Premiere Chevrolet, Inc. v. Headrick

• Decision Date: 12 November 1999
• Parties: PREMIERE CHEVROLET, INC., and Chris Ferguson v. Kathy HEADRICK.
• Court: Alabama Supreme Court

748 So.2d 891

PREMIERE CHEVROLET, INC., and Chris Ferguson v. Kathy HEADRICK.

1972001.

Supreme Court of Alabama.

November 12, 1999.

R. Dale Wallace, Jr., and Cecil H. Macoy, Jr., of Wallace, Jordan, Ratliff & Brandt, L.L.C., Birmingham, for appellants.

Garve Ivey, Jr., and Allison Shelley of Ivey & Ragsdale, Jasper, for appellee.

JOHNSTONE, Justice.

Kathy Headrick leased a Chevrolet Camaro automobile from Premiere Chevrolet, Inc., which required Ms. Headrick to make an initial payment of $2,417 and to sign a "lease agreement" and a "buyer's order." Premiere signed the lease agreement but not the buyer's order.

The lease agreement states:

"THIS LEASE CONTAINS THE ENTIRE AGREEMENT BETWEEN YOU AND US. There are no other agreements between you and us except those included in writing in this Lease. No change of this Lease, no course of performance and no other agreement between you and us will be binding unless in writing and signed by you and us." (Emphasis added.)

The lease agreement does not contain any arbitration provisions. The "buyer's order," however, contains the following:

"K. Purchaser acknowledges that the vehicle has been traveling in interstate commerce and had an impact on interstate commerce. In the event any dispute(s) under the terms of this contract or sale arise, (including but not limited to, the terms of the agreement, the condition of the motor vehicle sold, the conformity of the motor vehicle sold to the contract, the representations, promises, undertakings or covenants made by Premiere Chevrolet, Inc. in connection with the sale of the motor vehicle, or otherwise dealing with the motor vehicle, any terms of financing in connection therewith, or any terms of any credit life and/or disability insurance purchased simultaneously herewith, or extended service or maintenance agreement(s)), Premiere Chevrolet, Inc. and the purchaser(s) agree to submit such dispute(s) to binding arbitration, pursuant to the provisions of 9 U.S.C. § 1, Et Seq., and according to the commercial rules of the American Arbitration Association then existing, in Bessemer, Alabama.

"(A) In the event any dispute arises between the parties, as to the conformity or condition of the motor vehicle, the parties will permit a thirdparty (to be mutually agreed upon) to inspect the motor vehicle to determine the conformity and condition, and that the findings of such third-party shall be binding upon Premiere Chevrolet, Inc. and the purchaser(s), in connection with any litigation, arbitration or request for adjustment, pursuant to the provision of § 7-2-515(b) of the 1975 Code of Alabama.

"(B) In the event Premiere Chevrolet, Inc. and the purchaser(s) cannot mutually agree upon a third-party to conduct such inspection, either party shall have the right to petition any court of competent jurisdiction, or panel of arbitrators, to appoint an expert to act as such third party.

"(C) The cost of such third-party inspection shall be borne equally by Premiere Chevrolet, Inc. and the purchaser(s), or as may be directed by any court or panel of arbitrators."

While the "buyer's order" is signed by Headrick, it is not signed by any representative of Premiere, although it bears signature lines for that purpose and contains one provision stating that "this order is not valid unless signed and accepted by Premiere Chevrolet, Inc." (emphasis added), and a second provision stating that "this order shall not become binding until accepted by the dealer or his authorized representative."

After taking delivery of the automobile, Headrick sued Premiere and its agent Chris Ferguson for getting the $2,417 initial payment by fraud and for failing to apply the $2,417 to Headrick's balance in breach of contract. Premiere and Ferguson¹ filed a motion to compel arbitration pursuant to the provisions of 9 U.S.C. § 1; and Headrick then amended her complaint to include claims for fraudulent suppression of the existence of the arbitration agreement, theft by deception, and unjust enrichment. The amended complaint alleged further that the buyer's order was void for "lack of mutuality."

The trial judge granted Premiere's motion to compel arbitration, and Headrick filed a motion to reconsider, which was countered by Premiere. On reconsideration, the trial judge set aside the order compelling arbitration. After the trial court denied Premiere's ensuing motion to set aside the new order denying arbitration, Premiere initiated this appeal.

The appellate courts will affirm the ruling of the trial court if it is right for any reason, even one not presented to or considered by the trial judge. McKenzie Methane Corp. v. M-W Drilling, Inc., 653 So.2d 982, 984 (Ala.1995), and Smith v. Equifax Services, Inc., 537 So.2d 463 (Ala. 1988). Moreover, we will not reverse the trial judge's denial of a motion to compel arbitration unless it is clearly erroneous. Ryan Warranty Services, Inc. v. Welch, 694 So.2d 1271 (Ala.1997).

