Who Decides If A Dispute Is Subject To Arbitration?

• Published date: 06 April 2022
• Subject Matter: Litigation, Mediation & Arbitration, Arbitration & Dispute Resolution
• Law Firm: Holland & Knight
• Author: Ms Katharine Menéndez De La Cuesta and Brian A. Briz

Florida Supreme Court: Adopting Arbitration Rules That Empower Arbitrators to Decide Arbitrability Constitutes "Clear and Unmistakable" Evidence of Agreement to Delegate

Highlights

• The Florida Supreme Court on March 31, 2022, found that the incorporation by reference of the American Arbitration Association (AAA) arbitration rules in Airbnb's Terms of Service constitutes clear and unmistakable evidence of the parties' intent to delegate questions of arbitrability away from the court and to the arbitrator.
• This decision shows the importance of paying careful attention to the language of arbitration agreements to ensure they reflect the true intent of the parties and avoid issues by specifying key points in the agreements.

The Florida Supreme Court on March 31, 2022, found that the incorporation by reference of the American Arbitration Association (AAA) arbitration rules in Airbnb's Terms of Service constitutes clear and unmistakable evidence of the parties' intent to delegate questions of arbitrability away from the court and to the arbitrator. Airbnb, Inc. v. Doe, No. SC20-1167, 2022 WL 969184, at *5 (Fla. Mar. 31, 2022).

This decision shows how important it is for parties to pay careful attention to the language of their arbitration agreements to ensure they reflect the true intent of the parties and avoid issues by specifying key points in the agreements.

Under First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995), the U.S. Supreme Court held that courts - and not arbitrators - must decide questions of arbitrability unless there is clear and unmistakable evidence of the parties' intent to submit questions of arbitrability to the arbitrators. Following First Options, 11 of the 12 federal circuit courts of appeal have found that the incorporation by reference into an agreement to arbitrate of arbitration rules empowering arbitrators to decide arbitrability evidences the parties' clear and unmistakable intent to have the arbitrators, and not the courts, determine arbitrability.

Background

In 2016, a couple from Texas (John Doe, et al.) rented a condominium unit in Florida using Airbnb. The unit was owned by Wayne Natt, who, according to the Does, secretly recorded the Does' entire stay in his unit. The Does sued both Natt and Airbnb in tort, claiming intrusion and loss of consortium. Airbnb moved to compel arbitration, arguing that under Airbnb's terms of service, the Does and Airbnb agreed to arbitrate any disputes arising from the rental under...