Plaintiff Escapes Arbitration

            In Michael Waller v. Commerce Bank, et al., Commerce Bank appealed the interlocutory order of the Circuit Court of Jackson County, Missouri (“circuit court”), denying Commerce Bank’s motion to compel arbitration of Mr. Michael Waller’s (“Waller”) claims under the Missouri Human Rights Act (“MHRA”).  Because there was an unambiguous exclusion clause within the arbitration provision that was applicable to the undisputed facts of the underlying lawsuit relevant to this appeal, the Court of Appeals affirmed the circuit court’s denial of Commerce Bank’s motion to arbitrate.

[Waller] brought this action for Race Discrimination in Public Accommodation and Retaliation in Public Accommodation under the Missouri Human Rights Act after his request to open two business accounts was denied after several visits to two separate locations of Defendant Commerce Bank.  [Waller] claims he was denied the opportunity to open the business accounts because he is Black.

[Commerce Bank] filed a Motion alleging that “[Waller] agreed to the terms of a Deposit Agreement when opening his personal account with Commerce [Bank], and the Deposit Agreement require[d] Waller to arbitrate all claims related to or concerning his relationship with Commerce [Bank].”  However, the Dispute Resolution – Arbitration section of the Deposit Agreement contained a provision which stated “[t]his agreement to arbitrate shall not apply to any Claims or other disputes relating to business accounts or other non-personal accounts as such accounts are defined in Section II.I of this Agreement.  According to the Court, claim was related exclusively to [Waller’s] attempts to open business accounts.

On appeal, Commerce Bank contended the circuit court erred in denying its motion to compel arbitration.

According to the Court of Appeals “Motions to compel arbitration generally present two central issues:  (1) whether the parties to the lawsuit entered into an enforceable arbitration agreement; and (2) whether the scope of that agreement encompasses the disputes raised in the lawsuit.”  Maune v. Raichle, 721 S.W.3d 865, 869 (Mo. banc 2025).  “The parties, however, may agree to arbitrate either or both of these threshold issues by including in the arbitration agreement a delegation provision broad enough to encompass them.”  Id. (citing Brown v. GoJet Airlines, LLC, 677 S.W.3d 514, 521 (Mo. banc 2023)).  Here, neither party argues that either of these threshold issues have been delegated to arbitration and the arbitration agreement makes clear that those issues are not delegated to arbitration.

“Determining the scope of an arbitration agreement requires application of ‘the usual rules of state contract law and canons of contract interpretation’ in order to ‘ascertain the intent of the parties through the plain and ordinary meaning of the contract terms and give effect to that intent.’”  Nelson Trucking, LLC v. K&M Translogic, LLC, 696 S.W.3d 407, 417 (Mo. App. W.D. 2024) (emphasis added) (quoting Mackey, 640 S.W.3d at 798); see also Triarch Indus., Inc. v. Crabtree, 158 S.W.3d 772, 776 & n.5 (Mo. banc 2005) (collecting cases supporting the proposition that, “in determining whether the parties have entered into a valid agreement to arbitrate, the usual rules of state contract law and canons of contract interpretation apply”).

Here, the relevant provisions of the arbitration agreement that the parties entered into when Waller opened a personal banking account with Commerce Bank are plain, ordinary, and unambiguous terms.

The Court of Appeals agreed with Commerce Bank that the arbitration agreement defines “Claim” to have “the broadest possible meaning,” but noted that the same arbitration provision very plainly excludes from the definition of “Claim” any dispute “relating to business accounts.”  And, in this litigation, the entire dispute revolves around discrimination claims that “relate” to Waller’s attempt to open a “business account” with Commerce Bank and Commerce Bank’s refusal to open such business account, allegedly for a discriminatory reason.

In sum, because Waller’s claims related solely to his attempts to open business accounts with Commerce Bank, the claims brought in Waller’s petition fell within the scope of the exception to arbitration clause.  Thus, the circuit court did not err in denying Commerce Bank’s motion to compel arbitration.