In the instant case, Mr. James Dunlap, 1 who is a plaintiff below and the petitioner before this Court, claims in a civil lawsuit filed in May of 2000 in the Circuit Court of Kanawha County that Friedman’s, Inc., a jewelry store chain doing business in West Virginia (“Friedman’s”); Friedman’s insurance company partners, American Bankers Insurance Company of Florida and American Bankers Life Assurance Company of Florida (together, American Bankers”); and certain named individuals who are or were managerial employees of Friedman’s — all of whom are the defendants below and the respondents in the instant ease before this Court (we shall refer to these respondents together as “Friedman’s et al.”) — have been carrying out a systematic, deceptive, and illegal “loan packing” scheme, with the purpose and effect of surreptitiously adding unrequested insurance charges to the cost of consumers’ purchases from Friedman’s. In Mr. Dunlap’s case, allegedly illegal charges in the amounts of $1.48 for credit life insurance and $6.96 for property insurance were added when Mr. Dunlap bought a ring from Friedman’s in 1999; we discuss the details of that purchase infra.
The circuit court concluded that Mr. Dunlap could not go forward with his lawsuit against Friedman’s et al. in the circuit court because of certain language in Friedman’s purchase and financing agreement document, a form contract that Mr. Dunlap, signed when he bought the ring. The circuit court stayed the prosecution of Mr. Dunlap’s civil lawsuit against Friedman’s et al., and directed Mr. Dunlap (over his objection) to proceed to arbitration proceedings with Friedman’s et al., pursuant to language in the purchase and *552 financing agreement document. Challenging the circuit court’s order, Mr. Dunlap has petitioned this Court for a writ of prohibition; we conclude that the circuit court’s order was eironeous.
I.
Facts & Background
Mr. Dunlap filed suit against Friedman’s et al. on May 4, 2000. His complaint (we refer here to an amended complaint that the circuit court permitted to be filed) charges that Friedman’s et al. have been engaged in an illegal, fraudulent, and unconscionable scheme to charge customers, without the customers’ request, knowledge, and/or consent, for credit life insurance, credit disability insurance, and property insurance — all in connection with the purchase and financing of jewelry and/or other consumer goods from Friedman’s.
Mi’. Dunlap specifically alleges that Friedman’s systematically and deliberately directed its employees to conceal and lie about these added charges — going so far as to discharge or threaten to discharge employees who would not go along with the added charges/concealment scheme. Mr. Dunlap has supported his allegations of a comprehensive scheme to defraud consumers with affidavits (filed with his complaint) from former Friedman’s employees and customers.
In one of these affidavits, a former Friedman’s manager attested:
I was advised by [a Friedman’s trainer] to sell property, life and disability insurance to customers who financed their purchases. I was specifically told to just add the insurance onto the sale.... I felt very uncomfortable following these orders. I believed that Friedman’s practice of charging consumers a premium for insurance without disclosing it to the consumers was fraudulent, deceitful and wrong.... On many occasions, my employees, per Friedman’s orders, sold disability, life and property insurance to customers who financed jewelry, and did not disclose to the customer that the insurance was added to the sale.
Another former Friedman’s manager attested:
The computers at our stores were" programmed to automatically add on charges for credit life, credit disability and property insurance onto the customer’s retail installment contract. In order to remove these charges, the employee would have to manually delete them. I felt very uncomfortable following these orders. I believed that Friedman’s practice of charging consumers a premium for insurance without disclosing it to the consumers was fraudulent, deceitful and wrong.
Another former Friedman’s employee attested:
... I was informed by ... the district manager, that we, as employees of Friedman’s Jewelers, Inc. were to add life, disability and property insurance to customer credit applications without disclosing this information to the customer. If we did not do what was requested, we would be fired. He informed me that two people had been dismissed in Roanoke for refusing to do what they asked.... I was again informed by ... the store manager, during a staff meeting that we were to add life, disability and property insurance to customer credit applications without disclosing this information to the customer.... When I questioned what should we do if a customer questions the insurance, I was told that we should tell the customer that it was a computer error.
One Friedman’s employee quit working for Friedman’s “after she was instructed to deceive customers,” according to an administrative law judge who ruled that the employee was entitled to receive unemployment compensation benefits. The judge’s decision further stated:
In this case, the employer instructed its employees to use deceptive practices with regards to the sale of property, disability and life insurance to customers. When a customer opened an account to charge jewelry at the store, the employees were told to automatically add a premium based upon the amount of the charge for life, disability and property insurance. They were told not to give the customer a *553 choice, that they were to automatically add it to the cost of the merchandise. They were further advised that if they did not add the insurance, that they would lose their jobs.
Another former Friedman’s employee attested:
Around May 1999, I was informed by ... the district manager, that we, as employees of Friedman’s Jewelers, Inc. were to add life, disability and property insurance to customer credit applications without disclosing this information to the customer. If we did not do what was requested, we would be fired.
In his circuit court lawsuit, Mr. Dunlap seeks to enforce and vindicate his and other consumers’ right not to be victimized by such illegal schemes. Specifically, Mr. Dunlap seeks the following relief and remedies from the circuit court: (1) a declaratory judgment declaring that Friedman’s, et aids conduct violated the West Virginia Consumer Credit & Protection Act, W.Va.Code, 46A-1-101 et seq. (“the Consumer Protection Act”), West Virginia insurance laws, and the Uniform Commercial Code; (2) an injunction ordering Friedman’s et al. to cease their illegal conduct, to establish an employee training program on consumer protection in West Virginia, and to revise its sales procedures for insurance; (3) certification of a class of persons whose rights have been violated by Friedman’s et al in the fashion that Mi*. Dunlap’s were; (4) court-ordered cancellation of the plaintiffs’ and class members’ indebtedness to Friedman’s et al.; (5) judgment to each plaintiff and class member for statutory damages under the Consumer Protection Act for each violation of the Act; (6) judgment for actual, consequential and incidental damages suffered by each plaintiff and member of the class, including damages for emotional distress, annoyance and inconvenience; (6) judgment for punitive damages to each plaintiff and class member; (7) an award of attorneys’ fees; (8) pre-and post-judgment interest; and (9) such other relief as the court determines. Mr. Dunlap’s causes of action allege violations of the Consumer Protection Act and W.Va.Code, 33-12-1(a) [1957] (selling insurance without a license); common law fraud; uneonscionability; breach of duty of good faith under W.Va.Code, 46-1-203 [1963](UCC); negligent and wilful, wanton and intentional misconduct; and civil conspiracy. Mr. Dunlap requested a jury trial.
