Court of Appeals of Missouri, Western District, Second Division
FROM THE CIRCUIT COURT OF JACKSON COUNTY, MISSOURI THE
HONORABLE JOHN M. TORRENCE, JUDGE
Before: Edward R. Ardini, Jr., Presiding Judge, Karen King
Mitchell, Judge and Anthony Rex Gabbert, Judge
R. ARDINI, JR., JUDGE
Career Colleges, Inc., ("the College") appeals the
Order of the Circuit Court of Jackson County denying the
College's Application to Compel Arbitration in a case
filed by Katherine Dolly ("Dolly") and Kiley Elliot
("Elliot") (collectively referred to as "the
Students") against the College. We reverse and remand
for further proceedings.
AND PROCEDURAL BACKGROUND
summer of 2012, the Students, as part of their enrollment at
the College, signed Enrollment Agreements containing an
arbitration provision that is the focus of this appeal. The
Any dispute arising from enrollment at [the] College, no
matter how described, pleaded[, ] or styled, shall be
resolved by binding arbitration under the Federal Arbitration
Act conducted before a single arbitrator by the American
Arbitration Association ("AAA") at Kansas City,
Missouri, under its Commercial Rules. The award rendered by
the arbitrator may be entered in any court having
October 2015, Dolly and Elliot filed this action against the
College alleging violation of the Missouri Merchandising
Practices Act ("MMPA") (§ 407.010, et.
seq),  fraudulent misrepresentation, and
negligent misrepresentation. Two months later, the College
filed an Application to Compel Arbitration pursuant to the
Federal Arbitration Act ("FAA"), 9 U.S.C. § 1,
et seq. Discovery was conducted and an evidentiary
hearing was held.
evidentiary hearing, the Students, the admissions
representatives who handled their enrollments, and a business
office manager from the College testified. The trial court
also received evidence of other legal actions initiated by
the College in Missouri circuit courts against multiple other
students who had signed enrollment agreements containing the
same arbitration provision as well as a copy of the
stand-alone Arbitration Agreement later developed and used by
the evidentiary hearing, the court issued its Order denying
the College's application, stating that there were
"dozens of instances where the [College] chose to not
abide by their own arbitration agreement and filed suit
against a student in the Circuit Courts of Missouri" and
that the College "waived its right to invoke the
arbitration clauses which it chose to ignore when it
perceived it strategically advantageous to do so in the
past." The College appeals.
facts are set forth throughout this opinion as necessary.
appeal may be taken from . . . [a]n order denying an
application to compel arbitration made under section
435.355[.]" § 435.440.1. "The issue of whether
arbitration should be compelled is a question of law subject
to [de novo] review." Dotson v.
Dillard's, Inc., 472 S.W.3d 599, 602 (Mo. App. W.D.
2015) (citation omitted). We defer to the trial court's
factual findings, and "all fact issues upon which no
specific findings are made shall be considered as having been
found in accordance with the result reached." Bowers
v. Asbury St. Louis Lex, LLC, 478 S.W.3d 423, 426 (Mo.
App. E.D. 2015) (quoting Rule 73.01(c)).
Our analysis of whether arbitration should be compelled is as
First, we must "determine whether a valid arbitration
agreement exists." Second, if a valid arbitration
agreement exists, we must determine "whether the
specific dispute falls within the scope of the arbitration
agreement." Third, if a valid arbitration contract
exists, and if the subject dispute is within the scope of the
arbitration provision, then we must determine whether the
arbitration agreement is subject to revocation under
applicable contract principles.
Frye v. Speedway Chevrolet Cadillac, 321 S.W.3d 429,
434-35 (Mo. App. W.D. 2010) (citations omitted). "The
elements required to form a valid contract in Missouri[,
]" including an agreement to arbitrate, "are offer,
acceptance, and bargained for consideration."
Id. at 436 (citation and internal quotation marks
omitted). If a valid arbitration agreement has been formed, a
party may avoid arbitration if "grounds [ ] exist at law
or in equity for the revocation of [the contract]."
State ex rel. Hewitt v. Kerr, 461 S.W.3d
798, 806 (Mo. banc 2015) (citing 9 U.S.C. § 2); see
also § 435.350. Such defenses include "fraud,
duress, or unconscionability." Hewitt, 461
S.W.3d at 807 (citation omitted). Whether such grounds exist
are "determined using the general principles governing
contract law in Missouri." Id. at 806 (citation
omitted). If the court's analysis concludes that an
agreement to arbitrate has not been formed or that the
agreement is otherwise revocable, then "the case may
proceed in civil court." Id. (citation