Jackie1989

AAA declined arbitration

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Filed for arbitration with cavalry. Paid the fee today and they just sent a letter stating they will not accept arbitration from cavalry. This is in small claims and cavalry attorney agreed. The letter goes on to state that since the won't administer the arb, the claimant can ask the court to?

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19 minutes ago, Jackie1989 said:
 

Filed for arbitration with cavalry. Paid the fee today and they just sent a letter stating they will not accept arbitration from cavalry. This is in small claims and cavalry attorney agreed. The letter goes on to state that since the won't administer the arb, the claimant can ask the court to?

Do you have a court order for arbitration?

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No court order.

Day of trial attorney agreed to it and judge allowed a 60 days continuance but, there is no mention of this on court records. Simply states "60 day continuance allowed to both parties" something like that.

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Full story

Since this was small claims, I sent cavalry a demand for arbitration around 5/15/19 . Less than 30 days later, they filed claim in small claims. I answered denial. 12/9/19 was trial. Met with attorney in hall, after all her defaults, and mentioned that I requested arbitration prior to their filing. Like literally 3weeks? Anyways, she says, sure we can arbitrate. We go back into court. She states to magistrate that defendant wants to pursue arbitration and he looks at me and says "ok, will you be able to take care of this in 60 days?" I tell him yes.

So, continuance of 60 days makes no mention of arbitration.

 

Anyways, paid the fees, sent the agreement and couple hours later AAA sends an email that they wi not administer any cases with Cavalry. Doesn't state specifically why. Just that they are not abiding by their policies.

Any info appreciated

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I would file a motion with the court to dismiss with prejudice.  Attach the AAA letter to the motion and argue that, due to Cavalry's failure to abide by their contractual obligations, it's not fair to prejudice you for Cavalry's breach of contract with AAA.

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even though it is not court ordered?

also,  they have another case in the system. it is in superior court.  my concern is, will this backfire on me. could attorney say, you knew they would not accept this mtc and yet you filed? my thought is aaa may take the next one if it is a mtc.

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Well, you should have gotten a court order, but what other options do you have at this point?  Arbitration is your right per the FAA, which trumps local courts, and it's not your fault the JDB sabotaged their relationship with the only arbitration company you have available to you.

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Dear Parties:

Claimant has filed with us a demand for arbitration. We note that the arbitration clause provides for arbitration by the American Arbitration Association (“AAA”). Prior to the filing of this arbitration, the business failed to comply with the AAA’s policies regarding consumer claims. Accordingly, we must decline to administer this claim and any other claims between Cavalry SPV I, LLC and its consumers at this time. These policies can be found on our web site, www.adr.org, in the Consumer Due Process Protocol (“Protocol”) and the Consumer Arbitration Rules (“Consumer Rules”), including the Costs of Arbitration. Accordingly, we have administratively closed our file and will refund any payment received by the filing party. According to R-1(d) of the Consumer Rules, should the AAA decline to administer an arbitration, either party may choose to submit its dispute to the appropriate court for resolution. If you believe we have declined this matter in error, please email ConsumerFiling@adr.org . Pursuant to the AAA’s current policy, in the normal course of our administration, the AAA may maintain certain electronic case documents in our electronic records system. Such electronic documents may not constitute a complete case file. Other than certain types of electronic case documents that the AAA maintains indefinitely, electronic case documents will be destroyed 3 months after the date of this letter. If Cavalry SPV I, LLC advises the AAA in the future of its intention to comply with the AAA’s Consumer Arbitration Rules and if applicable, resolves any outstanding payment obligations, the AAA may consider at its sole discretion, accepting newly filed consumer cases going forward. Therefore, if Cavalry SPV I, LLC wishes for the AAA to consider accepting consumer disputes going forward, the business must, at a minimum, register its clause on the Consumer Clause Registry on our website, www.adr.org/clauseregistry. Upon completion of the registration process and confirmation from the AAA that the business is now active on the Consumer Clause

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4 minutes ago, Harry Seaward said:

Well, you should have gotten a court order, but what other options do you have at this point?  Arbitration is your right per the FAA, which trumps local courts, and it's not your fault the JDB sabotaged their relationship with the only arbitration company you have available to you.

