Colon v. Strategic Delivery Solutions, LLC

210 A.3d 932, 459 N.J. Super. 349
CourtNew Jersey Superior Court Appellate Division
DecidedJune 4, 2019
DocketDOCKET NO. A-2378-17T4
StatusPublished
Cited by6 cases

This text of 210 A.3d 932 (Colon v. Strategic Delivery Solutions, LLC) is published on Counsel Stack Legal Research, covering New Jersey Superior Court Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Colon v. Strategic Delivery Solutions, LLC, 210 A.3d 932, 459 N.J. Super. 349 (N.J. Ct. App. 2019).

Opinion

SUTER, J.A.D.

*354Plaintiffs Gloria Colon, Diana Mejia and Freddy Diaz appeal the January 2, 2018 summary judgment order that dismissed their class action complaint and jury demand. The order required mandatory binding arbitration on an individual basis of their wage and hour claims against defendants Strategic Delivery Solutions, LLC (SDS) and Myriam Barreto.1 We vacate the order of dismissal, and reinstate the complaint for the trial court to determine whether plaintiffs were engaged in transportation services in interstate commerce and thus, exempt under the Federal Arbitration Act (FAA), 9 U.S.C. §§ 1 - 16. If the FAA does not apply to plaintiffs, we hold that the New Jersey Arbitration Act (NJAA), N.J.S.A. 2A:23B-1 to -32, applies and requires arbitration of their claims. We also hold that plaintiffs waived a trial by jury and the ability to proceed as a class action under their agreements with SDS.

SDS is licensed by the United States Department of Transportation as a freight forwarder and freight broker. It arranges for the local delivery of pharmaceutical products and general merchandise to its customers. Plaintiffs each signed identical "Independent Vendor Agreement[s] for Transportation Services" with SDS in which they said they owned and operated a business that provided transportation services. Plaintiffs agreed to provide transportation services as independent contractors for SDS's customers.

*355The *936agreements covered various issues: transportation needs, rate of compensation, payment, fringe benefits, vehicles, signage, uniforms, badges, tools, equipment, insurance, indemnification, and termination of the agreements.

Paragraph 19 of the agreement provided that the law of the state of residence of the "vendor" would apply, meaning that for these plaintiffs, New Jersey law governed the agreement, "including its construction and interpretation, the rights and remedies of the parties hereunder, and all claims, controversies or disputes (whether arising in contract or tort) between the parties." Plaintiffs also agreed in paragraph 19(b) to waive "any right to a trial by jury in any suit filed hereunder and agree to adjudicate any dispute pursuant to [p]aragraph 20 ...." Paragraph 20 addressed arbitration and the waiver of class actions.

Plaintiffs alleged they worked out of SDS's facility in Elizabeth from February 2015 to March 2016 performing "truck driving and ... delivery functions." They claimed SDS made "unlawful deductions" from their compensation in violation of the New Jersey Wage Payment Law (WPL), N.J.S.A. 34:11-4.1 to 4.14. They contended they were misclassified by SDS as independent contractors and should have been classified as employees. Plaintiffs alleged they should have been paid one-and-a-half their hourly rate for work in excess of forty hours per week and SDS's failure to do so violated the New Jersey Wage and Hour Law (WHL), N.J.S.A. 34:11-56a to -56a38.2

In December 2016, plaintiffs filed suit against defendants on behalf of themselves and as a class action on behalf of other "similarly situated persons," for violation of the WHL and WPL, and demanded a jury trial. Defendants filed a motion to dismiss *356the complaint and to compel plaintiffs to arbitrate these claims on an individual basis, not as a class. Defendants relied on paragraphs 19 and 20 of the agreement, arguing that plaintiffs agreed to waive a jury trial, to proceed on an individual (non-class) basis, and to have their claims heard in binding arbitration. Plaintiffs opposed the motion, arguing they were exempt from arbitration under the FAA, and that they had not waived their right to a jury trial or class action relief under the WHL or WPL.

The trial court granted defendants' motion, treating it as a summary judgment motion, because the parties relied on materials not referenced in the complaint. See R. 4:6-2. The court concluded in its Statement of Reasons that plaintiffs waived their right to a jury trial in paragraph 20 of the agreement, comparing the language there to "analogous" language in Martindale v. Sandvik Inc., 173 N.J. 76, 800 A.2d 872 (2002). The court found that plaintiffs' agreement to arbitrate was "clear and unambiguous" and constituted a "valid and enforceable arbitration agreement." "Similarly, the [w]aiver to [j]oin a [c]lass provision [was] clear and unambiguous ... valid and enforceable." The trial court's order required plaintiffs to adjudicate their WHL and WPL claims through arbitration. The court did not expressly address plaintiffs' claims against Barreto.

I

The validity of a contractual provision that requires arbitration is a question *937of law. See Hirsch v. Amper Financial Services, LLC, 215 N.J. 174, 186, 71 A.3d 849 (2013). We review the court's order that required arbitration of these claims on a de novo basis. Ibid.; see Atalese v. U.S. Legal Servs. Group, 219 N.J. 430, 446, 99 A.3d 306 (2014).

Paragraph 20 of the agreement provided as follows:

(a) Agreement to Arbitrate. The parties agree to comply and be bound by the Federal Arbitration Act. The parties agree that any dispute, difference, question, or claim arising out of or any way relating to this Agreement or the transportation services provided hereunder shall be subject to binding arbitration in accordance with the Rules for Commercial Arbitration of the American Arbitration Association *357("AAA") in effect at the time such arbitration is initiated. The parties agree that the issue of arbitrability shall be determined by the arbitrator applying the law of the state of residence of the Vendor. The parties shall bear their own costs including, without limitation, attorneys' fees, and shall each bear one half (1/2) of the fees and costs of the arbitrator ... selected from a list of potential arbitrators provided by the AAA ....

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Bluebook (online)
210 A.3d 932, 459 N.J. Super. 349, Counsel Stack Legal Research, https://law.counselstack.com/opinion/colon-v-strategic-delivery-solutions-llc-njsuperctappdiv-2019.