Arbitration of Attorney/Client Disputes: The Missouri Perspective
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| Stanley A. Leasure1 |
Wayne L. Anderson2 |
Despite significant ethical and legal issues, the ultimate decision as to whether, and under what circumstances, pre-dispute arbitration clauses in attorney/client agreements should be used is best left to the attorney and client.
I. Introduction
A recent survey of Missouri lawyers conducted by the authors leads to the conclusion that the use of pre-dispute arbitration clauses in attorney/client agreements in Missouri is uncommon.3 This finding is not surprising in light of the fact that more than 75% of the Missouri attorneys surveyed indicated that they were not familiar with any appellate decisions, ethical opinions, or rulings relating to the use of pre-dispute arbitration clauses in attorney/client agreements.4 The nature of the relationship between attorneys and their clients gives rise to several concerns in this context, especially with regard to the ethical and practical considerations.5 The question arises as to whether these concerns are so substantial that the use of pre-dispute arbitration clauses in attorney/client agreements should be proscribed or otherwise strictly limited. Using principles of Missouri substantive law and ethics, we will explore these concerns, examine the perceptions of Missouri lawyers, and conclude with thoughts regarding the use of pre-dispute arbitration provisions in legal services contracts.
II. Survey of Missouri Attorneys
Prior to discussing the ethical and substantive law considerations arising out of the use of arbitration clauses in retainer agreements, we will first consider the opinions of Missouri attorneys. The authors mailed survey documents to 242 (3%) of The Missouri Bar’s resident members, as reflected on the membership list of September 2007. Selections were made on a random basis. These documents included a cover letter describing the purpose of the survey, the related study, and the survey instrument itself. A self-addressed stamped envelope was provided, and responses were requested on an anonymous basis. The limited biographical information requested included: primary area of legal work; gender; years licensed; number of attorneys in respondent’s firm; and the population of the city in which the respondent practices. The attorneys surveyed were also asked about: 1) their participation as an advocate or arbitrator in any arbitration proceeding; 2) their familiarity with appellate or ethical decisions dealing with the use of pre-dispute arbitration clauses in attorney/client agreements; and 3) whether they had ever considered the use of a pre-dispute arbitration clause in an attorney/client agreement. Table 1 on the following page summarizes some of the questions posed and the responses of the Missouri attorneys.
Below are some of the survey comments.
Should attorneys be permitted to use pre-dispute arbitration clauses in an attorney/client agreement?
“Yes, but with informed consent.”
“Yes, full disclosure.”
“Yes, but clients should be advised of court option.”
“Yes, would want bar association to approve.”
“I cannot give an informed judgment. At first blush, it seems like a good idea – but then clients should have freedom to decide how to proceed. In St. Louis, they can have the Bar Association perform arbitration or mediation.”
“Yes, it is no more or less onerous than litigating with-against a client.”
“Yes, but there is an inherent conflict of interest which is offset by benefits to clients, also.”
“Yes, arbitration in other commercial contexts is a matter which parties can choose to agree to if they wish and the attorney/client relationship should be no different.”
“Yes, arbitration is an inexpensive and quick method for resolving disputes. As long as the agreement is fair and the parties are fully informed of their rights, they should be allowed.”
If your answer to the preceding question was yes, should there be any restrictions or limitations on such use?
“Yes, those that the parties negotiate freely.”
“Yes, perhaps should be non-binding arbitration, but a prerequisite to filing suit.”
“Yes, it would have to be conspicuous and perhaps separately agreed to with an indication it was done after consultation on the specific provision.”
“Yes, should make sure scales of fairness not tipped in favor of attorney due to process setup.”
“Yes, bold disclaimers on court access waivers. Perhaps three day right of rescission.”
“Yes, potential for conflict and breaches of fiduciary duty to client.”
“Yes, should not be mandatory.”
“I believe that criminal defense attorney/client relationships are unique and since the client’s life and liberty may be at risk, the consequences of malpractice are too great, and any litigation of such a client/attorney dispute should be in a public forum.”
“Yes, designation of arbitrator – should not be able to just name arbitrator in contract, should require both attorney and client to select the arbitrator or have one appointed.”
