Fact Pattern $3-2$

Ellen contracts with James to be her stockbroker, making stock trades for. Ellen's account. Ellen need not pre$-$approve the trades that James makes, only trades for more than $$20,000.$ Ellen and James include a clause stating, "that in case of any disputes arising out of this contract, the dispute shall be arbitrated using the rules of the New York Stock Exchange."

Ellen learns that since signing her contract with James, he has routinely been making trades worth more than $$20,000$ without her permission and losing money.

Question $26$

$1pts$

Refer to Fact Pattern $3-2.$ If Ellen, decides before the lawsuit begins, she doesn't want to go to arbitration after all and therefore takes her dispute to the local court, what should happen?

the court will hear the case and make a judgment based on the facts of the case

the court should dismiss the case when she files it

the court will hear the case, but only if both parties disagree as to the subject matter

the FAA will not apply here, because the dispute involves intangible property

none of the other choices