Court Rejects Argument That Non-Signing Party Was Bound by Arbitration Agreement

Arbitration agreements have become more and more common over the years, especially in certain contexts. For example, many companies are beginning to include arbitration clauses into their contracts that are provided in advance of the service the company provides. For example, it is very common to see issues involving arbitration clauses come up in Virginia nursing home cases as well as Virginia car accident cases.

Legal News GavelArbitration agreements, if valid, are generally enforceable. However, before a court will hold a party to their obligation to arbitrate a claim, the court must determine that the party was bound by the agreement. Obviously, signing an agreement is usually sufficient. However, in some cases, a non-signing party may be bound by an arbitration agreement as well. A recent case discusses a rental truck company’s attempts to compel a non-signing party to arbitrate a claim against the company.

The Facts of the Case

The plaintiff was a warehouse worker. One day, the plaintiff’s employer rented a truck and asked that the plaintiff deliver some merchandise to the state fair. The employee had not performed delivery services for the employer in the past, but he agreed to do so on this occasion.

When the employer rented the truck, he signed a rental agreement that contained an agreement to arbitrate any claims arising from the use of the company’s truck. Notably, the employee did not sign the agreement and was not aware that the employer had signed it.

During the delivery, a tire blew out on the truck, and the plaintiff was injured as a result. The plaintiff filed a personal injury lawsuit against the rental truck company. The rental truck company claimed that the plaintiff was not permitted to file the claim because the rental agreement signed by the plaintiff’s employer agreed to arbitrate all claims. The trial court denied the company’s motion for summary judgment, and the company appealed.

On appeal, the case was affirmed in favor of the plaintiff. The court began by noting that, while the plaintiff did not sign the agreement, there are some situations in which a non-signing party can be bound by another party’s agreement to arbitrate. For example, if the non-signing party was an intended third-party beneficiary of the contract, he may be bound by the terms of the contract. Similarly, if the non-signing party was acting as an agent of the signing party, the non-signing party may be bound by the contract. However, under these circumstances, the court determined that neither of the exceptions applied; thus, the plaintiff was not bound by his employer’s signature.

Have You Been Injured in a Virginia Car Accident?

If you or a loved one has recently been injured in any kind of Virginia car accident, you may be entitled to monetary compensation. The dedicated team of Virginia personal injury attorneys at the law offices of Charles B. Roberts & Associates has extensive experience handling all types of Virginia personal injury claims, including car accident cases and other personal injury matters involving arbitration agreements, such as nursing home abuse cases. Call Attorney Roberts today at 703-491-7070 to schedule a free consultation with a dedicated personal injury attorney.

See More Blog Posts:

Court Rejects City’s Assertion of Government Immunity in Recent Premises Liability Case, Virginia Injury Lawyers Blog, December 11, 2017.

Court Permits Victim of “Horseplay” to Pursue Punitive Damages Against Fellow Student, Virginia Injury Lawyers Blog, December 18, 2017.