On June 23, 2000, Friedman’s et al. moved the Circuit Court of Kanawha County to prohibit Mi*. Dunlap from going forward in circuit court with his claims against Friedman’s et al. and to require Mr. Dunlap to bring any disputes that he has with Friedman’s et al. to arbitration. The basis of this motion was language contained in the two-page purchase and financing agreement document that Mr. Dunlap signed in connection with his purchase from Friedman’s. We shall review this specific language, after generally describing Friedman’s purchase and financing agreement document.
The front page of the purchase and financing agreement document is a pre-printed form, containing a number of boxed spaces with printed titles and explanatory language. For each sale or other similar transaction, transaction-specific words and numbers are supposed to be printed in the form’s blank spaces (presumably by a computer-driven printer attached to a cash register and ordinarily at the time of the transaction), showing the date of the transaction, the item(s) purchased or returned, any applicable credits or adjustments, and the financing terms, insurance charges, purchase price, interest rate, credits, payment schedule, and other pertinent information about the transaction.
In Mr. Dunlap’s case, it appears 2 from the transaction-specific information printed on *554 the front of the Friedman’s form that Mi*. Dunlap signed, that on or about September 20, 1999, Mr. Dunlap purchased a ring for about $150.00, and that Friedman’s “added” to the ring purchase price a $1.48 charge for credit life insurance and $6.96 for property insurance. Mr. Dunlap’s signature appears on a pre-printed line on the front of the form, stating that he is “applying” for insurance, and also on a line where he generally agrees to all terms and conditions on both sides of the document. At the bottom of the front of the form is a pre-printed notice that paragraph 14 of the other side of the form includes an alternate dispute resolution procedure, including a requirement for arbitration or mediation. A printed statement says not to sign the form without reading it, or if it contains any blank spaces.
Mr. Dunlap specifically alleges in his complaint that he did not ask for the insurance for which he was charged, that it was not explained to him that there were insurance charges; that the sales clerk simply showed him where to sign his name on the front of the form; and that the form was then placed in a Friedman’s envelope, where the information that was actually important to Mr. Dunlap — -his monthly payment amount and the number of payments — was written in a space provided on the outside of the envelope. Additionally, Mr. Dunlap states in an affidavit that none of the language in the actual purchase and financing agreement document was explained to him, including the language that purports to limit his remedies against Friedman’s. Mr. Dunlap’s allegations in his complaint regarding how insurance charges were automatically printed on the Friedman’s form and added to his purchase price without his request are consistent with the previously discussed affidavits regarding the mechanism of Friedman’s alleged “loan packing” scheme.
The reverse side of the purchase and financing agreement document form is titled “Additional Terms of Purchase,” and contains 14 pre-printed numbered paragraphs, followed by additional unnumbered language. Most of the numbered paragraphs in the document contain standard “boilerplate” language relating to financing, security in the goods purchased, etc., that is not germane to the issues in the instant case. The following language in the document, however, is germane.
Paragraph 3 of the document, titled “DEFAULT,” states in pertinent part that if the “Buyer” (Mr. Dunlap) dies, becomes insolvent or goes into bankruptcy, or does not make a timely payment, the “Seller” (Friedman’s) may “at its option and without notice, declare the entire unpaid balance immediately due and payable” and “to the extent permitted by Applicable Law” repossess the merchandise that Mr. Dunlap purchased. Additionally, Paragraph 3 says that Mr. Dunlap agrees to pay “all costs incurred in collecting the indebtedness under this Agreement, including, without limitation, reasonable attorney’s fees and court costs in an amount not to exceed 15% of the unpaid debt.”
Paragraph 14, titled “ALTERNATE DISPUTE RESOLUTION,” states in pertinent part:
All disputes, controversies or claims of any kind or nature between Buyer and Seller, arising out of or in connection with the sale of goods financed or refinanced pursuant to the terms of this Agreement ... or with respect to negotiation of, inducement to enter into, construction of, performance of, 'enforcement of, or breach of, effort to collect the debt evidenced by, the applicability of the arbitration clause in, or the validity of this Agreement or any earlier agreement (except as specifically set forth in this paragraph 14 below), shall be resolved by arbitration in the state in which this Agreement is entered into, at a location reasonably near the place where you signed this Agreement, in accordance with the Commercial Arbitration Rules of the American Arbitration Association, and judgment upon the award rendered by the Arbitrator may be entered in any court having jurisdiction thereof_All arbitra *555 tors’ or mediators’ fees shall be equally divided between the parties. Exception to arbitration and mediation: The Seller may exercise its right upon default by Buyer as set forth in the paragraph entitled “default” above, without resort to arbitration or mediation. Nothing in this paragraph shall be construed to prevent either party’s use of bankruptcy or repossession, replev-in, judicial foreclosure, non judicial foreclosure or any other prejudgment or provisional remedy relating to any collateral, security or property interests, for contractual debts now or hereafter and by either party to the other under this Agreement. No arbitrator may make an award of punitive damages.
Mr. Dunlap argued before the circuit court that any and all provisions in the above-quoted language from the purchase and financing agreement document that purport to limit or prohibit his claims for relief and remedies against Friedman’s et al., in a fashion different from that which is provided in West Virginia constitutional, statutory, and common law, are illegal and unconscionable. Mr. Dunlap also argued that any prohibitions or limitations in these provisions do not apply to his claims against American Bankers, because American Bankers is not mentioned in the purchase and financing agreement document.
On April 19, 2001, the circuit court entered an order that stayed all court proceedings on Mr. Dunlap’s claims in circuit court, and required Mr. Dunlap to pursue arbitration with respect to his claims against all of the respondents, pursuant to language in Paragraph 14 of Friedman’s purchase and financing agreement document. Mr. Dunlap thereafter sought a writ from this Court to prohibit the enforcement of the circuit court’s order, leading to the instant case.
