Perez v. Sky Zone LLC

472 N.J.Super. 240

276 A.3d 190

Louie PEREZ, Plaintiff-Appellant,

v.SKY ZONE LLC, Sky Zone Franchise Group, LLC, Circustrix Holdings, LLC, Go Ahead and Jump 4, LLC d/b/a Sky Zone, Abeo North America, Inc., and Fun Spot Manufacturing, LLC, Defendants-Appellants.

DOCKET NO. A-1861-20

Superior Court of New Jersey, Appellate Division.

Argued February 2, 2022

Decided May 16, 2022

Jared M. Placitella argued the cause for appellant (Cohen, Placitella & Roth, PC, and Chazen & Chazen, LLC, attorneys; Jared M. Placitella, Christopher M. Placitella, and David K. Chazen, Englewood, on the briefs).

Jill A. Mucerino argued the cause for respondents Sky Zone LLC, Sky Zone Franchise Group, LLC, Circustrix Holdings, LLC and Go Ahead and Jump 4, LLC d/b/a Sky Zone (Wood Smith Henning & Berman LLP, attorneys; Jill A. Mucerino and Sean P. Shoolbraid, Berkeley Heights, on the brief).

Before Judges Gilson, Gooden Brown, and Gummer.

The opinion of the court was delivered by

GILSON, J.A.D.

Plaintiff Louie Perez placed a check mark next to an arbitration provision contained in an agreement he signed to enter a trampoline park. He appeals from an order compelling his personal-injury claims to arbitration and staying the action he filed in the Law Division. We hold that the arbitration provision contained in the agreement that plaintiff signed is valid and enforceable. We, therefore, affirm the portion of the order compelling arbitration of the claims against defendants Sky Zone, LLC, Sky Zone Franchise Group, LLC, Circustrix Holdings, LLC, and Go Ahead and Jump 4, LLC (collectively the Sky Zone defendants).

We remand for entry of a new order compelling the claims against the Sky Zone defendants to arbitration and staying the Law Division action, including the claims against defendants Abeo North America, Inc. (Abeo) and Fun Spot Manufacturing, LLC (Fun Spot). There is nothing in the record establishing that Abeo or Fun Spot is an affiliate company or agent of the Sky Zone defendants and, therefore, neither defendant was covered by the arbitration provision. Consequently, the claims against Abeo and Fun Spot are to be stayed until the arbitration proceedings are concluded.

I.

On October 26, 2019, plaintiff, together with his seven-year-old son, went to the Sky Zone trampoline park in Springfield, New Jersey. To enter the park, plaintiff was required to check himself and his son in at a kiosk. At the kiosk, plaintiff had an opportunity to review a "Participation Agreement, Release and Assumption of Release (The Agreement)."

The Agreement contained various provisions, including provisions entitled "ACKNOWLEDGEMENT OF POTENTIAL INJURIES;" "VOLUNTARY ASSUMPTION OF RISK ACKNOWLEDGMENT;" "RELEASE OF LIABILITY;" and "ARBITRATION OF DISPUTES; TIME LIMIT TO BRING CLAIM" (the Arbitration Provision).

The Arbitration Provision stated that plaintiff was waiving his right to bring a lawsuit against the Sky Zone defendants and, instead, was agreeing to arbitrate any claims arising out of his access to or use of the trampoline park. The Provision also stated that the arbitrator would resolve any disputes concerning the scope of the agreement to arbitrate. Furthermore, the Arbitration Provision stated that it was governed by New Jersey law and that any arbitration would be governed by the Federal Arbitration Act (the FAA), 9 U.S.C. §§ 1 - 16. The Arbitration Provision stated:

I understand that by agreeing to arbitrate any dispute as set forth in this section, I am waiving my right, and the right(s) of the minor child(ren) above, to maintain a lawsuit against [the Sky Zone defendants] and the other Releasees for any and all claims covered by this Agreement. By agreeing to arbitrate, I understand that I will NOT have the right to have my claim determined by a jury, and the minor child(ren) above will NOT have the right to have claims(s) determined by a jury. Reciprocally, [the Sky Zone defendants] and the other Releasees waive their right to maintain a lawsuit against me and the minor child(ren) above for any and all claims covered by this Agreement, and they will not have the right to have their claim(s) determined by a jury. ANY DISPUTE, CLAIM OR CONTROVERSY ARISING OUT OF OR RELATING TO MY OR THE CHILD'S ACCESS TO AND/OR USE OF THE SKY ZONE PREMISES AND/OR ITS EQUIPMENT, INCLUDING THE DETERMINATION OF THE SCOPE OR APPLICABILITY OF THIS AGREEMENT TO ARBITRATE, SHALL BE BROUGHT WITHIN ONE YEAR OF ITS ACCRUAL (i.e., the date of the alleged injury) FOR AN ADULT AND WITHIN THE APPLICABLE STATUTE OF LIMITATIONS FOR A MINOR AND BE DETERMINED BY ARBITRATION IN THE COUNTY OF THE SKY ZONE FACILITY, NEW JERSEY, BEFORE ONE ARBITRATOR. THE ARBITRATION SHALL BE ADMINISTERED BY JAMS PURSUANT TO ITS RULE 16.1 EXPEDITED ARBITRATION RULES AND PROCEDURES. JUDGMENT ON THE AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. THIS CLAUSE SHALL NOT PRECLUDE PARTIES FROM SEEKING PROVISIONAL REMEDIES IN AID OF ARBITRATION FROM A COURT OF APPROPRIATE JURISDICTION. This Agreement shall be governed by, construed and interpreted in accordance with the laws of the State of New Jersey, without regard to choice of law principles. Notwithstanding the provision with respect to the applicable substantive law, any arbitration conducted pursuant to the terms of this Agreement shall be governed by the Federal Arbitration Act ( 9 U.S.C., Sec. 1 - 16 ). I understand and acknowledge that the JAMS Arbitration Rules to which I agree are available online for my review at jamsadr.com, and include JAMS Comprehensive Arbitration Rules & Procedures; Rule 16.1 Expedited Procedures; and, Policy On Consumer Minimum Standards Of Procedural Fairness.

