6 ms·

Can you use a small claims court if the rental contract has mandatory binding arbitration clause?

blackeyeblitzar 2y ago
I don’t think you can unfortunately, and arbitration should be banned. I’m not sure how a system overriding the legal system is allowed.
- sircastor 2y ago
  It’s not overriding the legal system, it willfully sidestepping it. But obligating the contracted party to agree. The issue of course is that Hertz (in this case) can put whatever random requirements into the contract, and you can’t arbitrarily strike them. You still need/want their service. That said, just because there’s an arbitration clause in the contract doesn’t mean you’re absolutely stuck. You can hire a lawyer and try to get out of it. They’re trying to keep you from doing something like that.
  - Repulsion9513 2y ago
    Reminds me of those contracts (that are completely formulaic and you definitely can't negotiate) that say "I agree this rate has been negotiated".
- eadler 2y ago
  The Supreme Court has repeatedly and willfully ignored the plain meaning of the statutes, congressional intent in writing the FAA, as well the standard rules of statutory interpretation effectively rewriting Title 9 into something it was never intended. At this point fixing it requires congressional action. See https://arbitrationinformation.org/docs/problems/ https://arbitrationinformation.org/docs/problems/ and https://arbitrationinformation.org/docs/solutions/ https://arbitrationinformation.org/docs/solutions/ for my complete writeup.
samatman 2y ago
You absolutely can. Now the company has to pay one of their lawyers ($$$) to show up, or the claim is a default judgement, which they have to pay. So the lawyer shows up and says blah blah mandatory binding arbitration. The judge can interrupt and say "don't care, judgement against, pay the man". Or the opposite, in which case at least you cost them more than they cost you. Which is why they probably take the default judgement and pay you.
- crooked-v 2y ago
  Yeah, the key thing here is that even if the arbitration agreement is binding, they have to have someone actually show up and prove that to the judge. So multiply that across even a few hundred times...
- ensignavenger 2y ago
  At least in some courts, I would think filing a motion to dismiss would be enough, without swnding a lawyer to court... but I have never been theough that process before so I can't say for sure? Still takes time, and arbitration isn't all that scary, ao forcing them to arbitrate can also be a costly endeavor for them.
  - qingcharles 2y ago
    I would think this is possible. I've often agreed with the other party's lawyer that oral arguments on MtDs are unnecessary and then we just let the judge rule "on the papers" without anyone having to be there in person. The judge can then just file a written order with his ruling. Bear in mind that motions and discovery are highly frowned upon in Small Claims courts that I've litigated in. And 95% of the time the court will rule in favor of the bigger party if they bring a lawyer, just out of general hatred of courts for unrepresented litigants.
- kelnos 2y ago
  In the latter case, don't they then ask the judge/arbitrator to also award them legal fees if (when, really) they win?
Animats 2y ago
If the arbitrator is specified as the American Arbitration Association, usually yes. See section R-9 of the AAA Consumer Rules.[1] JAMS just updated their "minimum standards" for consumer arbitration as of May 1, 2024, and they now seem to allow for transfer to small claims court.[2] [1] https://adr.org/sites/default/files/Consumer_Rules_Web_0.pdf https://adr.org/sites/default/files/Consumer_Rules_Web_0.pdf [2] https://www.jamsadr.com/consumer-minimum-standards/ https://www.jamsadr.com/consumer-minimum-standards/

I don’t think you can unfortunately, and arbitration should be banned. I’m not sure how a system overriding the legal system is allowed.

sircastor 2y ago
It’s not overriding the legal system, it willfully sidestepping it. But obligating the contracted party to agree. The issue of course is that Hertz (in this case) can put whatever random requirements into the contract, and you can’t arbitrarily strike them. You still need/want their service. That said, just because there’s an arbitration clause in the contract doesn’t mean you’re absolutely stuck. You can hire a lawyer and try to get out of it. They’re trying to keep you from doing something like that.
- Repulsion9513 2y ago
  Reminds me of those contracts (that are completely formulaic and you definitely can't negotiate) that say "I agree this rate has been negotiated".
eadler 2y ago
The Supreme Court has repeatedly and willfully ignored the plain meaning of the statutes, congressional intent in writing the FAA, as well the standard rules of statutory interpretation effectively rewriting Title 9 into something it was never intended. At this point fixing it requires congressional action. See https://arbitrationinformation.org/docs/problems/ https://arbitrationinformation.org/docs/problems/ and https://arbitrationinformation.org/docs/solutions/ https://arbitrationinformation.org/docs/solutions/ for my complete writeup.

samatman 2y ago

You absolutely can. Now the company has to pay one of their lawyers ($$$) to show up, or the claim is a default judgement, which they have to pay. So the lawyer shows up and says blah blah mandatory binding arbitration. The judge can interrupt and say "don't care, judgement against, pay the man". Or the opposite, in which case at least you cost them more than they cost you. Which is why they probably take the default judgement and pay you.

crooked-v 2y ago
Yeah, the key thing here is that even if the arbitration agreement is binding, they have to have someone actually show up and prove that to the judge. So multiply that across even a few hundred times...
ensignavenger 2y ago
At least in some courts, I would think filing a motion to dismiss would be enough, without swnding a lawyer to court... but I have never been theough that process before so I can't say for sure? Still takes time, and arbitration isn't all that scary, ao forcing them to arbitrate can also be a costly endeavor for them.
- qingcharles 2y ago
  I would think this is possible. I've often agreed with the other party's lawyer that oral arguments on MtDs are unnecessary and then we just let the judge rule "on the papers" without anyone having to be there in person. The judge can then just file a written order with his ruling. Bear in mind that motions and discovery are highly frowned upon in Small Claims courts that I've litigated in. And 95% of the time the court will rule in favor of the bigger party if they bring a lawyer, just out of general hatred of courts for unrepresented litigants.
kelnos 2y ago
In the latter case, don't they then ask the judge/arbitrator to also award them legal fees if (when, really) they win?

Animats 2y ago

If the arbitrator is specified as the American Arbitration Association, usually yes. See section R-9 of the AAA Consumer Rules.[1] JAMS just updated their "minimum standards" for consumer arbitration as of May 1, 2024, and they now seem to allow for transfer to small claims court.[2] [1] https://adr.org/sites/default/files/Consumer_Rules_Web_0.pdf https://adr.org/sites/default/files/Consumer_Rules_Web_0.pdf [2] https://www.jamsadr.com/consumer-minimum-standards/ https://www.jamsadr.com/consumer-minimum-standards/