Greene v. Alliance Auto., Inc.

• Decision Date: 11 March 2014
• Docket Number: No. WD 75863.,WD 75863.
• Citation: 435 S.W.3d 646
• Court: Missouri Court of Appeals
• Parties: Tylicee S. GREENE, Respondent, v. ALLIANCE AUTOMOTIVE, INC. d/b/a JD Byrider and Autobanc–2 Corporation d/b/a CNAC, Appellants.

435 S.W.3d 646

Tylicee S. GREENE, Respondent,

v.ALLIANCE AUTOMOTIVE, INC. d/b/a JD Byrider and Autobanc–2 Corporation d/b/a CNAC, Appellants.

No. WD 75863.

Missouri Court of Appeals,

Western District.

March 11, 2014.

Louis Wade, Robert Maher, for Appellants.

Douglass Noland, Thomas Mendel, Jack Lewis, for Respondent.

Before Division One: VICTOR C. HOWARD, P.J., JOSEPH M. ELLIS, and ANTHONY REX GABBERT, JJ.

ANTHONY REX GABBERT, Judge.

Alliance Automotive, Inc., d/b/a JD Byrider, and Autobanc–2 Corporation, d/b/a CNAC (hereinafter collectively referenced as “Alliance”) appeal the circuit court's order denying its motion to compel arbitration and denying its motion for relief from that order. Alliance contends that the court erred in denying its motions because a valid and enforceable arbitration agreement exists between the parties. We affirm.

On June 13, 2012, Tylicee S. Greene filed a petition for damages against Alliance wherein she alleged wrongdoing by Alliance in association with a vehicle she purchased and/or financed through Alliance and which Alliance later repossessed. On August 7, 2012, Alliance filed a motion to compel arbitration. Alliance contended that Greene was bound to arbitrate the matter because of a Retail Installment Contract and Security Agreement (Purchase Agreement) Greene signed when she purchased her vehicle. Alliance quoted the arbitration agreement language from the contract and provided a copy of the contract as an exhibit.

On October 9, 2012, Greene filed suggestions in opposition to Alliance's motion to compel arbitration. Therein, Greene set forth factual allegations and case law supporting that the arbitration agreement within the Purchase Agreement was unconscionable and part of an adhesion contract. Greene provided the court with the video that Alliance Automotive took of Greene's closing. On October 22, 2012, the court denied Alliance's motion to compel arbitration without comment. On November 1, 2012, Alliance filed a “Motion for Relief from Order or Motion to Amend the Order” and set forth factual and legal arguments as to the validity of the arbitration contract and factual and legal arguments as to why the contract was not an adhesion contract and was not unconscionable. On November 21, 2012, the court overruled Alliance's motion. Alliance appeals.

In Alliance's sole point on appeal, Alliance contends that the circuit court erred in denying its motion to compel arbitration and its motion for relief from that denial. Alliance argues that state and federal law favor arbitration and require enforcement of valid agreements to arbitrate and contends that Alliance and Greene's arbitration agreement is valid, binding, and enforceable.

The parties dispute the proper standard of review. While Alliance does not contend that the circuit court had inadequate facts before it to make a determination as to the validity and/or enforceability of the arbitration agreement, Alliance argues in its reply brief that, because there was no live witness testimony, no oral argument, and no factual findings, this court is to give no deference to the trial court's judgment.¹

Motions to compel arbitration are tried in summary proceedings. Section 435.355.2, RSMo 2000. Summary proceedings are those conducted “ ‘[w]ithout the usual formalities [and] without a jury.’ ” Nitro Distributing, Inc. v. Dunn, 194 S.W.3d 339, 352 (Mo. banc 2006) (quoting BLACK'S LAW DICTIONARY 1476 (8th ed.1999)). “In such summary proceedings where one of the parties disputes the existence of the contract of arbitration, the parties may present evidence, including but not limited to documents, affidavits, and deposition transcripts to resolve the factual disputes.” M & I Marshall & Ilsley Bank v. Sader & Garvin, L.L.C., 318 S.W.3d 772, 777 (Mo.App.2010). “After one party has challenged the existence of an enforceable agreement to arbitrate, the trial court must determine that issue based upon the evidence before it.” Id. See also Nitro Distributing, Inc., 194 S.W.3d at 352, and Katz v. Anheuser–Busch, Inc., 347 S.W.3d 533, 546 (Mo.App.2011). In so doing, the court applies the usual rules of state contract law and canons of contract interpretation. Nitro, 194 S.W.3d at 345. “[O]ur review of the trial court's determination as to the existence of an agreement itself is analogous to that in a court-tried case.” Kunzie v. Jack–In–The–Box, Inc., 330 S.W.3d 476, 480 (Mo.App.2010). The standard of review in court-tried civil cases requires that we defer to the court's assessment of evidence on contested issues of fact. White v. Director of Revenue, 321 S.W.3d 298, 308 (Mo. banc 2010).

