Irwin v. Pinetree Retirement Planning

• Court: Superior Court of Maine
• Decided: April 28, 2011
• Docket: CUMcv-10-645
• Status: Unpublished

Opinion

ST ATE OF MAfNE SUPERIOR COURT CUMBERLAND, ss. CIVIL ACTION DOCKET NO: CV -1 0-64fi !~f\L - ClAfY\- ~/;)'1,!")O)i

CAROLINE fRWIN and ELIZABETH OSMER,

Plaintiffs, ORDER v.

PINETREE RETfREMENT PLANNINC, P.A., SrATF or: n" Defendant Clmmor/nrrd , "'." JVII\INE S" (,I(1r1,'" (){f: ,\ '1" • ", ICIJ ildt' .: ;; ?O11 F

for defendant Pinetree Retirement Planning, P.A., pursuant to identical Agency

Agreements governing the terms of the commercial relationship. The plaintiffs

filed this Zlction against Pinetree seeking a declaration that the wri ttcn Agency

Agreements arc unconscionable, ilJegcll, Zlnd void or voidable, and that the

plZ1intiffs were employees rather than independent contractors as specified in

those Agreements. They also allege violations of the Title 26, section 629

prohibi bon agZlinst unfair ernployment agreernents, various wage violations, and

fraud.

Defendant [:Jinetree now moves to stay these proceedings and compel

arbitrL1tion pursui1nt to the clause contained in the Agency Agreements. Ms.

Irwin and Ms. Osmer oppose arbitn1tion on a number of grounds. First, they

chlim that the Agreements arc unenforceable so the arbitr'ltion clause should

have no legcll effect. Similarly, they contend that they were fraudulently induced

to enter the Agreements so they should not be compelled to arbi tratc. They argue

1 thtlt their cJaims under Mtline's employment ltlw should be substcll1tively exempt

from arbitratioll, <1nd that the plain langutlge of the arbitration clause does not

re

Agreements.

Maine's Uniform Arbitration Act instructs:

fA] provisioll in a written contract to submit to arbitration any controversy thereafter arising between the parties is valid, enforceable and irrevocable, save upon such grounds as exist elt Jawor in equity for the revocation of any contract. This chapter also applies to arbitration agreements behveen employers and employees ... unless otherwise provided in the agreement.

14 M.R.S. § 5927 (2010).

vVhcther a contract or agreement exists is a separate question from

whether it is valid and enforceable. Sleeper Forms v. Agwoy, Inc., 211 F. Supp. 2d

197, 201 (D. Me. 20(2); see Prilllo Poillt Corp. v. Flood S' Call/dill M.~c!" Co., 388 U.s.

395,403-04 (1967) (claim of fraud in the inducement of contract general1y docs

not necessarily invalidate an arbitration clause where the clause itself was not

procured by fraud). The Agency Agreements at issue in this case indisputably

did exist, so "Maine's 'broad presumption favoring substantive tlrbitrelbility

governs further considertltion of the action."' MocolII!wr v. MncQllillll-T'wccdie,

2003 ME 121, (1,[ 13, 834 A.2d '131, 136 (quoting V.r.P., f/lc. v. Firs! Tree Dev., fIC,

2001 ME 73, 9l 4, 770 A.2d 95, 96).

The court htls not been directed to tlny law or authority indicating thtlt

Welge tllld employment elctions tlre not arbitrable, and the plain lclilguelge of

section 5927 strongly indictltes thtlt the plcli n tiffs' claims arc subject to the

Arbitration Act. While Maine docs have"a broad presumption in favor of

arbitration," hmvever, it is also a fundtlmental principle of contract law that

"tllllbiguities ill a contract elre to be interpreted against the drafter." Bnrrct! il.

2 McD01l0ld Illves/II/ellts, l/lc., 2005 ME 43, (IllS, 870 A.2d 146, 149. The Agrecmcnts'

arbitration clausc provides:

Any dispute or claim arising out of or relating to this Agreement, or the breach thereof, shall be settled by binding JrbitrJtion conducted in Auburn, MJine, in accordance with the rules of the American Arbitration Association ....

(Compl. Ex. A § 25.)

