NOT FOR PUBLICATION WITHOUT THE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 NO. A-5388-16T3
MILAGROS ROMAN,
Plaintiff-Appellant,
v.
BERGEN LOGISTICS, LLC and
GREGG OLIVER,
Defendants-Respondents.
______________________________
Argued February 5, 2018 – Decided August 23, 2018
Before Judges Accurso, O'Connor and Vernoia.
On appeal from Superior Court of New Jersey,
Law Division, Bergen County, Docket No.
L-2652-17.
Peter D. Valenzano argued the cause for
appellant (Mashel Law, LLC, attorneys; Stephan
T. Mashel, of counsel and on the briefs; Peter
D. Valenzano, on the briefs).
Jessica L. Sussman argued the cause for
respondent Bergen Logistics, LLC (Jackson
Lewis PC, attorneys; Richard J. Cino, of
counsel; Jessica L. Sussman, on the brief).
Kyle L. Wu argued the cause for respondent
Gregg Oliver (Margolis Edelstein, attorneys;
Michael R. Miller and Kyle L. Wu, of counsel
and on the brief).
Thaddeus P. Mikulski, Jr., attorney for
amicus curiae National Employment Lawyers
Association of New Jersey, Inc. (Thaddeus P.
Mikulski, Jr. and Richard M. Schall, on the
brief).
PER CURIAM
Plaintiff Milagros Roman appeals from an order dismissing her
sexual harassment and retaliation complaint against defendants
Bergen Logistics, LLC and Gregg Oliver. Because we are convinced
the court correctly determined the complaint should be dismissed
because plaintiff agreed to arbitrate her claims, we affirm but
modify the court's order to permit plaintiff to pursue her punitive
damages claims in arbitration.
I.
In September 2015, Bergen Logistics hired plaintiff as a
human resources generalist. Oliver was Bergen Logistics's Human
Resources Director and plaintiff's immediate supervisor. He
terminated plaintiff's employment on December 30, 2015.
In an April 2017 Law Division complaint, plaintiff alleged
Oliver sexually harassed her and created a sexually hostile work
environment during her employment. She also alleged that after
she objected to his conduct and sexual advances, he retaliated
against her and terminated her employment. She asserted causes
of action against Bergen Logistics and Oliver under the New Jersey
2 A-5388-16T3
Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -49, and for
intentional infliction of emotional distress.
Defendants moved to dismiss the complaint, asserting
plaintiff was obligated to arbitrate her claims pursuant to the
arbitration agreement she signed when hired in September 2015. In
support of their motion, defendants relied on the agreement, which
refers to plaintiff as "you" and Bergen Logistics as the "Company,
and provides in pertinent part that "[a]s an express condition of"
plaintiff's "hiring" and "continu[ed]" employment by Bergen
Logistics she agreed:
(i) all (past, present and future) disputes,
controversies and claims of any nature
(whether under federal, state or local laws
and whether based on contract, tort, common
law, statute . . .) arising out of, involving,
affecting or related in any way to your . . .
employment . . . and/or termination of
employment by or from Company, the conditions
of your employment, or any act or omission of
Company or Company's other employees shall be
resolved exclusively by final and binding
arbitration before the American Arbitration
Association . . . . This Agreement covers all
employment matters, including but not limited
to matters directly or indirectly related to
wrongful termination, . . . discrimination,
harassment, retaliation (in the whistle blower
or any other context), . . . and any other
violation of state, federal or common law . .
. .
. . . .
(iii) neither you nor Company shall file or
maintain any lawsuit, action or legal
3 A-5388-16T3
proceeding of any nature with respect to any
dispute, controversy or claim within the scope
of this Agreement, including, but not limited
to, any lawsuit, action or legal proceeding
challenging the arbitrability of any such
dispute . . . . BY SIGNING THIS AGREEMENT YOU
AND COMPANY ARE WAIVING ANY RIGHT, STATUTORY
OR OTHERWISE, TO A TRIAL BY JURY AND TO
PUNITIVE AND EXEMPLARY DAMAGES . . . .
. . . .
