BENEFITS COMMUNICATION CORP. v. KLIEFORTH

• Decision Date: 09 June 1994
• Docket Number: No. 92-CV-996,92-CV-996
• Citation: 642 A.2d 1299
• Parties: BENEFITS COMMUNICATION CORPORATION, et al., Appellants, v. Laurette C. KLIEFORTH, Appellee.
• Court: D.C. Court of Appeals

642 A.2d 1299

BENEFITS COMMUNICATION CORPORATION, et al., Appellants, v. Laurette C.KLIEFORTH, Appellee.

No. 92-CV-996.

District of Columbia Court of Appeals.

Argued January 4, 1994.

Decided June 9, 1994.

APPEAL FROM THE SUPERIOR COURT, GEORGE W. MITCHELL, J.

C. William Groscup, with whom Steven G. Barringer, Washington, DC, John M. Husband, and Brian M. Mumaugh, Denver, CO, were on the brief, for appellants.

Robert B. Fitzpatrick, with whom Mark D. Laponsky and Jonathan R. Topazian, Washington, DC, were on the brief, for appellee.

Before FERREN, Acting Chief Judge, and STEADMAN and KING, Associate Judges. ^*.

Former Chief Judge ROGERS was a member of the division that heard oral argument in this case. After her departure from the court, Acting Chief Judge FERREN was selected by lot to replace her.

KING, Associate Judge:

Appellee Laurette C. Klieforth ("employee") filed a complaint against appellants Great West Life Assurance Co. ("GreatWest") and its subsidiary Benefits Communication Corporation ("BCC"), who was her employer, alleging appellants had denied her a promotion on the basis of her sex in violation of the District of Columbia Human Rights Act ("Human Rights Act").¹ Shortly after the Supreme Court's decision in Gilmer v. Interstate/Johnson Lane Corp.,² which upheld an arbitration provision for an age discrimination claim, appellants moved to compel arbitration of Klieforth's discrimination claim. After extensive briefing and argument, Judge Mitchell denied the motion, concluding the Civil Rights Act of 1991 ("the 1991 amendments")³ retroactively overruled the Supreme Court's Gilmer decision. Concluding that the trial court erred in so doing, we reverse and remand for further proceedings.

I.

On October 30, 1985, the employee executed a "Uniform Application for Securities Industry Registration or Transfer" ("Form U-4")⁴ in contemplation of beginning employment with BCC as a securities dealer.⁵ On January 2, 1986, the employee was hired by BCC as an account executive, an office support position. After passing an examination that qualified her to sell securities, Klieforth was promoted to the position of "Employer Sponsored Specialist" selling retirement related registered insurance products and securities. Some time thereafter, although the record is not clear on this point, the position of vice president of sales of the Washington, D.C. office became available and the employee, having already assumed many of the duties of that position, became a candidate for that post and expected to be promoted to it. Her expectations were not realized, and the vice president of sales for the Detroit office, a male, was actually appointed.

On October 10, 1990, the employee filed a complaint in the Superior Court alleging she was denied the promotion because of her sex in violation of the Human Rights Act. On June 24, 1991, just six weeks after Gilmer was decided, appellants filed a motion to compel arbitration pursuant to the Federal Arbitration Act ("FAA"),⁶ the District of Columbia Uniform Arbitration Act,⁷ and section 8(a) of the National Association of Securities Dealers ("NASD") Code of Arbitration Procedures.⁸ The employee opposed, contending:(1) sections 1 and 8(a) of the NASD code only provide for the arbitration of disputes relating to the business activities of NASD members; (2) the NASD code does not address employment discrimination claims; (3) appellants waived any right to arbitration by participating in the law suit; and (4) sex discrimination claims under the Human Rights Act are not subject to mandatory arbitration.⁹

On July 10, 1992, Judge Mitchell, ruling from the bench, denied the motion to compel submission to arbitration. Judge Mitchell concluded:

We . . . have examined the legislative history surrounding the Civil Rights Act of 1991, and . . . that legislative history clearly says that . . . they encourage alternative methods of resolving disputes, but they do not mean to supplant those rights as found under Title VII.

. . . So we conclude . . . that the legislative history [of the 1991 amendments] did not support [Gilmer]. . . . [S]ubsequent legislative history does seem to support the proposition that a — plaintiff does not give up this Seventh Amendment right without it being more specifically determined during the dispute itself.

In other words, they may give it up after they enter into negotiations and decide that we will submit this matter to arbitration, and the Court encourages that. And the legislative history encourages it.

But . . . the [Gilmer court] . . . indicated that the — if it had legislative history [of the Age Discrimination in Employment Act] which indicated something separate from . . . the conclusion reached in [Gilmer], that it would more or less follow that legislative history. . . . The Congress seemed to have taken extra and unusual steps to make it clear that they did not intend . . . the 1991 Civil Rights Act to be . . . governed by the principle purportedly espoused in the [Gilmer] case.

