11.1 Lack of Consideration Noohi v. Toll Brothers, Inc. 708 F.3d 599, 2013 U.S. App. Lexis 4188 (United States Court of Appeals for the Fourth Circuit, 2013)

Case: Toll Brothers, Inc. is a real estate development company that builds and sells luxury homes. Mehdi Noohi and Soheyla Bolouri (plaintiffs) deposited a total of $77,008 toward the $1,006,975 purchase price of a Toll Brothers home. The agreement for sale included an arbitration clause that required the plaintiffsbut not Toll Brothersto submit to arbitration any disputes regarding the agreement. The plaintiffs could not get a mortgage approved. The Toll Brothers, who had not incurred any cost, refused to refund their deposit.

Issue: When Toll Brothers refused to return the deposit, the plaintiffs sued Toll Brothers in U.S. district court for breach of contract individually and on behalf of a class of other prospective buyers who allegedly lost deposits to Toll Brothers in a similar manner. Toll Brothers made a motion to have the case removed for arbitration pursuant to the arbitration clause in the agreement. The plaintiffs asserted that the arbitration clause was unenforceable because it lacked mutuality of consideration because it required only the buyerbut not the sellerto submit disputes to arbitration.

Critical Thinking Question: Yes/No, did Toll Brothers given consideration for the arbitration agreement?