Trunnel v. Mo. Higher Educ. Loan Auth.

• Decision Date: 21 September 2021
• Docket Number: WD 84114
• Citation: 635 S.W.3d 193
• Parties: Demetria TRUNNEL, Respondent, v. MISSOURI HIGHER EDUCATION LOAN AUTHORITY, Appellant.
• Court: Missouri Court of Appeals

635 S.W.3d 193

Demetria TRUNNEL, Respondent,

v.MISSOURI HIGHER EDUCATION LOAN AUTHORITY, Appellant.

WD 84114

Missouri Court of Appeals, Western District.

OPINION FILED: September 21, 2021

Motion for Rehearing and/or Transfer to Supreme Court Denied October 26, 2021

Application for Transfer Denied December 21, 2021

John A. Hirth, Columbia, MO, for respondent.

Clifford A. Godiner, St. Louis, MO, for appellant.

Before Division Four: Cynthia L. Martin, Chief Judge, Presiding, Gary D. Witt, Judge and W. Ann Hansbrough, Special Judge

Cynthia L. Martin, Judge

Missouri Higher Education Loan Authority ("MOHELA") appeals from the trial court's order denying MOHELA's motion to compel arbitration. MOHELA challenges the trial court's determination that no valid arbitration agreement existed with Demetria Trunnel ("Trunnel"). Finding no error, we affirm.

Facts and Procedural Background¹

On September 2, 2014, MOHELA hired Trunnel. On that same date, Trunnel completed employment paperwork. The employment paperwork included two documents associated with the purported arbitration agreement in this case: (1) a two-page document titled "MOHELA Policy Regarding Mandatory Alternative Dispute Resolution/ADR Process" ("ADR Process"); and (2) a one-page document titled "IMPORTANT ACKNOWLEDGMENT OF RECEIPT OF MOHELA MANDATORY POLICY ON ALTERNATIVE DISPUTE RESOLUTION/ADR PROCESS" ("Acknowledgment of Receipt").

The ADR Process document described a four-step alternative dispute resolution process, and provided, in relevant part:

This policy is available and applies to all employees ... who wish to raise an appropriate issue regarding an employee's legally-protected, employment-related rights....

In all cases, an employee must exhaust the preceding level of review before proceeding to the next level of review. If an employee proceeds to resolve an issue covered by this policy and the ADR process in a forum other than those mandated by this policy and ADR process, the employee shall be responsible for all costs and expenses, including, but not limited to, reasonable attorneys’ fees incurred by MOHELA in defending any such claims and issues....

The ADR Process document included no signature lines.

The Acknowledgment of Receipt document provided:

IMPORTANT

ACKNOWLEDGMENT OF RECEIPT OF MOHELA MANDATORY POLICY ON ALTERNATIVE DISPUTE RESOLUTION/ADR PROCESS

The Alternative Dispute Resolution policy ("Policy") and its related process offers a quick and fair way to resolve disagreements involving legally-protected, employment-related rights. This Policy contains the rules and procedures MOHELA and its employees covered under this Policy must follow to resolve any covered claims through arbitration. This Policy does not waive any covered employee's substantive legal rights, nor does this Policy create or destroy any rights. It merely changes the forum where the dispute is resolved and the procedures to be followed. The Policy does not prevent an employee from filing a charge with an administrative agency like the Equal Employment Opportunity Commission, or the Missouri Commission on Human Rights. However, this policy must also be followed by employees.

Effective June 1, 2005, all employees of MOHELA, its affiliates and subsidiaries shall be subject to the Mandatory Alternative Dispute Resolution/ADR Process Policy, a copy of which I acknowledge receiving. Employees are deemed to have agreed to the provisions of the Policy by virtue of accepting employment with the MOHELA and/or continuing employment with the MOHELA.

Employees are bound by this Policy even if they do not sign this Acknowledgment form.

EFFECTIVE on the next day following May 31, 2005 that I perform work for MOHELA, both MOHELA and I shall be entitled to the benefits of and mutually agree to become subject to the Policy attached to and incorporated in this Acknowledgement.

THIS PAGE TO BE SIGNED BY EMPLOYEE

I ACKNOWLEDGE RECEIPT OF THE MANDATORY ALTERNATIVE DISPUTE RESOLUTION/ADR PROCESS POLICY.

Employee:

_________ (Signature)

______________ (Date)

The Authority Witness:

_________ (Signature)

______________ (Name)

______________ (Date)

(Emphasis in original). Trunnel signed the Acknowledgment of Receipt document on the "Employee" signature line and dated her signature "9/2/14." The lines allotted for the "Authority Witness" were left blank.

Trunnel alleges that she was "constructively discharged" from MOHELA on January 11, 2019. On October 16, 2019, Trunnel filed suit against MOHELA in the Circuit Court of Boone County, Missouri alleging that MOHELA discriminated against her on the basis of race, sex, and disability, and that MOHELA retaliated against her once she complained of the discrimination.