The Agreement also contained a severability clause, which provided: "If any term or provision of this Release shall be held illegal, unenforceable, or in conflict with any law governing this Release the validity of the remaining portions shall not be affected thereby." In the Agreement, plaintiff acknowledged: "I have had sufficient opportunity to read this entire document.

I have read and understood and voluntarily agree to be bound by its terms."

After having an opportunity to review it, plaintiff checked the box located at the beginning of the Arbitration Provision. At the end of the Agreement, plaintiff added his name, his son's name, their birthdates, and his address, phone number, and email address.

On October 20, 2020, plaintiff filed a lawsuit alleging that he suffered physical injuries while at the trampoline park. As defendants, he named the Sky Zone defendants, as well as Abeo and Fun Spot. The Sky Zone defendants moved to dismiss plaintiff's complaint and compel arbitration. Abeo and Fun Spot did not join that motion. Instead, Fun Spot filed an answer. The record provided to us does not contain an answer by Abeo.

On February 5, 2021, the trial court heard oral arguments on the motion. At that hearing, an attorney representing Abeo and Fun Spot informed the trial court that his clients were not joining the motion. After hearing oral argument, the trial court granted the motion and entered an order compelling all of plaintiff's claims to arbitration and staying the litigation. The court also issued a statement of reasons supporting its ruling. The trial court held that the Arbitration Provision was valid and enforceable against plaintiff and that it covered all his claims. The court also held that the claims against Fun Spot and Abeo should be compelled to arbitration, reasoning that those entities fell under the Arbitration Provision "based on agency principles." In making that holding, the court did not analyze or make any factual findings that Fun Spot or Abeo is an agent of the Sky Zone defendants. Moreover, the court concluded that it would not be equitable for plaintiff to avoid arbitration simply because he chose to name parties who had not signed the Arbitration Provision. Plaintiff now appeals from the February 19, 2021 order compelling arbitration and staying the Law Division action.

II.

On appeal, plaintiff argues that the trial court erred in (1) ruling that the Arbitration Provision was enforceable; (2) severing the Arbitration Provision from other provisions that were allegedly not enforceable; and (3) compelling his claims against Abeo and Fun Spot to arbitration. In his reply brief, plaintiff also contends that the Sky Zone defendants waived the argument that the questions concerning the scope of the Arbitration Provision should be delegated to the arbitrator and that the Arbitration Provision did not clearly delegate scope questions to the arbitrator.

A. The Enforceability of the Arbitration Provision.

We use a de novo standard of review when determining the enforceability of an arbitration agreement. Goffe v. Foulke Mgmt. Corp., 238 N.J. 191, 207, 208 A.3d 859 (2019) (citing Hirsch v. Amper Fin. Servs., LLC, 215 N.J. 174, 186, 71 A.3d 849 (2013) ). The validity of an arbitration agreement is a question of law, and we conduct a plenary review of such legal questions. Atalese v. U.S. Legal Servs. Grp., L.P., 219 N.J. 430, 445-46, 99 A.3d 306 (2014) (citing Kieffer v. Best Buy, 205 N.J. 213, 222-23, 14 A.3d 737 (2011) ); Barr v. Bishop Rosen & Co., Inc., 442 N.J. Super. 599, 605, 126 A.3d 328 (App. Div. 2015) (citing Hirsch, 215 N.J. at 186, 71 A.3d 849 ).

The FAA and "the nearly identical New Jersey Arbitration Act [(NJAA)], enunciate federal and state policies favoring arbitration." Atalese, 219 N.J. at 440, 99 A.3d 306 (citation omitted). Under both the FAA and NJAA, arbitration is fundamentally a matter of contract. 9 U.S.C. § 2 ; NAACP of Camden Cnty. E. v. Foulke Mgmt. Corp., 421 N.J. Super. 404, 424, 24 A.3d 777 (App. Div. 2011). "[T]he FAA ‘permits states to regulate ... arbitration agreements under general contract principles,’ and a court may invalidate an arbitration clause ‘upon such grounds as exist at law or in equity for the revocation of any contract.’ " Atalese, 219 N.J. at 441, 99 A.3d 306 (alteration in original) (quoting ...