ILNews

Judges order dispute be arbitrated

Back to TopCommentsE-mailPrintBookmark and Share

A complaint filed by a client against financial services companies and a former employee must be arbitrated per an agreement the client signed when opening an IRA account, the Indiana Court of Appeals concluded. The court split over whether one of the companies could compel arbitration.

In German American Financial Advisors & Trust Co. d/b/a German American Investment Svcs., PrimeVest Financial Svcs., Inc., and Jeffery W. Tooley v. Dennis M. Reed, 19A01-1110-PL-428, German American Financial Advisors and other appellants’ appealed the denial of their second motion to compel arbitration of Dennis Reed’s claims against them. Reed worked with Jeffery Tooley of GAFA and PrimeVest to open an IRA in 2003. GAFA and PrimeVest had a “commission sharing agreement.”

Reed’s new account application included an arbitration clause. In 2006, Reed rolled over his IRA accounts into a variable rate annuity under the advisement of Tooley that he’d be able to earn around $100,000 in three years and be able to withdraw the full amount without penalties at that time.

Three years later, when Reed sought to withdraw all the funds from the annuity, and after Tooley left GAFA, another employee told Reed he could only withdraw a portion without incurring significant penalties. Reed filed his complaint alleging violations of the Indiana Uniform Security Act, fraud, negligence, and other claims in 2009. The trial court denied the appellants’ first motion to compel arbitration; it denied the second motion to compel as well.

Reed challenged the second motion to compel by pointing out that PrimeVest and GAFA didn’t keep his entire record on file, so the original agreement was not found. He also argued that the companies provided several forms that they believed were the correct documents, but those forms turned out not to be the exact agreement that Reed signed in 2003.

The Court of Appeals reversed the trial court and ordered the dispute be arbitrated. They found the appellants satisfied their burden to show the existence of an enforceable arbitration agreement and that the disputed matter is the type of claim that is intended to be arbitrated.

“While we are unimpressed with Appellants’ failure to locate the proper documentation to support their first motion to compel, they ultimately met their burden on the second motion to compel arbitration, which is the only issue before us, and Reed has not offered any evidence to refute the evidence pointing to a valid arbitration agreement,” wrote Judge Edward Najam in the majority opinion.

The judges split over whether GAFA may compel Reed to submit his claims against it to arbitration. The majority found he is required to do so under the doctrine of equitable estoppel, but Judge Michael Barnes believed the majority “is elasticizing the plain and unambiguous language of the arbitration agreement by allowing GAFA to insist on arbitration when GAFA was not a named party to the arbitration agreement—only PrimeVest and Reed were named.”

 

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. So if I am reading it right, only if and when African American college students agree to receive checks labeling them as "Negroes" do they receive aid from the UNCF or the Quaker's Educational Fund? In other words, to borrow from the Indiana Appellate Court, "the [nonprofit] supposed to be [their] advocate, refers to [students] in a racially offensive manner. While there is no evidence that [the nonprofits] intended harm to [African American students], the harm was nonetheless inflicted. [Black students are] presented to [academia and future employers] in a racially offensive manner. For these reasons, [such] performance [is] deficient and also prejudice[ial]." Maybe even DEPLORABLE???

  2. I'm the poor soul who spent over 10 years in prison with many many other prisoners trying to kill me for being charged with a sex offense THAT I DID NOT COMMIT i was in jail for a battery charge for helping a friend leave a boyfriend who beat her I've been saying for over 28 years that i did not and would never hurt a child like that mine or anybody's child but NOBODY wants to believe that i might not be guilty of this horrible crime or think that when i say that ALL the paperwork concerning my conviction has strangely DISAPPEARED or even when the long beach judge re-sentenced me over 14 months on a already filed plea bargain out of another districts court then had it filed under a fake name so i could not find while trying to fight my conviction on appeal in a nut shell people are ALWAYS quick to believe the worst about some one well I DID NOT HURT ANY CHILD EVER IN MY LIFE AND HAVE SAID THIS FOR ALMOST 30 YEARS please if anybody can me get some kind of justice it would be greatly appreciated respectfully written wrongly accused Brian Valenti

  3. A high ranking Indiana supreme Court operative caught red handed leading a group using the uber offensive N word! She must denounce or be denounced! (Or not since she is an insider ... rules do not apply to them). Evidence here: http://m.indianacompanies.us/friends-educational-fund-for-negroes.364110.company.v2#top_info

  4. A high ranking bureaucrat with Ind sup court is heading up an organization celebrating the formal N word!!! She must resign and denounce! http://m.indianacompanies.us/friends-educational-fund-for-negroes.364110.company.v2#top_info

  5. ND2019, don't try to confuse the Left with facts. Their ideologies trump facts, trump due process, trump court rules, even trump federal statutes. I hold the proof if interested. Facts matter only to those who are not on an agenda-first mission.

ADVERTISEMENT