YOU ACKNOWLEDGE AND AGREE THAT YOU . . . READ
THIS AGREEMENT AND . . . HAD SUFFICIENT TIME
TO STUDY AND CONSIDER IT AND TO CONSULT WITH
COUNSEL OF YOUR CHOICE, THAT YOU UNDERSTAND
ALL OF ITS TERMS AND ARE SIGNING THIS
AGREEMENT KNOWINGLY AND VOLUNTARILY, AND THAT
IN DOING SO YOUR ARE NOT RELYING UPON ANY OTHER
STATEMENTS OR REPRESENTATIONS BY THE COMPANY,
ITS AFFILIATE OR THEIR EMPLOYEES OR
AGENTS . . . .
Plaintiff opposed the motion, arguing the agreement was
unenforceable as against public policy because it barred her
recovery of punitive damages otherwise available under the LAD.
See N.J.S.A. 10:5-3 (providing for the recovery of punitive damages
for LAD claims). Plaintiff also asserted the agreement was
unenforceable because she was unable to read it when it was
presented, it was not written in plain language and she did not
read it before signing it.
After hearing argument, the court issued a written opinion
finding plaintiff knowingly signed the agreement, and that it
contained an unambiguous waiver of claims for "punitive and
4 A-5388-16T3
exemplary damages."1 The court found plaintiff's hiring and
continued employment provided consideration for the agreement,
which covered the claims asserted in the complaint, was binding
and required submission of her claims to arbitration. The court
entered an order dismissing the complaint. This appeal followed.
II.
Plaintiff first contends the court erred by dismissing the
complaint because the arbitration agreement's punitive damages
waiver violates the public policy underlying the LAD, thereby
rendering the agreement unenforceable.2 Bergen Logistics and
Oliver contend punitive damages waivers do not violate public
policy and therefore there is no basis to void plaintiff's
obligation to arbitrate her claims under the agreement's plain
language.
We review the court's order dismissing the complaint de novo
because it is founded on a determination of a question of law -
the validity of the arbitration agreement. Barr v. Bishop Rosen
1
We note that although the arbitration agreement refers to
"punitive and exemplary damages," the two are one and the same.
See Fischer v. Johns-Manville Corp., 103 N.J. 643, 654 (1986)
(referring to punitive damages and exemplary damages
interchangeably); Restatement (Second) of Torts § 908(1) (Am. Law
Inst. 1979) (noting that punitive damages are frequently called
"exemplary" damages).
2
Amicus curiae, National Employment Lawyers Association of New
Jersey, Inc., make the same argument.
5 A-5388-16T3
& Co., Inc., 442 N.J. Super. 599, 605 (App. Div. 2015). "Our
review of a contract, generally, is de novo, and therefore we owe
no special deference to the trial court's . . . interpretation.
Our approach in construing an arbitration provision of a contract
is governed by the same de novo standard of review." Atalese v.
U.S. Legal Servs. Grp., L.P., 219 N.J. 430, 445-46 (2014)
(citations omitted).
The Federal Arbitration Act (FAA), 9 U.S.C. §§ 1 to 16, and
the New Jersey Arbitration Act (NJAA), N.J.S.A. 2A:23B-1 to -32,
reflect federal and state policies favoring arbitration of
disputes. Roach v. BM Motoring, LLC, 228 N.J. 163, 173-74 (2017);
Hojnowski v. Vans Skate Park, 187 N.J. 323, 342 (2006). The FAA
was enacted "to 'reverse the longstanding judicial hostility'
towards arbitration agreements and to 'place arbitration
agreements upon the same footing as other contracts,'" Roach, 228
N.J. at 173 (quoting Gilmer v. Interstate/Johnson Lane Corp., 500
U.S. 20, 24 (1991)), and "preempts state laws that single out and
invalidate arbitration agreements," id. at 174 (citing Doctor's
Assocs. v. Casarotto, 517 U.S. 681, 687 (1996)). A court "'cannot
subject an arbitration agreement to more burdensome requirements
than' other contractual provisions." Ibid. (quoting Atalese, 219
N.J. at 441).
6 A-5388-16T3
"The preference for arbitration 'is not without limits,'"
Hirsch v. Amper Fin. Servs., LLC, 215 N.J. 174, 187 (2013) (quoting
Garfinkel v. Morristown Obstetrics & Gynecology Assocs., 168 N.J.
124, 132 (2001)), and "[t]he right of freedom to contract 'is not
such an immutable doctrine as to admit of no qualification,'"
Rodriguez v. Raymours Furniture Co., Inc., 225 N.J. 343, 361
(2016) (quoting Henningsen v. Bloomfield Motors, Inc., 32 N.J.