We read this passage as a ruling by the trial judge that the 1991 amendments overrule the holding of Gilmer. The trial judge did not, however, reach any of the other grounds raised by the employee in opposition to the motion to compel arbitration. This appeal followed.¹⁰

II.

In this case the employee's claim is based on an alleged violation of the Human Rights Act. In interpreting that act we have generally looked to cases from the federal courts involving claims brought under the Civil Rights Act of 1964 for guidance and have adopted those precedents when appropriate. See, e.g., Atlantic Richfield Co. v. District of Columbia Comm'n on HumanRights, 515 A.2d 1095, 1102-03 (D.C. 1986) (holding that Office of Human Rights' failure to timely amend complaint to include constructive discharge claim does not bar Human Rights Commission from ruling on claim is in accord with federal rule on the issue); RAP, Inc., v. District of Columbia Comm'n on Human Rights, 485 A.2d 173, 176-77 (D.C. 1984) (following apportionment of burdens and orders of proof prescribed for sex discrimination claims under Title VII); Howard Univ. v. Best, 484 A.2d 958, 978 (D.C. 1984) (following federal precedent in holding that faculty member presented prima facie case of sex discrimination) (citations omitted). We have also followed, when applicable, precedent from the federal courts involving claims under other civil rights statutes. See, e.g., Miller v. American Coalition of Citizens with Disabilities, Inc., 485 A.2d 186, 190-91 (D.C. 1984) (relying on federal precedent interpreting Rehabilitation Act of 1973 in holding that physically handicapped woman failed to make prima facie case of employment discrimination under District's Human Rights Act) (citation omitted).

In Gilmer, the Supreme Court, applying the FAA, held that an employment discrimination claim filed pursuant to the Age Discrimination in Employment Act ("ADEA")¹¹ was subject to a compulsory arbitration agreement contained in a securities registration application executed by an employee.¹² Gilmer, supra, 500 U.S. at 27, 111 S.Ct. at 1652. With a single exception (later reversed), every federal circuit court of appeals addressing the issue has extended the Gilmer holding to employment discrimination claims brought under Title VII.¹³ See, e.g., Bender v. A.G. Edwards & Sons, Inc., 971 F.2d 698, 700 (11th Cir. 1992); Mago v. Shearson Lehman Hutton, Inc., 956 F.2d 932, 935 (9th Cir. 1992); Willis v. Dean Witter Reynolds, Inc., 948 F.2d 305, 307 (6th Cir. 1991). Thus, the uniform and overwhelming federal court precedent holds that compulsory arbitration agreements are binding for employment discrimination claims such as those presented in this case.

The employee contends that since the Council of the District of Columbia ("Council"),in drafting the Human Rights Act, recognized the importance of a jury trial in actions brought pursuant to that statute, she would be deprived of this important right if we follow Gilmer, and hold that the arbitration provision can be enforced by the employer.¹⁴ However, as with the ADEA and Title VII of the Civil Rights Act of 1964, there is no provision in the District's Human Rights Act precluding an employer and employee from voluntarily agreeing to arbitrate employment discrimination claims. Given this silence, Gilmer, and the Title VII cases following Gilmer, holds that employment discrimination claims can be subject to arbitration if the employer and employee have agreed to arbitrate disputes of that nature. Moreover, other District legislation endorses arbitration as an acceptable dispute resolution alternative.¹⁵

The employee also objects to the adequacy of arbitration procedures with respect to disputes arising under the Human Rights Act. We agree with the Gilmer Court's observation that "[s]uch generalized attacks on arbitration rest on suspicion of arbitration as a method of weakening the protections afforded in the substantive law to would-be complainants." Gilmer, supra, 500 U.S. at 30, 111 S.Ct. at 1654 (citation, internal quotation, and alteration omitted). Time and again this court has observed that there is a well-established preference to arbitrate disputes when the parties have so agreed. See generally Carter v. Cathedral Ave. Coop., Inc., 566 A.2d 716, 719 n. 9 (D.C. 1989); Poire v. Kaplan, 491 A.2d 529, 534 n. 8 (D.C. 1985); Sindler v. Batleman, 416 A.2d 238, 343 (D.C. 1980). Thus, arbitration has been recognized as a highly desirable and sound alternative to litigation.

Finally, although the Human Rights Act cases cited in the text, supra pp. 1301-1302, mainly address procedural issues, we see no reason for departing from our practice of considering applicable federal court precedent as persuasive authority when interpreting a local provision that is substantiallypatterned on a federal statute.¹⁶ When interpreting other local statutes, we ordinarily "look to the interpretation...