Justia West Virginia Supreme Court of Appeals Opinion Summaries

The complex issues at issue in these three consolidated appeals revolved around four overlapping leases to extract oil and gas from land owned by Plaintiff. Each lease contained an arbitration clause. Plaintiff filed the instant case against Defendants seeking a declaration as to which lease was controlling as to which defendants and seeking damages from Defendants. The circuit court entered an order voiding two of the four leases, addressing the substantive terms of two other leases, and compelling the parties to arbitrate any remaining claims by Plaintiff. The Supreme Court affirmed in part and reversed in part, holding that the circuit court (1) properly found the arbitration clause in one lease to be unenforceable and correctly ruled that the entire lease was unenforceable; (2) erred in compelling certain defendants to participate in arbitration under the terms of a second lease but did not err when it made findings of fact and conclusions of law that addressed the substance of Plaintiff’s claims regarding that lease; (3) erred in voiding a third lease, and its included arbitration clause, in violation the doctrine of severability; and (4) erred in its substantive rulings interpreting a fourth lease, as the court should have referred questions about the lease to arbitration. View "Chesapeake Appalachia, LLC v. Hickman" on Justia Law

Plaintiffs signed a form contract with Defendant for the construction of a house. The contract contained an arbitration clause within which was a provision that Defendant contended was a “delegation provision” stating that the parties agreed to delegate, from the courts to an arbitrator, any question about the enforceability of the arbitration clause. Plaintiffs later filed a complaint against Defendant for alleged defects in the house. The circuit court denied Defendant’s motion to dismiss and compel arbitration, finding that the arbitration clause was procedurally and substantively unconscionable. Defendant appealed, arguing that the trial court should have enforced the delegation provision and referred the parties’ claims about arbitrability to arbitration. The Supreme Court affirmed, holding (1) the delegation provision did not reflect a clear and unmistakable intent by the parties to assign to the arbitrator all questions about the enforceability of the arbitration clause; and (2) the circuit court was correct in deciding that the arbitration provision was unenforceable under West Virginia contract law. View "Schumacher Homes of Circleville v. Spencer" on Justia Law

Petitioners entered into a written agreement with Bastian Homes and Lion Enterprises, Inc. (collectively, “Bastian Homes”) for the construction of a new home. The agreement contained an arbitration clause. After a water leak allegedly substantially damaged major portions of the partially-constructed home, Petitioners sued Bastian Homes. Bastian Homes filed a motion to dismiss the complaint, arguing that the arbitration clause in the construction contract required the matter to be submitted to arbitration. Petitioners opposed the motion to dismiss, contending that the arbitration clause in this case was not bargained for and was therefore invalid. The circuit court granted the motion to dismiss. The Supreme Court affirmed in part and reversed in part, holding (1) because the construction contract was properly formed and supported by sufficient consideration, there was no requirement that the arbitration clause be independently “bargained for”; and (2) because the circuit court decided the arbitration clause not unconscionable without the issue being fairly argued by the parties and without any factual development, this issue needed to be remanded for further development of the record.View "Kirby v. Lion Enters., Inc." on Justia Law

In 2006, Respondents obtained an adjustable rate mortgage loan from a mortgage company. Respondents executed a deed of trust on the real property being purchased and separately executed an arbitration rider. Respondents later defaulted on the loan, and Petitioner, which serviced the loan, assessed a number of fees. Respondents filed an action against Petitioner alleging violations of the West Virginia Consumer Credit and Protection Act. Petitioner filed a motion to compel arbitration. The circuit court denied the motion, concluding that the arbitration agreement was unenforceable under the Dodd-Frank Act and that it was procedurally and substantively unconscionable. The Supreme Court granted Petitioner's requested writ of prohibition to prevent enforcement of the circuit court's order, holding (1) the Dodd-Frank Act did not apply to the mortgage loan because the loan was executed prior to the Act's enactment; and (2) the arbitration agreement was neither procedurally nor substantively unconscionable. View "State ex rel. Ocwen Loan Servicing, LLC v. Circuit Court of Kanawha County" on Justia Law

In 2009, GameStop, Inc., which operated retail stores that sold video games and video gaming software, hired Petitioner as an assistant manager. When she began her employment, Petitioner received a store associate handbook. In a document included with the handbook was an arbitration agreement. Petitioner signed and dated an acknowledgment of the handbook and rules including arbitration. In 2011, Petitioner sued GameStop and some of its managers (collectively, GameStop) for wrongful discharge, sexual harassment, and intentional infliction of emotional distress, among other causes of action. The circuit court dismissed the complaint pending Petitioner's submission of her claims to final and binding arbitration. Petitioner appealed, arguing that she did not enter into a valid arbitration with GameStop or, in the alternative, the arbitration agreement was unconscionable and unenforceable. The Supreme Court affirmed, holding (1) Petitioner and GameStop entered into a valid agreement to arbitrate Petitioner's claims; and (2) the arbitration agreement was neither procedurally nor substantively unconscionable. View "New v. GameStop, Inc." on Justia Law

