Third District Court of Appeal
State of Florida
Opinion filed February 10, 2021.
Not final until disposition of timely filed motion for rehearing.
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No. 3D20-0969
Lower Tribunal No. 19-10064
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Herbert Jean,
Appellant,
vs.
Bayview Loan Servicing, LLC, etc., et al.,
Appellees.
An appeal from a nonfinal order from the Circuit Court for Miami-Dade
County, Carlos Guzman, Judge.
Anthony V. Falzon, P.A., and Anthony V. Falzon, for appellant.
Greenberg Traurig P.A., and Paul B. Ranis (Fort Lauderdale), for
appellees.
Before MILLER, GORDO, and BOKOR, JJ.
MILLER, J.
Appellant, Herbert Jean, challenges a nonfinal order compelling
arbitration in his lawsuit against appellees, Bayview Loan Servicing, LLC and
Bayview Asset Management, LLC (collectively “Bayview”). We have
jurisdiction. Fla. R. Civ. P. 9.130(a)(3)(C)(iv). Concluding that “disputed
factual issues regarding the making of the arbitration agreement” preclude
the summary procedure engaged by the court below, we reverse and
remand for an evidentiary hearing. Am. Mgmt. Servs., Inc. v. Merced,
186
So. 3d 612, 614 (Fla. 4th DCA 2016) (citations omitted).
BACKGROUND
Jean filed suit against his employer, Bayview, under the Fair Labor
Standards Act, seeking damages for unpaid overtime compensation. See
29 U.S.C. § 201 et seq. Bayview terminated his employment and, relying
upon its “Dispute Resolution and Arbitration Policy,” subjecting all
employment “disputes, claims or controversies” to arbitration, moved to
compel arbitration. Appended to its motion were affidavits alleging all
employees, including Jean, were required to electronically sign the Policy as
a condition of continued employment. Although Bayview did not produce a
signed copy, it filed computer screenshots purportedly demonstrating Jean
“necessarily” received, viewed, and electronically acknowledged the Policy.
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Jean opposed the motion with a counter-affidavit denying he had ever
received, reviewed, or signed the Policy. He further contended all required
employment documents were manually signed, and suggested that, because
Bayview was capable of technologically overriding his assigned credentials,
the electronic acknowledgment was either forged or falsified. Finally, Jean
alleged the documents submitted by Bayview demonstrated an internal
inconsistency, calling into question whether they actually bore an electronic
acknowledgment.
He then requested an evidentiary hearing to resolve the competing
factual issues surrounding the formation of the agreement. The lower
tribunal denied the request, found the parties were bound by the Policy, and
ordered the matter to arbitration. The instant appeal ensued.
LEGAL ANALYSIS
“Arbitration is strictly ‘a matter of consent,’ and thus ‘is a way to resolve
those disputes—but only those disputes—that the parties have agreed to
submit to arbitration.’” Granite Rock Co. v. Int’l Brotherhood of Teamsters,
561 U.S. 287, 299,
130 S. Ct. 2847, 2857,
177 L. Ed. 2d 567 (2010) (citations
omitted). Hence, the threshold issue in determining the propriety of a motion
to compel arbitration is whether the parties assented to arbitration. H.
3
Michael Muniz, Compelling Arbitration of Disputes: The Florida v. Federal
Law Quagmire, 80-DEC Fla. B.J. 31, 31 (2006).
In accord with these principles, the law has long recognized a
distinction between challenges to the formation, or very existence, of an
arbitration agreement, which must be resolved by the court, and challenges
to the continuing validity or scope of such an agreement, which are
arbitrable. Buckeye Check Cashing, Inc. v. Cardegna,
546 U.S. 440, 444,
126 S. Ct. 1204, 1208,
163 L. Ed. 2d 1038 (2006); see also § 682.02(2), Fla.
Stat.; Specht v. Netscape Commc’ns Corp.,
306 F.3d 17, 26 (2d Cir. 2002)
(“It is well settled that a court may not compel arbitration until it has resolved
‘the question of the very existence’ of the contract embodying the arbitration
clause.”) (citation omitted).
