Infiniti of Mobile, Inc. v. Office

• Decision Date: 08 January 1999
• Parties: INFINITI OF MOBILE, INC., et al. v. English OFFICE and Mildred Office.
• Court: Alabama Supreme Court

727 So.2d 42

INFINITI OF MOBILE, INC., et al. v. English OFFICE and Mildred Office.

1971565.

Supreme Court of Alabama.

January 8, 1999.

Marion A. Quina, Jr., William E. Shreve, Jr., and J.M. McMillan III of Lyons, Pipes & Cook, P.C., Mobile, for appellants.

David Michael Huggins and Gordon K. Howell of Turner, Onderdonk, Kimbrough & Howell, P.A., Chatom; and William L. Utsey of Utsey, Christopher, Newton & Utsey, Butler, for appellees.

HOUSTON, Justice.

Infiniti of Mobile, Inc. ("Infiniti"), and one of its sales representatives, Ron McCovey, appeal from the trial court's order denying their motion to compel arbitration of the fraud and breach-of-warranty claims filed against them by English Office and his wife, Mildred Office.¹ We reverse and remand. The following facts are undisputed: English Office bought a motor vehicle from Infiniti on September 23, 1996. Mr. Office purchased the vehicle for his wife, using their joint funds. Mr. Office wrote a check on a joint account owned by him and his wife; the check, which was for the full purchase price, was made payable to "Infiniti of Mobile." During the preparation of the various sales documents, McCovey, in accordance with Infiniti's policy, filled in by hand the necessary sales information on a boilerplate "New Vehicle Retail Buyer's Order" form. The front of that form clearly identified Infiniti as the seller and Mr. Office as the buyer, and it contained pertinent information such as the description of the vehicle, the vehicle identification number, the price, etc. The signature of the Infiniti representative is illegible; however, the form appears to have been executed by McCovey. Mr. Office's signature appears in the bottom right corner of the front of the form; it appears under the following provision, which is in bold type that is larger than much of the rest of the wording on the front page:

"Dispute Resolution Agreement

"Buyer hereby acknowledges and agrees that all disputes and controversies of every kind and nature between buyer and Infiniti of Mobile, Inc., arising out of or in connection with the purchase of this vehicle will be resolved by arbitration in accordance with the procedure set forth on the reverse side of this Buyer's Order."²

The details of the arbitration agreement and procedure referred to on the front of the form were set out on the reverse side of the form above lines designated for filling in the "Vehicle Description," the "Vehicle Identification Number," the signature of the "Seller(s)/Lessor(s)," the signature of the "Buyer(s)/Lessee(s)," and the "Date." All of these lines were left blank.

After obtaining Mr. Office's signatures on the first retail-buyer's-order form, which he had filled out by hand, McCovey took that form to Mark Morgan, who was Infiniti's finance manager at the time of the sale. Morgan, again in accordance with Infiniti's policy, prepared another boilerplate, but this time computer-generated, "New Vehicle Retail Buyer's Order" form using the information contained on the first form. In fact, the information contained on both forms is identical. The second form was identical to the first one, with one exception. During the process of transferring the information from the handwritten form to the computer-generated form, Morgan mistakenly printed the information on a retail-buyer's-order form that identified the seller as "Jaguar of the Gulf Coast, Inc." Morgan explained the mistake in an affidavit that Infiniti submitted in support of its motion to vacate the trial court's order denying arbitration:

"On or about September 23, 1996, English Office came to the premises of Infiniti of Mobile, Inc., and purchased a 1996 Infiniti Model 130, bearing VIN # JNKCA21DTT002574. During the process of purchasing said vehicle, English Office executed two `New Vehicle Retail Buyer's Orders.' [These retail buyer's orders were attached to the affidavit as Exhibits `A' and `B'.]"

"Exhibit `A' [the first retail buyer's order] was executed by English Office and by Infiniti of Mobile, Inc. As is evident, the information on this document is handwritten. It is customary in the business for the salesmen to have a handwritten Buyer's Order prepared as soon as an agreement is reached between the dealership and a customer. The executed handwritten Buyer's Order is then submitted to either the Sales Manager or the Finance Manager, and the information on the handwritten form is input into a computer, and a typewritten Buyer's Order is printed and the Buyer's Order is re-executed. Exhibit `B' is such a typewritten Buyer's Order. It was executed by me on behalf of Infiniti of Mobile, Inc., but on the wrong Buyer's Order. During the process of preparing the sales documents, I inadvertently obtained a Buyer's Order on which `Jaguar of the Gulf Coast, Inc.' was printed. This happened because, at the time of this transaction, Infiniti and Jaguar automobile paperwork was handled in the same office due to construction work at the dealership. At no time did I represent or intend to represent Jaguar of Mobile in this sale. Mr. Office made no indication of a belief to the contrary nor do I remember any objection to the arbitration agreement.

