Arbitration: Favored Way of Resolving Disputes or Equal Footing?
<p>In <a href="https://law.stackexchange.com/questions/86518/is-an-arbitraton-agreement-binding-during-a-month-to-month-tennacy-in-nj/86520#86520">a recent answer on SE</a> @ _ohwilleke writes:</p>
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<p>that the case law does make clear that the standard to apply the
arbitration clause is relatively modest <strong>especially where one party has
signed the agreement and another is a direct contractual successor to
a signatory party</strong></p>
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<p>And that:</p>
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<p>Courts tend to <strong>err very generously on the side of enforcing
arbitration agreements</strong> which there is a plausible connection of
contactual ties to the original agreement signed by both sides.</p>
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<p>Does the policy of erring on the side of arbitration remain in effect after the recent ruling of the U.S Supreme Court which (seemingly) put arbitration agreements on &quot;equal footing&quot; with other contractual obligations?</p>
<p>In <a href="https://www.supremecourt.gov/opinions/21pdf/21-328_m6ho.pdf" rel="nofollow noreferrer">Morgan v. Sundance Inc</a> SCOTUS ruled:</p>
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<p>The federal policy is about treating arbitration contracts like all
others, not about fostering arbitration.</p>
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<p>An article by <a href="https://www.foley.com/en/insights/publications/2022/06/supreme-court-makes-it-easier-waiver-arbitration" rel="nofollow noreferrer">foley.com</a> summarizes the ruling as follows:</p>
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<p>Supreme Court Reiterates that Arbitration Contracts Should Be
Evaluated on Equal Footing as Any Other Contract, and Courts Cannot
Create Special Arbitration Rules</p>
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<p>Does the new policy differ based on whether we know the two parties entered in an agreement to arbitrate at some point vs. when the parties dispute the formation of an arbitration agreement in the first place?</p>
<p>Are there any instances where the courts have favored arbitration (especially in NJ), after the U.S Supreme Court ruling?</p>

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<p>Does the policy of erring on the side of arbitration remain in effect after the recent ruling of the U.S Supreme Court which (seemingly) put arbitration agreements on &quot;equal footing&quot; with other contractual obligations?</p>
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<p>No. The <em>Morgan</em> court held:</p>
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<p>[T]he FAA's &quot;policy favoring arbitration&quot; does not authorize federal
courts to invent special, arbitration-preferring procedural rules</p>
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<p>(quotation marks in original)</p>
<p>because ultimately</p>
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<p>the FAA's policy &quot;is based upon the enforcement of contract, rather
than a preference for arbitration as an alternative dispute resolution
mechanism&quot;</p>
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<p>(quotation marks in original, citations omitted).</p>
<p>This works in both directions. In the scenarios you have outlined elsewhere, an arbitration clause is to be enforced by virtue of it being a contractual matter rather than because the clause is about arbitration. A mere change of parties to a contract generally does not preclude enforcement of provisions in that contract. That is because the new party acquires the rights and obligations pursuant to the contract.</p>
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<p>Does the new policy differ based on whether we know the two parties entered in an agreement to arbitrate at some point vs. when the parties dispute the formation of an arbitration agreement in the first place?</p>
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<p>No. A dispute of whether the parties formed an arbitration agreement is moot if there is evidence --i.e., &quot;<em>we know</em>&quot;-- that they entered an agreement to arbitrate. But the policy itself remains the same.</p>
<p>Enforcement of the FAA is premised on the ascertainment that the party(-ies) &quot;<em>knew of the right [to arbitrate]</em>&quot;, just as with any other contract.</p>
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<p>Are there any instances where the courts have favored arbitration (especially in NJ), after the U.S Supreme Court ruling?</p>
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<p>That seems unlikely. It also would be improper because &quot;<em>[u]nder both the FAA and New Jersey law, arbitration is fundamentally a matter of contract</em>&quot;, <em>Antonucci v. Curvature Newco, Inc.</em>, 470 N.J.Super. 553, 561 (App. Div. 2022), and a state may not &quot;<em>subject an arbitration agreement to more burdensome requirements than those governing the formation of other contracts</em>&quot;, <em>Leodori v. CIGNA Corp.</em>, 175 NJ 293, 302 (2003). Both precedents are applied in <a href="https://www.leagle.com/decision/innjco20221129323" rel="nofollow noreferrer"><em>Zuluaga v. Altice USA</em>, Sup. Court of N.J. (App. Div., Nov, 2022)</a> in the decision &quot;<em>to enter an order staying the case until the arbitration is completed</em>&quot;.</p>

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