Miller v. GGNSC Atlanta, LLC
323 Ga. App. 114
| Ga. Ct. App. | 2013Background
- Miller admitted to Golden Living Center-Northside in Jan 2010 and signed a Resident and Facility Arbitration Agreement.
- Arbitration clause requires disputes to be resolved exclusively by binding arbitration under the National Arbitration Forum (NAF) Code of Procedure, at a forum chosen by the parties or at the facility, governed by the FAA.
- NAF is headquartered in Minneapolis; in July 2009 Minnesota authorities entered a consent judgment prohibiting NAF from administering consumer arbitrations after July 24, 2009.
- Miller challenges the arbitration, alleging NAF unavailability makes the agreement impossible to enforce, and argues unconscionability and Miller’s supposed incompetence to sign the agreement.
- Trial court denied compulsory arbitration, finding no impossibility or unconscionability but allowing a competency jury question; the matter proceeded on interlocutory appeal.
- Georgia appellate court adopts an 'integral term' approach and holds NAF availability is integral; unavailability renders the arbitration agreement unenforceable and thus void, vacating the trial court order.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is the arbitration clause void for impossibility due to NAF unavailability? | Miller: NAF unavailability makes enforcement impossible. | Golden Living: FAA §5 may allow substitute arbitrator; otherwise enforceability persists. | Yes, the agreement is impossible to enforce and unenforceable. |
| Is the NAF designation an integral term vs. an ancillary logistical concern? | NAF is integral to arbitration; without NAF, contract fails. | Designation of NAF could be severed to allow alternative administration. | NAF designation is integral; severance not allowed; substitution not permitted. |
| Does FAA §5 apply to appoint a substitute arbitrator when the chosen forum is unavailable? | §5 may permit substitution if forum unavailable. | §5 would override contract terms; not appropriate here. | §5 does not apply; unavailability renders the agreement unenforceable. |
Key Cases Cited
- Yates v. CACV of Colorado, LLC, 303 Ga. App. 425 (2010) (review of arbitration enforceability; contract defenses apply)
- Brown v. ITT Consumer Financial Corp., 211 F.3d 1217 (11th Cir. 2000) (forum unavailability may void arbitration under FAA §5)
- Riley v. Extendicare Health Facilities, 826 N.W.2d 398 (Wis. App. 2012) (NAF designation shown as integral term)
- Carr v. Gateway, Inc., 944 N.E.2d 327 (Ill. 2011) (NAF integration and severability considerations)
- Rivera v. American Gen. Fin. Svcs., 259 P.3d 803 (N.M. 2011) (unavailability of forum and corresponding rules)