K.G.N Deccan Engineering

Mfg. Of Grey Iron Casting, S.G. Iron Casting and Cast Iron Casting

Mfg. Of Grey Iron Casting, S.G. Iron Casting and Cast Iron Casting

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The fresh new FAA is intended to offer inexpensive, reasonable, and you can reasonable arbitration choices in order to litigation

The fresh new FAA is intended to offer inexpensive, reasonable, and you can reasonable arbitration choices in order to litigation

<35>World Finance argues that the arbitration agreements at issue are governed by the FAA, which provides that arbitration agreements “shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C. § 2. While we acknowledge the controlling nature of that principle of law, we disagree that it can save the one-sided arbitration scheme in this case.

<36>We recently held in Fiser that the FAA did not preclude our addressing and invalidating an arbitration agreement’s class action ban, because our holding was based on neutral and generally applicable New Mexico public policy contract principles. 2008-NMSC-046, ¶ 23. Id. ¶¶ 2-4. We held the class action ban was contrary to New Mexico public policy because “[t]he opportunity for class relief and its importance to consumer rights is enshrined in the fundamental policy of New Mexico and evidenced by our statutory scheme.” Id. ¶ 13. The arbitration agreement in Fiser that banned any form of class action relief was unenforceable because it would have been “tantamount to allowing Defendant to unilaterally exempt itself from New Mexico consumer protection laws.” Id. ¶ 21. Because the Fiser ruling rested on a New Mexico doctrine that existed for the revocation of any contract, the FAA did not preclude our examination of the enforceability of the suspect arbitration clause. See id. ¶ 23 (“?[G]enerally applicable contract defenses, such as fraud, duress, or unconscionability, may be applied to invalidate arbitration agreements without contravening [the FAA].'” (quoting Doctor’s Assocs., Inc. v. Casarotto, 517 U.S. 681, 687 (1996))).

From inside the Fiser, a computer brand name debated you to definitely a buyer wasn’t permitted to document a category action lawsuit getting misrepresentation on the sale out of machines, where each also established consumer suffered problems regarding less than twenty cash

<37>As in Fiser, our invalidation of these arbitration agreements is based on a generally applicable New Mexico unconscionability analysis. See Perry v. Thomas, 482 U.S. 483, 493 n.9 (1987) (“[S]tate law, whether of legislative or judicial origin, is applicable [and does not contravene the FAA] if that law arose to govern issues concerning the validity, revocability useful link, and enforceability of contracts generally.”).

The unconscionability analysis, that is used in the same way so you’re able to arbitration conditions due to the fact to virtually any other clauses from an agreement, try for this reason not inconsistent on the dictates of the FAA

<38>New Mexico’s legal doctrine of contractual unconscionability, like that of other jurisdictions, was not developed to target or invalidate this or any other arbitration agreement. See id. (“A court may not, then, in assessing the rights of litigants to enforce an arbitration agreement, construe that agreement in a manner different from that in which it otherwise construes nonarbitration agreements under state law.”). It is not a license for businesses to take advantage of consumers by the imposition of one-sided, unfair, and legally unconscionable arbitration schemes. We will not allow our courts to be used to enforce unconscionable arbitration clauses any more than we will allow them to be used to enforce any other unconscionable contract in New Mexico.

<39>There are two possible remedial actions we can take to give effect to our holding that the one-sided arbitration provisions separately attached to the loan agreements are unenforceable: We can strike the arbitration provisions in their entirety, or we can attempt to refashion parts of them into a fair and balanced arbitration arrangement. In Padilla, we stated:

In the event the a contract otherwise identity thereof is unconscionable at that time the brand new bargain is done a legal could possibly get decline to demand brand new contract, otherwise can get enforce the rest of the fresh contract without the unconscionable title, otherwise can get so reduce application of any unconscionable term because to quit any unconscionable results.

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