2017 Ohio 1035
Ohio Ct. App.2017Background
- Wisniewski contracted with Marek Builders for a home addition/remodel; contract signed at plaintiff’s home after in‑home solicitations.
- Wisniewski sent certified mail cancelling the contract under the Ohio Home Solicitation Sales Act (HSSA), alleging he was never given the required three‑day cancellation notice.
- Marek moved to stay the court case and compel arbitration under an arbitration clause in the contract; trial court granted the stay.
- Wisniewski appealed, arguing the contract (and thus the arbitration clause) was void under the HSSA, and alternatively that the arbitration clause was unconscionable or waived.
- The Eighth District majority held the HSSA applied, Wisniewski validly cancelled the contract, and statutory rescission defeated enforcement of the arbitration clause; it reversed the stay and remanded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the HSSA apply to the contract? | HSSA covers home improvement including additions; contract created by in‑home solicitation and lacked required cancellation notice. | Contract was for a home "addition" and defendant argued HSSA does not apply. | HSSA applies to the contract; facts show in‑home solicitation and no cancellation notice. |
| Was the contract effectively cancelled under the HSSA? | Wisniewski cancelled by certified mail; R.C. 1345.23(C) preserves right to cancel where notice omitted. | Marek did not dispute cancellation but argued unfairness because it performed work. | Cancellation was valid; performance before notice does not negate statutory right (contractor may seek unjust enrichment). |
| Does statutory rescission under the HSSA void the arbitration clause? | Rescission under statutory law can revoke an arbitration clause that resulted from conduct statutorily permitting revocation. | ABM Farms treats arbitration clause as separable and surviving rescission; arbitration clause should remain enforceable. | The court held statutory rescission under HSSA can invalidate the arbitration clause; trial court erred in compelling arbitration. |
| Was the arbitration clause unconscionable or otherwise unenforceable on its own terms? | Claimed unconscionability (procedural and substantive), hidden arbitration costs, and lack of meaningful consent. | Clause is short and standard; AAA rules give arbitrator discretion on costs; parties negotiated terms and had bargaining parity. | Because the majority found statutory rescission dispositive, it did not rely on unconscionability; dissent would have held clause enforceable on its own terms. |
Key Cases Cited
- ABM Farms, Inc. v. Woods, 81 Ohio St.3d 498 (1998) (arbitration clause is separable from underlying contract and survives challenges to contract generally unless clause itself is invalid)
- Taylor Bldg. Corp. of Am. v. Benfield, 117 Ohio St.3d 352 (2008) (party challenging arbitration must show the arbitration clause itself is unconscionable; unconscionability has procedural and substantive components)
- Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395 (1967) (valid arbitration clause generally delegates contract‑validity questions to arbitrators)
- Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614 (1985) (arbitration agreements can cover statutory claims; arbitration does not forfeit substantive statutory rights)
- Academy of Medicine of Cincinnati v. Aetna Health, Inc., 108 Ohio St.3d 185 (2006) (four‑part test for arbitrability and presumption of arbitrability)