In formation challenges, the court generally acts as a gatekeeper,
charged with determining the “existence of a legally enforceable assent to
submit to arbitration.” Alan Scott Rau, Everything You Really Need to Know
About “Separability” in Seventeen Simple Propositions,
14 Am. Rev. Int'l Arb.
1, 17 (2003); see also § 682.02, Fla. Stat.; AT & T Techs. Inc. v. Commc'ns
Workers,
475 U.S. 643, 649,
106 S. Ct. 1415, 1418,
89 L. Ed. 2d 648 (1986)
(“Unless the parties clearly and unmistakably provide otherwise, the question
of whether the parties agreed to arbitrate is to be decided by the court, not
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the arbitrator.”) (citation omitted). This is because prematurely ordering
arbitration before resolving whether an agreement exists, “could result in an
arbitrator deciding no agreement was ever formed.” Will-Drill Res., Inc. v.
Samson Res. Co.,
352 F.3d 211, 219 (5th Cir. 2003). Logically, such an
outcome could not stand, as it “would be a statement that the arbitrator never
had authority to decide the issue.” Id.; see also United Steelworkers v.
Warrior & Gulf Navigation Co.,
363 U.S. 574, 582,
80 S. Ct. 1347, 1353,
4 L.
Ed. 2d 1409 (1960) (“For arbitration is a matter of contract and a party cannot
be required to submit to arbitration any dispute which he [or she] has not
agreed so to submit.”).
Conversely, in challenges falling within the latter category, the parties
have formed a binding agreement. Consequently, issues surrounding the
continuing validity, application, scope, and enforceability are most-often
delegated to the arbitrator for resolution. See, e.g., A T & T Techs., Inc.,
475
U.S. at 648-49,
106 S. Ct. at 1418 (“[A]rbitrators derive their authority to
resolve disputes only because the parties have agreed in advance to submit
such grievances to arbitration.”) (citation omitted); Jones v. Waffle House,
Inc.,
866 F.3d 1257, 1267 (11th Cir. 2017) (Parties have manifested the clear
and unmistakable “requisite intent [to] delegat[e] [to arbitration gateway
issues when the] provision at issue commit[s] to arbitration ‘any issue
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concerning the validity, enforceability, or scope of this loan or the Arbitration
agreement,’ or, ‘any and all disputes arising out of or in connection with this
Agreement, including any question regarding its existence, validity, or
termination,’ or, finally, ‘any issue regarding whether a particular dispute or
controversy is . . . subject to arbitration.’”) (fifth alteration in original) (citations
omitted); Price v. Int’l Brotherhood of Teamsters, Chauffeurs,
Warehousemen & Helpers,
457 F.2d 605, 610 (3d Cir. 1972) (“A court will
defer to arbitrators or committees when they are exercising their delegated
power to decide unforeseen or unresolved problems arising out of gaps or
content in the contract.”).
Here, Jean challenged the formation of the arbitration agreement.
Thus, the trial court was charged with determining the threshold issue of
whether an agreement to arbitrate existed.
Ordinarily, the court would have been well-within its discretion to
summarily declare Jean assented to arbitration. See § 682.03(1)(b), Fla.
Stat. However, here, in the absence of credibility determinations derived
from live testimony, the disputed factual claims surrounding the making of
the agreement were incapable of any informed resolution. Am. Mgmt.
Servs., Inc., 186 So. 3d at 614 (“When a party seeks to compel arbitration
and the other party opposed the motion, the trial court must first determine
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whether there are disputed factual issues regarding the making of the
arbitration agreement . . . If the court determines that there is a substantial
disputed issue, then it must set an expedited evidentiary hearing.”) (citations
omitted). Accordingly, by failing to conduct an evidentiary hearing, we
conclude the trial court exceeded its discretion in finding a valid contract
existed and we reverse and remand for such a hearing on the merits of the
respective claims of the parties.
Reversed and remanded.
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