Following up on my blog post regarding Setting Aside Bais Din Agreements to Arbitrate Due to Procedural Issues, this post will focus on some more substantive issues that could arise that may serve as a defense to Agreements to Arbitrate in the Bais Din, if necessary.
I want to be clear that in writing these posts, I am not discouraging resolving a matter in the Bais Din. Bais Din provides a very valuable forum to resolve disputes for many people and there are plenty of great stories that come out of Bais Din.
However, these blog posts are intended for those that need assistance when Bais Din proceedings do not go as planned, due to some degree of misconduct or other types of issues that could give rise to a challenge.
When there is a challenge to an arbitration agreement, a court must examine the circumstances surrounding the agreement itself to determine whether there was fraud, duress, or unconscionability.
In determining whether to vacate an Agreement to Arbitrate, a Court must “consider the totality of circumstances to evaluate whether a party has waived the right to object to arbitration after the matter has been ordered to arbitration and arbitration is held.” Wein v. Morris.
In Gobac v. Davis, the Court defined duress in relation to execution of contracts as follows:
‘Duress in the Restatement of this subject means (a) any wrongful act of one person that compels a manifestation of apparent assent by another to a transaction without his volition, or (b) any wrongful threat of one person by words or other conduct that induces another to enter into a transaction under the influence of such fear as precludes him from exercising free will and judgment, if the threat was intended or should reasonably have been expected to operate as an inducement.’
The Court elaborated, stating:
‘Duress consists of threats that cause such fear as to induce the exercise of volition, so that an undesired act is done. In duress of this latter type neither the threats alone not the fear alone is duress. The same threats may cause fear in one person and not in another. The test of what act or threat produces the required degree of fear is not objective. The threat need not be such as would put a brave man, or even a man of ordinary firmness, in fear. The question is rather, did it put one entering into the transaction in such fear as to preclude the exercise by him of free will and judgment.’
The age, capacity, education and relationship of the parties are among the factors a Court considers in determining if there was duress. McBride v. Atlantic City.
Duress has long been considered by Courts as a cognizable defense where the provision of a Gett is conditioned upon a party’s capitulation to contract terms.
For example, in Segal v. Segal, the Court invalidated a Marital Settlement Agreement wherein the husband withheld a Gett until the Wife conveyed a Lakewood property to him in the divorce. In so concluding, the Court examined cases in other jurisdictions wherein agreement procured by this brand of religious coercion and duress were invalidated, even in the context of Bais Din proceedings:
In Golding v. Golding, [176 N.Y.S.2d 4 (1992)], a husband repeatedly submitted documents to his wife containing terms of divorce favorable to him, and threatened not to grant her a Get unless she signed the documents. The court concluded that “it is evident plaintiff did not freely and voluntarily enter into the agreement but was compelled to do so by her husband’s invocation of his power to refuse to give her a Jewish divorce.” 581 N.Y.S.2d at 6. The court also noted:
[E]ven if the document(s) signed by plaintiff had, in fact, been the product of rabbinical arbitration, as defendant alleges, this still does not preclude the court from examining its substance and the procedure by which it was adopted so as to ascertain that there was no fraud, duress or overreaching. The judiciary must merely refrain from delving into matters concerning religious doctrine. At any rate, the Supreme Court properly found that there was no indication of rabbinical arbitration, simply that the rabbis had acted as go-betweens for the parties.
The Court in Segal vacated the marital settlement agreement, finding that the Wife was subjected to “ ‘extreme pressures.’”
With this in mind, there are several indicators of “extreme pressures” that could also be present in the context of entering into an Agreement to Arbitrate to be mindful of:
- 1. The Agreement to Arbitrate is signed upon a guarantee that a party will or will not receive a Gett. Conditioning an agreement on a Gett, in any situation, is “akin to extortion”, just as with the Agreement in Segal.
- 2. The Agreement to Arbitrate was signed at a time someone is faced with a threat of loss of custody. Sometimes, there is a repeated trope in Bais Din that one party with receive custody over another in Bais Din but not in civil court. People are warned: agree to Bais Din or else you’ll lose your children. This may be precisely the type of extreme pressure the cases refer to.
- 3. There are certain external financial pressures to compel a party to sign an Agreement to Arbitrate. Perhaps someone has spent months without basic support, or perhaps a party is guaranteed a favorable financial outcome if the Agreement is signed.
- 4. There are “side agreements” – guarantees that are made that are not contained in the signed Agreement to Arbitrate. There should be no side agreements made – the Agreement to Arbitrate will be your agreement, so make sure you are comfortable with it as it is. Do not expect any side agreements to be honored by anyone.
- 5. Parties are young, and/or lack the necessary experience or education to oppose the pressures. It may be difficult for one or both of the parties to reach conclusions that are contrary to what a rabbi is telling them in the moment because of cultural reasons and the manner in which they were raised and educated.
As you go through Bais Din, watch out for these possibilities and always consult an attorney before you sign any Agreement to Arbitrate. My next post will discuss the importance of having an attorney as you go through this process, from the very start of the proceedings with the Agreement to Arbitrate, to the time when it is conformed by the Court, all the way at the end of the proceedings.
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Eliana T. Baer is a contributor to the New Jersey Family Legal Blog and a partner in the Family Law Practice Group of Fox Rothschild LLP. Eliana practices in Fox Rothschild’s Princeton, New Jersey office and focuses her state-wide practice on representing clients on issues relating to divorce, equitable distribution, support, custody, adoption, domestic violence, premarital agreements and Appellate Practice. You can reach Eliana at (609) 895-3344, or etbaer@foxrothschild.com.