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A New Jersey appellate court held that a bank employee did not have to arbitrate in Florida because he was not subject to the forum clause contained within agreements which he signed.
In Stern v. Challenge Financial Investors Corp., No. A-2817-05T2, 2006 WL 3433562 (N.J. Super. A.D. Nov. 29, 2006), Michael Stern pursued various claims against his former employer, Challenge Financial, in court. Challenge Financial moved to dismiss and to compel arbitration in accordance with an arbitration agreement contained within its dispute resolution policy. Stern had signed the Employee Dispute Resolution policy. There were two other agreements associated with his employment. Each contained forum selection clauses. The Branch Management Company agreement required arbitration in Florida, and the Branch Manager agreement vested jurisdiction in the Florida courts.
Stern conceded that the dispute should be arbitrated, but argued that the forum selection clauses should not be enforced. “Generally… [New Jersey] courts…enforce forum selection clauses.” However, in this case, the Court found that Stern was not subject to the forum selection clauses contained within the Branch Manager agreement or the Branch Management Company agreement. Stern was not a branch manager and had never signed the Branch Manager Company agreement. Further, the agreements were “inconsistent with one another because the Branch Manager agreement sets jurisdiction with the Florida court, while the Branch Management Company agreement requires Florida arbitration.”
The Court agreed with Stern that Stern’s claims “did not arise” from either of the two agreements with forum selection clauses. His claims arose “from his position [as a loan officer] with [Challenge Financial].” The Court disregarded Challenge Financial’s argument that the agreements should be read together to find party intent to resolve disputes in Florida. The Court held that Stern was not required to file or arbitrate in Florida.
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