358, 388 (1960)). "[S]tate contract-law principles generally
govern a determination whether a valid agreement to arbitrate
exists." Hojnowski, 187 N.J. at 342. Thus, "[a]n arbitration
clause may be invalidated 'upon such grounds as exist at law or
in equity for the revocation of any contract.'" Martindale v.
Sandvick, Inc., 173 N.J. 76, 85 (2002); see also Morgan v. Sanford
Brown Inst., 225 N.J. 289, 303-04 (2016) ("Under the FAA, an
arbitration agreement, like any contract, may be held invalid
'upon such grounds as exist at law or in equity for the revocation
of any contract.'"); Rent-A-Center, W., Inc. v. Jackson, 561 U.S.
63, 68 (2010) (quoting Casarotto, 517 U.S. at 687) (finding
arbitration agreements "may be invalidated by 'generally
applicable contract defenses, such as fraud, duress, or
unconscionability'").
Our courts have "recognize[d] that an individual may agree
by contract to submit his or her statutory LAD claim to alternative
7 A-5388-16T3
dispute resolution and therefore different processes," Rodriquez,
225 N.J. at 364, and applied state contract law principles in
enforcing agreements requiring arbitration of employment-related
claims, see, e.g., Martindale, 173 N.J. at 91-92 (finding an
arbitration agreement in an employment application constitutes a
binding contractual obligation); Young v. Prudential Ins. Co. of
Am., Inc., 297 N.J. Super. 605, 618 (App. Div. 1997) (enforcing
an agreement to arbitrate LAD claims and claims arising under the
Conscientious Employee Protection Act, N.J.S.A. 34:19-1 to -14).
Applying contract principles, our courts have also determined
agreements otherwise requiring arbitration of employment-related
claims are unenforceable. See, e.g., Leodori v. Cigna Corp., 175
N.J. 293, 302-07 (2003) (finding an arbitration requirement in
an employee handbook was not binding because there was no evidence
the plaintiff consented to it); Garfinkel, 168 N.J. at 132-36
(finding an arbitration agreement too ambiguous to constitute a
binding contractual obligation waiving the right to a trial by
jury); Quiqley v. KPMG Peat Marwick, LLP, 330 N.J. Super 252, 270-
73 (App. Div. 2000) (finding an arbitration agreement
unenforceable as to the plaintiff's LAD claims because the contract
did not clearly cover such claims).
In Rodriguez, the Court determined an arbitration agreement
provision requiring the filing of an employee's LAD claim within
8 A-5388-16T3
six months of its accrual was unenforceable under general contract
principles because it violated the public policy embodied in the
LAD. 225 N.J. at 363-66. The Court noted that "the right of
freedom to contract 'is not such an immutable doctrine as to admit
of no qualification,'" and "[t]he right must recede to 'prevent
its abuse, as otherwise it could be used to override all public
interests.'" Id. at 361 (quoting Henningsen, 32 N.J. at 388).
The Court found the LAD "exists for the good of all the
inhabitants of New Jersey," and is "imbued with a public-interest
agenda" of eliminating discrimination. Ibid. Thus, the Court
reasoned that a "contractual limitation on an individual's right
to pursue and eradicate discrimination of any form prohibited
under the LAD is not simply . . . a private matter," but instead
"would curtail a claim designed to also further a public interest."
Ibid. The Court found the two-year statute of limitations for the
filing of a LAD claim recognized in Montells v. Haynes, 133 N.J.
282 (1993), has been tacitly approved by the Legislature, and is
"woven . . . into the fabric of the LAD" and "part of the statutory
program and how it operates." Id. at 362.
The Court observed that although an individual may agree by
contract to submit his or her LAD claims to arbitration, "in
permitting the submission of an LAD claim to an alternative forum
by operation of contract, the contract is examined to determine
9 A-5388-16T3
whether substantive rights have been precluded." Id. at 364. The
Court determined the arbitration agreement requiring that LAD
claims be filed within six months was unenforceable because it "is
contrary to the public policy expressed in the LAD," ibid.,
"undermines the integrated nature of the statutory avenues of
relief and the election of remedies available to victims of
discrimination," id. at 362, and would "effectively eliminate[ ]
claims,"3 id. at 363; see also Van Duren v. Rzasa-Ormes, 394 N.J.