II.
Standard of Review
Prohibition -will lie to hear claims relating to a court’s jurisdiction or to address non-jurisdietional issues where a court’s challenged ruling or action is clearly contrary to law and an appeal would not be as adequate as review in prohibition.
See
Syllabus Point 1,
Hinkle v. Black,
The central issue in the instant case is whether the circuit court should exercise the civil jurisdiction that it would ordinarily have to consider
de novo
the merits of Mr. Dunlap’s claims against Friedman’s
et al.
and to award all appropriate and legally available relief — or whether the circuit court must forego the exercise of its ordinary civil jurisdiction, and play only the relatively deferential and limited role that courts have when reviewing the results of arbitration,
cf.
Syllabus Points 1 and 2,
Boomer Coal and Coke Co. v. Osenton,
In
State ex rel. United, Inc. v. Sanders,
In Syllabus Point 3,
Troy Min. Corp. v. Itmann Coal Co.,
III.
Discussion
A.
The central issue in this case is whether Mr. Dunlap is correct in asserting the uncon-scionability of certain provisions in Friedman’s purchase and financing agreement document. In
Arnold v. United Companies Lending Corp.,
“Unconscionability” is a general contract law principle, based in equity, which is deeply ingrained in both the statutory and decisional law of West Virginia. Of particular importance to this case are the provisions contained in the West Virginia Consumer Credit and Protection Act, W. Va. Code § 46A-1-101 et s eq. (hereinafter “CCPA”), which were specifically designed to eradicate unconscionability in consumer transactions. W.Va.Code § 46A-2-121 (1996) of the CCPA provides, in relevant part:
(1) With respect to a transaction which is or gives rise to a consumer credit sale, consumer lease or consumer loan, if the court as a matter of law finds:
(a) The agreement or transaction to have been unconscionable at the time it was made, or to have been induced by unconscionable conduct, the court may refuse to enforce the agreement, or
(b) Any term or part of the agreement or transaction to have been unconscionable at the time it was made, the court may refuse to enforce the agreement, or may enforce the remainder of the agreement without the unconscionable term or part, or may so limit the application of any unconscionable term or part as to avoid any unconscionable result.
The legislature in enacting the West Virginia Consumer Credit and Protection Act, W.Va.Code, 46A-1-101, et seq., in 1974, sought to eliminate the practice of including unconscionable terms in consumer agreements covered by the Act. To further this purpose the legislature, by the express language of W.Va.Code, 46A-5-101(1), created a cause of action for consumers and imposed civil liability on creditors who include unconscionable terms that violate W.Va.Code, 46A-2-121 in consumer agreements.
* * * * * *
The basic test is whether, in the light of the background and setting of the market, the needs of the particular trade or case, and the condition of the particular parties to the conduct or contract, the conduct involved is, or the contract or clauses involved are so one-sided as to be unconscionable under the circumstances existing at the time the conduct occurs or is threatened or at the time of the making of the contract.
[See Uniform Consumer Credit Code, § 5.108 comment 8, 7A U.L.A. 170 (1974).] The drafters explained further that “[t]he particular facts involved in each ease are of utmost importance since certain conduct, contracts or contractual provisions may be unconscionable in some situations but not in others.” Id.
Arnold v. United Companies Lending Corp.,
Guided by the foregoing principles, we shall proceed to examine Mr. Dunlap’s claim that the provisions of Friedman’s purchase and financing agreement document that the circuit court relied on are unconscionable. 3
*557 B.
First, however, we observe that the purchase and financing agreement document that Mr. Dunlap signed was a “contract of adhesion” — and because this term is sometimes used in an imprecise or confusing fashion, a few words of clarification are in order.
In
American Food Management, Inc. v. Henson,
“Adhesion contracts” include all “form contracts” submitted by one party on the basis of this or nothing [* * *] Since the bulk of contracts signed in this country, if not every major Western nation, are adhesion contracts, a rule automatically invalidating adhesion contracts would be completely unworkable. Instead courts engage in a process of judicial review.... Finding that there is an adhesion contract is the beginning point for analysis, not the end of it; what courts aim at doing is distinguishing good adhesion contracts which should be enforced from bad adhesion contracts which should not. 4
Id.
The author of this opinion recently discussed contracts of adhesion in a separate
*558
concurring opinion in
Mitchell v. Broadnax,
The drafters of the Restatement of Contracts Second, in their discussions regarding contracts of adhesion like an insurance policy, recognized that:
A party who makes regular use of a standardized form of agreement does not ordinarily expect his customers to understand or even to read the standard terms. One of the purposes of standardization is to eliminate bargaining over details of individual transactions, and that pui'pose would not be served if a substantial number of customers retained counsel and reviewed the standard terms. Employees regularly using a form often have only a limited understanding of its terms and limited authority to vary them. Customers do not in fact ordinarily understand or even i’ead the standard terms. They trust to the good faith of the party using the form and to the tacit representation that like terms are being accepted regularly by others similarly situated. But they understand that they are assenting to the terms not read or not understood, subject to such limitations as the law may impose [citation omitted, emphasis in original].
In a number of cases, this Court has considered exculpatory provisions in such contracts of adhesion that would if applied effectively limit a party’s legal exposure, accountability, or liability in a fashion that would otherwise not exist under general law. A review of these cases shows that such exculpatory provisions in contracts of adhesion are given close scrutiny, with respect to both them construction and their potential for unconseionability, particularly where rights, remedies and protections that exist for the public benefit are involved.
*559
For example, we held in
Murphy v. North American River Runners,
In
Hill v. Joseph T. Ryerson & Son, Inc.,
... [the sale] was handled in a routine fashion. There is nothing in the record to suggest that there was any advance bargaining between Ryerson and U.S. Steel as to the terms of the sale and, in particular, as to the exculpatory language. The record does not demonstrate that any price concessions were given in return for the exculpatory provision. It does not appear that any formal contract was signed by the parties in advance of the sale, but rather that the pipe order was placed by Ryerson with U.S. Steel by a written purchase order on a printed form prepared by Ryer-son. U.S. Steel subsequently acknowledged the purchase order by its order acknowledgement form which contained certain conditions, including the exculpatory clause, on its reverse side. The initial purchase order of Ryerson contained conditions which were inconsistent with the exculpatory language contained on the U.S. Steel acknowledgement of order form. This fact, when coupled with the absence of any evidence to demonstrate that there had been any bona fide bargaining over the terms and conditions of the sale, compels us to conclude that the exculpatory language asserted by U.S. Steel was not an essential part of the sale. The trial court was thus correct in denying to U.S. Steel the benefit of the exculpatory clause.