"I am not aware of any situation in which a handwritten Buyer's Order would have been, or was, prepared and executed after a typewritten Buyer's Order was executed. Therefore, the Jaguar Buyer's Order, Exhibit `B,' would have been executed after the Infiniti Buyer's Order."

Apparently the Offices did not notice the mistake; however, there is no question that the Offices understood that Infiniti was the seller of the vehicle.³ The trial court erred in denying Infiniti's motion to reform the second retail-buyer's-order form so as to identify Infiniti, rather than Jaguar of the Gulf Coast, Inc., as the seller.

Mr. Office placed his initials on the front of the second retail-buyer's-order form on the five lines that corresponded to the lines he had signed on the front of the first form, including the line in the bottom right corner under the bold-type provision entitled "Dispute Resolution Agreement." The reverse side of the second form, like the reverse side of the first form, set out the details of the arbitration agreement. The two lines on the reverse side of the second form designated for the "Vehicle Description" and "Vehicle Identification Number," like the corresponding two lines on the reverse side of the first form, were left blank. However, on the reverse side of the second form, Morgan signed on the line designated for the signature of the "Seller(s)/Lessor(s)"; Mr. Office placed his initials on the line designated for the signature of the "Buyer(s)/Lessee(s)"; and the date "9/23/96" was filled in. The front of the second form contained the following provision, which is included in a group of seven provisions dealing with such matters as property insurance, limitation of remedies, etc.:

"Statement Concerning Exclusivity of Agreement

"This Buyer's Order includes all of the terms and conditions of the sale and cancels and supersedes any prior written or oral agreement. The Buyer's Order comprises the complete and exclusive statement of the terms of the agreement relating to the sale of the motor vehicle."

Mr. Office's signature appears two paragraphs below this provision, on a line apparently designated for the buyer to acknowledge consent to the seven provisions set out above it.

The trial court ruled that Infiniti's use of the "Jaguar of the Gulf Coast" dealer's form, in conjunction with Mr. Office's failure to sign the reverse side of the first handwritten retail-buyer's-order form, created an ambiguity as to whether Mr. Office had agreed to the "Dispute Resolution Agreement," which appeared in both forms.

With respect to whether Mildred Office was obligated to arbitrate, the trial court stated:

"The Court has previously held ... that the actual signatory to the contract, English Office, is not required to submit his claim to binding arbitration. Obviously, a person even further removed from this contract, who never signed any of the documents, likewise, will not be compelled to submit her claims to arbitration. The Court is well aware of numerous cases, however, where non-signatories to a contract have been required, nevertheless, to submit their claims to arbitration. However, those cases which hold that arbitration provisions are enforceable against non-signatories to the arbitration agreement have [an] underlying theme in which it is clear that the parties agreed that all disputes, claims, or controversies [arising] from or relating to the contract or the relationships which resulted from the contract are to be submitted to arbitration. Obviously, if this Court is not satisfied that it was the intention of English Office and Infiniti to submit their disputes to binding arbitration, Mildred Office's claims likewise will not be required to be submitted to binding arbitration.

"In addition to the rationale stated by the Court in the preceding paragraph, the Court is convinced that the rationale for denying arbitration [of the wife's claims] in [Ex parte Dickinson, 711 So.2d 984 (Ala. 1998)], also applies in this case. In Dickinson, the wife ... had a much closer involvement with the overall sale of the automobile than ... Mildred Office [had] in this case. In Dickinson, the husband and wife both negotiated for the purchase of the vehicle. In Dickinson, unlike this case, the wife actually signed the sales contract. Later when questions arose about financing and other matters, a second sales contract was signed, this time again by the wife. However, she never signed an arbitration clause and the Supreme Court refused to compel arbitration [of her claims]."

The Offices argue that the trial court properly denied Infiniti and McCovey's motion to compel arbitration. (We will sometimes hereinafter refer to the two defendants together as "Infiniti.")

Infiniti argues that the undisputed...