The Week in Torts – Cases From the Week of April 23, 2021
Friends Don’t Let Friends Sign Contracts For Their Children
FLORIDA LAW WEEKLY
VOLUME 46, NUMBER 16
CASES FROM THE WEEK APRIL 23, 2021
TRIAL COURT PROPERLY DENIED DEFENDANT’S MOTION TO COMPEL ARBITRATION IN A CASE WHERE A BOY WAS SERIOUSLY INJURED AT IN AN INDOOR TRAMPOLINE PARK, BECAUSE THE MOTHER’S FRIEND WHO ACCOMPANIED HIM THERE AND SIGNED THE WAIVER AND EXCULPATORY CLAUSE ON HIS BEHALF, LACKED LEGAL AUTHORITY TO EXECUTE SUCH A RELEASE
UATP Management v. Barnes, 46 Fla. L. Weekly D875 (Fla. 2nd DCA April 16, 2021):
An adult friend of the minor child’s mother took the boy to an indoor trampoline park for a birthday party. In order for him to be admitted, she signed a customer release, assumption of risk and waiver of liability and indemnification agreement, which included all the required words for waiver, arbitration, indemnification, etc. The woman signed the document electronically, and he was seriously injured while there.
When the boy’s mother sued the facility, it moved to compel arbitration based upon the documents signed by her friend. The defendant argued that the woman had acted within her authority as the mother’s apparent agent when she signed the document. The trial court denied the motion to compel arbitration, finding that only a natural guardian may execute a limited release on behalf of a child under 744.301(3).
The defendant argued that the trial court should have granted its motion to compel, and that the court’s role was strictly limited to deciding the threshold issue of whether a valid agreement to arbitrate existed.
While orders denying or granting motions to compel arbitration are generally reviewed de novo, there is also a de novo review of a trial court’s construction of the arbitration agreement, and its application of law to the facts found.
In deciding whether a dispute should go to arbitration, a trial court looks to three fundamental elements: (1) Whether a valid written agreement to arbitrate exists; (2) Whether an arbitrable issue exists; and (3) Whether the right to arbitration was waived. It is up to the trial court, and not the arbitrator, to determine whether a valid written agreement to arbitrate exists.
The Florida Supreme Court has stated that the question of whether a minor child or a child’s estate may be bound by an agreement to arbitrate by a parent or guardian on the child’s behalf, is a question of contract formation; i.e., whether a valid agreement to arbitrate exists. It then follows that whether a minor child may be bound by an arbitrating agreement signed by a non-parent or non-guardian is also a matter of contract formation.
There is a difference between a challenge to contract validity and a challenge to contract formation. Challenges to the validity of a contract are resolved by the arbitrator. Conversely, challenges to the formation or existence of that contract are resolved by the court.
The trial court found that no valid written agreement existed between the friend and the defendant, because the friend lacked the legal authority to execute the release on behalf of the child or his parents. The trial court found that no agreement existed, therefore, it did not need to reach the issue of enforceability. Enforceability issues presuppose that an agreement does exist.
The court acknowledged Florida’s public policy favoring the arbitration of disputes, as well as the law stating that courts should resolve doubts concerning the scope of such agreements in favor of arbitration. However, importantly, no such presumption exists when the parties dispute whether they agree to arbitrate.
The boy’s mother did not sign the document. The boy himself lacked the capacity to do so because he was under 18. Consequently, the arbitration agreement could not bind the mother or her son unless the defendant demonstrated that the friend had authority to sign on behalf of the boy under §744.301(3).
§744.301(3)(b) authorizes a parent to execute a limited pre-injury release of her child’s personal injury claims resulting from inherent risks in activities so long as the document contains certain specific language in a particular format. The defendant had no legal authority to demonstrate that a parent’s friend has the ability to bind that parent’s child to such a contract.
As a result, the defendant argued that the friend had the “apparent agency” to sign the document. However, unless there is (a) a representation by the purported principal; (b) a reliance on that representation by a third party; and (c) a change in position by the third party in reliance on the representation, there can be no apparent agency. The fundamental problem for the defendant, according to the court, was that it did not rely upon any representation by the friend who was the purported principal. Rather, the defendant attempted to bind the friend based upon the actions taken by her. In fact, the defendant did not even argue that the friend represented anything to it to induce its supposed reliance on her authority, belying its entire argument.
The defendant suggested that prior releases she had signed supported its argument that the friend was the mother’s apparent agent. However, none of those alleged releases were in evidence, and the court refused to address that issue for the first time on appeal.
The defendant also contended that the “clear and unequivocal delegation provision,” which required the arbitrator and not the trial court to determine the enforceability of the arbitration agreement, salvaged its position. Despite the parties’ agreement that the delegation provisions are generally valid absent a challenge, if no contract was ever formed, parties cannot be bound to the terms of a non-existent contract.
The defendant also asserted that the arbitration provision was severable from the release, and therefore the arbitration provision would survive even if the remainder of the release did not. The court wrote that such an argument struck them as “illogical,“ and it was “impossible to sever and enforce part of an agreement that never existed in the first place.”
