Murea v. Pulte Group, Inc.
2014 Ohio 398
Ohio Ct. App.2014Background
- Murea, a purchaser of a new home from Pulte in 2003, signed a purchase agreement containing an arbitration clause and a limited warranty incorporated by reference.
- The arbitration clause requires mediation first and then arbitration under AAA rules and the FAA, with the limited warranty governing related claims.
- Schield Family Brands manufactured the Weather Shield and Visions 2000 windows installed in Murea's home, which allegedly leak, causing energy inefficiency.
- Murea asserted breach of warranty and breach of contract against Pulte and Schield based on alleged window defects.
- In February 2012, Murea filed suit; Pulte moved to stay litigation pending arbitration under R.C. 2711.02(B); the trial court denied the motion.
- The trial court's denial prompted Pulte's appeal, challenging the enforceability and scope of the arbitration clause and its purported unconscionability.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Validity and scope of arbitration agreement | Murea argues the arbitration clause is unconscionable and void for lack of consideration. | Pulte contends there is a valid, broad arbitration agreement covering the claims. | Arbitration agreement valid and scope includes Murea's claims. |
| Arbitration clause unconscionability | Murea contends procedural and substantive unconscionability due to adhesion and lack of meaningful choice. | Pulte argues the clause is conspicuously drafted and not procedurally unconscionable. | Clause not procedurally or substantively unconscionable; trial court erred in denying stay. |
| Remedy for undecided issues | N/A | N/A | Court reversed and remanded to stay litigation pending arbitration; costs awarded to Pulte. |
Key Cases Cited
- Schaefer v. Allstate Ins. Co., 63 Ohio St.3d 708 (1992) (strong state policy favoring arbitration; see arbitral presumptions)
- Williams v. Aetna Fin. Co., 83 Ohio St.3d 464 (1998) (strong presumption of arbitrability in stay actions)
- Taylor Bldg. Corp. of Am. v. Benfield, 117 Ohio St.3d 352 (2008) (two-prong test for unconscionability (procedural and substantive))
- Hayes v. Oakridge Home, 122 Ohio St.3d 63 (2009) (clarifies conjunctive requirement for unconscionability)
- Strack v. Pelton, 70 Ohio St.3d 172 (1994) (two-prong conjunctive test for unconscionability)