Premiere argues that Headrick should be compelled to arbitrate her claims in accordance with the buyer's order which she signed when she leased the vehicle. Headrick argues that, because the buyer's order was never signed by any agent of Premiere and thus was never fully executed, no agreement to arbitrate ever came into existence.

Med Center Cars, Inc. v. Smith, 727 So.2d 9 (Ala.1998), involved facts which are, in all material respects, identical to the facts of this case. There we said:

"`"The purpose of the signature is to show `mutuality and assent,' which are required for a contract to be binding. Lawler Mobile Homes, Inc. v. Tarver, 492 So.2d 297, 304 (Ala.1986)..."'

"Med Center seeks to enforce the arbitration clause contained in the buyer's order, although it did not affix its signature to the buyer's order. Although Kimberly Smith signed the buyer's order, as previously pointed out the buyer's order specifically provides that it is `Not valid unless accepted by seller or its authorized representative.' Therefore, the buyer's order, which contains the arbitration clause, is not enforceable."

Med Center Cars, 727 So.2d. at 14 (quoting Ex parte Pointer, 714 So.2d 971, 972 (Ala. 1997) (quoting Crown Pontiac Inc. v. McCarrell, 695 So.2d 615, 618-19 (Ala. 1997))).

The buyer's order before us bears two similar provisions, one on the front and one on the back of the document, which require the signature of Premiere to make a contract of the document. On the front appears the caveat: "This order is not valid unless signed and accepted by Premiere Chevrolet, Inc....," and after that language appears a blank signature line with the preprinted words, "Accepted-PREMIERE CHEVROLET, INC.," and "Must be accepted by a Manager authorized by the Corp." Likewise, on the back, in paragraph L., immediately after the arbitration provisions, appears the caveat: "This order shall not become binding until accepted by dealer or his authorized representative...," and below this provision appears a blank signature line with the preprinted words "Accepted" and "Premiere Chevrolet, Inc. (Must be dealer or authorized representative)." Neither of these signature lines bears a signature. No signature for Premiere or its agent appears anywhere on the buyer's order. Under these facts, and under the law recognized by Med Center Cars, supra, the trial judge was correct in ruling that there was no enforceable agreement to arbitrate.

Moreover, the lease agreement, signed by both parties, clearly states that it is the sole agreement between them. It provides further that no other agreement between the parties will be binding unless in writing signed by both parties. Nowhere does the lease mention arbitration.

Premiere drafted and signed the lease and, in doing so, bound itself to the terms contained therein. Yet Premiere would have us invalidate these provisions of the lease agreement by forcing Headrick to adhere to the terms stated in the buyer's order not signed by Premiere. To accept Premiere's argument would require the Court to flout a lease contract fully executed by both parties in signification of their intention to be mutually bound by it.

Premiere argues that, regardless of whether it signed the buyer's order, its actions demonstrate its approval of the contract and its waiver of any requirement for an officer's signature. In essence, Premiere argues that its performance in delivering the car and accepting the initial payment should "ratify and confirm [the buyer's order] even though [its] actual signature is not affixed." Lawler Mobile Homes, Inc. v. Tarver, 492 So.2d 297, 305 (Ala.1986). However, the buyer's order does not state by its terms that Premiere must deliver anything to Headrick. It states merely that Headrick "hereby agrees to purchase from Premiere Chevrolet, Inc.... for a purchase price as hereinafter set out, the following [vehicle]." The buyer's order next contains a laundry list of disclaimers to insulate Premiere from a variety of problems and finally contains the arbitration section. Because the text of the buyer's order requires no active performance of Premiere, no doctrine of performance to manifest assent is applicable. Premiere's delivery of the vehicle, and any other act of performance, constituted performance in accordance with the lease agreement, not the buyer's order.

Moreover, the buyer's order requires both acceptance and a signature by Premiere. As already revealed, the buyer's order provides: "This order is not valid unless signed and accepted by Premiere...." (Emphasis added.) The requirements for signature and acceptance are conjunctive, not disjunctive. This document, drafted and imposed by Premiere, must be construed strictly against the drafter, Lilley v. Gonzales, 417 So.2d 161 (Ala.1982), and Jewell v. Jackson & Whitsitt Cotton Co., 294 Ala. 112, 313 So.2d 157 (1975), so as to require the signature of Premiere in addition to acceptance by Premiere.

Premiere further cites the principle that "any written contract,...