Ultimately, because the defendant failed to demonstrate that the parties entered into an arbitration agreement, the court affirmed the trial judge’s decision denying the defendant’s motion to compel arbitration.
TRIAL COURT IMPERMISSIBLY DENIED A PEREMPTORY STRIKE OF AN AFRICAN-AMERICAN JUROR, NOTWITHSTANDING THAT THE REASON FOR THE STRIKE WAS “RACE-NEUTRAL”
Lafayette v. Southeastern Freight Lines, 46 Fla. L. Weekly D861 (Fla. 4th DCA April 14, 2021):
In this wrongful death case involving an African American truck driver defendant, and a company whose corporate representative was also African American, the plaintiff sought to peremptorily exclude one of the jurors who happened to be African American because her husband of over 30 years was also a truck driver. The defendants then sought a race-neutral explanation for the strike (truck driver husband in a long-term marriage), but the trial court denied the strike, ruling that plaintiff failed to meet the race-neutral test enunciated in the case law.
The next day, the plaintiff renewed her challenge to the juror, remarking that the trial court had not made a finding that the reason expressed was not genuine, causing the defendants to argue that the plaintiff should have used a cause challenge if she wished to strike the juror for her “ties” to the trucking industry.
The trial court stated on the record that it did not believe that the plaintiff’s reason for striking the juror was race-neutral and that was the reason why it did not believe the reason given was genuine. The trial court focused primarily on the racial makeup of the jury – this juror was the only African American left on the panel – as well as on a minority group’s right to serve on a jury.
The Court found that the trial court’s conclusion refusing the strike was more legal in nature than discretionary (the court had not actually ruled on genuineness). Here, the defendants had timely objected to the challenge, and the court asked the plaintiff for a race-neutral reason which she gave.
However, the trial court erred in how it applied the Melbourne test in step three in the analysis of the genuineness. The Court explained that the stated reason – the juror’s potential bias – was clearly race-neutral, but the trial court still inexplicably found that the plaintiff failed to meet the race-neutral test enunciated in Melbourne, which was tantamount to finding that the plaintiff’s stated reason was pretextual. Again, there was nothing in the record to substantiate that finding.
The defendants’ only corroboration for its claim of purposeful racial discrimination was that the juror was the sole African American juror remaining on the panel, and that the defendants had a right to have a member of a minority group serve on the jury. The court observed that that reason alone is insufficient to override a genuine race-neutral or gender-neutral challenge.
The plaintiff did not make a cause challenge in that case, (another reason the defendants led the court into making this error). It probably never hurts to make a cause challenge in these circumstances, even if you can’t actually convince the court.
AN AFFIDAVIT CONTESTING PERSONAL JURISDICTION IS VALID EVEN IF THE DOCUMENTS THE AFFIANT RELIES UPON IN SIGNING THE AFFIDAVIT ARE NOT ATTACHED
Team Health Holdings, Inc. v. Caceres, 46 Fla. L. Weekly D839 (Fla. 3rd DCA April 14, 2021):
An out of state hospital corporation moved to dismiss the plaintiffs’ medical malpractice complaint for lack of personal jurisdiction, attaching an affidavit of the corporation’s chief operations counsel. While the affidavit itself was legally sufficient, plaintiffs contested its sufficiency based on the affiant’s failure to attach any of the documents to it.
There is no requirement that such documents be attached. Thus, in light of the agreement that the sworn proof contesting the jurisdictional allegations was itself sufficient, the court reversed and remanded for additional proceedings.
TRIAL COURT DEPARTED FROM ESSENTIAL REQUIREMENTS OF LAW IN OVERRULING INSURER’S WORK PRODUCT OBJECTION, AND COMPELLING THE INSURER TO PRODUCE INVESTIGATIVE AND CLAIMS HANDLING DOCUMENTS FROM ITS CLAIMS FILE – ISSUE OF COVERAGE REMAINS DISPUTED WHEN THE AMOUNT OF COVERAGE REMAINS TO BE DETERMINED
Avatar Property & Casualty Ins. Co. v. Flores, 46 Fla. L. Weekly D884 (Fla. 2nd DCA April 16, 2021):
After the plaintiffs’ home was damaged in Hurricane Irma in 2017, the insureds submitted a claim. The insurer agreed there was coverage. The parties disagreed, though, as to how much the claim was worth.
The magistrate found that coverage was not at issue in the case. Instead, it found that there was simply a dispute over scope and pricing of damages, and therefore, the documents were not prepared in the anticipation of litigation.
While there is no privilege in Florida that automatically attaches to “claims file” materials, the work product privilege is broadly defined to include documents that can fairly be said to have been prepared or obtained because of the prospect of litigation.
The magistrate’s finding, which the trial court adopted, was that the documents were not privileged because coverage was not at issue, presumably because the insurer admitted that some coverage existed under the policy.
That finding is contrary to Florida law, however, which holds that regardless of the binary question of whether any coverage exists, the question of coverage remains disputed for these purposes when the amount of coverage remains to be determined. Because “coverage” was still essentially in dispute, these documents were protected by the work product doctrine, and it was a departure for the court to order their production.