Right. I was surprised that day in court that they were so willing to go into arbitration. I didn't expect this. I dont believe I can MTC this because of the small claims provision. Really upset that nothing was mentioned in magistrates 60 day continuance

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33 minutes ago, Jackie1989 said:

I was surprised that day in court that they were so willing to go into arbitration.

That was probably ignorance on the part of the attorney - she either though it was "mediation," through the court, or that it was something you would have to pay for, in it's entirety.

One thing that sticks out in AAA's letter is their repeated mention of "Cavalry." One thing I would emphasize is that they assumed the contract of the Original Creditor - they can't arbitrarily and unilaterally claim that it's now "their" contract, to re-define as they please.

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47 minutes ago, Jackie1989 said:

I dont believe I can MTC this because of the small claims provision.

You can, and it's unlikely the small claims business would have come up considering you got no resistance from opposing.  Most judges aren't going to sit and read through a contract when both parties are agreeable to the motion.

I just saw where you said this is in "superior court".  Is that considered "small claims" there?

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@Jackie1989  If you can obtain a court order to compel Cavalry, AAA may reverse this. There was a recent thread where AAA sent a similar letter as yours to a poster because JDB Unifund was noncompliant with AAA's policies. However, the poster had his MTC granted and had included the judge's order with the arb demand. @fisthardcheese advised the poster to contact AAA to let them know there was a court order attached. AAA reversed its decision and sent the letter linked to below with the following:

"We are in receipt of a court order compelling arbitration. Accordingly, we are proceeding on that basis."

 

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46 minutes ago, Harry Seaward said:

I just saw where you said this is in "superior court".  Is that considered "small claims" there?

This is small claims but, there is another case in superior

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19 minutes ago, Brotherskeeper said:

@Jackie1989  If you can obtain a court order to compel Cavalry, AAA may reverse this. There was a recent thread where AAA sent a similar letter as yours to a poster because JDB Unifund was noncompliant with AAA's policies. However, the poster had his MTC granted and had included the judge's order with the arb demand. @fisthardcheese advised the poster to contact AAA to let them know there was a court order attached. AAA reversed its decision and sent the letter linked to below with the following:

"We are in receipt of a court order compelling arbitration. Accordingly, we are proceeding on that basis."

 

I did read this

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AAA sent email to attorney and cc'd me.

I don't want this to slip through my fingers.

This file is closed apparently. It was scheduled to be closed by the 9th, if I didn't pay but, I paid it last night. They didn't take any money out of my bank account. Weird.

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I have been searching and searching and can not find anything. I have to imagine that there are others in a similar situation.

Since this wasn't court ordered (only verbally agreed with magistrate and counsel and no mention of it on court records) and it's in small claims, I am not sure how to proceed.

If I attempt MTD, like Harry suggest, and state it's not fair etc., I am afraid they may state small claims exemption and that would end the arb route.

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@Jackie1989 AAA has shown that it will accept a case like this with a court order. Can you get AAA to put this in writing to you? If you can show the judge that an order to compel can get this off his docket, he may oblige. 

You filed an AAA arb demand before they filed the case in small claims court, correct? They ignored it?

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3 hours ago, Brotherskeeper said:

@Jackie1989 AAA has shown that it will accept a case like this with a court order. Can you get AAA to put this in writing to you? If you can show the judge that an order to compel can get this off his docket, he may oblige. 

You filed an AAA arb demand before they filed the case in small claims court, correct? They ignored it?

I sent cavalry a request for arbitration in May. They filed suit 3 weeks? Later.  I then filed an answer. Denying everything but, didn't mention arbitration. Day of trial , judge lets us go in hall to discuss. I bring it to her attention that I requested arbitration and they filed quickly. She said no problem, we can get a continuation and you can pursue arbitration.

We go back into court. She tells judge that I want to pursue arbitration. He asks me if I will be able to handle this in 60 days. I say yes.

