assuming the
clause was otherwise enforceable and consented to by
plaintiff, there was no meeting of the minds as to an
A-5601-18T1
12
arbitral forum if [the exclusive forum] was not
available. As Atalese instructs, the party from whom
such a provision has been extracted must be able to
understand—from clear and unambiguous language—
both the rights that have been waived and the rights that
have taken their place. Because [the exclusive forum]
was not available to administer the arbitration of this
dispute at the time the contract was formed, or even at
the time the trial court ruled on the application, the
judge mistakenly compelled arbitration of plaintiff's
personal injury claims against th[e] defendant.
[Id. at 552-53 (citation and footnotes omitted).]
Similarly, in Flanzman, we reversed the order compelling arbitration of
the eighty-two-year-old plaintiff's discrimination complaint against her
employer "because the parties failed to identify any arbitration forum and any
process for conducting the arbitration." 456 N.J. Super. at 617. We explained
that "[t]he mechanism or setting for the proceeding is important because the
rights associated with arbitration forums may differ depending on which forum
the parties choose, or on how they define the arbitral process." Ibid. By ignoring
"the subject altogether," we held that "the parties lacked a 'meeting of the minds'
because they did not understand the rights under the arbitration agreement that
ostensibly foreclosed plaintiff's right to a jury trial." Ibid.
While we acknowledged that the facts in Kleine were similar, we noted
that the difference was that in Kleine, the parties had in fact designated an
A-5601-18T1
13
arbitral forum, albeit an unavailable one. Flanzman, 456 N.J. Super. at 622. We
emphasized that
[o]ur opinion should not be misread to hold that the
parties' failure to identify a specific arbitrator renders
the agreement unenforceable. This is not a situation
where on the one hand, the parties generally addressed
in some fashion the process that foreclosed plaintiff's
right to a jury trial, but on the other hand, simply failed
to identify a specific method for selecting an arbitrator.
If that were the case, either party arguably could have
filed a motion under N.J.S.A. 2A:23B-11(a) [5] . . .
asking the judge to appoint the arbitrator.
[Id. at 623.]
We pointed out that 9 U.S.C. § 5 6 of the FAA was similar to N.J.S.A.
2A:23B-11(a), and we referred to Khan, where the court determined that 9
5
N.J.S.A. 2A:23B-11(a) provides:
If the parties to an agreement to arbitrate agree on a
method for appointing an arbitrator, that method shall
be followed, unless the method fails. If the parties have
not agreed on a method, the agreed method fails, or an
arbitrator appointed fails or is unable to act and a
successor has not been appointed, the court, on
application of a party to the arbitration proceeding,
shall appoint the arbitrator. An arbitrator so appointed
has all the powers of an arbitrator designated in the
agreement to arbitrate or appointed pursuant to the
agreed method.
6
9 U.S.C. § 5 provides:
A-5601-18T1
14
U.S.C. § 5 provided "a mechanism for substituting an arbitrator when the
designated arbitrator . . . is unavailable." Flanzman, 456 N.J. Super. at 625-26
(quoting Khan, 669 F.3d at 354). In Khan, the court explained that "[i]n
determining the applicability of [9 U.S.C. § 5] when an arbitrator is unavailable,
courts have focused on whether the designation of the arbitrator was 'integral' to
the arbitration provision or was merely an ancillary consideration." 669 F.3d at
354. "In this light, the parties must have unambiguously expressed their intent
not to arbitrate their disputes in the event that the designated arbitral forum is
unavailable." Ibid. Otherwise, 9 U.S.C. § 5 "requires a court to address such
unavailability by appointing a substitute arbitrator" and a "contrary conclusion
If in the agreement provision be made for a method of
naming or appointing an arbitrator or arbitrators or an
umpire, such method shall be followed; but if no
method be provided therein, or if a method be provided
and any party thereto shall fail to avail himself of such
method, or if for any other reason there shall be a lapse
in the naming of an arbitrator or arbitrators or umpire,
or in filling a vacancy, then upon the application of
either party to the controversy the court shall designate
and appoint an arbitrator or arbitrators or umpire, as the
case may require, who shall act under the said
agreement with the same force and effect as if he or
they had been specifically named therein; and unless
otherwise provided in the agreement the arbitration
shall be by a single arbitrator.
A-5601-18T1
15
is at odds with the fundamental presumption in favor of arbitration." Id. at 357.
See Hirsch, 215 N.J. at 186 (reinforcing "the strong preference to enforce
arbitration agreements, both at the state and federal level").
Here, the agreement designates JAMS as the arbitral forum, and JAMS
Expedited Arbitration Rules as the applicable rules of procedure governing the
proceedings. Thus, unlike Flanzman, an arbitral forum and a process for
conducting the arbitration were in fact selected by the parties. Further, unlike
Kleine, the agreement does not designate JAMS as the exclusive arbitral forum.
There is no language in the agreement indicating the parties' unambiguous intent
not to arbitrate the dispute if JAMS is unavailable, and no indication that the
designation of the arbitrator was integral to the arbitration provision . Indeed,
the agreement to arbitrate and the selection of JAMS as the arbitrator appear in
separate sentences, and the severability clause prescribes that if any term or
provision of the agreement is deemed unenforceable, "the validity of the
remaining portions shall not be affected thereby." See Delta Funding, 189 N.J.
at 46 (approving an "arbitration agreement's broad severability clause" and
finding that "if an arbitrator were to interpret all of the disputed provisions in a
manner that would render them unconscionable, . . . those provisions could be
A-5601-18T1
16
severed and . . . the remainder of the arbitration agreement would be capable of
enforcement").
