Missouri Court of Appeals Rejects Motion to Compel Arbitration Where Company Reserved the Right to Go to Court

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“A contract lacks valid consideration if it purports to contain mutual promises, yet allows one of the parties to retain the unilateral right to modify or alter the agreement as to permit the party to unilaterally divest itself of an obligation it otherwise promised to perform.  A promise to arbitrate is illusory when the agreement promises mutuality of arbitration, but effectively allows one party to proceed in court on its claims while the other party is required to resolve its claims by arbitration and is prohibited from taking any action in court.  Here, the trial court found that the Agreement was unenforceable…. [W]hile the Agreement allowed Motormax to pursue its claims in court and exercise ‘self-help’ repossession, Mr. Knight was required to resolve his claims solely through arbitration.” Motormax Financial Services v. Knight, No. 102257, 2015 WL 4911825 (Mo.App. E.D. Aug. 18, 2015).




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