60 So. 3d 1079
Fla. Dist. Ct. App.2011Background
- Appellant Wendy Betts appeals a trial court order denying her renewed motion to appoint an arbitrator who could fulfill this court’s mandate directing arbitration on remand.
- The mandate stemmed from the court’s prior decision in Betts regarding class arbitration and illegality of the loan contracts under Florida law.
- NAF was designated as the arbitral forum under the arbitration agreement and its Code contains class arbitration rules interpreted consistent with the FAA.
- NAF demanded compliance with Rule 19 to proceed with class arbitration, requiring putative class members’ names and arbitration agreements; Betts withdrew her demand for arbitration and moved to dismiss.
- The trial court dismissed Betts’s suit with prejudice; Betts contends NAF’s unavailability and the Code’s class rules prevent compliance with the mandate, necessitating appointment of a substitute arbitrator.
- The court ultimately reverses and remands to evaluate appointment of an arbitrator under 9 U.S.C. § 5 to address whether the contract is usurious and whether class arbitration is permissible.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the trial court had jurisdiction to address the arbitrator appointment on plenary review. | Betts argues jurisdiction over the nonfinal order. | Appellees contend jurisdiction and law-of-the-case bar apply. | Jurisdiction exists; law-of-the-case not applicable. |
| Whether the trial court erred by dismissing with prejudice instead of enforcing the mandate. | Betts seeks enforcement of the mandate, not dismissal. | State that dismissal with prejudice was proper. | Dismissal with prejudice reversed; mandate to appoint arbitrator remains. |
| Whether a substitute arbitrator should be appointed if NAF is unavailable. | Arbitration should proceed with a substitute arbitrator under 9 U.S.C. § 5. | NAF’s unavailability complicates but does not end arbitration. | If NAF availability is not integral, appoint substitute arbitrator under §5. |
| Whether the arbitrator can determine class arbitration viability under Florida law. | Class arbitration rules in the Code may be unconscionable and conflict with public policy. | Arbitrator determines class arbitrability consistent with applicable law. | Arbitrator to resolve whether the contract allows class arbitration; court declines independent ruling. |
Key Cases Cited
- Dreggors v. Employers Ins. of Wausau, 16 So.3d 309 (Fla. 5th DCA 2009) (jurisdiction over nonfinal order on plenary appeal)
- Bloco, Inc. v. Porterfield Oil Co., 990 So.2d 578 (Fla. 2d DCA 2008) (law-of-the-case inapplicable when issue not decided previously)
- Betts v. FastFunding The Company, Inc., 950 So.2d 379 (Fla.2006) (mandate and arbitration framework guiding programmatic relief)
- Brown v. ITT Consumer Financial Corp., 211 F.3d 1217 (11th Cir.2000) (unavailability of chosen forum in arbitration)
- New Port Richey Med. Investors, LLC v. Stern, 14 So.3d 1084 (Fla. 2d DCA 2009) (appointing substitute arbitrator under §5 when forum lapse)
- McKenzie v. Betts, 55 So.3d 615 (Fla. 4th DCA 2011) (public policy considerations in class arbitration)
- Rollins, Inc. v. Garrett, 176 Fed.Appx. 968 (11th Cir.2006) (unconscionability of class arbitration in consumer contracts)
- Powertel, Inc. v. Bexley, 743 So.2d 570 (Fla. 1st DCA 1999) (unconscionability of class-action waiver)
- Green Tree Fin. Corp. v. Bazzle, 539 U.S. 444 (2003) (arbitrator decides class arbitration issues)
- Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440 (2006) (arbitrability of contract; arbitrator’s determination)
- Formor v. State, 923 So.2d 563 (Fla. 5th DCA 2006) (mandate compliance is ministerial)
- Della Penna v. Zabawa, 931 So.2d 155 (Fla. 5th DCA 2006) (interpretation of arbitration rules for arbitrator)