General Comments
“We have no problem with suggesting that arbitration is an option, but don’t believe clients should be required to do it.”
“Consumers (including consumers of legal services) should not be forced to give up constitutional rights (jury trial) for a system that can be costlier and more difficult than the courts. If businesses at arms length want to arbitrate, then fine.”
“There is no such thing as an ethical pre-arbitration clause.”
“We presently have a Missouri Bar dispute resolution committee to assist in fee disputes – otherwise I question the use.”
“I would consider a requirement that the dispute be mediated but not arbitrated – in that arbitration is binding and it does not resolve the underlying concerns – i.e. client satisfaction or attorney misconduct, negligence, etc.”
Nearly 70% believe that attorneys should be permitted to use pre-dispute arbitration clauses in attorney/client agreements, although 31% of those think such use should be subject to restrictions or limitations. Interestingly, only 51.7% indicated they would consider the use of such clauses in their own practice if permitted to do so from a legal and ethical standpoint.
| Question |
Yes |
No |
Other/No Response |
| Have you ever participated as an advocate in any arbitration proceeding? |
44.8% |
53.4% |
1.8% |
| Have you ever participated as an arbitrator in any arbitration proceeding? |
12.1% |
86.1% |
1.8% |
| Are you familiar with any appellate decisions or ethical opinions/rulings dealing with the issue of the use of pre-dispute arbitration clauses in attorney/client agreements? |
22.3% |
75.9% |
1.8% |
| Have you ever considered the use in your practice of a pre-dispute arbitration clause in an attorney/client agreement? |
22.3% |
75.9% |
1.8% |
| Should attorneys be permitted to use pre-dispute arbitration clauses in an attorney/client agreement? |
68.9% |
20.7% |
10.4% |
| If your answer to the preceding question was yes, should there be any restrictions or limitations on such use? |
31.0% |
22.4% |
46.6% |
| In your practice, would you consider proposing the use of a pre-dispute arbitration clause in an attorney/client agreement if it were legal and ethical in your jurisdiction? |
51.7% |
41.4% |
6.9% |
III. Ethics
The evaluation of the use of arbitration clauses in contracts between attorneys and their clients requires consideration of both ethical and substantive issues. It appears, however, that the ethical issues predominate; as such, our discussion begin there. Pursuant to the authority granted under the Missouri Supreme Court Rules,6 the Advisory Committee’s ethics counsel has issued three informal advisory opinions on this question. In each opinion, the ethics counsel opined that provisions in fee agreements requiring disputes (including claims for malpractice) to be submitted to binding arbitration are not violative of the Rules of Professional Conduct.7 In the most recent of these informal advisory opinions, counsel noted that the “[a]ttorney has an obligation … under Rules 4-1.4 (b) and 4-1.7 (b) … to orally point out this provision and to explain it, to the extent necessary for the individual client.”8 Rule 4-1.8 (h) provides:
(h) A lawyer shall not:
(1) make an agreement prospectively limiting the lawyer’s liability to a client for malpractice unless the client is independently represented in making the agreement….
Comment 13 to Rule 4-1.8(h) of the Missouri Rules of Professional Conduct addresses the question of whether a binding arbitration clause constitutes the attorney’s attempt to prospectively limit liability to the client:
Rule 4-1.8(h) does not, however, prohibit a lawyer from entering into an agreement with the client to arbitrate legal malpractice claims, provided such agreements are enforceable and the client is formally informed of the scope and effect of the agreement.
Accordingly, even though there has been neither a formal ethics opinion nor a Missouri appellate case specifically addressing this question, there appears to be no ethical impediment to the use of arbitration provisions in attorney/client agreements.