Super. 254, 267-68 (App. Div. 2007) (finding an arbitration
agreement provision foreclosing judicial review of an arbitration
award void as against public policy).
Measured against the standard employed by the Court in
Rodriguez, we are persuaded the arbitration agreement's bar of
punitive damages claims under the LAD is unenforceable because it
violates the public policy embodied in the LAD. Our Supreme Court
has "long recognized that the essential purpose of the LAD is the
3
The Court also observed that "contracts, or discrete contract
provisions," may be unenforceable because they are unconscionable.
Id. at 366. However, the Court found it unnecessary to decide if
the arbitration agreement's provision requiring that LAD claims
be filed within six months was unconscionable because it otherwise
violated public policy. Ibid. We similarly do not address whether
the punitive damages bar under the arbitration agreement is
unenforceable as unconscionable, see Muhammad, 189 N.J. at 15
(explaining the standard for determining whether an arbitration
agreement is unenforceable as unconscionable), because we
determine the provision is unenforceable because it violates
public policy.
10 A-5388-16T3
'eradication of the cancer of discrimination.'" Quinlan v.
Curtiss-Wright Corp., 204 N.J. 239, 258 (2010) (quoting Fuchilla
v. Layman, 109 N.J. 319, 334 (1988)); accord Rodriguez, 225 N.J.
at 361. The Court has "been vigilant in interpreting the LAD in
accordance with that overarching purpose," Quinlan, 204 N.J. at
259, and "scrupulous in [its] insistence that the [LAD] be applied
to the full extent of its facial coverage,'" ibid. (quoting Bergen
Commercial Bank v. Sisler, 157 N.J. 188, 216 (1999)).
In 1990, the Legislature amended the LAD to permit the
recovery of punitive damages. L. 1990, c. 12. The amendment
includes an unambiguous declaration of public policy providing a
substantive remedy to victims of discrimination: "[t]he
Legislature intends that [punitive] damages be available to all
persons protected by" the LAD. L. 1990, c. 12; N.J.S.A. 10:5-3.
"Awards of punitive damages [under the LAD] . . . serve
particular purposes, which [the Court has] described as 'the
deterrence of egregious misconduct and the punishment of the
offender.'" Quinlan, 204 N.J. at 273 (quoting Herman v. Sunshine
Chem. Specialties, Inc., 133 N.J. 329, 337-38 (1993)); see also
Fischer, 103 N.J. at 657 (citation omitted) ("The doctrine of
punitive damages survives because it continues to serve the useful
purposes of expressing society's disapproval of intolerable
conduct and deterring such conduct where no other remedy would
11 A-5388-16T3
suffice."). Our Supreme Court "view[s] the . . . scope of an
employer's liability for compensatory and punitive damages as a
question of public policy," to be resolved in a manner "provid[ing]
the most effective intervention and prevention of employment
discrimination." Lehmann v. Toys 'R' Us, Inc., 132 N.J. 587, 625
(1993).
The availability of punitive damages serves the LAD's public
policy of eradicating employment discrimination by focusing on the
deterrence and punishment of particularly serious discriminatory
conduct by certain employees. See Fischer, 103 N.J. at 657 (noting
that punitive damages "punish the wrongdoer" and "deter both the
wrongdoer and others from similar conduct in the future").
Punitive damages may be awarded under the LAD only where there is
"proof that there was 'actual participation by upper management
or willful indifference,' and proof that the conduct was
'especially egregious.'" Quinlan, 204 N.J. at 274 (quoting Rendine
v. Pantzer, 141 N.J. 292, 313-14 (1995)). "[F]or an employer to
be held liable for punitive damages under the LAD, there must be
some involvement by a member of the employer's upper management."
Cavuoti v. N.J. Transit Corp., 161 N.J. 107, 117 (1999). The
Court has defined those employees who may be properly considered
to be in upper management, see id. at 128-29, and stated the
"purpose of the definition of 'upper management' is to 'provid[e]
12 A-5388-16T3
employers with the incentive not only to provide voluntary
compliance programs'" directed at eliminating workplace
discrimination, "but also to insist on the effective enforcement
of their programs . . . [,]" id. at 128 (alteration in original)
(quoting Lehmann, 131 N.J. at 626).
