Court agrees with NJSBA argument in case centering on arbitration clauses

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Jan. 11, 2019
Contact: Paula Saha
Director of Communications and Media Relations

NEW BRUNSWICK - The Supreme Court today released its decision in Kernahan v. Home Warranty Administrator of Florida, Inc.
NJSBA President John E. Keefe Jr. said the decision will help the public.
"The NJSBA believes today's opinion will aid consumers because the Court agreed with the association's argument that in applying general principles of contract, the language in the arbitration clause at issue was not clear and therefore there was no mutual assent of the parties, a necessary precursor to a valid contract and enforcement of its provisions."
The case focused on an arbitration clause in a home appliance service agreement. It ask if the clause was unenforceable under Atalese for failure to provide the purchaser with adequate notice that the consumer was relinquishing the right to bring a consumer fraud claim in court?
The Appellate Division refused to enforce a clause that is so confusing on its face that a reasonable consumer could not be expected to understand its import. The Supreme Court agreed. Read the decision here