On August 7, 2020, MOHELA moved to dismiss the proceedings and compel arbitration, or, in the alternative, to stay the proceedings and compel arbitration. MOHELA argued that all of Trunnel's claims "are subject to mandatory arbitration" because by signing the Acknowledgment of Receipt document, Trunnel "agreed to arbitrate any ‘claims for discrimination, harassment, violation of any federal, state, or other governmental law, statute or regulation, termination of employment or tort claims’ that she might have against MOHELA."

Relying on Jackson v. Higher Education Loan Authority of Missouri , 497 S.W.3d 283 (Mo. App. E.D. 2016), Trunnel argued that the trial court should deny MOHELA's motion to compel arbitration. In Jackson , the Eastern District examined the same ADR Process and Acknowledgment of Receipt documents at issue here, and determined the documents did not create an agreement to arbitrate because MOHELA never extended an offer to be bound by an arbitration process that could be accepted by the employee. Id. at 289-90.

After a hearing on MOHELA's motion, the trial court issued an order denying the motion to compel arbitration. The trial court found that no arbitration agreement existed because MOHELA never extended an offer to be bound by an arbitration process that Trunnel could accept. The trial court found that Jackson was dispositive, as "the Eastern District Court of Appeals analyzed the very same Policy and the very same Acknowledgment that are in issue in this case and concluded that there was no ‘offer’ for the plaintiff's acceptance," in that "there was no ‘objective manifestation’ that [MOHELA] ‘intended’ the Policy and Acknowledgment to constitute an ‘offer.’ " The trial court also found that "[t]here was no consequence for an employee's failure to sign and employment was not contingent upon acceptance," and concluded that " ‘[m]ere acknowledgement’ and publication of the Policy and an understanding of the Policy are not synonymous with acceptance of an offer." The trial court explained that it was persuaded by Jackson's reasoning that "[r]epeatedly using the term ‘policy’ but never using the term ‘contract,’ and deeming an employee to have agreed to a policy without the employee's assent do not constitute an offer for the employee's acceptance."

MOHELA appeals.²

Standard of Review

We review the trial court's denial of a motion to compel arbitration de novo. Miller v. Securitas Sec. Servs. USA Inc. , 581 S.W.3d 723, 728 (Mo. App. W.D. 2019) (citing Greene v. Alliance Auto., Inc. , 435 S.W.3d 646, 649 (Mo. App. W.D. 2014) ). "However, issues relating to the existence of an arbitration agreement are factual and require our deference to the trial court's findings." Id. (quoting Baier v. Darden Rests. , 420 S.W.3d 733, 736 (Mo. App. W.D. 2014) ). "Where the trial court does not make factual findings, ‘all fact issues upon which no specific findings are made shall be considered as having been found in accordance with the result reached.’ " Id. (quoting Baier , 420 S.W.3d at 737 ). Thus, our review of the trial court's "determination as to the existence of an agreement itself is analogous to that in a court-tried case."

Theroff v. Dollar Tree Stores, Inc. , 591 S.W.3d 432, 436 (Mo. banc 2020) (quoting Kunzie v. Jack-In-The-Box, Inc. , 330 S.W.3d 476, 480 (Mo. App. E.D. 2010) ). We will affirm the trial court's order "unless there is no substantial evidence to support it, it is against the weight of the evidence, or it erroneously declares or applies the law." Duncan v. TitleMax of Mo., Inc. , 607 S.W.3d 243, 247 (Mo. App. W.D. 2020) (quoting Theroff , 591 S.W.3d at 436 ). MOHELA, as the party asserting the existence of a valid and enforceable contract to arbitrate, bears the burden of proving that proposition. Id. at 249 (citation omitted).

Analysis

MOHELA raises a single point on appeal, arguing that it was legal error for the trial court to conclude that there was no valid arbitration agreement because the Acknowledgment of Receipt document Trunnel signed "contain[s] clear language that a binding agreement [was] being offered," and because both acceptance and consideration were also present and not contested by Trunnel. MOHELA concedes that the ADR Process and Acknowledgment of Receipt documents that the Eastern District examined in Jackson are identical to the documents involved in this case. MOHELA argues, however, that it was error for the trial court to rely on Jackson to deny MOHELA's motion to compel arbitration because Jackson was wrongly decided, and because the present factual record is materially distinguishable from the factual record in Jackson .

Whether an arbitration agreement has been formed is a matter of state contract law

"The Federal Arbitration Act (FAA) governs the applicability and enforceability of arbitration agreements in all contracts involving interstate commerce" and it applies even when "an arbitration agreement is executed in a single state by residents of that state if one of the parties to the agreement engages in business in multiple states." State ex rel. Hewitt v. Kerr , 461 S.W.3d 798, 805 (Mo. banc 2015) (citing 9 U.S.C. section 1 et seq. ; Citizens Bank v. Alafabco, Inc. , 539 U.S. 52, 56, 123 S.Ct. 2037, 156 L.Ed.2d 46 (2003) ). Trunnel does not contest that the...