Section 4 of the Federal Arbitration Act
According to Section 4 of the Federal Arbitration Act, a jury trial is necessary to determine if an arbitration agreement is enforceable:
The court shall hear the parties, and upon being satisfied that the making of the agreement for arbitration or the
failure to comply therewith is not in issue, the court shall make an order directing the parties to proceed to arbitration
in accordance with the terms of the agreement. The hearing and proceedings, under such agreement, shall be within
the district in which the petition for an order directing such arbitration is filed. If the making of the arbitration
agreement or the failure, neglect, or refusal to perform the same be in issue, the court shall proceed summarily
to the trial thereof. If no jury trial be demanded by the party alleged to be in default, or if the matter in dispute is
within admiralty jurisdiction, the court shall hear and determine such issue. Where such an issue is raised, the
party alleged to be in default may,…, demand a jury trial of such issue, and upon such demand the court shall
make an order referring the issue or issues to a jury in the manner provided by the Federal Rules of Civil
Procedure, or may specially call a jury for that purpose. If the jury find that no agreement in writing for arbitration was
made or that there is no default in proceeding thereunder, the proceeding shall be dismissed. If the jury find that an
agreement for arbitration was made in writing and that there is a default in proceeding thereunder, the court shall make
an order summarily directing the parties to proceed with the arbitration in accordance with the terms thereof.
Several courts have allowed the issue of arbitration to be decided by a jury. Recently, in Kentucky, The Court in Boyd Nursing & Rehabilitation, LLC v. Wells, No. 0:22-cv-00011 (E.D. Ky. Aug. 30, 2022) ordered the matter to proceed to the jury on the limited issues concerning the validity and enforceability of the arbitration agreement.
Relying on the Federal Arbitration Act, the U.S. District Court for the Eastern District of Kentucky denied the defendant’s motion to dismiss the plaintiff’s action to compel arbitration. Great news for consumers and residents everywhere.
The case involves the neglect and wrongful death of Opal Wells. The family sought justice in Court but the nursing home moved to dismiss based on an alleged arbitration agreement. Arguments rejecting the validity and enforceability of the arbitration agreement should overcome the motion to compel arbitration.
The Court correctly held that Section 4 of the Federal Arbitration Act allowed a jury trial. The issue of “the making of the agreement is in issue” requires a jury trial. The Court ordered a jury trial on the issue of enforceability with limited discovery.
The Federal Arbitration Act is an archaic law from 100 years ago. Legislators should update and limit the Act. Arbitration is often unfair. Allowing a quick summary jury trial to determine the enforceability of the arbitration agreement would increase fairness. It is also another delay and expensive.