When the case is submitted to the trial court on the basis of documentary evidence, and we have the same opportunity to review the evidence as did the trial court, “ ‘the law allocates the function of fact-finder to the [trial]court.’ ” State v. Williams, 334 S.W.3d 177, 181 n. 9 (Mo.App.2011) (quoting MSEJ, LLC v. Transit Cas. Co., 280 S.W.3d 621, 623 (Mo. banc 2009)). Therefore, “[e]ven where the trial court's decision was based solely on the records,' we defer to the trial court as the finder of fact in determining whether there is substantial evidence to support the judgment and whether the judgment is against the weight of the evidence.” Williams, 334 S.W.3d at 181 (internal quotation omitted). While the record might have supported a contrary result, it is not our role to reweigh the evidence. Cf. Anderson v. City of Bessemer City, 470 U.S. 564, 573–75, 105 S.Ct. 1504, 84 L.Ed.2d 518 (1985) (finding court of appeals improperly applied standard of appellate review set forth in Federal Rule of Civil Procedure 52(a) by weighing the evidence in the record de novo; reviewing court oversteps its bounds if it undertakes to duplicate role of lower court; if district court's factual findings, even when based on only documentary evidence, are plausible viewed in light of the entire record, the court of appeals may not reverse, even though it may have weighed the evidence differently; deference to the factual findings of the trier of fact is the rule, not the exception).

Mapes v. Director of Revenue, 361 S.W.3d 29, 36 (Mo.App.2011). “Whether the trial court should have granted a motion to compel arbitration is a question of law that this [c]ourt reviews de novo.” Robinson v. Title Lenders., 364 S.W.3d 505, 510 (Mo. banc 2012).

Here, Alliance argues that the arbitration agreement between Alliance and Greene is valid and enforceable because Greene voluntarily entered into the contract. Alliance argues that Greene was advised multiple times of the arbitration provision, that Greene failed to ask any questions though given the opportunity, and that Greene had a unilateral right to reject the arbitration provision which she failed to exercise. Alliance urges that the Purchase Agreement is not a contract of adhesion. Alliance contends that the pre-closing video and transcript, the video of the closing, and the signed documents all prove that the arbitration provision was disclosed to Greene. Greene disagrees. Greene argues that the arbitration agreement is invalid per Missouri contract law because it is procedurally and substantively unconscionable and is part of an adhesion contract.

By denying Alliance's motion to compel arbitration, the circuit court necessarily disagreed with Alliance's contention that the Purchase Agreement contained an enforceable arbitration agreement.² As the court denied Alliance's motion without comment, it is the burden of this court to determine if substantial evidence and the weight of the evidence support the court's conclusion. “All fact issues upon which no specific findings are made shall be considered as having been found in accordance with the result reached.” Rule 73.01(c). Pursuant to our Supreme Court's analysis in Brewer v. Missouri Title Loans, 364 S.W.3d 486, 492 (Mo. banc 2012), we analyze the issues in this appeal to determine if, under the factual record presented, Greene “established a defense to the formation of the agreement's arbitration clause.” Id. at 492. Brewer instructs that we are to no longer focus on procedural and substantive unconscionability, as we have in the past, but how unconscionability impacted the formation of the contract. Id. at 492 n. 3. Alliance, as the party seeking to compel arbitration, had the burden of proving the existence of a valid and enforceable arbitration agreement. Whitworth v. McBride & Son Homes, Inc., 344 S.W.3d 730, 737 (Mo.App.2011).

When considering whether a party is compelled to arbitrate, we first must determine if a valid arbitration agreement exists. ³M & I Marshall & Ilsley Bank v. Sader & Garvin, L.L. C., 318 S.W.3d 772, 776 (Mo.App.2010).

It is a firmly established principle that parties can be compelled to arbitrate against their will only pursuant to an agreement whereby they have agreed to arbitrate claims. Though [individuals] are free to enter into an agreement to arbitrate disputes, the agreement is not valid unless it reflects the essential contract elements required under Missouri law. It follows that arbitration may not be unilaterally imposed on a party when there is not a valid and enforceable agreement to arbitrate. The elements required to form a valid contract in Missouri are offer, acceptance, and bargained for consideration.

Frye v. Speedway Chevrolet Cadillac, 321 S.W.3d 429, 436 (Mo.App.2010) (internal quotations and citations omitted).

With regard to the first necessary element for a valid contract—offer—there is no dispute that Greene was offered an arbitration agreement. The arbitration agreement is found on pages four and five of Greene's Purchase Agreement. With regard to the second requisite element for a valid contract—acceptance—Alliance contends that Greene signed the arbitration agreement and, therefore, accepted it. Greene, in essence, contends that while she signed the agreement, she did not knowingly accept it.⁴ She...