In our view, a contractual provision barring an employee's
access to punitive damages under the LAD not only violates public
policy by eliminating a remedy the Legislature expressly declared
is available to all victims of discrimination under the statute,
see Martindale, 173 N.J. at 93-94 (enforcing an agreement to
arbitrate LAD claims in part because none of the plaintiff's
substantive rights and remedies under the statute were affected);
N.J.S.A. 10:5-3, it also eviscerates an essential element of the
LAD's purpose – deterrence and punishment of the most egregious
discriminatory conduct by employees who, by virtue of their
position and responsibilities, see Cavuoti, 161 N.J. at 128-29
(providing the standards for inclusion in upper management),
control employer policies and actions that should prevent
discriminatory conduct in the workplace. An agreement barring the
recovery of punitive damages to victims of employment
discrimination under the LAD allows an employer's upper management
to be willfully indifferent to the most egregious forms of
discriminatory conduct without fear of punishment and without the
13 A-5388-16T3
incentive to stop or prevent the discriminatory conduct that the
availability of punitive is intended to provide. We find such a
result is contrary to the public policy underlying the LAD – the
eradication of discrimination – and therefore the arbitration
agreement's bar to the recovery of punitive damages is
unenforceable as against public policy. Rodriguez, 225 N.J. at
361; see also Estate of Anna Ruszala ex. rel. Mizerak v. Brookdale
Living Cmtys., Inc., 415 N.J. Super. 272, 298-99 (App. Div. 2010)
(finding an arbitration agreement provision precluding recovery
of punitive damages otherwise available under the Nursing Home
Responsibilities and Rights of Residents Act, N.J.S.A. 30:13-1 to
-17, is "void and unenforceable under the doctrine of substantive
unconscionability").
As we determined in Ruszala, where we found an arbitration
agreement provision precluding the recovery of punitive damages
unenforceable, "the remedy here is to enforce our federal policy
in favor of arbitration, while excising . . . restrictions we have
concluded are unenforceable." 415 N.J. Super. at 300; see also
Muhammad, 189 N.J. at 26 (finding an arbitration agreement's class-
arbitration waiver was unenforceable and severing the waiver
provision). We reject plaintiff's claim that severance of the
unenforceable provision barring recovery of punitive damages is
not appropriate because the arbitration agreement does not
14 A-5388-16T3
expressly provide for severance. See, e.g., Muhammad, 189 N.J.
at 26 (rejecting the argument that severance of an unenforceable
contract provision was inappropriate in part because the agreement
reflected an intention that the contract would be implemented
without the unenforceable provision); Ruszala, 415 N.J. Super. at
300 (concluding severance of unenforceable contract provisions was
appropriate "as provided for in the arbitration agreement").
"[I]f a contract contains an illegal provision, if such
provision is severable [we] will enforce the remainder of the
contract after excising the illegal position." Naseef v. Cord,
Inc., 90 N.J. Super. 135, 143 (App. Div.), aff'd, 48 N.J. 317
(1966). In Van Duren, 394 N.J. Super. at 268, the arbitration
agreement did not address severability, but we nevertheless
determined that an unenforceable provision barring judicial review
of an arbitration award should be severed because "the agreement
[was] otherwise valid and enforceable." As the Third Circuit
Court of Appeals stated in a similar context, "[y]ou don’t cut
down the trunk of a tree because some of its branches are sickly."
Spinetti v. Serv. Corp. Int'l, 324 F.3d 212, 214 (3d Cir. 2003).
We are satisfied the unenforceable prohibition against the
recovery of punitive damages should be severed from the otherwise
valid agreement to arbitrate the claims asserted in the complaint.
15 A-5388-16T3
The parties shall do so, however, without any limitation on
plaintiff's right to recover punitive or exemplary damages.
III.
Plaintiff next argues that even if the punitive damages waiver
provision is valid or otherwise severable, the arbitration
agreement is unenforceable because she did not knowingly and
voluntarily enter into an agreement to arbitrate the claims
asserted in the complaint. More particularly, she contends the
arbitration agreement did not include a sufficiently clear waiver
of her right to litigate her claims in court, her right to a jury
trial and her right to punitive and exemplary damages. She also
argues she did not knowingly waive any of her rights because she
was not provided an opportunity to take the document home, did not
have legal counsel, was not told she was giving up her right to
proceed to court, and did not understand what the terms "punitive"
and "exemplary" meant. Last, she claims she was entitled to a
plenary hearing on her claim that she did not knowingly and
voluntarily waive her rights by entering into the arbitration
agreement.