This question has been comprehensively addressed in a formal opinion of the American Bar Association Committee on Ethics and Professional Responsibility.9 In acknowledging the propriety of the use of pre-dispute arbitration clauses, that committee’s analysis centered on two primary issues: 1) whether the requirement of binding arbitration prospectively limits the lawyer’s liability in violation of Rule 1.8(h), and 2) the duty under Rule 1.4(b) to give clients an adequate explanation of matters, including the risks and benefits of mandatory binding arbitration.10 The committee concluded that mandatory arbitration constitutes the establishment of an alternative procedure for resolving claims rather than an attempt to limit liability in violation of Rule 1.8(h).11
The committee did conclude that the attorney’s fiduciary duty to the client requires that the client be informed of the advantages and disadvantages of binding arbitration (such as the waiver of jury trial, broad discovery, and right to appeal) to enable an informed decision to be made. As long as the client is fully apprised of the positive and negative attributes of arbitration, is given sufficient information to enable the client to make an informed decision, and no attempt is made to prospectively limit the liability of the attorney, the committee concluded that a binding arbitration provision covering both fee disputes and malpractice claims is ethically permissible.12
There appears to be no ethical prohibition to the use of pre-dispute arbitration clauses in attorney/client agreements in Missouri, as long as such provisions are enforceable under the substantive law. Consideration of the enforceability of such clauses requires an analysis of the Federal Arbitration Act, the Missouri Uniform Arbitration Act, and common law principles.
IV. Federal Arbitration Act and Missouri Uniform Arbitration Act
In response to the judiciary’s reluctance to enforce arbitration agreements, Congress passed the Federal Arbitration Act (FAA) in 1925. It provides:
A written provision in any … transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction, or the refusal to perform the whole or any part thereof, or an agreement in writing to submit to arbitration an existing controversy arising out of such a contract, transaction, or refusal, shall be valid, irrevocable and enforceable, save upon such grounds as exists at law or in equity for the revocation of any contract.13
Since the passage of the FAA, much litigation has ensued with respect to the role of the FAA in juxtaposition to contrary state law provisions. The reach of the FAA has been the subject of a series of United States Supreme Court decisions, particularly Citizens Bank v. Alafabco, Inc.,14 Bernhardt v. Polygraphic Co. of America, Inc.,15 and Allied-Bruce Terminix Cos. v. Dobson.16 Using a “commerce in fact” test, in Allied-Bruce Terminix the Court focused on the multi-state nature of the businesses in question – as well as the fact that the materials used came from outside their home states – to conclude that the contract at issue involved interstate commerce.17 The Court noted:
States may regulate contracts, including arbitration clauses, under general contract principles... What States may not do is decide that a contract is fair enough to enforce all its basic terms (price, service, credit), but not fair enough to enforce its arbitration clause. The Act makes any such state policy unlawful, for that kind of policy would place arbitration clauses on an unequal “footing,” directly contrary to the Act’s language and Congress’ intent.18
The Court expanded the reach of the FAA even further in Citizens Bank, holding that “involving commerce” was equivalent to “affecting commerce,”19 placing the FAA within the ambit of the broadest possible exercise of Commerce Clause power.20 Citizens Bank involved a banking relationship between an Alabama bank and an Alabama construction company. The Court noted that this is traditionally a matter of local concern, but:
No elaborate explanation is needed to make evident the broad impact of commercial lending on the national economy or Congress’ power to regulate that activity pursuant to the Commerce Clause … “[B]anking and related financial activities are of profound local concern … Nonetheless, it does not follow that these same activities lack important interstate attributes.” (citation omitted).21
In 1980, the Missouri legislature adopted the Missouri Uniform Arbitration Act (MUAA), which has since been declared the substantial equivalent of the FAA.22 The MUAA provides:
A written agreement to submit any existing controversy to arbitration or a provision in a written contract, except contracts of insurance and contracts of adhesion, to submit to arbitration any controversy thereafter arising between the parties is valid, enforceable and irrevocable, save upon such grounds as exist at law or in equity for the revocation of any contract. Contracts which warrant new homes against defects in construction and reinsurance contracts are not “contracts of insurance or contracts of adhesion” for purposes of the arbitration provisions of this section.23