The substance of the plaintiffs' complaint is that they were deceived Jbout

the precise scope and meaning of certain clauses in the Agreements, that the

Agreements Jre unenforceable, that contrary to the terms of the Agreements the

plJintiffs ,vere employees Jnd not independent contrJctors, Jnd that they arc

therefore entitled to recover unpJid wJges and overtime. While the plaintiffs do

not C111ege breach of contrC1ct, it would be disingenuous to say that their clC1ims do

not reI C1te to the Agency Agreements.

The Agreements purportedly governed the working relationship between

the plC1intiffs and the defendant. The question of whether the Agreements are

vC1lid C1nd controlling, or whether they are unenforceC1ble C1nd the lC1ws governing

employment relC1tionships generally should C1pply, is centrJI to the plC1intiffs'

cJse. The plJintiffs' claims C1re inextricC1bly related to the substance of the

Agreement C111d plainly fall within the ambit of the arbitrC1tion cbuse. See Barrett,

2005 ME 43, (II 21,870 A.2d C1t'151 (wllere C1rbitration c1C1use WC1S contC1ined ill

contrC1ct of

unrelC1ted to the SubstC1llce of the contrJct).

FinC1l1y, the plC1intiffs' claim for frC1ud in the inducement of the Agreement

as a whole does not pI'event the action from being submitted to an C1rbitr

United States Supreme Court squC1rely addressed this question Linder the

C1nC1logoLis federal Arbitration Act in 1967 by requiring "that when C1 contr

the contract must be resolved by an tlrbi trator, not the courts." Barretl, 2005 ME

43,9126, R70 A.2d at 152 (Alexander, J., concurring) (citing Prima Paint Corp., 388

U.s. Clt 403-04); sce Maxwcll v. Greentrcc Fin. Servicing Corp., 1997 Me. Super.

LEXIS 162 (May 19,1997) (Brennan, ].); Murphy v. Miley, 1992 Me. Super. LEXIS

47 (Apr. 8, 1993) (Fritzsche, J.); Sleeper Farms, 211 F. Supp. 2d 197, 201 (D. Me.

20(2). The courl notes thtlt this is not <:1 case in which the arbitration clCluse would

divert the pltlintiffs' claims into Cl lribunCll thClt is controlled by the defendant or

is otherwise inherently suspect. See Barretl, 2005 ME 43, (I[ 3, 870 A,2d tit 148

(arbitrCltion to be conducted by defendtlnt's Clffiliate org<:mizalion); id. 91 30,870

A.2d Clt 154 (AlexClnder, J., concurring) (discussing the dClnger of limiting

ClfbitrCltion to internal industry forums); Hooters of America, Inc. v. Pln'llips, 173

F.3d 9JJ, 93R-40 (4th Or. 1999) (arbitrc1tion clause unenforceClble where employer

controlted forum cllld process).

The entry is:

The defendant's motion to compel arbitration pursuant to Section 25 of the

Agency Agreements is granted. This action is stayed pe

thClt the pcwties may file and respond to offers of jt gm· mitted within ten

(0) days of this order pursuant to Maine Rule

DATE:~(,2P/(

4 CAROLINE IRWIN ET AL VS PINETREE RETIREMENT PLANNING PA UTN:AOCSsr -2010-0133246 CASE #:PORSC-CV-2010-00645

01 0000007728 BIRGEL CUNNINGHAM, ANNE ONE PORTLAND SQUARE PO BOX 586 PORTLAND ME 04112-0586 F CAROLINE IRWIN ;:,.P.: :L R;....,::..TN;.;,D::....-_;;;;.12::...;,../2;; ;.; ; .1;. ./2; ; .0: . ; ; .,: . 10 F ELIZABETH OSMER PL RTND 12/21/2010 --------'-------'----:.....;;;;..~

02 000000167 3 ..::.G~A~RC=IA~,.....;P~E:::;.;T~E~R--'- _ 95 MAIN STREET PO BOX 3200 AUBURN ME 04212-3200 F ELI ZABETH OSMER ;:,.P.: :L R_T_N;.;,D::..-_O..:,..2::...;.../2_8..:,../;...2;;;;.0..:,..1::..;;:.1 F PINETREE RETIREMENT PLANNING PA ::..D=E::..F .....;R;.;,T::..N;.;,D~_0..:...2::...;.../2::..8..:.../;...2..:...0..:...1~1