Young v. Prudential Ins. Co. of Am

In Young v. Prudential Ins. Co. of Am., 297 N.J. Super. 605, 688 A.2d 1069 (App.Div.), certif. denied, 149 N.J. 408, 694 A.2d 193 (1997), the court held that even though Form U-4 signed by plaintiff was a contract of adhesion, it was enforceable. The court explained that "the Supreme Court obviously contemplated avoidance of the arbitration clause only upon circumstances substantially more egregious than the ordinary economic pressure faced by every employee who needs the job." Id. at 621, 688 A.2d 1069. The court also considered the "strong public policy" in favor of enforcing arbitration agreements, and the fact that sellers of securities are subject to federal regulation. Ibid. In Young v. Prudential Ins. Co, as a condition of employment, the plaintiff was required to register with the National Association of Securities Dealers ("NASD"). The standard employment application signed by the plaintiff, id. at 609, 688 A.2d 1069, required that any claim asserted against his firm would be arbitrated, as is required under the NASD rules, id. at 613, 688 A.2d 1069. The Court held that the plaintiff's claims under the LAD and the Conscientious Employees Protection Act ("CEPA"), N.J.S.A. 34:19-1 to -8, "may be the subject of an arbitration agreement," thereby requiring an employee to waive the right to a jury trial under the LAD and the CEPA (although the CEPA claim was not waived under the agreement). Young, supra, 297 N.J.Super. at 615-16, 688 A.2d 1069. The Court decided that the plaintiff's agreement to arbitrate was valid with regard to the LAD claim, even though a form contract was involved. Id. at 620-21, 688 A.2d 1069. The plaintiff asserted that he was not aware that the standard employment form contained the arbitration clause because he did not have "sufficient time to read it carefully" before signing it. Id. at 617-18, 688 A.2d 1069. Thus, the plaintiff argued that he never agreed to arbitration and, moreover, was never provided with a copy of either the employment form or the NASD rules to which it referred. Ibid. The Court held that, in accordance with the undisputed evidence, "no reasonable factfinder could conclude that the plaintiff did not knowingly sign the registration application and its arbitration agreement," id. at 618, 688 A.2d 1069, and that "failing to read a contract does not excuse performance unless fraud or misconduct by the other party prevented one from reading it," id. at 619, 688 A.2d 1069.