The MUAA ― like the FAA ― has been proclaimed to further advance the important public policy of resolving disputes without having to resort to litigation.24 It also authorizes and sanctions voluntary arbitration agreements in Missouri.25 In the interest of uniformity, the Missouri legislature has declared that the MUAA is to be “construed so as to effectuate” the purpose of the uniformity of laws between the states which enact it.26 As such, absent Missouri precedent and contrary public policy, the MUAA is construed in a manner consistent with the common law of other states adopting the Uniform Act.27
V. Missouri Common Law
In light of the fact that the relationship between lawyers and their clients is an agency relationship governed by the rules generally applicable to agency, the common law plays an integral part in the evaluation of the efficacy of arbitral provisions in legal services contracts.28 This examination must be done in light of the favored status arbitration enjoys as a matter of public policy. In the face of a challenge to any given arbitration clause, the court must determine whether a valid agreement to arbitrate exists and whether the dispute in question falls within the scope of the agreement.29 This evaluation begins with answering the question as to whether the clause is susceptible to more than one fair and honest interpretation, thus making it ambiguous. If the court finds ambiguity, the primary interpretive task is to determine and give effect to the intent of the parties.30 If no ambiguity is found, the parties’ intent is to be gathered from the language of the contract without resorting to construction or extrinsic evidence.31 The overarching principle is that doubts concerning the scope of arbitrable issues are resolved in favor of arbitration.32 This favored status notwithstanding, the language of the arbitration clause cannot be stretched beyond that which was intended by the parties.33
Likewise, arbitration’s favored status does not exempt its clauses from traditional state law contract defenses, which include fraud, duress, and unconscionability – concepts that are all available to vitiate arbitration agreements.34 Certainly one potential issue in connection with legal arbitration clauses is whether the clause is rendered unenforceable by virtue of the MUAA’s provision that precludes the enforcement of arbitration clauses constituting contracts of adhesion.35 In State ex rel. Vincent v. Schneider, the Supreme Court of Missouri considered whether a real estate contract containing an arbitration provision fit these criteria.36 The Court answered in the negative, defining a “contract of adhesion” as follows:
A contract of adhesion, as opposed to a negotiated contract, is a form of contract that is created and imposed by the party with greater bargaining power. (citation omitted). The “stronger party” has more bargaining power than the “weaker party,” often because the “weaker party” is unable to look elsewhere for more attractive contracts. (citation omitted). The “stronger party” offers the contract on a “take this or nothing” basis. (citation omitted). The terms in the contract are imposed on the weaker party and “unexpectedly or unconscionably limit the obligations and liability of the [stronger party].” (citation omitted).37
The Vincent Court also dealt with the issue of unconscionability of the arbitral provision, an issue likely to arise in the context of agreements between lawyers and clients.38 The Court separated the concept of unconscionability into two categories: “procedural unconscionability” (e.g. “high pressure sales tactics,” “fine print,” and misrepresentation) and “substantive unconscionability” (“undue harshness” of “contract[ual] terms”).39 The Court found both the process of selecting the arbitrator and a cost-shifting provision of the arbitral clause unconscionable and, therefore, unenforceable. Given the nature of the relationship between lawyers and clients, care must be taken to avoid characterization of the agreement as unconscionable or one of adhesion.
VI. The View of Sister States
Other jurisdictions have dealt with the propriety of mandatory arbitration provisions in attorney/client agreements in a variety of ways. The New York Appellate Division found no public policy reason to require resolution of legal malpractice claims exclusively in court, provided the retainer agreement otherwise comports with the applicable ethical rules.40 However, in a recent case, a New York trial court took the strong position that it remains the court’s obligation to determine if the subject matter of the arbitral agreement is one that may be submitted to arbitration without violating the law or public policy.41 In this case, the court noted that in New York, attorneys and clients are presumed to possess equal bargaining power when entering into the attorney/client contract; but that such agreements will not be enforced if they are “unconscionable,” “illegal,” or not “fully comprehended by the client.”42 The subject arbitration agreement failed to contain a statement that the client had the right, under local administrative rules, to proceed to the court’s fee dispute resolution program.43 The court seized upon this shortcoming to express its disdain for arbitration clauses and to hold the agreement “unenforceable and against public policy”:
[A] retainer agreement that contains a clause to arbitrate in front of the American Arbitration Association, which waives the client’s right to access to the courts to resolve disputes arising out of the attorney-client relationship must be viewed as inherently unenforceable and against public policy.... In setting up part 137... the Chief Administrator of the courts has indicated his intent to preempt any other action affecting this critically important aspect of the practice of law. In fact, this court is not sure that, without explicit court approval, the parties by private agreement, can alter or expand upon the available dispute resolution options. Without deciding this issue, the court finds that [the law firm] is attempting to enforce an agreement that is patently unethical and therefore illegal.44
In Texas, an appellate court rejected the claim that an arbitration clause in an attorney-client agreement was unenforceable because it limited the lawyer’s liability.45 The court gave significant weight to Formal Opinion 02-425 from the American Bar Association Committee on Ethics and Professional Responsibility in upholding the enforceability of the arbitral provision.46 The court declared that the clause simply prescribed a procedure for dispute resolution and did not insulate or limit the attorney’s liability in any manner.47
In a recent case, the United States District Court for the District of Arizona upheld the arbitral provision on the grounds that neither Arizona nor Texas, the states whose law was deemed pertinent, precludes arbitration of legal malpractice disputes.48 The court instructed:
[T]he Arizona Supreme Court has clarified … there is no prohibition against “a lawyer ... entering into an agreement with the client to arbitrate legal malpractice claims, provided such agreements are enforceable and the client is fully informed of the scope and effect of the agreement.” (citations omitted)... Texas also does not prohibit the inclusion of arbitration provisions of attorney malpractice disputes between lawyers and clients. (citation omitted).... 49
Conversely, the Court of Appeals of Ohio in a malpractice action declared an arbitration clause in an attorney/client agreement unenforceable. This ruling was based on an ethics opinion which precluded language in an attorney-client agreement requiring the client to agree to arbitrate malpractice claims.50 In that opinion, the ethics board had not concluded that such arbitration provisions constitute a per se attempt to limit attorney liability, but instead had run afoul of the duty to zealously represent the client. The board felt that requiring a client to “hire a lawyer to hire a lawyer” was unseemly.51
VII. Conclusion
The majority of Missouri lawyers responding to our survey expressed that attorneys should be permitted to use pre-dispute arbitration clauses in attorney/client agreements. However, a significant minority felt there should be limitations, including voluntariness, clear indication of the loss of right to a jury trial, opportunity to negotiate, and fairness. These findings are generally in accord with the conclusions reached by the Missouri Legal Ethics Counsel, the formal opinion of the American Bar Association Committee on Ethics and Professional Responsibility, and the holdings of various state and federal courts. If the client is given an appropriate explanation of the nature and effect of a binding arbitration clause so as to enable an informed decision to be made, and the lawyer does not attempt to prospectively limit liability to the client, there appears to be no legal, ethical, or public policy reason that the client and the attorney should be denied the opportunity to decide that arbitration is beneficial and enter into an agreement calling for arbitration of future disputes.52 The ultimate decision as to whether, and under what circumstances, such clauses should be used is one to be made by the attorney and client. Obviously, the context in which this decision is made renders it one of some significance, both from the societal perspective and for the individuals involved. There are difficult ethical and practical considerations. However, those concerns and any attendant abuses can be dealt with on a case specific basis and should not deny attorneys and their clients the freedom to decide how disputes in which they may become involved will be resolved.
Footnotes
1 Assistant Professor of Business Law, Missouri State University; J.D. University of Tulsa College of Law, 1980. He is a member of the bars of Arkansas and Oklahoma.
2 Professor of Business Law, Missouri State University; J.D. California Western School of Law, 1980. He is a member of the California bar.
3 See Section II of this article. For purposes of this article, a “pre-dispute arbitration clause in an attorney/client agreement” is an agreement entered into at the formation of the attorney/client relationship requiring all disputes between the attorney and client, including malpractice claims, to be resolved through binding arbitration.
4 Id.
5 Matthew J. Clark, The Legal and Ethical Implications of Pre-Dispute Agreements Between Attorneys and Clients to Arbitrate Fee Disputes, 84 Iowa L. Rev. 827, 842-843 (1997).
6 Rule 5.30 (c).
7 Mo. Ethics Counsel, Informal Advisory Opinion 940153 (1994); Informal Advisory Opinion 960066 (1996) (“Attorney’s duty of communication, under Rule 1.4, requires Attorney to make certain that Attorney’s clients are aware of the provision and understand it.” Id.)
