Dasher v. RBC Bank (USA), No. 13-10257 (11th Cir. Feb. 10, 2014) [Click for opinion]
Michael Dasher sued RBC Bank in 2010 on behalf of a class of customers, alleging that RBC had charged excessive fees in breach of a 2008 account agreement. (The suit is part of the Checking Account Overdraft Multidistrict Litigation, which alleges that more than 30 banks manipulated debit card transactions to increase customers' overdraft fees.) The 2008 account agreement contained an arbitration provision, so RBC moved to compel arbitration. The district court denied the motion because, in 2012, PNC Financial Services Group Inc. acquired RBC and issued a new, superseding account agreement that did not contain an arbitration clause.
On appeal, RBC argued that, despite the new account agreement, the Federal Arbitration Act's presumption of arbitrability should apply and should result in arbitration. The Eleventh Circuit held that the presumption "applies only where a validly formed and enforceable arbitration agreement is ambiguous about whether it covers the dispute at hand." Here, however, the issue was whether an arbitration agreement existed at all. The court found that no arbitration agreement existed because the 2012 agreement contained no arbitration clause and expressly stated that it "supersedes all prior versions and will at all time govern."
RBC further argued that the arbitration agreement contained in the 2008 contract could not be waived by silence in the new agreement but only through clear and explicit language. The court rejected this argument because it was "obvious" that the case did not involve any waiver of a right to arbitrate but rather involved a decision to supersede and replace an entire agreement.
RBC also argued that, because the facts giving rise to the dispute occurred while the 2008 agreement was still effective, the dispute is subject to arbitration. The court rejected the argument because the parties agreed to apply the terms of the 2012 agreement retroactively. Specifically, the amendment clause in the 2008 agreement states that "the most current version of the Agreement supersedes all prior version and will at all times govern." The court interpreted the last phrase ("at all times") to include the past, present, and future. For these reasons, the Eleventh Circuit affirmed the district court's denial of RBC's motion to compel.