consumer - arbitration clause

Kaneff v. Delaware Title Loan - 3d Cir. - November 24, 2009

http://www.ca3.uscourts.gov/opinarch/081007p.pdf

This case involves a personal loan for $550 on which the plaintiff's car was collateral. Over a 6-month period, plaintiff paid over $800 but still owed over more than $700 on this loan, on which the interest rate was 300%. After a series of unfortunate events, including repossession, plaintiff sued the loan company. She eventually got the car back then brought a class action under a number of consumer protection statutes.

The lower court dismissed the case and granted defendant's motion to compel arbitration, pursuant to a clause in the contract.

Here are comments about the case from plaintiff's counsel, Robert Salvin, staff attorney with Community Impact Legal Services. His brief is attached.

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We finally have a decision in the Kaneff case, and unfortunately it is not good. The Third Circuit affirmed the district court decision enforcing the arbitration agreement. It is quite disheartening. A copy of the decision is attached. I was so much hoping that after all this time there would be a better decision than this one. The court did not find that the class action waiver was unconscionable.

The court agreed that the cost sharing provision of the arbitration agreement was unconscionable, and severed it from the agreement. That cost sharing provision, which was presumably in all of the contracts, required borrowers to pay their own fees and costs even though the applicable consumer protection statutes would allow fees and costs (including attorney's fees) to be shifted to Delaware Title Loans in a successful case. I had argued that even the presence of the clause was a problem because it was a misrepresentation to all of the consumers who signed similar contracts of their ability to obtain fees and costs in a successful arbitration and would having a chilling effect on challenges. There is not really any discussion of that argument in the decision. There is not much discussion of the exception to arbitration that allowed Delaware Title Loans to bypass arbitration and repossess borrowers' cars by self help. The court basically concludes in summary fashion that the arbitration clause is not unconscionable under Pennsylvania law.

There is one good point to the decision, which is that the court performed a choice of law analysis and did find that Pennsylvania law applied. That is a finding that supports the merits of the argument for every Pennsylvania borrower that title loans originating in Delaware are illegal in Pennsylvania. It is certainly helpful in the Salvatico case.

So the court makes a key choice of law decision that Pennsylvania law applies to the transaction despite the choice of law clause in the contract contrary, but then abandons thousands of Pennsylvanians who have borrowed money from this lender and others like it by depriving them of an effective remedy in the form of a class action.

I do not think it is clear that a Pennsylvania court would reach the same conclusion as to the class action waiver. The Third Circuit has previously indicated its rejection of the Pennsylvania Superior Court cases on class action waivers, which are favorable consumers, but a trial court in Pennsylvania would be bound by those decisions. In other words, I would suggest that a similar case could still be filed in state court against a similar entity challenging a class action waiver under the Superior Court authority, and such a case could be kept in state court if the complaint was limited to state law causes of action and contained express limitations on damages, not more than $74,999 per in person, not more than $4,999,999 in the aggregate. Food for thought. There is some possible subtlety in the decision. I suggest you take a look. I am wondering whether the court is suggesting that an arbitrator could still find that the entire contract, including the class action waiver, is unconscionable?

One might think the choice of law part of the decision would have a chilling effect on loans made to Pennsylvanians in the future, but I doubt it.

There is a limited period, ten days I suppose (but I need to check), to file for en banc review.

PFA - "family/household member" - grandfather of plaintiff's child

Slusser v. DeBoer - Superior Court - November 23, 2009

http://origin-www.courts.state.pa.us/OpPosting/Superior/out/a26039_09.pdf

PFA order properly granted PFA order to mother of defendant's grandchild. Defendant was a "family or household member" under the Act.

The court rejected grandfather's argument that his relationship to the mother of his grandchild does not fit within any of the relationships described in the definition of "abuse" -- the "occurrence of one or more...acts between family or household members, sexual or intimate partners or persons who share biological parenthood." (emphasis in original)

Both parties "have a direct blood relationship to the child, and by extension are inextricably linked to each other by that relationship. In fact, the parties are more directly related by consanguinity than the in-law relationship that was deemed adequate to invoke the protection of the Act in McCance v. McCance, 908 A.2d 905, 910 (Pa.Super. 2006) (Court interpreted “affinity” to include a family relationship of in-laws)."

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The abuse here consisted of defendant pulling a gun out of the glove compartment, showing it to plaintiff andt telling her that if she didn't let him see his granddaughter, she knows what he could do.