Next I see court records online and it states 60 days continuance for the parties..something like that but, no mention of arbitration.

I filed with AAA and just paid them the other day my fee of $200. 

Right after I do this, they send email that they won't administer because of Cavalry owing money and not playing by the rules. They state in email that they will do court ordered arbitration.

I sent attorney for cavalry an email yesterday asking what was Cavalry's plan, before I proceed further. She tells me that she will find out and get back to me.

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3 minutes ago, Jackie1989 said:

I sent cavalry a request for arbitration in May. They filed suit 3 weeks? Later.  I then filed an answer. Denying everything

Did you have a suspicion that you were going to be sued when you filed with AAA? What did you list as the nature of your AAA claim?

As I'm sure you know now, arbitration is an affirmative defense to be asserted in your answer. (FYI--Some states require you to assert arb in your answer as an affirmative defense or it is waived. Some states might require you to submit an amended answer to include it.) It would have been very helpful to your small claims case if you had asserted arb as an affirmative defense and included that you had filed an AAA demand claim prior to them filing the suit. Then the magistrate would have known that granting your motion to compel was needed, and a stay of case pending arb instead of a 60-day continuance. 

My thinking is that your magistrate needs to understand that the only thing preventing you from arbitrating this case is a court order to do so. (IANAL)

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I didn't think there were going to file so quickly with the courts. I didn't do anything with AAA and just answered the complaint.

I know about the special defense for arbitration but, being it was in small claims and Citibank has the small claims exception, I didn't bother.

Now, I can try to file a MTC, I guess, and state what went on in trial that magistrate allowed continuance and attorney agreed but, that Cavalry owes money to AAA" and they won't administer your honor unless cavalry pays up".

Or MTD?

Same verbiage just add "it's prejudice to me that I am not allowed to arbitrate because Cavalry is not obliging the agreement terms.

I have to imagine that there are plenty more in this situation.(small claims exemption clause).

I am just trying to figure out next move and puzzled.

I have another case in the system with same jdb same firm same OC but it's in Superior Court so a MTC will be filed appropriately.

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@Jackie1989 @BV80 Is this the Citibank arbitration provision in the applicable agreement you're using?

PLEASE READ THIS PROVISION OF THE AGREEMENT CAREFULLY.
This section provides that disputes may be resolved by binding arbitration. Arbitration replaces the right to go to court, have a jury trial or initiate or participate in a class action. In arbitration, disputes are resolved by an arbitrator, not a judge or jury. Arbitration procedures are simpler and more limited than in court. This arbitration provision is governed by the Federal Arbitration Act (FAA), and shall be interpreted in the broadest way the law will allow.
Covered claims
• You or we may arbitrate any claim, dispute or controversy between you and us arising out of or related to your Account, a previous related Account or our relationship (called “Claims”).
• If arbitration is chosen by any party, neither you nor we will have the right to litigate that Claim in court or have a jury trial on that Claim.
Except as stated below, all Claims are subject to arbitration, no matter what legal theory they’re based on or what remedy (damages, or injunctive or declaratory relief) they seek, including Claims based on contract, tort (including intentional tort), fraud, agency, your or our negligence, statutory or regulatory provisions, or any other sources of law; Claims made as counterclaims, cross-claims, third-party claims, interpleaders or otherwise; Claims made regarding past, present or future conduct; and Claims made independently or with other claims. This also includes Claims made by or against anyone connected with us or you or claiming through us or you, or by someone making a claim through us or you, such as a co-applicant, Authorized User, employee, agent, representative or an affiliated/parent/subsidiary company.
Arbitration limits
• Individual Claims filed in a small claims court are not subject to arbitration, as long as the matter stays in small claims court.
• We won’t initiate arbitration to collect a debt from you unless you choose to arbitrate or assert a Claim against us. If you assert a Claim against us, we can choose to arbitrate, including actions to collect a debt from you. You may arbitrate on an individual basis Claims brought against you, including Claims to collect a debt.
• Claims brought as part of a class action, private attorney general or other representative action can be arbitrated only on an individual basis. The arbitrator has no authority to arbitrate any claim on a class or representative basis and may award relief only on an individual basis. If arbitration is chosen by any party, neither you nor we may pursue a Claim as part of a class action or other representative action. Claims of 2 or more persons may not be combined in the same arbitration. However, applicants, co-applicants, Authorized Users on a single Account and/or related Accounts or corporate affiliates are here considered as one person.
How arbitration works
• Arbitration shall be conducted by the American Arbitration Association(“AAA”) according to this arbitration provision and the applicable AAA arbitration rules in effect when the claim is filed (“AAA Rules”), except where those rules conflict with this arbitration provision. You can obtain copies of the AAA Rules at the AAA’s website (www.adr.org) or by calling 800-778-7879. You or we may choose to have a hearing, appear at any hearing by phone or other electronic means, and/or be represented by counsel. Any in-person hearing will be held in the same city as the U.S. District Court closest to your billing address.