8 Mo. Ethics Counsel, Informal Advisory Opinion 990130.
9 ABA Comm. on Ethics and Prof’l Responsibility, Formal Op. 02-425 (2002).
10 Id. Others have concluded that the differences between arbitration and the litigation are so significant they do, in fact, constitute an attempt to limit liability. See, e.g., Md. State B. Ass’n Comm. On Ethics Op. 90-12 (1990).
11 ABA Comm. on Ethics and Prof’l Responsibility, Formal Op. 02-425 (2002) (citing “2 G.C. Hazard and W.W. Hodes, The Law of Lawyering (3d ed. 2001) §12.18 at 12-50”); Me. Prof’l Ethics Comm’n of the Board of Overseers of the Bar, Op. 170 (December 23, 1999) available at www.mebaroverseers.org and Model Rules of Prof’l Conduct R. 1.8(h) cmt. [14] and [5] (2004).
12 ABA Comm. on Ethics and Prof’l Resp., Formal Op. 02-425 (2002).
13 9 U.S.C. § 2 (2008).
14 539 U.S. 52 (2003).
15 350 U.S. 198 (1956).
16 513 U.S. 265 (1995).
17 Id. at 281.
18 Id. The United States Supreme Court has ruled that if the contract in which an arbitration clause is contained involves interstate commerce, state restrictions on the enforcement of arbitration clauses are preempted by the FAA. Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395 (1967); Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983); Southland Corp. v. Keating, 465 U.S. 1 (1984). The Missouri appellate courts have acknowledged the applicability of the FAA to contracts involving interstate commerce and its preemptive nature in circumstances in the face of contrary state law. See Triarch Indus., Inc. v. Crabtree, 158 S.W.3d 772, 774 (Mo. banc 2005); Bunge Corp. v. Perryville Feed & Produce, Inc., 685 S.W.2d 837, 838-839 (Mo. banc 1985); Edward D. Jones & Co. v. Schwartz, 969 S.W.2d 788, 793 (Mo. App. W.D. 1998). However, even in the absence of an interstate commerce connection sufficient to invoke preemption by the FAA, the decision of the United States Supreme Court in Volt Information Sciences, Inc. v. Bd. of Trustees of the Leland Stanford Junior Univ. has been interpreted to stand for the proposition that if the arbitration clause in question specifically calls for the application of the FAA, such broader terms will apply. See Volt Info. Sciences, Inc. v. Trustees of Leland Stanford Junior Univ., 489 U.S. 468, 478-79 (1989); In re Ledet, No. 04-04-00411-CV, 2004 W.L. 2945699 (Tex. App.-San Antonio (4th Dist.) 2004); Hudson v. Conagra Poultry Co., 484 F.3d 496 (8th Cir. 2007).
19 Citizens Bank v. Alafabco, Inc., 539 U.S. 52, 56 (2003).
20 Id.
21 Id. at 58. Also see generally Stanley A. Leasure, Arbitration of Nursing Home Claims: Oklahoma Goes Its Own Way, 60 Okla. L. Rev. 737 (2007).
22 CPK/Kupper Parker Commc’n, Inc. v. GHL/Hart, 51 S.W.3d 881 (Mo. App. E.D. 2001).
23 Section 435.350, RSMo. 2007.
24 McCarney v. Nearing, 866 S.W.2d 881 (Mo. App. W.D. 1993).
25 Ewing v. Pugh, 420 S.W.2d 14 (Mo. App. W.D. 1967).
26 Section 435.450, RSMo. 2007.
27 BJC Health Systems, Inc. v. Group Health Plan, Inc., 30 S.W.3d 198 (Mo. App. E.D. 2000).
28 Southwestern Bell Tel. Co. v. Roussin, 534 S.W.2d 273, 276 (Mo. App. E.D. 1976); State v. Weinstein, 411 S.W.2d 267 (Mo. App. E.D. 1967). See also, Schwarze v. May Dep’t Stores, 360 S.W.2d 336, 338 (Mo. App. E.D. 1962) in which the court noted: “Under the law, the relation between attorney and client is highly fiduciary in its nature and in a limited and dignified sense it is essentially that of principal and agent.” Arbitration agreements, being matters of contract, are subject to the usual rules of contract interpretation. Village of Cairo v. Bodine Contracting Co., 685 S.W.2d 253, 258 (Mo. App. W.D. 1985); Dunn Indus. Group, Inc. v. City of Sugar Creek, 112 S.W.3d 421, 428 (Mo. banc 2003).