The cases underlying these consolidated appeals involved the purchase of an automobile. Plaintiffs purchased vehicles and signed retail installment contracts with three separate dealers. The dealers assigned their rights in the contract and vehicles to Credit Acceptance Corporation, who financed the purchases. All of the contracts contained arbitration clauses. Plaintiffs later commenced civil actions against Credit Acceptance in circuit court, alleging, inter alia, violations of the West Virginia Consumer Credit and Protection act (WVCCPA). Credit Acceptance filed a motion to compel arbitration and dismiss, which the circuit court denied, finding that the arbitration agreements were unconscionable based upon the unavailability of some of the arbitration forums named therein and because Plaintiffs in the agreements waived their respective rights to a jury trial. The Supreme Court reversed in both of the cases, holding that because one of the arbitration forums named in the arbitration agreements remained available to arbitrate the parties' disputes, and because an arbitration agreement is not unenforceable solely because a party to the contract waives her right to a jury trial, the causes must be remanded for entry of orders compelling arbitration. View "Credit Acceptance Corp. v. Front" on Justia Law

Nancy Belcher was the designated health care surrogate of decedent Beulah Wyatt. Belcher signed an arbitration agreement that was presented to her when she sought to admit Wyatt to the McDowell Nursing and Rehabilitation Center (McDowell Nursing). Wyatt died after living ten months in the nursing home. Lelia Baker subsequently filed a wrongful death suit against McDowell Nursing alleging that its negligent care of Wyatt caused and/or contributed to her death. McDowell Nursing filed a motion to dismiss and to enforce the arbitration agreement. The circuit court denied the motion and concluded that the agreement was unenforceable because Belcher did not have the authority to waive Wyatt's right to a jury trial. The Supreme Court denied McDowell Nursing's subsequent request for a writ of prohibition to prevent the circuit court from enforcing its order, holding that Belcher, as a health care surrogate, did not have the authority to enter the arbitration agreement because it was not a health care decision and was not required for Wyatt's receipt of nursing home services from McDowell Nursing. View "State ex rel. AMFM, LLC v. Circuit Court (King)" on Justia Law

This case was before the Supreme Court upon the appeal of Petitioner from an order of the circuit court granting Respondents' motion for summary judgment and dismissing Petitioner's lawsuit. The court ruled that arbitration clauses in Petitioner's investment contracts were not unconscionable and enforceable. Petitioner alleged the circuit court erred in (1) requiring him to prove the arbitration clauses in the paries' agreements were independently enforceable under federal law rather than applying West Virginia law and finding those agreements unenforceable; (2) failing to find the agreements' arbitration clauses independently unenforceable; (3) refusing to find one respondent's deposition testimony an unresponsive and evasive effort to deprive Petitioner of any opportunity to conduct meaningful discovery; and (4) failing to enforce a respondent's offer to repay Petitioner. The Supreme Court reversed, holding that the circuit court's order lacked the findings of fact and conclusions of law necessary for the Supreme Court to conduct a meaningful appellate review. View "Grayiel v. Appalachian Energy Partners 2001-D, LLP" on Justia Law

The United States court of appeals certified a question to the West Virginia Supreme Court that concerned two areas of state law: the law of contract formation and the doctrine of unconscionability. The question from the court of appeals arose from a contract that contained an arbitration provision requiring one party to the contract to arbitrate all of their claims but allowed the other party to file a lawsuit for some of its claims. A federal district court previously determined that the arbitration provision was not enforceable because it lacked mutuality of obligation and mutuality of consideration. The Supreme Court concluded (1) West Virginia's law of contract formation only required that a contract as a whole be supported by adequate consideration, and hence, a single clause within a multi-clause contract does not require separate consideration when the contract as a whole is supported by adequate consideration; but (2) under the doctrine of unconscionability, a trial court may decline to enforce a contract clause, such as an arbitration provision, if the obligations or rights created by the clause unfairly lack mutuality. View "Dan Ryan Builders, Inc. v. Nelson" on Justia Law

At issue in this construction lawsuit was whether the circuit court erred in refusing to compel a plaintiff corporation to arbitrate its claims against three defendant corporations. The circuit court had previously entered two orders in which it found the arbitration clauses in Defendants' contracts with Plaintiff were unconscionable. Further, the circuit court found it would be inequitable to fracture Plaintiff's lawsuit into multiple "piecemeal" arbitrations and lawsuits against Defendants. Defendants petitioned the Supreme Court for a writ of prohibition to halt enforcement of the circuit court's orders and to compel Plaintiff to arbitrate its claims. The Court granted the requested writ of prohibition as moulded, holding (1) the arbitration agreements were not unconscionable, and therefore, the circuit court erred in refusing to enforce the agreements; (2) the FAA requires that if a lawsuit presents multiple claims, some subject to an arbitration agreement and some not, the former claims must be sent to arbitration even if this leads to piecemeal litigation; and (3) the circuit court's refusal to enforce the arbitration clauses ran afoul of the FAA. View "State ex rel. Johnson Controls, Inc. v. Circuit Court (Tucker) " on Justia Law