• Arbitration may be requested at any time, even where there is a pending lawsuit, unless a trial has begun or a final judgment entered. Neither you nor we waive the right to arbitrate by filing or serving a complaint, answer, counterclaim, motion or discovery in a court lawsuit. To choose arbitration, a party may file a motion to compel arbitration in a pending matter and/or commence arbitration by submitting the required AAA forms and requisite filing fees to the AAA.

• The arbitration shall be conducted by a single arbitrator in accord with this arbitration provision and the AAA Rules, which may limit discovery. The arbitrator shall not apply any federal or state rules of civil procedure for discovery, but the arbitrator shall honor claims of privilege recognized at law and shall take reasonable steps to protect Account information and other confidential information of either party if requested to do so. The arbitrator shall apply applicable substantive law consistent with the FAA and applicable statute of limitations, and may award damages or other relief under applicable law.

• The arbitrator shall make any award in writing and, if requested by you or us, may provide a brief statement of the reasons for the award. An arbitration award shall decide the rights and obligations only of the parties named in the arbitration, and shall not have any bearing on any other person or dispute.

Paying for arbitration fees

• We’ll pay your share of the arbitration fee for an arbitration of Claims of $75,000 or less if they are unrelated to debt collection. Otherwise, arbitration fees will be allocated according to the applicable AAA Rules. If we prevail, we may not recover our arbitration fees, unless the arbitrator decides your Claim was frivolous. All parties are responsible for their own attorney’s fees, expert fees and any other expenses, unless the arbitrator awards such fees or expenses to you or us based on applicable law.

The final award

• Any award by an arbitrator is final unless a party appeals it in writing to the AAA within 30 days of notice of the award. The arbitration appeal shall be determined by a panel of 3 arbitrators. The panel will consider all facts and legal issues anew based on the same evidence presented in the prior arbitration, and will make decisions based on a majority vote. Arbitration fees for the arbitration appeal shall be allocated according to the applicable AAA Rules. An award by a panel on appeal is final. A final award is subject to judicial review as provided by applicable law.

Survival and Severability of Terms

This arbitration provision shall survive changes in this Agreement and termination of the Account or the relationship between you and us, including the bankruptcy of any party and any sale of your Account, or amounts owed on your Account, to another person or entity. If any part of this arbitration provision is deemed invalid or unenforceable, the other terms shall remain in force, except that there can be no arbitration of a class or representative Claim. This arbitration provision may not be amended, severed or waived, except as provided in this Agreement or in a written agreement between you and us.

Rules for rejecting this arbitration provision

You may reject this arbitration provision by sending a written rejection notice to us at: PO Box 6195; Sioux Falls, SD 57117-6195. Your rejection notice must be mailed within 45 days of Account opening. Your rejection notice must state that you reject the arbitration provision and include your name, address, Account number and personal signature. No one else may sign the rejection notice. Your rejection notice will not apply to the arbitration provision(s) governing any other account(s) that you have or had with us. Rejection of this arbitration provision won’t affect your other rights or responsibilities under this Agreement, including use of the Account.

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