NARENDRA R. BUDHAN v. TRUGREEN CORPORATION

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-4902-11T1

NARENDRA R. BUDHAN,

Plaintiff-Respondent,

v.

TRUGREEN CORPORATION,

TRUGREEN LIMITED PARTNERSHIP,

and SCOTT HEIST,

Defendants-Appellants.

_____________________________________________

May 16, 2013

Argued February 25, 2013 Decided

Before Judges Graves, Ashrafi, and Guadagno.

On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-3751-11.

Robert F. Friedman (Littler Mendelson, P.C.) of the Texas bar, admitted pro hac vice, argued the cause for appellants (Littler Mendelson, P.C., attorneys; Jedd Mendelson, Michele Malloy, and Jeannine R. Idrissa, on the brief).

Neal M. Unger argued the cause for respondent.

PER CURIAM

Defendants TruGreen Corporation, TruGreen Limited Partnership, (collectively TruGreen), and Scott Heist appeal from an April 30, 2012 order of the Law Division, granting plaintiff's motion for reconsideration of an order entered March 19, 2012, which had granted summary judgment to defendants. The April 30, 2012 order vacated the earlier order and reinstated plaintiff's complaint. Defendants claim the Law Division judge erred in granting reconsideration of her earlier order and in concluding that plaintiff is not obligated to arbitrate his dispute. After review of the parties' arguments, in light of the record and applicable law, we affirm the order entered by Judge Heidi Willis Currier, which vacated her prior order and reinstated plaintiff's complaint.

We glean the following facts from the record. Narendra R. Budhan, who was born and raised in Guyana and is of Asian Indian descent, began employment with TruGreen in March of 2009 as a sales and telemarketing representative. Plaintiff was supervised by, and reported to, TruGreen manager, defendant Scott Heist. Heist terminated plaintiff's employment on July 7, 2009.

Plaintiff learned of an employment opportunity at Terminix through an online posting found on Craigslist, an Internet bulletin board. On November 11, 2009, plaintiff accepted a job with Terminix. On his first day at Terminix, plaintiff signed a ServiceMaster1 form acknowledging that he was given a copy of a booklet describing ServiceMaster's employee dispute resolution program known as "We Listen." The form provides:

I acknowledge that I have been given the We Listen booklet and that it describes important information concerning ServiceMaster's internal dispute resolution program. I also acknowledge that, as a term and condition of my employment with The ServiceMaster Company, I will use the program to address any employment-related concerns and complaints.

I further understand that the program is considered a free benefit to ServiceMaster associates, with the exception of the one-time $50 mediation fee. Further, I also will be responsible for any cost of legal representation should I choose to hire legal counsel to assist in the resolution process.

Finally, I understand that if I have an employment-related dispute, including any dispute surrounding separation of my employment, it will be submitted to binding arbitration in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration Association that are current at the time I raise the dispute.

On January 26, 2010, plaintiff signed another ServiceMaster form acknowledging that he had been given access to the ServiceMaster Associate Handbook and again agreed "to utilize ServiceMaster's alternative dispute resolution program, We Listen, to resolve any and all work-related disputes/concerns and to arbitrate such disputes if they are not resolved."

May 7, 2010, was the last day plaintiff worked for Terminix. Plaintiff's termination notice, dated May 14, 2010, indicates that plaintiff resigned his position over the phone telling his supervisor that he was "pursuing his own business possibilities" and would not be returning to work.

On May 18, 2011, plaintiff commenced suit against TruGreen and Scott Heist, alleging he was subjected to a hostile work environment, was discriminated against and wrongfully discharged on the basis of his race and/or national origin in violation of the New Jersey Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -34. In his complaint, plaintiff demanded a jury trial.

On March 19, 2012, Judge Currier granted defendants' motion for summary judgment, dismissing plaintiff's complaint with prejudice and directing plaintiff to pursue arbitration. Plaintiff moved for reconsideration and on April 30, 2012, Judge Currier granted the motion, vacated her prior order and reinstated plaintiff's complaint. Defendants filed a notice of appeal and Judge Currier granted defendants' motion for a stay of the trial court proceedings.

On appeal, defendants raise the following points for our consideration:

I. THE FEDERAL ARBITRATION ACT MANDATES ENFORCEMENT OF THE WE LISTEN PROGRAM.

II. THE COURT ERRED IN CONCLUDING THAT PLAINTIFF IS NOT BOUND TO THE ARBITRATION AGREEMENT WITH RESPECT TO HIS EMPLOYMENT WITH TRUGREEN.

III. THE COURT ERRED IN GRANTING RECONSIDERATION TO CONSIDER A NEW THEORY PREMISED ON FACTS AVAILABLE TO PLAINTIFF WHEN RESPONDING TO DEFENDANT'S MOTION FOR SUMMARY JUDGMENT.

The primary question presented on appeal is whether plaintiff's agreement to submit to ServiceMaster's dispute resolution program, signed as a condition of his employment at Terminix, compels him to waive his right to a jury trial and arbitrate a claim against a former employer, simply because that employer is a subsidiary of ServiceMaster.

Our review of the trial court's decision is de novo. See Fastenberg v. Prudential Ins. Co. of Am., 309 N.J. Super. 415, 420 (App. Div. 1998). "A trial court's interpretation of the law and the legal consequences that flow from established facts are not entitled to any special deference." Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995).

An arbitration agreement is subject to the same basic principles as other forms of contract formation. Leodori v. Cigna Corp., 175 N.J. 293, 302, cert. denied, 540 U.S. 938, 124 S. Ct. 74, 157 L. Ed. 2d 250 (2003). In Garfinkel v. Morristown Obstetrics & Gynecology Associates, our Supreme Court recognized "[t]hat parties to an agreement may waive statutory remedies in favor of arbitration[.]" 168 N.J. 124, 131 (2001). The Court stressed, however, that "[t]o enforce a waiver-of-rights provision in this setting, the Court requires some concrete manifestation of the employee's intent as reflected in the text of the agreement itself." Id. at 135.