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child abuse - dependency - appeal - aggrieved party

In the Interest of J.G., a minor - Superior Court - November 13, 2009

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/1948CD08_11-17-09.pdf

County child welfare agency (CWA) was not an "aggrived party" under PRAP 501 and did not have standing to appeal a lower court decision holding that the subject child was dependent, but failing to specify that the child's parents had committed the abuse.

CWA petitioned the court for a dependency order. It did not request a specific finding that the parents had abused the child. The lower court refused to make such a finding, given the fact that the child had been under the control of both the parents and a babysitter during the period when the abuse had taken place, thus preventing the application of the presumption in 23 Pa. C.S. 6381.

"Although a prevailing party may disagree with the trial court’s legal reasoning or findings of fact, the prevailing party’s interest is not adversely affected by the trial court’s ultimate order because the prevailing party was meritorious in the proceedings below.....Under Pa.R.A.P. 501, “[o]nly an aggrieved party can appeal from an order entered by a lower court.” ...This Court has consistently held that for purposes of Pa.R.A.P. 501, “[a] party is ‘aggrieved’ when the party has been adversely affected by the decision from which the appeal is taken. A prevailing party is not ‘aggrieved’ and therefore, does not have standing to appeal an order that has been entered in his or her favor.”

There is no statutory provision in the Child Protective Services Law or the Juvenile Act to suggest that the trial court must make a specific finding as to which caretaker perpetrated the abuse in order to adjudicate a dependent. These are two separate inquires. Where, as here, the evidence is inconclusive as to who had control or supervision over the child at the time of the abuse, the presumption in 23 Pa.C.S.A. § 6381(d) is inherently self-rebutting, and applying it to one or both persons alleged to be the perpetrators would be arbitrary and capricious in the absence of a credibility determination and a factual finding by the trial court to the contrary.

UC - referee performance - backlog

Horwitz v. Dept. of Labor and Industry - Cmwlth. Court - November 16, 2009 - unreported memorandum decision

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/221CD09_11-16-09.pdf

UC referee's challenge to his employee performance report (EPR) rejected, holding that there was no discrimination against him based on non-merit factors.

The EPR essentially reflects the Department’s conclusion that Horwitz had an unacceptable backlog of decisions. Two standards pertinent to the present case provide as follows:

Disposal of Cases - Each referee is to schedule and dispose of an average of 30-35 appeals per week. 30-35 meets standard, more than 35 exceeds standard.
Issuance of Decisions - Federal mandates will remain the same until new mandates are promulgated in the near future. 60% of all hearings decided within 30 days, 80% of all hearings decided within 45 days are satisfactory.

In addition to the federal standards, DOLI requires that all Referees issue decisions as quickly as possible after hearings.

The opinion indicates that there were "nine complaints during the fall of 2007 from parties who had waited two to four months for decisions from Horwitz."

UC - voluntary quit - personal preference v. necessitous and compelling reason

Dopson v. UCBR - Cmwlth. Court - November 13, 2009

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/1129CD09_11-13-09.pdf

Claimant requested an FMLA leave to go to South Carolina to help care for the young child of her son and daughter-in-law, who were finishing students teaching study for medical board tests, respectively. The court held that "Claimant did not quit her job to rejoin a spouse, but to temporarily relocate to assist her son and daughter-in-law. While laudable, this was her personal preference. This Court agrees with the Board that Claimant lacked a necessitous and compelling reason to terminate her employment." Hammond v. UCBR, 569 A.2d 1013 (Pa. Cmwlth. 1990),

The court distinguished decisions in Truitt v. UCBR, 527 Pa. 138, 589 A.2d 208 (1991), Beachem v. UCBR, 760 A.2d 68 (Pa. Cmwlth. 2000), and Wagner v. UCBR, 965 A.2d 324 (Pa. Cmwlth. 2009).

housing - disability - reasonable accommodation

Solivan v. Valley Housing Development Corp. - ED Pa. - November 9, 2009

http://www.paed.uscourts.gov/documents/opinions/09D1355P.pdf

This case involved a plaintiff-tenant's claims against a sec. 8 landlord for, inter alia, failure to reasonably accommodate her disability in the leasing of an apartment. For the most part, the Court rejected the defendant's motion for summary judgment, as follows:

- statute of limitations - plaintiff apparently came within the two-year statute

- disability - plaintiff present sufficient evidence that she was "disabled" under the ADA, i.e., that she suffered from “a physical or mental impairment that substantially limits one or more of the major life activities of such individual.” 42 U.S.C. § 12102(2)

- reasonable accommodation - The Court must consider: 1) whether Plaintiff’s requested accommodation/modification was necessary to afford her an equal opportunity to use and enjoy the dwelling; and 2) whether Plaintiff’s requested accommodation was reasonable, or whether it imposed an undue hardship on Defendant. To show that a requested accommodation is necessary, a plaintiff “must show that, but for the accommodation, [she] will likely be denied an equal opportunity to enjoy the housing of [her] choice.” Lapid-Laurel, LLC v. Zoning Bd. Of Adjustment of Twp. Of Scotch Plains, 284 F.3d 442, 461 (3d Cir. 2002). Here, without the accommodation of a first floor apartment, Plaintiff was required to walk up two flights of stairs in order to enter or leave her apartment, which took her 30 minutes.

