Personal Injury Lawyer Blog
(Please note: the names and locations of all parties have been changed to protect the confidentiality of the participants in this medical malpractice/personal injury case and its proceedings.)
Procedural Unconscionability
Ms. Hall was pregnant and in need of an obstetrician to deliver her baby. At her first visit to Dr. Black, Ms. Hall was presented with the arbitration agreement. She was told to sign it prior to being seen.
In Armendariz, the arbitration agreement was imposed on the employees as a condition of their employment. Here, Ms. Hall was essentially in the same position as the employees in Armendariz. She was required to sign the arbitration agreement or forego receiving prenatal care and delivery from Dr. Black. She was in an oppressive take it or leave it situation. Just as the employees in Armendariz were put in the position of signing an arbitration agreement or risk being unemployed, Ms. Hall was put in the weaker position of signing the arbitration agreement or risk not finding a doctor to deliver her baby. This is classic disparity of bargaining power. The arbitration agreement is therefore a contract of adhesion and is procedurally unconscionable.
Substantive Unconscionability
Defendant Black’s arbitration agreement is substantively unconscionable in two respects, lack of mutuality and the allocation of fees for arbitration. For more information you are welcome to contact Sacramento personal injury lawyer, Moseley Collins.
(1) Mutuality
An arbitration agreement is substantively unconscionable if it is unfairly one-sided, requiring one party to the agreement to arbitrate their claims while the other party is not.
The Court in Armendariz, where an arbitration provision required employees to arbitrate wrongful termination claims while the employer had no corresponding obligation, stated that … an arbitration agreement imposed in an adhesive context lacks basic fairness and mutuality if it requires one contracting party, but not the other, to arbitrate all claims arising out of the same transaction or occurrence or set of series of transactions and occurrences. Armendariz, supra. 24 Cal. 4th 120.
The Court went on to say that there must be a modicum of bilaterality in an arbitration agreement. Given disadvantages that may exist for plaintiffs arbitrating disputes, it is unfairly onesided for an employer with superior bargaining power to impose arbitration on the employee as plaintiff but not to accept such limitations when it seeks to prosecute a claim against the employee, without at least some reasonable justification for such one-sidedness based on business realities … if the arbitration system established by the employer is indeed fair, then the employer as well as the employee should be willing to submit claims to arbitration…. Armendariz, supra, 24 Cal. 4th 117-118. (See Part 7 of 10.)
For more information you are welcome to contact Sacramento personal injury lawyer, Moseley Collins.