Garfinkel involved a waiver-of-rights provision in an employment agreement between a physician and his employer that provided the parties would resolve "any controversy or claim" that arose from the agreement by submitting it to arbitration. Id. at 134. Two years after signing the agreement, the physician claimed that his employer had terminated him in violation of the LAD. The Court found that the agreement was insufficient to constitute a waiver of remedies under the LAD. Ibid. The Court reasoned that the language in the waiver provision suggested that the parties had intended only to arbitrate "those disputes involving a contract term, a condition of employment, or some other element of the contract itself." Ibid. The language did not signal an intention to arbitrate disputes that were governed more broadly by the LAD or by similar statutes. Ibid.

Martindale v. Sandvik, Inc., 173 N.J. 76 (2002), involved a waiver-of-rights agreement contained in an application for employment that the plaintiff had completed and signed prior to being hired by the defendant corporation. The relevant provision indicated that the plaintiff had agreed "that all disputes relating to my employment with [the corporation] or termination thereof shall be decided by an arbitrator[.]" Id. at 81-82. The provision also stated, "[a]s a condition of my employment, I agree to waive my right to a jury trial in any action or proceeding related to my employment with [the corporation]." Id. at 81.

In resolving whether the arbitration agreement was enforceable as a matter of law, the Court examined the Federal Arbitration Act through which Congress has sought "to place arbitration agreements upon the same footing as other contracts." Id. at 84. The Court held that an agreement to arbitrate contained in an application for employment "is binding, as would be any other contractual term not contrary to public policy contained in a signed employment application that led . . . to employment." Id. at 89. The Court concluded that the waiver-of-rights provision in Martindale "not only was clear and unambiguous, it was also sufficiently broad to encompass reasonably [the] plaintiff's statutory causes of action." Id. at 96.

Applying these principles to the present case, we determine that the waiver-of-rights provision executed by plaintiff when he joined Terminix did not reflect an unambiguous intention to arbitrate claims he may have had against his former employer, TruGreen. "[A] valid waiver results only from an explicit, affirmative agreement that unmistakably reflects the employee's assent." Leodori, supra, 175 N.J. at 303.

Judge Currier found that while plaintiff waived his right to a jury trial regarding disputes with Terminix, he did not waive those rights as to disputes with his prior employer:

I don't think that this plaintiff or any employee would realize that this [waiver] would have applied to the job they held several months earlier for another company, another division. . . . He only received this handbook in November 2009. His employment at Trugreen was from March until July of 2009.

I don't find that he could have waived his jury trial rights to an employment that he had already left 4 months previously.

These findings are well-supported in the record. The only indication that the waiver applies to past disputes is in the definition of disputes contained in the ServiceMaster "We Listen" Plan and Rules:

"Dispute" includes all such matters regardless of when the events on which they are based occurred (except as otherwise provided herein with respect to legal and equitable claims barred as untimely), including matters based on events occurring before the Associate became subject to this Plan (so long as such disputes were not previously asserted in a judicial forum) or after termination of the employment relationship.

Only two references in the "We Listen" booklet indicate that the ServiceMaster waiver includes disputes with TruGreen. A footnote on page four indicates that the ServiceMaster dispute resolution "includes all ServiceMaster business units, including . . . TruGreen . . . ." Also, the cover of the booklet lists all of the ServiceMaster "family of brands" and includes both Terminix and TruGreen. The "We Listen" booklet is a reference document provided to ServiceMaster employees and "intended as a summary of the major features of the 'We Listen' program." Defendants argue that by signing the two "We Listen" acknowledgment forms and receiving the informational booklet, "plaintiff agreed to arbitrate all disputes relating to his employment with any ServiceMaster company, including TruGreen." We disagree. Defendants have failed to demonstrate that plaintiff has executed an enforceable waiver of his right to a jury trial on a statutory discrimination claim arising from his employment with TruGreen.

We find the remainder of defendants' arguments lack sufficient merit to warrant more than a brief comment. R. 2:11-3(e)(1)(E).

"Reconsideration should be utilized only for those cases which fall into that narrow corridor in which either 1) the Court has expressed its decision based upon a palpably incorrect or irrational basis, or 2) it is obvious that the Court either did not consider, or failed to appreciate the significance of probative, competent evidence . . . ." Cummings v. Bahr, 295 N.J. Super. 374, 384 (App. Div. 1996) (quoting D'Atria v. D'Atria, 242 N.J. Super. 392, 401-02 (Ch. Div. 1990)).

"It is well established that 'the trial court has the inherent power to be exercised in its sound discretion, to review, revise, reconsider and modify its interlocutory orders at any time prior to the entry of final judgment.'" Lombardi v. Masso, 207 N.J. 517, 534 (2011) (quoting Johnson v. Cyklop Strapping Corp., 220 N.J. Super. 250, 257 (App. Div. 1987), certif. denied, 110 N.J. 196 (1988)). Rule 4:42-2, "like the jurisprudence on which it is based, sets forth no restrictions on the exercise of the power to revise an interlocutory order." Ibid.

In her April 30, 2012 decision, Judge Currier gave careful consideration to the facts before her and determined that any waiver plaintiff had executed as to his right to a jury trial did not apply to his former employment. As the Lombardi Court held, when a "judge later sees or hears something that convinces [her] that a prior ruling is not consonant with the interests of justice, [she] is not required to sit idly by and permit injustice to prevail." Lombardi, supra, 207 N.J. at 537.

A

1 Terminix is a subsidiary of ServiceMaster Corp., as is TruGreen.