Business Law and the Regulation of Business 11th Edition by Richard Mann, Barry Roberts

Exercise 20

Dorton, as a representative for The Carpet Mart, purchased carpets from Collins Aikman that were supposedly manufactured of 100 percent Kodel polyester fiber but were, in fact, made of cheaper and inferior fibers. Dorton then brought suit for compensatory and punitive damages against Collins Aikman for its fraud, deceit, and misrepresentation in the sale of the carpets. Collins Aikman moved for a stay pending arbitration, claiming that Dorton was bound to an arbitration agreement printed on the reverse side of Collins Aikman's printed sales acknowledgment form. A provision printed on the face of the acknowledgment form stated that its acceptance was ''subject to all of the terms and conditions on the face and reverse side thereof, including arbitration, all of which are accepted by buyer.'' Holding that there existed no binding arbitration agreement between the parties, the district court denied the stay. Collins Aikman appealed. Is the arbitration clause enforceable?