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DOCKET NO. A-0654-12T3








February 22, 2013


Argued January 22, 2013 - Decided


Before Judges Parrillo and Fasciale.


On appeal from the Superior Court of New Jersey, Law Division, Special Civil Part, Ocean County, Docket No. DC-006622-12.


William D. Wright argued the cause for appellant.


Thomas M. Barron argued the cause for respondent.


Plaintiff Patricia Atalese appeals the August 21, 2012 order of the Law Division dismissing her complaint against defendant United States Legal Services Group, L.P., and compelling arbitration. We affirm.

On July 5, 2011, plaintiff entered into a debt resolution service agreement with defendant in which defendant was to assist plaintiff in dealing with her credit problems. Among the services contracted for, defendant was to review plaintiff's financial circumstances, provide consultations, evaluate potential legal defenses to plaintiff's debts and claims under the Fair Debt Collection Practices Act, and then negotiate and attempt to enter into settlements with creditors in an effort to modify and restructure plaintiff's debt obligations.

The written contract between plaintiff and defendant contained an arbitration clause that read as follows:

Arbitration: In the event of any claim or dispute between Client and the USLS[] related to this agreement or related to any performance of any services related to this Agreement, the claim or dispute shall be submitted to binding arbitration upon the request of either party upon the service of that request on the other party. The parties shall agree on a single arbitrator to resolve the dispute. The matter may be arbitrated either by the Judicial Arbitration Mediation Service or American Arbitration Association, as mutually agreed upon by the parties or selected by the party filing the claim. The arbitration shall be conducted in either the county in which Client resides, or the closest metropolitan county. Any decision of the arbitrator shall be final and may be entered into judgment in any court of competent jurisdiction. The conduct of the arbitration shall be subject to the then current rules of the arbitration service. The costs of arbitration, excluding legal fees, will be split equally or be born by the losing party, as determined by the arbitrator. The parties shall bear their own legal fees.


According to plaintiff, defendant settled one debt on her behalf, negotiated with other creditors, and retained an attorney who prepared a single page answer for her to file in a collection action filed by a creditor. She paid defendant over $5,000 in fees.

Plaintiff became dissatisfied with defendant's efforts and commenced the instant lawsuit in the Special Civil Part alleging defendant, as an unlicensed debt adjuster, engaged in deceptive and unlawful practices in violation of the New Jersey Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to -195, and the Truth-In-Consumer Contract, Warranty & Notice Act, N.J.S.A. 56:12-14 to

-18, and further is guilty of criminal usury, N.J.S.A. 2C:21-19(f). Defendant did not timely answer and consequently a default was entered, which defendant later succeeded in vacating.

Following its answer, defendant moved to compel arbitration based on the arbitration provision of the agreement, and to dismiss plaintiff's complaint. Plaintiff resisted and cross-moved for default judgment. Following argument, the court referred the parties to arbitration and dismissed plaintiff's complaint without prejudice. The judge reasoned:

I do think that I agree then with the [f]ederal [j]udges who have come to the conclusion that this identical language is minimally, barely, but it is sufficient to put the party on notice that if you have any sort of dispute arising out of your agreement, it's going to be heard in Arbitration. It doesn't explicitly say it won't be in [c]ourt, it won't be a trial by jury. Neither did, as we pointed out, the Epix agreement, [Epix Holdings Corp. v. Marsh & McLennan Cos., 410 N.J. Super. 453 (App. Div. 2009)], but that wasn't fatal. It's otherwise unambiguous that you're going to go to Arbitration, it's going to be decided by the Arbitrator, and then later after that if you get an award, you can take it to [c]ourt. It's not lengthy. It's conspicuous as everything else. The font is the same. It's not hidden. It's got its own title, heading. It's right above the bottom of the page where the consumer initialed.


And I think it meets every other criteria as enunciated in Curtis v. Cellco [, 413 N.J. Super. 26 (App. Div.), certif. denied, 203 N.J. 94 (2010)]. And in light of the favored status of Arbitration, when it's close, I think we have to come down then on the side of favoring Arbitration.

. . . It says, "any and all, arising out of relating to are going to be decided in Arbitration." It's right there for the consumer to see and initial.


On appeal, plaintiff contends the contractual arbitration provision is unenforceable because it does not clearly state its purpose or contain an express waiver of her right to sue in court on her statutory claims. We disagree.

New Jersey courts favor arbitration as a means of resolving disputes, embracing the federal policy preferring this method of alternative dispute resolution. EPIX Holdings Corp. v. Marsh & McLennan Cos., 410 N.J. Super. 453, 471 (App. Div. 2009); Bruno v. Mark MaGrann Assocs., 388 N.J. Super. 539, 545 (App. Div. 2006). "Because of the favored status afforded to arbitration, '[a]n agreement to arbitrate should be read liberally in favor of arbitration.'" Garfinkel v. Morristown Obstetrics & Gynecology Assocs., 168 N.J. 124, 132 (2001) (quoting Marchak v. Claridge Commons, Inc., 134 N.J. 275, 282 (1993)).