- expert testimony - not required at this point - The standard for whether expert testimony is required under federal law is as follows: Expert testimony is not necessary . . . if all the primary facts can be accurately and intelligibly described to the jury, and if they, as men of common understanding, are as capable of comprehending the primary facts and of drawing correct conclusions from them as are witnesses possessed of special or peculiar training, experience, or observation in respect of the subject under investigation. Padillas v. Stork-Gamco, Inc., 186 F.3d 412, (3d Cir. 1999).

- money damages - Under the section of the ADA prohibiting discrimination in public accommodations, private plaintiffs may not obtain monetary damages. Preventive relief, including an injunction or restraining order, is the only remedy. 42 U.S.C. § 12188 (a)(1) (providing that “the remedies and procedures set forth in section 2000a-3(a) of this title are the remedies and procedures this subchapter provides to any person who is being subjected to discrimination on the basis of disability in violation of this subchapter;” 42 U.S.C. § 2000a-3(a) describes preventive relief). Summary judgment on this issue to defendant.

- sec. 1983 - The private landlord was not a state actor, in spite of receipt of rent in the form of govt. subsidies. Cases considering the application of 42 U.S.C. § 1983 against housing providers who accept and even rely exclusively on Section 8 vouchers hold that such housing providers are private actors who are not acting under color of state law. Miller v. Hartwood Apartments, 689 F.2d 1239, 1242 (5th Cir. 1982); Young, supra at 366; see Morris v. Dehaan, 1991 U.S. App. Lexis 22135, *10 (6th Cir. 1991); Tosta v. Williams, 1987 WL 17233, *3 (E.D.P.A. 1987).

disability - ALJ duty to a) order consultative exams and b) to develop the record

Poleck v. Astrue - ED Pa. - November 9, 2009

http://www.paed.uscourts.gov/documents/opinions/09D1349P.pdf

The Magistrate Judge found that the ALJ failed to fully articulate his reasons for denying plaintiff's claims regarding his alleged heart impairment and carpal tunnel syndrome and recommended that these claims be remanded for further consideration by the Commissioner. Plaintiff appealed, claiming that the ALJ should have ordered second consultative examination and should have more fully developed the record. The court disagreed.

Failure to Order a Second Consultative Examination
Plaintiff claims that 20 C.F.R. § 1519a creates an independent duty on the part of the ALJ to order a second consultative examination even though plaintiff had informed the ALJ that he had medical insurance and would see his doctors for further evaluation. Plaintiff's 443). Plaintiff's reading of the regulation is incorrect.

Section 1519a states that a consultative examination may be purchased when the record as a whole is insufficient to support a decision on a claim. It then lists five situations that normally require a consultative examination.1 None of them apply in this case. Moreover, 20C.F.R. § 404.1512 states that it is the claimant’s responsibility to provide medical evidence showing the existence and scope of any impairment. This is consistent with the general principle that the claimant – not the Commissioner – has the burden of proof.

1 The five situations in which a consultative examination is required are when (1) additional evidence needed is not contained in the claimant’s medical sources, (2) evidence from the claimant’s medical source cannot be obtained for reasons beyond the claimant’s control, (3) the evidence is highly technical or highly specialized and not available from the claimant’s medical sources, (4) a conflict, inconsistency, ambiguity or insufficiency in the evidence must be resolved but cannot be by contacting the claimant’s medical source and (5) there is an indication of a change in the claimant’s condition that is likely to affect the claimant’s ability to work but the severity of the change cannot be established. 20 C.F.R. § 1519a(b)(1) - (5).

ALJ Duty to Develop the Record
Claimant argued that the 1) status of his alleged back, heart and mental impairments was unknown at the time of the hearing, 2) in such circumstances the ALJ has an affirmative duty to develop the record, 3) this duty could only be satisfied by ordering a second consultative examination, 4) the ALJ did not order such an examination and, therefore, 5) the ALJ’s decision is not supported by substantial evidence.

