In a potentially far-reaching decision in favor of our firm’s client, the New Jersey Supreme Court today ruled that an agreement to arbitrate must contain language that notifies the consumer that they are waiving their right to seek relief in a court of law. This victory will help secure the right’s of citizens’ access to our Court system for years to come.
In the case of Atalese v. U.S. Legal Services Group, L.P., our client entered into an agreement with U.S. Legal Services Group, L.P. for debt relief services. The contract between our client and the debt adjusters contained a provision that required the parties to submit disputes under the contract to binding arbitration. The arbitration provision in the contract, however, did not explicitly state that by signing the agreement, our client was giving up her right to seek relief in court.
As such, we filed a lawsuit on our client’s behalf in the Superior Court of New Jersey seeking remedies under the Consumer Fraud Act (N.J.S.A. 56:8-1 et seq.) and the Truth in Consumer Contract, Warranty and Notice Act ( N.J.S.A. 56:12-4 et seq.). At the trial level, the Court dismissed our client’s case and found that because the parties had agreed to arbitration, our client gave up her right to file a lawsuit. We appealed the Trial Court’s decision and on February 22, 2014 the Appeals Court affirmed the Trial Court’s decision and agreed that the case should be dismissed.
After the Appeals Court’s decision, we filed a “petition for certification” with the New Jersey Supreme Court, the highest court in the state. We knew this was a long shot, because the Supreme Court denies more than 90 percent of petitions for certification. In the face of these heavy odds, the Supreme Court granted the petition and on April 9, 2014 Mr. Wright argued the case for our firm’s client.
After the argument, Justice Barry T. Albin wrote the opinion of the court which reversed the Trial Court and Appeals Court decisions. The decision was completely unanimous, as all seven Justices, including the Chief Justice, voted in favor of the decision to reverse the lower courts.
As with each of our successes, this victory for New Jersey Consumers could not have been achieved without the help and support of our colleagues, clients, family and friends.