This Court’s close scrutiny of exculpatory provisions in contracts of adhesion — particularly those that would unconscionably impair rights that are afforded under the law designed to protect the public—is reinforced by the public policy of this State, as enacted by the Legislature. For example, in Syllabus Point 2 of
U.S. Life Credit Corp. v. Wilson,
Another example of our law’s disfavoring of exculpatory provisions in adhesion contracts that derogate public rights may be found in
Teller v. McCoy,
In
Bd. of Ed. v. W. Harley Miller,
In real life we can envisage ... provisions being imposed upon consumers in contract situations where consumers are totally ignorant of the implications of what they are signing, and where consumers bargain away many, of the protections which have been secured for them with such difficulty at common law.
Based on all of the foregoing and in fidelity to the approach that we have long taken in this area, we recognize and hold that exculpatory provisions in a contract of adhesion that if applied would prohibit or sub *560 stantially limit a person from enforcing and vindicating rights and protections or from seeking and obtaining statutory or common-law relief and remedies that are afforded by or arise under state law that exists for the benefit and protection of the public are unconscionable; unless the court determines that exceptional circumstances exist that make the provisions conscionable. 5
C.
Mr. Dunlap argues that several prohibitions on and/or limitations of his rights and remedies — that are part of Paragraph 14 in Friedman’s purchase and financing agreement document — are unconscionable exculpatory provisions in a contract of adhesion. 6
Mr. Dunlap identifies, as a threshold prohibition or limitation, the deprivation of his constitutional right to have a jury trial in the West Virginia circuit court system on his claims against Friedman’s et al.
Mr. Dunlap has a fundamental constitutional right to use West Virginia’s court system to seek justice. The West Virginia Constitution, Article III, § 17 states:
The courts of this State shall be open, and every person, for an injury done to him, in his person, property or reputation, shall have remedy by due course of law; and justice shall be administered without sale, denial or delay.
And the West Virginia Constitution, Article III, § 13 states:
In suits at common law, where the value in controversy exceeds twenty dollars exclusive of interest and costs, the right of trial by jury, if required by either party, shall be preserved; and in such suit in a eourt of limited jurisdiction a jury shall consist of six persons. No fact tried by a jury shall be otherwise reexamined in any ease than according to rule of court or law.
These constitutional rights — of open access to the courts to seek justice, and to trial by jury — are fundamental in the State of West Virginia. Our constitutional founders wanted the determinations of what is legally correct and just in our society, and the enforcement of our criminal and civil laws' — to occur in a system of open, accountable, affordable, publicly supported, and impartial tribunals — tribunals that involve, in the case of the jury, members of the general citizenry. These fundamental rights do not exist just for the benefit of individuals who have disputes, but for the benefit of all of us. The constitutional rights to open courts and jury trial serve to sustain the existence of a core social institution and mechanism upon which, it may be said without undue grandiosity, our way of life itself depends.
We have recognized, of course, that the constitutionally-enshrined and fundamental rights to assert one’s claims for justice before a jury in the public court system may be the subject of a legally enforceable waiver.
See, e.g., Stephenson v. Ashburn,
Koslow did not waive its right to a trial by jury. In its answer to the Moons’ complaint, a jury trial was demanded. Furthermore, at the pretrial conference, Kos-low made a timely objection to the circuit court’s decision to refer the ease to a special commissioner. Rule 38(a) of the Rules of Civil Procedure provides that “[t]he *561 right of trial by jury as declared by the Constitution or statutes of the State shall be preserved to the parties inviolate.”
And of course, our cases involving arbitration recognize the waiver of the right to go to court in the first instance that is inherent in consent to an arbitral process, see Bd. of Ed. v. W. Harley Miller Inc., supra.
However, as we stated in Syllabus Point 2 of
State ex rel. May v. Boles,
In the instant case, Friedman’s et al. argue that the Federal Arbitration Act (“FAA”), 9 U.S.C. Sec. 2 (1947), categorically precludes Mr. Dunlap from invoking or relying to any degree upon his West Virginia state constitutional rights to seek justice in a public court and to have a jury trial on all issues so triable.
Interpreting the FAA, the Supreme Court has held that states may not single out arbitration for disfavor or special scrutiny simply because arbitration is a “different forum” than the traditional public court system.
See generally Doctor’s Associates, Inc. v. Casarotto,
Because complex issues of federalism are implicated, we do not believe that in deciding the instant case we should unnecessarily reach the issue of to what extent, under the FAA, West Virginia’s constitutional policy giving her citizens the waiveable entitlement to seek justice in the public court system may permissibly factor into judicial scrutiny of the eonscionability of a provision in a contract of adhesion purporting to waive that entitlement. 7
Rather, because other issues are present in the instant case that permit us to rule without addressing this issue, we will for purposes of our decision give no weight to Mr. Dunlap’s state constitutional rights to a jury trial in the public court system.
D.
Mr. Dunlap also asserts that the language of Friedman’s purchase and financing agreement document contains, in connection with the document’s arbitration provision, other impermissibly unconscionable limitations on his rights and remedies under laws that exist for the protection of the public. We shall primarily address two asserted limitations — punitive damages and class action relief.
