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Southland Corp. v. Keating
・ Southland Credit Union
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Southland Corp. v. Keating : ウィキペディア英語版
Southland Corp. v. Keating

''Southland Corp. v. Keating'', , is a United States Supreme Court decision concerning arbitration. It was originally brought by 7-Eleven franchisees in California state courts, alleging breach of contract by the chain's then parent corporation. Southland pointed to the arbitration clauses in their franchise agreements and said it required disputes to be resolved that way; the franchisees cited state franchising law voiding any clause in an agreement that required franchisees to waive their rights under that law. A 7-2 majority held that the Federal Arbitration Act (FAA) applied to contracts executed under state law.
Chief Justice Warren Burger wrote for the majority that it was clearly the intent of Congress in passing the FAA to encourage the use of arbitration as widely as possible, that it enacted "a national policy favoring arbitration". Justice Sandra Day O'Connor dissented, along with William Rehnquist, arguing that the legislative history of the FAA strongly suggested it was intended to apply only to contracts executed under federal law. In later years, Clarence Thomas would make her arguments the foundation of a series of dissents from cases concerning the application of the FAA to state law, even in cases where O'Connor went with the majority citing ''stare decisis''.
The decision was a turning point in the use of arbitration in American contract law, when it was followed with other decisions limiting the authority of states to regulate arbitration. It has been described as "perhaps the most controversial case in the Supreme Court's history of arbitration jurisprudence."〔Burch, Thomas; , 31 Fla State Univ Law Rev 1005, 1014 (2004).〕 Its legal foundation has been examined and disputed, and some critics have found the FAA's legislative history directly contradicts the court's holding. One scholar has even found the decision an unconstitutional infringement of states' power over their own courts. Mandatory prebinding arbitration clauses became widespread, particularly in credit card agreements and other consumer services. Proponents of arbitration pointed to its success in reducing crowded court dockets, while consumer advocates charged that the arbitration process was biased in favor of large corporations and against consumers, many of whom were far poorer and legally unsophisticated. They would be joined in calling for it to be overturned (unsuccessfully) in a later case by 20 state attorneys general.
==Background of the case==

The plaintiffs, all 7-Eleven franchisees, filed suit individually in California Superior Court charging Southland with fraud, misrepresentation, breach of contract, breach of fiduciary duty and violations of disclosure provisions required in California's Franchise Investment Law (CFIL) between 1975 and 1977. Their actions were consolidated with another filed separately by Keating in Alameda County seeking class certification for all franchisees. Southland sought to compel arbitration per the franchise agreements. The Superior Court granted that request except for the CFIL claims, citing Section 31512 of that statute, under which any contractual language that binds a franchisee to waive rights it grants was void. It did not see it as conflicting with the FAA, and did not rule on the motion for class certification.
A state appeals court reversed that decision, reading the arbitration clause to require the arbitration of all claims under the contract, including those under the CFIL. If the CFIL's language did create an exception, it was superseded by the federal law and thus unenforceable. It directed the trial court to begin hearing the class certification motion.
The plaintiffs appealed to the California Supreme Court. It ruled in their favor, seeing the CFIL as requiring adjudication of all claims brought under it, and not in conflict with the FAA. Again, the case was remanded to trial court with an instruction to begin hearing the class certification motion.

抄文引用元・出典: フリー百科事典『 ウィキペディア(Wikipedia)
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