The Mississippi Supreme Court enforced an arbitration provision between a client and her attorney relating to a fee dispute. Slater-Moore v. Goeldner, 113 So. 3d 521, 531 (Miss. 2013).
Between 2007 and 2008, Norma Slater-Moore, the plaintiff, entered into two contracts for legal services with the Goeldner Law Firm, the defendant—one governing the defendant’s handling of a claim and another governing the defendant’s handling the appeal of that claim. The parties’ contracts stated that any dispute over the defendant’s fees would be subject to binding arbitration, collectively, the Arbitration Provision. Id. at 524.Both contracts stated that the “contract was discussed in detail, all questions about its content, meaning and scope were answered, and client acknowledges receipt of copy.” Id. The plaintiff signed the contract below this provision. Thedefendant did not sign the contract.
The parties proceeded in accordance with the terms of the contract in pursuing the plaintiff’s claim and appeal. After losing the appeal of her claim, the plaintiff brought an action against the defendant for legal malpractice, breach of contract, misrepresentation, and bad faith. The crux of the plaintiff’s legal malpractice claim was that the defendant engaged in billing misconduct. Id. The defendant filed a motion to compel arbitration of the claims regarding improper legal fees. The Mississippi circuit court granted the motion. Id. at 525.
On appeal, the Mississippi Supreme Court addressed the plaintiff’s three arguments that: (1) the contracts, including the Arbitration Provisions therein, were invalid and unenforceable; (2) the legal malpractice claim is not a “fee dispute” within the scope of the Arbitration Provision; and (3) the requirements of the arbitration agreements are procedurally unconscionable. To address these arguments, the court applied a two-prong inquiry: “‘whether the parties intended to arbitrate the dispute’ and if so, [] ‘whether legal constraints external to the parties’ agreement foreclosed the arbitration of those claims’” Id. at 526.
First, the court rejected the plaintiff’s contentions that the Arbitration Provision was invalid. Specifically, the court reasoned that (1) the parties’ actions in pursuing the plaintiff’s claim and appeal made it clear that they intended to be bound by the terms of the written agreement despite the fact that the defendant did not sign the contract; (2) the plaintiff agreed to submit any fee dispute to arbitration by signing the contract; and, (3) that the plaintiff had not met her burden to prove that the absence of certain words—“arbitrate” or “arbitration”—invalidated the contract.
Second, the court found that the plaintiff’s legal malpractice claims fell within the scope of the Arbitration Provision because the malpractice claim was essentially a dispute over legal fees.
Third, the court rejected the plaintiff’s contention that the agreements were procedurally unconscionable. The court noted that the plaintiff failed to show any evidence that she was unaware of the terms of the Arbitration Provision. The court observed that the plaintiff’s signature on the contract was directly below the clause and stated that the “contract was discussed in detail” and “all questions about its content, meaning, and scope were answered.” Id. at 529.
Practice Pointers: Goeldner serves to warn parties that they will be hard-pressed to contradict what a document they signed plainly says. It also stands as a sharp reminder that parties need to carefully define the disputes they are agreeing to arbitrate. Finally, although the court enforced the Arbitration Provision in this case, the defendant’s failure to sign the agreement needlessly subjected the defendant to the risk that the Arbitration Provision would not be enforced. The lesson? Sign an arbitration agreement if you want it enforced.
Keywords: alternative dispute resolution, adr, litigation, malpractice, fee dispute, valid, enforceable, arbitration, signature, motion to compel arbitration