Paragraph 14 of the Friedman’s purchase and financing agreement document provides that “No arbitrator may make an award of punitive damages.” As previously *562 noted, Mr. Dunlap’s claims against Friedman’s et al. include a request for statutory and common-law punitive and penalty damages that under West Virginia law would be potentially available to Mr. Dunlap (and other putative class members) if they were to prevail on a claim of systematic illegal, intentional, and/or fraudulent misconduct by Friedman’s et al. 8
It is axiomatic that when consumers, employees, etc. are the victims of illegal, wilfully and wantonly wrongful, and/or fraudulent misconduct, the social remedy of punitive and penalty damages may be a powerful tool — for the benefit of the plaintiff and for the benefit of society in general — “to punish the wrongdoer and to deter the commission of similar offenses in the future[,]”
Burgess v. Porter
field,
In the instant case, the intended effect of the “no punitive damages” provision that is included in Paragraph 14 of Friedman’s purchase and financing agreement document is that every Friedman’s customer is deprived of them right to invoke and employ an important remedy provided by law to punish and deter illegal, willful, and grossly negligent misconduct — and that Friedman’s would be categorically shielded from any liability for such sanctions, regardless of Friedman’s level of wrongdoing. 9
Mi'. Dunlap also argues that his ability to fully pursue his legal rights and remedies is unconscionably limited by the terms of Friedman’s purchase and financing agreement document, because Mr. Dunlap could not prosecute his claims for class action relief in arbitration.
Class action relief — including the remedies of damages, rescission, restitution, penalties, and injunction — is often at the core of the effective prosecution of consumer, employment, housing, environmental, and similar cases. In
McFoy v. Amerigas, Inc.,
In Mr. Dunlap’s case, the total of $8.46 in insurance charges that Friedman’s added to his purchase price by Friedman’s is precisely the sort of small-dollar/high volume (alleged) illegality that class action claims and remedies are effective at addressing. In many cases, the availability of class action relief is a sine qua non to permit the adequate vindication of consumer rights.
As the United States Supreme Court stated in
Amchem Products, Inc. v. Windsor,
Thus, in the contracts of adhesion that are so commonly involved in consumer and employment transactions, permitting the proponent of such a contract to include a provision that prevents an aggrieved party from pursuing class action relief would go a long way toward allowing those who commit illegal *563 activity to go unpunished, undeterred, and unaccountable.
Friedman’s et al. do not dispute Mr. Dunlap’s assertion that he would not be able to obtain punitive or penalty damages, or assert class action claims and obtain class relief, in an arbitration proceeding. Friedman’s et al. claim, however, that the FAA’s policy prohibiting states from disfavoring the arbitral forum prohibits Mr. Dunlap from asserting a claim that the arbitral forum is inadequate because of a lack of punitive damages or class action relief in that forum.
Friedman’s points to the case of
Gilmer v. Interstate Johnson Lane Corp.,
We do not think that
Gilmer
is controlling in support of Friedman’s
et alls
argument. The plaintiff in
Gilmer
raised an alleged lack of class action remedies in arbitration as part of a facial and generalized challenge to the applicability of the FAA to any. and all claims arising under the ADEA. The Court in
Gil-mer
did not rule out the possibility that “collective [class action] relief’ could be available in the specialized NYSE arbitration proceedings.
Gilmer,
In the instant case, in contrast to Gilmer, a consumer is seeking to use well-settled principles of state law to challenge and remedy an allegedly widespread and illegal practice of defrauding thousands of consumers. The consumer signed a contract of adhesion containing provisions that would bar him from utilizing two remedies — punitive damages and class action relief — that are essential to the enforcement and effective vindication of the public purposes and protections of underlying the law. 10 For these reasons, we do not accept the argument that the Gilmer *564 ease prohibits Mr. Dunlap in the instant case from asserting a lack of class action relief as an unconscionable limitation of his remedies against Friedman’s et al. 11
Based on all of the foregoing, we hold that the Federal Arbitration Act, 9 U.S.C. See. 2 [1947] does not bar a state court that is examining exculpatory provisions in a contract of adhesion that if applied would prohibit or substantially limit a person from enforcing and vindicating rights and protections or from seeking and obtaining statutory or common-law relief and remedies that are afforded by or arise under state law that exists for the benefit and protection of the public from considering whether the provisions are unconscionable — merely because the prohibiting or limiting provisions are part of or tied to provisions in the contract relating to arbitration.
In the instant case, we conclude that the prohibitions on punitive damages and class action relief that would be the result of the application of the provisions of Friedman’s purchase and finance agreement are clearly unconscionable. 12
*565 E.
Mr. Dunlap also asserts that Paragraph 14 of the Friedman’s purchase and financing agreement document, that requires consumers to resolve disputes “[i]n accordance with the Commercial Rules of the American Arbitration Association” and adds that “[a]ll arbitrators or mediators’ fees shall be equally divided between the parties,” places such a high financial barrier in the path of any consumers seeking to vindicate their rights that most if not all consumers would be effectively discouraged from ever making the attempt. Mi*. Dunlap argues that these costs and fees make arbitration under any terms effectively inaccessible to Mr. Dunlap and similarly situated consumers, substantially impeding their ability to “effectively vindicate” their rights. Mr. Dunlap argues that if the proponent of a contract of adhesion could impose excessive arbitration costs, the proponent could effectively shield themselves from potential liability for their wrongdoing in connection with the subject of the contract — and this would constitute an abuse of the arbitration process.
The Supreme Court has recognized that “[t]he existence of large arbitration costs could preclude a litigant ... from effectively vindicating her ... rights in the arbitral forum.”
Green Tree Financial Corp. v. Randolph,
The specter of high arbitration costs being used to prevent claimants from having reasonable access to justice was discussed in
Shankle v. B-G Maintenance Management of Colorado,
In order to invoke the procedure mandated by his employer, however, Mr. Shankle had to pay for one-half of the arbitrator’s fees. Assuming Mr. Shankle’s arbitration would have lasted an average length of time, he would have had to pay an arbitrator between $1,875 and $5,000 to resolve his claims. Mr. Shankle could not afford such a fee, and it is unlikely other similarly situated employees could either. The Agreement thus placed Mr. Shankle between the proverbial rock and hard place — it prohibited use of the judicial forum, where a litigant is not required to pay for a judge’s services, and the prohibitive cost substantially limited use of the arbi-tral forum.[citation omitted.]
In refusing to compel arbitration because of high costs imposed by an arbitration clause, the U.S. Court of Appeals for the D.C. Circuit held that “... it is unacceptable to require Cole to pay arbitrators’ fees, because such fees are unlike anything that he would have to pay to pursue his statutory claims in court.”