An arbitration agreement, "like any other contract, 'must be
the product of mutual assent, as determined under customary
principles of contract law.'" Atalese, 219 N.J. at 442 (citation
omitted). "Mutual assent requires that the parties have an
16 A-5388-16T3
understanding of the terms to which they have agreed." Ibid.
"This requirement of a 'consensual understanding' about the rights
of access to the courts that are waived in the agreement has led
our courts to hold that clarity is required." Moore v. Woman to
Woman Obstetrics & Gynecology, L.L.C., 416 N.J. Super. 30, 37
(App. Div. 2010) (citation omitted).
"By its very nature, an agreement to arbitrate involves a
waiver of a party's right to have her claims and defenses litigated
in court." Atalese, 219 N.J. at 442 (citation omitted). However,
"an average member of the public may not know — without some
explanatory comment — that arbitration is a substitute for the
right to have one's claim adjudicated in a court of law." Ibid.
Plaintiff's claim that the agreement does not adequately
state she waived her right to proceed in court and to a jury trial
is undermined by the agreement's plain language. The agreement
states that plaintiff and Bergen Logistics agree not to "file or
maintain any lawsuit, action or legal proceeding of any nature
with respect to any dispute, controversy or claim within the scope
of [the] Agreement," and that "BY SIGNING [THE] AGREEMENT
[PLAINTIFF] AND THE COMPANY ARE WAIVING ANY RIGHT, STATUTORY OR
OTHERWISE TO A TRIAL BY JURY." The agreement also expressly states
that any covered claims "shall be resolved exclusively by final
and binding arbitration." In Atalese, the Court held "the absence
17 A-5388-16T3
of any language in the arbitration provision that plaintiff was
waiving her statutory right to seek relief in a court of law
renders the provision unenforceable." Id. at 436. Here, the
arbitration agreement informed plaintiff that the exclusive forum
for resolution of her claims was arbitration, she was prohibited
from filing any other lawsuits or legal proceedings and she waived
her right to a trial by jury.
The Court in Atalese provided "examples of language
sufficient to meet these expectations." Barr, 442 N.J. Super. at
606. Our Supreme Court noted our decision in Griffin v. Burlington
Volkswagen, Inc., 411 N.J. Super. 515, 518 (App. Div. 2010), where
we "upheld an arbitration clause, which expressed that '[b]y
agreeing to arbitration, the parties understand and agree that
they are waiving their rights to maintain other available
resolution processes, such as a court action or administrative
proceeding, to settle their disputes.'" Atalese, 219 N.J. at 445.
In Atalese, the Court also cited an arbitration clause stating
"the plaintiff agreed 'to waive [her] right to a jury trial,'" and
another where the arbitration clause stated: "Instead of suing in
court, we each agree to settle disputes . . . only by arbitration,"
where "[t]here's no judge or jury." Id. at 444-45 (citations
omitted). A valid arbitration agreement does not require advice
on all component rights encompassed in a waiver of seeking relief
18 A-5388-16T3
in court. Such a requirement would render arbitration clauses too
complex, hard to understand, and easy to invalidate, in
contravention of the strong public policy favoring arbitration.
See Jaworski v. Ernst & Young U.S. LLP, 441 N.J. Super. 464, 480-
81 (App. Div. 2015) (upholding an arbitration clause stating the
parties would not "be able to sue in court," and rejecting
plaintiffs' argument that the "the arbitration agreement must
inform the parties of (1) the number of jurors, (2) the parties'
rights to choose the jurors, (3) how many jurors would have to
agree on a verdict, and (4) who will decide the dispute instead
of the jurors.").
Here, the agreement made clear that the parties opted for
arbitration to resolve their disputes rather than "lawsuit[s],
action or [other] legal proceeding[s]," and the arbitration would
be conducted before the American Arbitration Association, not a
court. The agreement expressly provided, in bold letters, that
plaintiff and Bergen Logistics waived their right to a trial by
jury. Thus, the record provides no support for plaintiff's claim
the arbitration agreement did not provide adequate notice
plaintiff waived her right to prosecute her claims in a court
proceeding and to a trial by jury. An enforceable arbitration
agreement "at least in some general and sufficiently broad way,
must explain that plaintiff is giving up her right to bring her
19 A-5388-16T3
claims in court or have a jury resolve the dispute." Atalese, 219
N.J. at 447. The arbitration agreement meets that standard here.4
We also reject plaintiff's contention the agreement is not
enforceable because she was not provided an opportunity to read
it, could not understand it or was not informed of her right to
confer with counsel. The argument is also contradicted by the
plain language of the agreement, stating that by its execution
plaintiff acknowledged and agreed she read it, had sufficient time
to study and consider it, had sufficient time to confer with
counsel of her choice, understood its terms, signed it knowingly
and voluntarily, and did not rely on any statements or
representations by Bergen Logistics in doing so. In plaintiff's
submissions, she does not address this provision of the agreement
or contend she did not, or could not, understand it.
4
Because we have determined the agreement's putative waiver of
plaintiff's right to seek punitive and exemplary damages is
unenforceable, it is unnecessary to address her claim she did not
knowingly and voluntarily agree to the waiver because the term
"punitive and exemplary damages" was not explicitly defined in the
agreement. We observe, however, that the damages waiver was
clearly and unequivocally stated in the agreement, and plaintiff's
inability to understand the term would not otherwise have been a
defense to the enforceability of the arbitration agreement. See
New Gold Equities Corp. v. Jaffe Spindler Co., 453 N.J. Super 358,
381 (App. Div. 2018) (noting the general rule that a party to a
contract is presumed to have read and understood its terms absent
a showing of fraud or misconduct).
20 A-5388-16T3
Moreover, "[a] party who enters into a contract in writing,
without any fraud or imposition being practiced upon him, is
conclusively presumed to understand and assent to its terms and
legal effect." Rudbart v. N. Jersey Dist. Water Supply Comm'n,
127 N.J. 344, 353 (1992) (quoting Fivey v. Pa. R.R. Co., 67 N.J.L.
627, 632 (E. & A. 1902)). An employee who signs but claims to not
understand an arbitration agreement will not be relieved from an
arbitration agreement on those grounds alone. See Booker v. Robert
Half Int'l, Inc., 315 F. Supp. 2d 94, 101 (D.D.C. 2004) ("Failing
to read or understand an arbitration agreement, or an employer's
failure to explain it, simply will not constitute 'special
circumstances' warranting relieving an employee from compliance
with the terms of an arbitration agreement that she signed.").
Thus, plaintiff's claims she was unable to read or understand the
agreement and, for some undisclosed reason, precluded from
conferring with her counsel are unavailing, and did not require a
plenary hearing.
Plaintiff's remaining arguments are without sufficient merit
to warrant discussion in a written opinion.5 R. 2:11-3(e)(1)(E).
5
We note that at oral argument, plaintiff's counsel argued for
the first time that the arbitration agreement contained an
unenforceable fee-shifting provision, and that the combination of
the fee-shifting provision and punitive damages waiver constituted
and integrated scheme that rendered the agreement unenforceable.
21 A-5388-16T3
In sum, we affirm the court's order dismissing the complaint.
The parties may proceed to arbitration in accordance with the
arbitration agreement, but the provision barring recovery of
punitive and exemplary damages is unenforceable and void.
Plaintiff shall be permitted to prosecute her claims for such
damages at arbitration.
Affirmed as modified.
We do not address the fee-shifting argument either alone or as it
pertains to any purported scheme because it was not raised before
the motion court and does not involve jurisdictional or public
interest concerns, Zaman v. Felton, 219 N.J. 199, 226-27 (2014),
and was not briefed on appeal, see Jefferson Loan Co., Inc. v.
Session, 397 N.J. Super. 520, 525 n.4 (App. Div. 2008) (finding
that an issue not briefed on appeal is deemed waived).
22 A-5388-16T3
MILAGROS ROMAN VS. BERGEN LOGISTICS, LLC (L-2652-17, BERGEN COUNTY AND STATEWIDE)
Court: New Jersey Superior Court Appellate Division
Date filed: 2018-08-23
Citations: 192 A.3d 1029, 456 N.J. Super. 157
Copy CitationsCombined Opinion