Foss v. Circuit City Stores, Inc. - 477 F. Supp. 2d 230 (D. Me. 2007)

Rule:

The U.S. Supreme Court has noted that arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit. Thus, a party seeking to invoke the protections of §§ 3 or 4 (9 U.S.C.S. §§ 3,4) of the Federal Arbitration Act must demonstrate, at a minimum, that a valid agreement to arbitrate exists. The determination of whether the court or the arbitrator is the proper decision-maker to resolve initial disputes turns on questions of contract formation and interpretation

Facts:

Plaintiff Andrew Foss sued defendant Circuit City Stores, Inc., claiming a hostile work environment and retaliation in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C.S. § 2000e et seq., and the Civil Rights Act of 1991, 42 U.S.C.S. § 1981(a). Defendant moved to compel arbitration and to stay the proceedings pursuant to § 2 and 4 (9 U.S.C.S. §§ 2, 4) of the Federal Arbitration Act (FAA). Plaintiff resisted the motion to compel arbitration, asserting that because he was under eighteen when he signed the Agreement and he never ratified the Agreement in writing, no valid contract was ever formed. Moreover, plaintiff claimed that even if there was a binding contract, the Agreement was unconscionable and therefore unenforceable. Defendant acknowledged that plaintiff was a minor when he signed the agreement. Nonetheless, it argued that plaintiff ratified the contract after turning 18 and that his parents had consented.

Issue:

Could arbitration be compelled, notwithstanding the issue on plaintiff’s infancy at the time he signed the agreement? 

Answer:

No.

Conclusion:

The court noted that arbitration was a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit. Thus, a party seeking to invoke the protections of sections 3 or 4 of the FAA must demonstrate, at a minimum, that a valid agreement to arbitrate was existing. In this case, it was undisputable that the plaintiff signed the agreement when he was less than eighteen years of age. The general law in Maine regarding the validity of a minor’s contract was clear – no action shall be maintained on any contract made by a minor, unless he, or some person lawfully authorized, ratified it in writing after he arrived at the age of 18 years. In this case, the court found that the forms of ratification offered by the defendant were insufficient: (i) defendant claimed that by completing and submitting daily time cards, plaintiff ratified the agreement; however, the court held that mere completion and submission of a time card, was, at most, an acknowledgement of the time actually worked; it does not evidence intent by the infant to be bound by an independent agreement to arbitrate; (ii) defendant also asserted that by continuing to work after turning eighteen, plaintiff expressly consented to the agreement; however, the court held that, in Maine, action was insufficient for ratification absent a deliberate written ratification; (iii) defendant finally alleged that plaintiff ratified the contract by filing the present lawsuit; however, the court held that plaintiff was suing on statutory grounds independent of the Agreement, not upon any provision or action under the contract. Accordingly, the court denied defendant's motion to compel arbitration and to stay the proceeding.