Cole v. Burns Intern. Security Services,
Based on the principles enunciated in the foregoing cases, we hold that provisions in a contract of adhesion that if applied would impose unreasonably burdensome costs upon or would have a substantial deterrent effect upon a person seeking to enforce and vindicate rights and protections or to obtain statutory or common-law relief and remedies that are afforded by or arise under state law that exists for the benefit and protection of the public are unconscionable; unless the court determines that exceptional circumstances exist that make the provisions conseionable. In any challenge to such a provision, the responsibility of showing the costs likely to be imposed by the application of such a provision is upon the party challenging the provision; the issue of whether the costs would impose an unconscionably *567 impermissible burden or deterrent is for the court. 14
Applying the foregoing to the instant' case, Friedman’s et al. are correct that Mr. Dunlap’s contentions as to the cost of arbitration to Mr. Dunlap are at best speculative and not well-supported in the record. Certainly the circuit court made no determination about the likely costs of arbitration. Consequently Mr. Dunlap’s “excessive costs” argument for reversal of the circuit court’s order regarding arbitration is not persuasive. 15
F.
Based on all of the foregoing, we have concluded that as a matter of law that the provisions in Friedman’s purchase and financing agreement document that severely limited Mr. Dunlap’s rights and remedies were unconscionable.
Friedman’s et al. argue that if this Court finds that any provisions of Friedman’s purchase and financing agreement unconscionably limit Mr. Dunlap’s rights and remedies, this Court should remand the case to the circuit court with instructions to compel Mr. Dunlap to go to ai’bitration on his claims against Friedman’s et al. under altered terms and conditions in which Mr. Dunlap could fully and effectively vindicate his rights in the arbitral forum. Presumably this would mean that the circuit court would order arbitration where Mr. Dunlap could obtain class action relief, and where the full range of statutory and common-law damages, penalties, and other legal and equitable remedies could be imposed on Friedman’s et al. 16
A recent court opinion rejected a defendant’s offer to trim the unconscionable provisions of an arbitration clause;
In an effort to compel arbitration and dismiss the instant action against Drs. Porth and Kelly, United has expressed a willingness to waive the arbitration clauses’ limitations that prevent an arbitrator from awarding extra contractual damages and punitive or exemplary damages. Principles of justice and fair play, however, lead to the conclusion that one party unilaterally cannot alter 'post litem motam terms of an agreement so that a case is dismissed .... The Court rejects United’s attempted waiver.
In re Managed Care Litigation,
Flyer Printing points out that it offered to pay all the costs of arbitration notwithstanding the language of the agreement. Hill rejected this unilateral offer to amend the agreement, however, and we are not authorized to remake the parties’ contract.
*568
Flyer Printing Co. Inc. v. Hill,
In
Armendariz, supra,
Moreover, whether an employer is willing, now that the employment relationship has ended, to allow the arbitration provision to be mutually applicable, or to encompass the full range of remedies, does not change the fact that the arbitration agreement as written is unconscionable and contrary to public policy. Such a willingness “can be seen, at most, as an offer to modify the contract; an offer that was never accepted. No existing rule of contract law permits a party to resuscitate a legally defective contract merely by offering to change it.” [citations omitted].
In evaluating Friedman’s et alls argument that we should order the circuit court to compel arbitration, but under “eonseionable” standards, we must again recognize the nature of the contract that is at issue — and the substance of the use to which Friedman’s et al. have sought to put arbitration in the context of that contract.
Friedman’s et al. are not asking this court to re-write a business contract that was knowingly entered into by two sophisticated parties — where a court doing equity might seek to put the parties where they really intended to be, by correcting a provision in the contract that has become unconscionable because of a mistake or changed circumstances.
Rather, Friedman’s et al., by tying substantively unconscionable exculpatory and limitation of liability provisions to an arbitration provision in a form contract of adhesion, has sought to unilaterally use (one could say “misuse”) the honorable mechanism of arbitration — -that has found a respected place in the commercial life of our nation — as a scheme or mechanism to shield itself from legal accountability for misconduct.
Under such circumstances, we think a court doing equity should not undertake to sanitize any aspect of the unconscionable contractual attempt.
Consequently, we conclude that the circuit court erred in refusing to exercise its ordinary jurisdiction over the claims made by Mr. Dunlap, and in instead requiring Mr. Dunlap to bring any disputes he has with Friedman’s et al. to arbitration.
IV.
Conclusion
We conclude with a quotation from
Ting v. AT & T,
This lawsuit is not about arbitration 17 ... [Under the guise of requiring arbitration, the company] was actually rewriting substantially the legal landscape on which its customers must contend ... [the company] sought to shield itself from liability ... by imposing Legal Remedies Provisions that eliminate class actions, sharply curtail damages in cases of misrepresentation, fraud, and other intentional torts, cloak the arbitration process with secrecy and place significant financial hurdles in the path of a potential litigant. It is not just that [the company] wants to litigate in the forum of its choice — arbitration; it is that [the company] wants to make it very *569 difficult for anyone to effectively vindicate her rights, even in that forum. That is illegal and unconseionable[.]
The requested writ of prohibition is granted and this ease is remanded for further proceedings consistent with this opinion. 18
Writ Granted.
Notes
. Ms. Stephanie Gibson is Mr. Dunlap's co-plaintiff in the case below; her claim is essentially the same as Mr. Dunlap’s. However, her purchase and financing agreement document did not contain the language that is at issue in the instant case. The fact that two plaintiffs have joined their claims in one case does not affect our consideration of Mr. Dunlap’s petition.
. In the copy of the Friedman’s purchase and financing agreement document memorializing Mr. Dunlap’s ring purchase that was submitted with the petition in the instant case, the transaction-specific words and numbers are misaligned with the blank spaces on the form where the words and numbers should appear, making the financial and other details of the transaction difficult to comprehend from the face of the document. Put another way, the transaction-specific information on the form (at least on the copy submitted to this Court) is not readily comprehensible to an average person who is not already familiar with the details of the transaction. Moreover, the pre-printed parts of the document would probably be seen by the average *554 person as legal gobbledygook. Our discussion infra regarding such contracts of adhesion shows that it makes little difference whether they are in fact comprehensible — because people simply don’t read them.
