In Firstlight Federal Credit Union v. Loya, the Eighth District Court of Appeals held that the trial court abused its discretion in refusing to compel arbitration. The court held that Loya, an at-will employee, was bound by the arbitration agreement as a matter of law despite her lack of signature because she continued working after receiving notice of the arbitration agreement. According to the Court of Appeals, there was evidence that Loya received a notice of the arbitration policy and acknowledged its receipt electronically through a secure web-portal. It was undisputed that Loya did not print, sign, and return the online version of the company’s Dispute Resolution Policy & Procedure.

The Court of Appeals also examined the “delegation clause” of the agreement–that portion of the agreement that determines whether the court or the arbitrator has the power to rule on gateway issues, such as the validity and enforceability of the arbitration agreement. Here, the Court of Appeals held that the agreement to arbitrate “clearly and unmistakably” provided that the gateway issues of validity and enforceability belong to the arbitrator and not the court.

The trial court, however, determines the scope of the arbitration agreement because that is a separate issue from its validity and enforceability and in this case, the agreement did not clearly and unmistakably delegate the issue of scope of the agreement to the arbitrator. Similarly, whether an agreement to arbitrate exists was an issue for the trial court.

On the issue of lack of signature by the employee, the Court of Appeals held that neither the FAA nor Texas law requires arbitration clauses to be signed, so long as they are written and agreed to by the parties. In the absence of a signature, a party’s conduct may be some evidence of an intent to be bound by an agreement to arbitrate.

Read original article


Tags: