Green Tree Financial Corp. v. Smith

736 So. 2d 604, 1999 Ala. LEXIS 159
CourtSupreme Court of Alabama
DecidedJune 4, 1999
Docket1972238
StatusPublished

This text of 736 So. 2d 604 (Green Tree Financial Corp. v. Smith) is published on Counsel Stack Legal Research, covering Supreme Court of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Green Tree Financial Corp. v. Smith, 736 So. 2d 604, 1999 Ala. LEXIS 159 (Ala. 1999).

Opinions

MADDOX, Justice.

This mandamus petition relates to an action filed in the Baldwin Circuit Court. That action involves a dispute between a buyer of a mobile home and the seller of the mobile home; one of the seller’s employees; and the financial institution that provided financing for the purchase. The circuit court ordered the parties to proceed in arbitration and removed the case from its trial docket. Larry Smith, the buyer, petitions this Court for a writ of mandamus directing the circuit judge to set aside her order refusing to reinstate the civil action to her trial docket. Smith further asks this Court to declare that the arbitration clause involved in this case is unenforceable, and he also argues that the other parties had waived any rights they may have had to compel arbitration. For the reasons discussed below, the writ is due to be denied.

Facts and Procedural History

Larry Smith purchased a double-wide mobile home from The Sanderson Group, Inc., d/b/a Sanderson Homes of Bay Mi-nette, on December 6, 1996, at approximately 4:30 p.m. Greentree Financial Corporation financed the purchase. The purchase contract establishes that Green-tree is the assignee of the contract obligations, and the contract contains the following arbitration clause:1

“14. ARBITRATION: ALL DISPUTES, CLAIMS OR CONTROVERSIES ARISING FROM OR RELATING TO THIS CONTRACT OR THE PARTIES THERETO SHALL BE RESOLVED BY BINDING ARBITRATION BY ONE ARBITRATOR SELECTED BY YOU WITH MY CONSENT. THIS AGREEMENT IS MADE PURSUANT TO A TRANSACTION IN INTERSTATE COMMERCE AND SHALL BE GOVERNED BY THE FEDERAL ARBITRATION ACT AT 9 U.S.C. SECTION 1. JUDGEMENT UPON THE AWARD RENDERED MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. THE PARTIES AGREE AND UNDERSTAND THAT THEY CHOOSE ARBITRATION INSTEAD OF LITIGATION TO RESOLVE DISPUTES. THE PARTIES UNDERSTAND THAT THEY HAVE A RIGHT TO LITIGATE DISPUTES IN COURT, BUT THAT THEY PREFER TO RESOLVE THEIR DISPUTES THROUGH ARBITRATION, EXCEPT AS PROVIDED HEREIN. THE PARTIES VOLUNTARILY AND KNOWINGLY WAIVE ANY RIGHT THEY HAVE TO A JURY TRIAL EITHER PURSUANT TO ARBITRATION UNDER THIS CLAUSE OR PURSUANT TO A COURT ACTION BY YOU (AS PROVIDED HEREIN). THE PARTIES AGREE AND UNDERSTAND THAT ALL DISPUTES ARISING UNDER CASE LAW, STATUTORY LAW AND ALL OTHER LAWS INCLUDING, BUT NOT LIMITED TO, ALL CONTRACT, TORT AND PROPERTY DISPUTES WILL BE SUBJECT TO BINDING ARBITRATION IN ACCORD WITH THIS CONTRACT. THE PARTIES AGREE THAT THE ARBITRATOR SHALL HAVE ALL POWERS PROVIDED BY LAW, THE CONTRACT AND THE AGREEMENT OF THE PARTIES. THESE POWERS SHALL INCLUDE ALL LEGAL AND EQUITABLE REMEDIES INCLUDING, BUT NOT LIMITED TO, MONEY DAMAGES, DECLARATORY RELIEF AND INJUNC-TIVE RELIEF. NOTWITHSTANDING ANYTHING HEREUNTO [sic] THE CONTRARY, YOU RETAIN [607]*607AN OPTION TO USE JUDICIAL (FILING A LAWSUIT) OR NONJUDICIAL RELIEF TO ENFORCE A SECURITY AGREEMENT RELATING TO THE MANUFACTURED HOME SECURED IN A TRANSACTION UNDERLYING THIS ARBITRATION AGREEMENT, TO ENFORCE THE MONETARY OBLIGATION SECURED BY THE MANUFACTURED HOME OR TO FORECLOSE ON THE MANUFACTURED HOME. THE INSTITUTION AND MAINTENANCE OF A LAWSUIT TO FORECLOSE UPON ANY COLLATERAL, TO OBTAIN A MONETARY JUDGMENT OR TO ENFORCE THE SECURITY AGREEMENT SHALL NOT CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY TO COMPEL ARBITRATION REGARDING ANY OTHER DISPUTE OR REMEDY SUBJECT TO ARBITRATION IN THIS CONTRACT, INCLUDING THE FILING OF A COUNTERCLAIM IN A SUIT BROUGHT BY YOU PURSUANT TO THIS PROVISION.”

The contract also contains a paragraph regarding the waiver of Smith’s right to a jury trial. That paragraph states:

“15. WAIVER OF JURY TRIAL: I HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY THAT I HAVE IN ANY SUBSEQUENT LITIGATION BETWEEN ME AND THE SELLER, OR ME AND ANY ASSIGNEE OF THE SELLER, WHERE SUCH LITIGATION ARISES OUT OF, IS RELATED TO, OR IS IN CONNECTION WITH ANY PROVISION OF THIS CONTRACT WHETHER THE CONTRACT IS ASSERTED AS THE BASIS FOR A CLAIM, COUNTERCLAIM OR CROSSCLAIM, OR A DEFENSE TO A CLAIM, COUNTERCLAIM OR CROSSCLAIM.”

Because Larry Smith wanted to obtain insurance on the home before the insurance office closed at 5:00 p.m., he hurriedly signed the contract, without reading it closely.

On December 20, 1996, Sanderson delivered one-half 0&) of the mobile home to Smith. From what is currently before this Court, it is unclear exactly when Sander-son delivered the other half of the mobile home, but it appears to have been delivered sometime between early January and March 1997. Smith alleges that he was dissatisfied with the delayed delivery of the second half of his mobile home, and that, as a result, he contacted Greentree. Smith alleges that agents of Greentree told him to send a letter rescinding the contract. On January 6, 1997, Smith sent a letter stating, in effect, that he no longer wanted the mobile home. He stated as his reasons that the first-delivered half of the mobile home had been exposed to snow and rain as a result of Sanderson’s failure to deliver the second half and that Sander-son had repeatedly failed to keep its promises to deliver the second half.

In June 1997, Greentree sued Smith, seeking damages for Smith’s alleged breach of the purchase contract. In August, Smith answered, asserting affirmative defenses and a counterclaim and demanding a jury trial. In September, Smith filed a third-party complaint naming Sanderson and Morris Nelson, a Sander-son employee, as third-party defendants. In October, Greentree moved to compel arbitration; the trial court granted its motion. In January 1998, Nelson moved to compel arbitration, and the trial court granted his motion. Finally, in February, Sanderson moved to compel arbitration, and the trial court also granted its motion. On the same day the court granted Sand-erson’s motion to compel arbitration, Smith’s attorney withdrew as counsel.

The trial court’s orders compelling arbitration did not specify a period within which the arbitration proceedings were required to commence. In February 1998, according to Greentree, an attorney telephoned Greentree’s lawyer and stated that [608]*608he was reviewing the case for Smith. This attorney stated that he should not be considered as representing Smith until he had filed an appearance in the case. Green-tree, on June 4, 1998, received notice that Smith had acquired substitute counsel; it received this notice when Smith’s present attorney filed a motion asking the trial court to reinstate the case on the trial docket. On August 6, 1998, the trial court denied the motion and ordered that arbitration commence within 45 days. Smith filed this petition for the writ of mandamus on September 14, 1998. The pertinent events are set out in the following chronology--

June 23,1997 Greentree filed its complaint.
August 29,1997 Smith filed his answer and counterclaim.
September 5,1997 Smith filed his third-party complaint.
October 9,1997 Greentree moved for arbitration.
October 10,1997 The trial court granted Greentree’s motion.
January 20,1998 Nelson moved for arbitration.
January 23, 1998 The trial court granted Nelson’s motion.
February 5,1998 Sanderson moved for arbitration.
March 16,1998 The trial court granted Sanderson’s motion.
March 16,1998 Smith’s attorney withdrew.

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736 So. 2d 604, 1999 Ala. LEXIS 159, Counsel Stack Legal Research, https://law.counselstack.com/opinion/green-tree-financial-corp-v-smith-ala-1999.