It is equally well-settled "that parties to an agreement may waive statutory remedies in favor of arbitration." Garfinkel, supra, 168 N.J. at 131. Pertinent here, courts have determined arbitration is an appropriate forum to vindicate statutory rights under the CFA. See, e.g., Curtis v. Cellco P'ship, 413 N.J. Super. 26, 36-37 (App. Div.) ("We have found nothing in the CFA that precludes vindication of a consumer's 'statutory rights in the forum.'"), certif. denied, 203 N.J. 94 (2010); Gras v. Assocs. First Cap., 346 N.J. Super. 42, 52 (App. Div. 2001) ("There is no inherent conflict between arbitration and the underlying purposes of the CFA."), certif. denied, 171 N.J. 445 (2002); Caruso v. Ravenswood Developers, 337 N.J. Super. 499, 505 (App. Div. 2001) ("[C]laims arising under the Consumer Fraud Act may be heard and resolved through arbitration."); Cybul v. Atrium Palace Syndicate, 272 N.J. Super. 330, 335 (App. Div.) (same), certif. denied, 137 N.J. 311 (1994).

To be sure, "such a waiver contained in a written provision 'must reflect that [a party] has agreed clearly and unambiguously to arbitrate the disputed claim.'" NAACP of Camden Cnty. E. v. Foulke Mgmt. Corp., 421 N.J. Super. 404, 425 (App. Div.) (quoting 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)), certif. granted, 209 N.J. 96 (2011), appeal dismissed, ___ N.J. ___ (2013). Consequently, courts "must examine whether the terms of the provisions were stated with sufficient clarity and consistency to be reasonably understood by the consumer who is being charged with waiving her right to litigate a dispute in court." Foulke, supra, 421 N.J. Super. at 428. In this regard, an arbitration will be upheld if

[t]he arbitration provisions are sufficiently clear, unambiguously worded, satisfactorily distinguished from the other Agreement terms, and drawn in suitably broad language to provide a consumer with reasonable notice of the requirement to arbitrate all possible claims arising under the contract.


[Curtis, supra, 413 N.J. Super. at 33.]


Applying this rule here, we conclude the arbitration provision at issue survives this level of scrutiny. In the first place, the clause is not hidden in fine print but rather set off in a separate paragraph (#16) and bears the title "Arbitration" in bold, thus distinguishing it from other terms of the agreement. Moreover, the arbitration clause is plainly and clearly written, expressly stating: "In the event of any claim or dispute between [the client] and [defendant] USLSG related to this Agreement or related to any performance of any services related to this Agreement, the claim or dispute shall be submitted to binding arbitration upon the request of either party . . . ." (Emphasis added). The clause goes on to state, "[a]ny decision of the arbitrator shall be final and may be entered into judgment in any court of competent jurisdiction." (Emphasis added). Finally, the provision informs where the arbitration shall take place, responsibility for the payment of the costs thereof, and the process under which it will be conducted. We find the consistency and clarity of the language employed allows the parties to reasonably understand the arbitration clause and to knowingly agree to be bound thereby.

Contrary to plaintiff's contention, we do not find the lack of express reference to a waiver of the right to sue in court or to arbitration as the "exclusive" remedy to be a bar to enforcement of the clause. In fact, we have previously upheld arbitration provisions in the absence of such language. See, e.g., EPIX Holdings Corp., supra, 410 N.J. Super. at 476; Griffin v. Burlington Volkswagen, Inc., 411 N.J. Super. 515, 518 (App. Div. 2010) (approving arbitration provision that did not explicitly refer to a "jury trial" waiver).

Here, while the disputed provision did not explicitly state that plaintiff agreed to waive her right to try her dispute in court, it clearly and unambiguously stated that at the request of a party, any dispute relating to the underlying agreement shall be submitted to arbitration and the resolution of that forum shall be binding and final. Such language provides the parties reasonable notice of the requirement to arbitrate all claims under the contract and sufficiently distinguishes the arbitral forum, with its own processes and procedures, from a court of law, where the decision of the arbitrator may later be enforced. Thus, a reasonable person, by signing the agreement, understands that arbitration is the sole means of resolving contractual disputes upon the election of either party; that the resolution binds both parties and is final in nature; and that such resolution may be reduced to a judgment in a separate and distinct judicial forum. Accordingly, we conclude the language used is sufficient to render the arbitration clause at issue valid and enforceable.


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