29 Kagan v. Master Home Prods., Ltd., 193 S.W.3d 401, 405 (Mo. App. E.D. 2006). This is a question of law. See e.g. Dunn Indus. Group, Inc. v. City of Sugar Creek, 112 S.W.3d 421, 429 (Mo. banc 2003).
30 Butler v. Mitchell-Hugeback, Inc., 895 S.W.2d 15, 21 (Mo. banc 1995). The contract terms must be read as a whole and giving them their plain, ordinary and usual meaning. See United Steel Workers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574 (1960). Also, the clause is to be construed, if possible, to avoid making other terms meaningless and contributing a reasonable meaning to all provisions. Dunn Indus. Group, Inc. v. City of Sugar Creek, 112 S.W.3d 421, 428-429 (Mo. banc 2003).
31 Dunn Indus. Group, Inc. v. City of Sugar Creek, 112 S.W.3d 421, 428-429 (Mo. banc 2003).
32 Tractor-Trailer Supply Co. v. NCR Corp., 873 S.W.2d 627, 629 (Mo. App. E.D. 1994); Kagan v. Master Home Prods. Ltd., 193 S.W.3d 401, 405 (Mo. App. E.D. 2006).
33 Greenwood v. Sherfield, 895 S.W.2d 169, 174 (Mo. App. S.D. 1995); Whitney v. Alltel Commc’ns, Inc., 173 S.W.3d 300, 306 (Mo. App. W.D. 2005).
34 Swain v. Auto Servs., Inc., 128 S.W.3d 103, 107 (Mo. App. E.D. 2003); Whitney v. Alltel Commc’ns, Inc., 173 S.W.3d 300, 308 (Mo. App. W.D. 2005). The Federal Arbitration Act provides that arbitration agreements are subject to such defenses “[A]s exist at law or in equity for the revocation of any contract.” 9 U.S.C. § 2. The exclusion in the Missouri counterpart goes further: “[E]xcept contracts of insurance and contracts of adhesion,... save upon such grounds as exist at law or in equity for the revocation of any contract.” § 435.350, RSMo. (emphasis added). See also Matthew J. Clark, The Legal and Ethical Implications of Pre-Dispute Agreement Between Attorneys and Clients To Arbitrate Fee Disputes, 84 Iowa L. Rev. 827, 842-843 (1997).
35 Section 435.350, RSMo. 2007.
36 State ex rel. Vincent v. Schneider, 194 S.W.3d 853, 857 (Mo. banc 2006).
37 Id.
38 Id at 858.
39 Id.
40 In re Derfner & Mahler, L.L.P. v. Rhoades, 257 A.D.2d 431 (N.Y. App. Div. 1999).
41 Larrison v. Scarola Reavis, Misc.3d 572, 812 N.Y.S.2d 243, 2005 N.Y. Slip Op. 25558 (N.Y. Sup. Ct. 2005).
42 Id. at 579.
43 Id.
44 Id. at 580.
45 In re Hartigan, 107 S.W.3d 684 (Tex. App.-San Antonio [4th Dist.] 2003).
46 Id. at 689.
47 Id.
48 MCA Financial Group, Ltd. v. Gardere Wynne Sewell, L.L.P., No. 05-2562-PHX-MHM, 2007 WL 951959 (D. Ariz, Mar. 27, 2007).
49 Id. at *3.
50 Thornton v. Haggins, No. 8305, 2003 WL 23010100 (Ohio Ct. App. 8th Cir. 2003).
51 Id. at *2
52 Although it is beyond the scope of this article, there are numerous issues to be considered in connection with whether an arbitration clause should be used in an attorney/client agreement and, if so, the terms of that arbitration clause. See, e.g., Ronald E. Mallen & Jeffrey M. Smith, 1 Legal Malpractice § 2:49 (2007 ed.).