Plaintiff Cynthia M. Lopez appeals the judgment entered in this action after an arbitration award. We conclude the trial court erred in granting defendant Charles Schwab & Co., Inc.’s (Schwab) motion to compel arbitration. Accordingly, we reverse.

I. Background Schwab is a securities broker, and as part of its business opens and maintains trading accounts for its clients and executes transfers of securities and buy and sell orders. On January 24, 2000, at Schwab’s Albuquerque branch, Lopez applied to open an account by filling out two forms. The first was entitled “Open a Schwab Account Today.” This application form included a section in which the applicant could select either a “Schwab Account” or a “Schwab One Account.” The Schwab One Account had a higher minimum balance and offered features that the Schwab Account did not, such as a daily sweep of uninvested cash balances into a Schwab money fund, checks or a debit card, and automatic margin trading. Lopez checked only the box indicating she wanted a Schwab One Account. The third page of the application stated in bold print: “! Remember to sign the Account Agreement on the next page.”
The following page contained the bold-print heading “Agree to Terms.”
Among those terms was an arbitration provision, which stated: “I agree to settle by arbitration any controversy between myself and Schwab and/or any Schwab officers, directors, employees or agents relating to the Account Agreement, my brokerage account or account transactions, or in any way arising from my relationship with Schwab as provided in Section 17, pages 11–13, of the Brokerage Account Agreement and Section 23, pages 29–31, of the Schwab One Account Agreement. The following disclosures are made pursuant to applicable self-regulatory organization rules: (1) arbitration is final and binding on all parties; (2) the parties are waiving their right to seek remedies in court, including the right to a jury trial; (3) pre-arbitration discovery is generally more limited than and different from court proceedings; (4) the arbitrators’ award is not required to include factual findings or legal reasoning, and any party’s right to appeal or seek modification of rulings by the arbitrators is strictly limited; and (5) the panel of arbitrators will typically include a minority of arbitrators who were or are affiliated with the securities industry.” At the bottom of this form was a box for Schwab use only, labeled “Approved.” This box was signed, apparently by a Schwab representative, and an account number was assigned.
On the same day, Lopez also completed and signed a form headed “Transfer Your Account to Schwab,” on which she indicated she wanted Schwab to transfer all of her Intel shares from an account with another financial institution.
As noted above, the application’s arbitration provision stated that the applicant agreed to settle controversies by arbitration “as provided in Section 17, pages 11–13, of the Brokerage Account Agreement and Section 23, pages 29–31, of the Schwab One Account Agreement.” The referenced section of the Schwab One Account agreement contained similar language agreeing to arbitration, as well as disclosures similar to those in the application. In addition, it provided that the arbitration would be conducted by the rules of the National Association of Securities Dealers (NASD), the New York Stock Exchange, the Pacific Stock Exchange, or the Chicago Board Options Exchange; and that either party could initiate arbitration by filing a written claim with one of those organizations. It also provided that arbitration would be binding, and included provisions that would be effective if the account holder was not a United States resident. The referenced section of the Schwab Account agreement contained similar provisions.
The Schwab One Account agreement included several other provisions relevant to this dispute. It defined the Schwab One Account agreement as “[t]he agreement you make with us and the Bank when you open a Schwab One Account, consisting of the Schwab One Application, this Schwab One Account Agreement and any other written agreements between you and us concerning your Schwab One Account, all as amended from time to time.” A section entitled “Provision of Services” stated: “To open a Schwab One®
Account, you complete an account application. When we approve your application and subject to credit verification, we will open a Schwab One Account for you and act as your broker to purchase and sell securities for your account and on your instructions.” In a section entitled “Approval of Application, Credit Verification and Account Information,” the agreement stated: “The Schwab One Account Agreement is effective only after we approve your Schwab One Account Application. We may decline your application for any reason.”
In response to Lopez’s application, Schwab directed a letter headed “Account Verification” to Lopez on January 24, 2000. The letter began, “Welcome to Schwab”; it included the account number, indicated the account in question was a Schwab One Account, and included account handling instructions.
The following day, however, Schwab sent a letter to Lopez denying her request for a Schwab One Account. The letter stated in pertinent part: “Thank you for your interest in establishing a Schwab One /Schwab One International account. [¶] At this time we are unable to honor your request for this account and are also unable to maintain a standard brokerage account for you. This decision is based on a credit analysis that included a consumer credit report . . . . [¶] . . . [¶] You will earn interest for one full week after the date of this letter and then your account will be closed and the assets mailed to you.”
Lopez stated in a declaration that she went to Schwab’s Albuquerque office on January 28, 2000. A broker there told her an account had not been opened for her, and she had not been approved for an account due to her poor credit report. Lopez told the broker she was only interested in a Schwab One Account and that she did not want the transfer of assets to go forward. She had no further contact with Schwab until March 1, 2000.
According to Lopez’s declaration, she contacted her broker at another firm, Merrill Lynch, to place a trade of Intel securities on March 1, 2000. She was informed that all of her Intel shares had been transferred to another account on February 24, 2000. She contacted Schwab that day, and spoke with broker Lee Lauderdale. He told her that when he learned her application had been rejected, he reopened a Schwab account by “pulling a few strings”—although not a Schwab One Account—and had transferred her Intel shares from Merrill Lynch to Schwab. He admitted he had acted without Lopez’s permission. Lopez demanded that her stock be returned to Merrill Lynch. Lauderdale agreed, but the stock was not returned until after April 1, 2000.
Lopez filed this action on June 26, 2000, alleging causes of action for conversion and intentional infliction of emotional distress. Schwab moved to compel arbitration and to stay proceedings, and the motion was granted on October 5, 2000. On January 28, 2003, the court dismissed the action, noting the matter had been resolved at a binding NASD arbitration that resulted in an award dated April 8, 2002. Judgment for Schwab was entered on April 3, 2003. This timely appeal ensued..........

Questions

1. Under what circumstances may an appellate court determine the meaning of a contract?
2. What standard does the court articulate to determine whether a communication is an offer?
3. What does the court say is the major problem with the defendant’s position?