"This argument’s third premise is mistaken. It is important to recognize that the scope of an ALJ’s duty to independently investigate the facts is relatively narrow. In Sims v.Apfel, the Supreme Court stated that ALJs have a duty “to investigate the facts and develop the arguments both for and against granting benefits,” but this portion of his opinion was joined by only three other members of the court and is not precedential. 530 U.S. 103, 111 (2000). Although the Third Circuit has quoted this language favorably in two precedential opinions, it has never formally imposed a broad duty to investigate and develop arguments for all parties...."

The regulation describing the duties of the ALJ states, in part, that the ALJ "shall inquire fully into the matters at issue and shall receive in evidence the testimony of witnesses and any documents which are relevant and material to such matters. If the ALJ believes that there is relevant and material evidence available which has not been presented at the hearing, the ALJ may adjourn the hearing or, at any time prior to the mailing of notice of the decision, reopen the hearing for the receipt of such evidence." 20 C.F.R. § 410.640 (emphasis added).

The only Third Circuit opinion directly interpreting the scope of this regulation is Hess v. Secretary, 497 F.2d 837 (3d Cir. 1974). In Hess, an ALJ denied the claimant's benefits claim without consulting his attending physician and without interviewing or examining the plaintiff. Id. at 840. The Third Circuit concluded that this was error, explaining that the claimant had the burden of proving his disability but that “due regard for the beneficent purposes of the legislation requires that a more tolerant standard be used in this administrative proceeding than is applicable in a typical suit in a court of record where the adversary systemprevails.” Id.

In its application of thismore tolerant standard the Third Circuit explicitly refused to hold “that the responsibility will always be upon the hearing officer to secure current medical evaluations.” Id. at 841. Instead, it stated that “some lesser effort might be employed” and, in a non-exclusive list of examples, noted that an ALJ might advise claimants of the importance of current medical evaluations and suggest their submission at a later date. Id.

The Third Circuit explicitly refused to hold “that the responsibility will always be upon the hearing officer to secure current medical evaluations.” Id. at 841. Instead, it stated that “some lesser effort might be employed” and, in a non-exclusive list of examples, noted that an ALJ might advise claimants of the importance of current medical evaluations and suggest their submission at a later date. Id.

Here, the magistrate judge balanced plaintiff’s right to have his record developed by the ALJ with his burden to prove that he is disabled. The ALJ questioned claimant about the possibility of obtaining additional medical records. Claimant said that he had medical insurance, that he would consult his doctor, and that he would agree to any tests recommended by his doctor. His attorney said nothing to the contrary. Before this exchange, the ALJ had already agreed to leave the record open for thirty days so that claimant and his counsel could submit additional evidence. In these circumstances, the ALJ had every reason to believe that claimant would provide him with a complete record.

drivers license - refusal to take chemical test - location of request/refusal - silence

Deal v. PennDOT - Cmwtlh. Court - November 5, 2009 - unpublished memorandum opinion

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/344CD09_11-5-09.pdf

silence - In Broadbelt v. DOT, 903 A.2d 636 (Pa. Cmwlth. 2006), our court determined that the licensee’s silence when asked to submit to chemical testing after having been read the DL-26 form, constituted a refusal in violation of Section 1547 of the Vehicle Code. This court has consistently held that “police officers are not required to spend effort either cajoling the [licensee] or spend time waiting to see if the [licensee] will ultimately change his mind.” King v. DOT, 828 A.2d 1, 5, n.8 (Pa. Cmwlth.), appeal denied, 577 Pa. 738, 848 A.2d 931 (2002)

location of request/refusal - Our Supreme Court in DOT v. Scott, 546 Pa. 241, 253, 684 A.2d 539, 545 (1996), stated that: the police must advise the motorist that in making this decision, he does not have the right to speak with counsel, or anyone else, before submitting to chemical testing, and further, if the motorist exercises his right to remain silent as a basis for refusing to submit to testing, it will be considered a refusal and he will suffer the loss of his driving privileges.

[I]t would be absurd for an officer to drive a licensee to the situs of the breath, blood or urine testing equipment, which could be miles away from the scene of arrest, in order to allow the licensee to look at the equipment prior to the licensee’s silence being considered a refusal. Requiring a police officer to drive the licensee to the situs of testing when the licensee has already been properly warned but has refused chemical testing, either explicitly or through his silence, would fail to serve the purposes of the current Implied Consent Law and would be a waste of valuable and limited police, and State Trooper, resources.

As police officers are now required to give licensees warnings prior to asking them to consent to chemical testing, and such warnings state that “remaining silent when asked to submit to chemical testing will constitute a refusal,” remaining silent will constitute a refusal, irrespective of where the licensee is at the time the warnings are given.