My guess is that the bolt that holds the armrest has come loose, which is why it has backed out. Unzip the upholstery covering the armrest to reveal a hole, which holds the bolt. Undo the bolt completely if not done already, attach/bring the armrset to the resting (horizontal) position and tighten the screw. The armrest has a stopper thingy (on the side that sits against the seatback); inspect to make sure it's not broken or you'll have to replace it. Hope this helps, buddy.
See these links also:
WikiAnswers - How do you remove the armrest of a 1999 Ford Windstar