. Because these provisions involve or relate to arbitration, the Federal Arbitration Act, 9 U.S.C. Sec. 2 [1947] (''FAA") is applicable. The FAA provides that contracts to arbitrate "shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” Under the FAA, a claim of unconscionability is available to a party contesting the validity and enforceability of a contractual provision that requires submission of disputes to arbitration.
Doctors’ Associates, Inc. v. Casarotto,
A pre-dispute agreement to use arbitration as an alternative to litigation in court may be enforced pursuant to the FAA only when arbitration, although a different forum with somewhat different and simplified rules, is nonetheless one in which the arbitral mechanisms for obtaining justice permit a party to fully and effectively vindicate their rights. As the Supreme Court stated in
Gilmer v. Interstate/Johnson Lane Corp.,
In
Floss v. Ryan’s Family Steak Houses, Inc.,
[E]ven if arbitration is generally a suitable forum for resolving a particular statutory claim, the specific arbitral forum provided under an arbitration agreement must nevertheless allow for the effective vindication of that claim. Otherwise, arbitration of the claim conflicts with the statute’s purpose of both providing individual relief and generally deterring unlawful conduct through the enforcement of its provisions.
See also Paladino, supra,
. Other authorities similarly recognize that in a contract of adhesion, a party’s
"contractual intention is but a subjection more or less voluntary to terms dictated by the *558 stronger party, terms whose consequences are often understood in a vague way, if at all.” Such standardized contracts have been described as those in which one predominant party will dictate its law to an undetermined multiple rather than to an individual. They are said to resemble a law rather than a meeting of the minds.
Henningsen v. Bloomfield Motors, Inc.,
In
Neal v. State Farm Ins. Companies,
Commentators have characterized the type of agreement before us as a "contract of adhesion." ... Such an agreement does not issue from that freedom in bargaining and equality of bargaining which are the theoretical parents of the American law of contracts. Yet, today, the impact of these standardized contracts can hardly be exaggerated. "Most contracts which govern our daily lives are of a standardised [sic] character. We travel under standard terms, by rail, ship, aeroplane, or tramway. We make contracts for life or accident assurances under standardised [sic] conditions. We rent houses or rooms under similarly controlled terms; authors or broadcasters, whether dealing with public or private institutions, sign standard agreements; government departments regulate the conditions of purchases by standard conditions.” [citations omitted].
In
Broemmer v. Abortion Services of Phoenix, Ltd.,
The conclusion that [a] contract was one of adhesion is not, of itself, determinative of its enforceability. "[A] contract of adhesion is fully enforceable according to its terms [citations omitted] unless certain other factors are present which, under established legal rules— legislative or judicial—operate to render it otherwise.” Graham v. Scissor-Tail, Inc.,28 Cal.3d 807 , 820171 Cal.Rptr. 604 , 611,623 P.2d 165 , 172 (1981) (footnotes omitted). To determine whether this contract of adhesion is enforceable, we look to two factors: the reasonable expectations of the adhering party and whether the contract is unconscionable. As the court stated in Graham:
Generally speaking, there are two judicially imposed limitations on the enforcement of adhesion contracts or provisions thereof. The first is that such a contract or provision which does not fall within the reasonable expectations of the weaker or "adhering” party will not be enforced against him. [citations omitted] The second — a principle of equity applicable to all contracts generally — is that a contract or provision, even if consistent with the reasonable expectations of the parties, will be denied enforcement if, considered in its context, it is unduly oppressive or "unconscionable.”
. Because unconscionability is an equitable matter and must in the final analysis be determined on a case-by-case basis, a rule that admits of no exceptions is not appropriate. However, a rebut-table presumption is consistent with public policy and retains the flexibility that a court of equity requires.
. Mr. Dunlap also asserts that the limitations on his rights and remedies that were included in Friedman's purchase and financing agreement document are unenforceable because Mr. Dunlap was not actually aware of and did not consciously agree to the limiting provisions. Friedman’s et al. reply that the language relating to these limitations was "prominently displayed” on the document form, and was accompanied by a written warning to "be sure to read all of this document.” As our discussion of contracts of adhesion supra shows, Friedman’s et al.'s reliance on a "written warning” misses the point. The legal enforceability vel non of exculpatory provisions in contracts of adhesion has little to do with whether there are self-serving caveats in a document that is not going to be read, and everything to do with whether the provisions would operate to deprive people of important rights and protections that the law secures for them.
. In the criminal law context, in
State v. Neuman,
Certain constitutional rights are so inherently personal and so tied to fundamental concepts of justice that' their surrender by anyone other than the accused acting voluntarily, knowingly, and intelligently would call into question the fairness of a criminal trial.
Similarly, in
State v. Eden,
... [Wjaiver of a constitutional right is not implied to be lightly regarded, and if such a waiver is to be implied at all, it can only be in situations in which it is clear that the accused has not only a full knowledge of all facts and of his rights, but a full appreciation of the effects of his voluntary relinquishment, [citations omitted.]
Absent concerns raised by the applicability of the FAA, we see no reason why a strict “knowing and intelligent waiver” standard should not ordinarily apply to the waiver of the rights to a jury trial in the public court system. (If a "knowing and intelligent” waiver of uninsured motorist’s coverage is required for such a waiver to be effective,
see
Syllabus Point 2,
Riffle v. State Farm Mut. Auto. Ins. Co.,
.
W.Va.Code,
46A-5-101 [1974] authorizes statutory penalty damages of $100.00 to $1,000.00 for each violation of the Consumer Protection Act. A plaintiff who proves common-law fraud may recover punitive damages,
Muzelak v. King Chevolet,
.
Cf. Smithson v. U.S. Fidelity & Guar. Co.,
. We note that Rule 23 of the
West Virginia Rules of Civil Procedure,
which establishes the procedures for invoking the power of a court to award class action relief, has the force and effect of a statute. Syllabus Point 3,
State v. Mason,
. Gilmer did not deal with the issue of punitive damages. Friedman’s et al. argue that Mr. Dunlap does not have an inviolate right to such damages, and therefore cannot claim that the Friedman’s contract’s bar on such damages is unconscionable. Obviously, Mr. Dunlap has no absolute entitlement to such damages, but he does under West Virginia law have a legal entitlement to them, if he can prove their legal basis. The question is whether Friedman’s — by placing limiting language in an adhesive contractual provision relating to arbitration — may absolutely and categorically shield itself (and others) from an important sanction that is provided by West Virginia law for the benefit of the public. Our answer is that Friedman’s cannot do so.