Further, the agreement specifies that "any arbitration . . . shall be governed
by the [FAA]," suggesting that in the event of JAMS's unavailability, 9 U.S.C.
§ 5's mechanism for appointing a replacement arbitrator when the designated
arbitrator is unavailable shall apply. As we stated in Flanzman, "if after having
generally identified a forum — that is they have reached mutual assent — [the
parties] still remain unable to appoint a specific arbitrator, then they arguably
can make the appropriate application to the court for that purpose." 456 N.J.
Super. at 630. We conclude the parties here "reached a 'meeting of the minds'
as to what rights replaced the right to a jury trial," id. at 629, and entered into a
valid and enforceable arbitration agreement. Thus, the judge correctly
compelled arbitration, and, as requested by defendants, determined that she
would select an arbitrator if the parties were unable to agree on one as required
under 9 U.S.C. § 5.
Plaintiffs also argue that applying "the JAMS Rule 16.1 expedited
procedures" specified in the agreement "to a complex personal injury case, such
as this, is unconscionable and intended to give . . . [d]efendants unfair advantage
A-5601-18T1
17
in the dispute resolution process."7 Plaintiffs contend that because they "have
virtually no chance of achieving justice under the expedited JAMS rules ,"
"[d]efendants' effort, through an arbitration provision, to restrict discovery in a
personal injury case, where negligence, gross negligence and wanton willful
conduct are alleged, should be found to be unconscionable and unenforceable
by the [c]ourt."
New Jersey law explicitly allows for contracting parties to select the
arbitral forum and the type of procedure to govern the resolution of the dispute.
See Perini Corp. v. Greate Bay Hotel & Casino, Inc., 129 N.J. 479, 490 (1992)
7
While JAMS's procedural rules place certain limitations on discovery, there
are exceptions conferring wide latitude upon the arbitrator to override the limits
and allow for broader discovery as necessary. Specifically, JAMS Rule 16.2(b)
outlines the procedure for document requests and provides that such requests
must (1) "be limited to documents that are directly relevant to the matters in
dispute or to its outcome;" (2) "be reasonably restricted in terms of time frame,
subject matter and persons or entities to which the requests pertain;" and (3) "not
include broad phraseology such as 'all documents directly or indirectly related
to.'" JAMS Rule 16.2(c) also limits electronic discovery to "sources used in the
ordinary course of business," but allows parties to request other electronic
documents based on "a showing of compelling need." Under JAMS Rule
16.2(d), depositions should be limited to one "per side," but the arbitrator may
determine, "based on all relevant circumstances, that more depositions are
warranted." JAMS Rule 16.2(e) permits written expert reports and expert
depositions "for good cause shown." Finally, under JAMS Rule 16.2(g),
discovery should not exceed "seventy-five . . . calendar days after the
[p]reliminary [c]onference" or "one hundred five . . . calendar days for expert
discovery (if any)." However, "[t]hese dates may be extended by the [a]rbitrator
for good cause shown."
A-5601-18T1
18
(explaining that, in agreeing to arbitrate disputes, "[p]arties can agree to follow
. . . the usual trial-type format, or they can agree to any other type of procedure
to resolve the dispute"); State Farm Guar. Ins. Co. v. Hereford Ins. Co., 454 N.J.
Super. 1, 6-7 (App. Div. 2018) ("Parties, of course, can contract for specific
procedures to govern their arbitration" and "can incorporate into their contract
by reference rules of arbitration organizations to govern their arbitration
proceedings.").
Nonetheless, having determined that the arbitration provision is
enforceable, plaintiffs' argument regarding the unenforceability of the
agreement based on the unconscionability of JAMS's expedited procedures
should be decided by the arbitrator. See Buckeye, 546 U.S. at 449 ("We reaffirm
. . . that, regardless of whether the challenge is brought in federal or state court,
a challenge to the validity of the contract as a whole, and not specifically to the
arbitration clause, must go to the arbitrator.").
However, we agree with plaintiffs that the judge erred in dismissing their
complaints with prejudice in conjunction with compelling arbitration. See
GMAC v. Pittella, 205 N.J. 572, 582 n.6 (2011) ("[T]he Uniform Arbitration
Act only provides for stays, rather than dismissals, of actions pending
arbitration." (citing N.J.S.A. 2A:23B-7(g))); Alfano v. BDO Seidman, LLP, 393
A-5601-18T1
19
N.J. Super. 560, 577 (App. Div. 2007) ("[U]nless it can be said with positive
assurance that an arbitration clause is not susceptible of an interpretation whi ch
would cover the dispute at issue, then a stay pending arbitration should be
granted." (alteration in original) (quoting Jansen v. Salomon Smith Barney, Inc.,
342 N.J. Super. 254, 257-58 (App. Div. 2001))). Therefore, we remand the
matter to the trial court to enter an amended order staying the action pending
arbitration.
Affirmed in part; remanded for the entry of an amended order consistent
with this opinion. We do not retain jurisdiction.
A-5601-18T1
20
PREETI SHARMA VS. SKY ZONE, LLC SAEDDA FARRAJ VS. SKY ZONE, LLC (L-0930-19 AND L-0931-19, MERCER COUNTY AND STATEWIDE) (CONSOLIDATED)
Combined Opinion