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A party does not waive its right to arbitrate if the party's conduct causes no prejudice to the opposing party, a federal court in Mississippi held.
In Alexander v. Easy Finance of New Albany, Inc., No. 103CV91-D-D, 2007 WL 188579 (N.D. Miss. Jan. 23, 2007), Edgar and Martha Alexander and several additional plaintiffs (collectively the Plaintiffs) filed claims in court against Easy Finance alleging fraud and breach of contract.
After substantial delay caused by the Plaintiffs' untimely amendment of their complaint, Easy Finance moved to dismiss the Plaintiffs' claims. The trial court denied its motion and discovery ensued. In moving for summary judgment, Easy Finance argued that six of the Plaintiffs should be compelled to arbitrate because they had binding arbitration agreements with Easy Finance.
This Court rejected the Plaintiffs' argument that Easy Finance had waived its rights to arbitrate, finding that Plaintiffs did not meet their burden of proving waiver. The Plaintiffs had contributed to the delay of the case and "would have participated in discovery and spent time and expense" regardless of Easy Finance's request of these six plaintiffs to arbitrate. Easy Finance requested arbitration immediately in its answer after discovery and the six Plaintiffs would not experience prejudice if their disputes were arbitrated.
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