. Mr. Dunlap also claims that Friedman's purchase and financing agreement is unconscionable because it lacks even-handedness with respect to who may invoke the arbitral forum and who may use the court system, pointing out that Friedman's contract preserves Friedman’s right to use the judicial system in the case of a default by Mr. Dunlap — to repossess the jewelry and to collect any deficiency, which are the primary enforcement tools of a seller/financer. Mr. Dunlap argues that Friedman’s purchase and financing agreement document thus preserves for Friedman’s the ability to use the court system to enforce the rights that are most important to Friedman’s and at the same time gives Friedman’s the ability to use the arbitral forum to limit a consumer’s right to impose penalties and remedies against illegal conduct.
Confronted with a similar provision that retained significant rights to use the court system for a consumer lender, but denied the right to invoke the power of the court system to a borrower, we held in Syllabus Point 5,
Arnold v. United Companies Lending Corp.,
Where an arbitration agreement entered into as part of a consumer loan transaction contains a substantial waiver of the borrower's rights, including access to the courts, while preserving the lender’s right to a judicial forum, the agreement is unconscionable and, therefore, void and unenforceable as a matter 'of law.
We agree that Friedman’s retention of the right to use die courts for its most important remedies, at the same time that it denies that forum to Mr. Dunlap with respect to his most important remedies, meets our established criteria for uncon-scionability in the context of a contract of adhesion, and this reason provides additional and independently adequate grounds for our holding herein.
We also observe that neutrality in the selection and composition of any forum or tribunal is essential to the legal validity of contractual provisions providing for dispute resolution mechanisms, particularly when such provisions are placed in contracts of adhesion like the one signed by Mr. Dunlap.
“A
functional analysis of the West Virginia cases which do not favor arbitration demonstrates that this Court would not countenance an arbitration provision by which the parties agree that all disputes will be arbitrated by a panel chosen exclusively by one of the parties.”
Bd of Ed.
v. W.
Harley Miller, Inc.,
. Similarly, the California Supreme Court, in striking an arbitration clause which imposed high costs on statutory claims, emphasized:
... we are unaware of any situation in American jurisprudence in which a beneficiary of a federal statute has been required to pay for the services of the judge assigned to hear her or his case. Under Gilmer, arbitration is supposed to be a reasonable substitute for a judicial forum. Therefore, it would undermine Congress’s intent to prevent employees who are seeking to vindicate statutory rights from gaining access to a judicial forum and then require them to pay for the services of an *566 arbitrator when they would never be required to pay for a judge in court.
Armendariz v. Foundation Health Psychcare Services, Inc.,
Phillips offers evidence from die AAA that she will be forced to pay upwards of $4,000 simply to file her claim.... Furthermore, the initial filing fee is far from the only cost involved in the arbitration. The AAA’s Commercial Rules provide that the arbitrator’s fees (which range from $750 to $5,000 per day, with an average of $1,800 per day in die Chicago area), travel expenses, rental of a hearing room, and other costs are borne equally by the parties, absent some agreement between the parties.
Phillips v. Associates Home Equity Seivices,
[plaintiff] Christopher has submitted an affidavit in support of her opposition detailing the various costs which she can reasonably be expected to incur if she is compelled to submit her claims to arbitration. These include a $1,000 per day arbitrator’s fee, a $500 counterclaim fee, $150 per day hearing fees, and $150 per day postponement fees, [citations omitted],
Cf. also Mendez v. Palm Harbor Homes, Inc.,
Though Camacho may apply for fee deferral or reduction due to "extreme hardship,” the parties stipulate that waiver of fees is extremely rare in practice. The AAA does not provide formal standards for granting hardship, and its accounting department actually determines who is afforded “extreme hardship” status.
. Thus provisions in an adhesion contract that required a party to deposit an unreasonably high bond before returning an item for warranty repairs, or to pay travel expenses for the other party's witnesses if a case is filed in court, would be subject to the same analysis.
. Mr. Dunlap also argues that his opportunity to obtain an award of attorney fees would be impaired in arbitration, as opposed to in circuit court, where a statute provides for their award in Consumer Protection Act cases,
W.Va.Code,
46A-5-104 [1994], Our statutes and common law provide in some cases for the award of attorney fees to encourage the "private attorney general” enforcement of laws that protect the general welfare; and we have an established body of law on attorney fee awards.
See, e.g.,
Syllabus Point 4,
Bowling v. Ansted Chrysler-Plymouth-Dodge,
.Were we to follow Friedman's suggestion, however, the circuit court would also have to address on remand the issues of arbitral costs and attorney fees.
. We emphasize that the attempted avoidance of legally-required accountability for wrongdoing under the laws of West Virginia that Friedman's has attempted to accomplish with exculpatory arbitration-related provisions in a contract of adhesion in the instant case would be just as objectionable and unconscionable if that attempted avoidance arose from language that made no mention of arbitration. Also, we emphasize that our concern in the instant case is with the attempted prohibition or limitation of rights, remedies, and protections that are afforded for the benefit of the public by statutes and the common law; and we do not address the assertion, vindication, and enforcement of rights that arise purely from the contract itself. Finally, we note that Justice Neely, in
Bd. of Ed. v. Harley Miller, supra,
stated that arbitration clauses that were abusively included in contracts of adhesion, that were unconscionable, that were wholly inappropriate given the nature of the contract and could only have been intended to defeat just claims, or were oppressive under the circumstances, could not be held to have been truly "bargained for” and therefore should not be enforced.
. Mr. Dunlap also argues that American Bankers cannot compel Mr. Dunlap to go to arbitration with his claims against American Bankers, because they are neither a party to nor referred to in the purchase and financing agreement document. We need not reach this issue, but we observe that this Court recently stated:
Despite the recognized exception to the rule requiring express assent to require arbitration, there is equally "[plersuasive authority ... that á ... court is not required to compel arbitration between parties who have not agreed to such arbitration."
State ex rel. United Asphalt Suppliers, Inc. v. Sanders,