SDS Autos, Inc. v. Chrzanowski

976 So. 2d 600, 2007 WL 4145222
CourtDistrict Court of Appeal of Florida
DecidedNovember 26, 2007
Docket1D06-4293, 1D06-4294
StatusPublished
Cited by11 cases

This text of 976 So. 2d 600 (SDS Autos, Inc. v. Chrzanowski) is published on Counsel Stack Legal Research, covering District Court of Appeal of Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
SDS Autos, Inc. v. Chrzanowski, 976 So. 2d 600, 2007 WL 4145222 (Fla. Ct. App. 2007).

Opinion

976 So.2d 600 (2007)

S.D.S. AUTOS, INC., a Florida Corporation, d/b/a Lexus of Jacksonville, Appellant,
v.
Francis A. CHRZANOWSKI, Kimberly M. Chrzanowski, Alfred G. Jonas, Harold Gregory Forrest and Rita B. Forrest, both individually and on behalf of all others similarly situated, Appellees,
Brumos Motor Cars, Inc., a Florida Corporation, Appellant,
v.
Carolyn C. Montgomery, Cleophus M. Howell, Alfred G. Jonas and Heidi H. Jonas, both individually and on behalf of all others similarly situated, Appellees.

Nos. 1D06-4293, 1D06-4294.

District Court of Appeal of Florida, First District.

November 26, 2007.
Rehearing Denied March 19, 2008.

*602 Christopher J. Greene and Gregory Williamson of Brant, Abraham, Reiter, McCormick & Greene, P.A., Jacksonville, for Appellant.

J. Michael Lindell and Roger K. Gannam of Lindell, Farson & Pincket, P.A., Jacksonville, and Bryan S. Gowdy and John S. Mills of Mills & Creed, P.A., Jacksonville, for Appellees.

BENTON, J.

Appellants Brumos Motor Cars, Inc., a Mercedes dealership (Brumos), and S.D.S. Autos, Inc., a Lexus dealership (S.D.S.), seek relief from non-final orders[1] denying their motions to dismiss amended class action complaints filed under Florida's Deceptive and Unfair Trade Practices Act (FDUTPA or the Act), section 501.201 et seq., Florida Statutes (2005). The trial court construed their motions to dismiss as in part motions to compel arbitration. To the extent Brumos and S.D.S. sought dismissal on the ground that automobile lessees were contractually obligated to pursue their claims (on an individual basis) in arbitration, we have jurisdiction to review the orders. See Fla. R.App. P. 9.130(a)(3)(C)(iv)(2007) (allowing appeals of non-final orders that determine "the entitlement of a party to arbitration").

*603 I.

Appellees' amended class action complaints allege that Brumos and S.D.S. charged each named plaintiff $379.70 (the fee) as either an "administrative and documentary fee" or as "administrative and state fees" in connection with each vehicle the appellees acquired. The complaints allege that Brumos and S.D.S. violated FDUTPA by failing to disclose the true nature of the fee as required by sections 501.976(11) and 501.976(18), Florida Statutes (2005), and seek, among other things, injunctive relief and money damages under FDUTPA.[2] The appellees also sought certification of a class consisting of all those who paid the fee[3] "in connection with the purchase or lease of a motor vehicle."

Brumos and S.D.S. moved to dismiss the amended complaints in part on the ground that putative class members who had leased[4] vehicles from them had signed leases containing arbitration provisions. Brumos and S.D.S. argued the lessees could proceed no further in court, once Brumos and S.D.S. demanded arbitration. While the motions to dismiss were pending, the appellees moved for leave to file their second amended class action complaints,[5] adding as named plaintiffs two couples who had leased vehicles from Brumos and S.D.S. under agreements containing arbitration provisions. In July of 2006, the trial court denied the motions to dismiss, and timely appeals ensued. The trial court certified a class[6] only after it denied the motions to dismiss, and after the present appeals had been taken. In the orders under review, the trial court ruled the arbitration provisions of various leases unenforceable, on grounds they were unconscionable, contrary to Florida's public policy, and unsupported by mutual assent and consideration.

II.

We address the validity of only two arbitration provisions, the arbitration provisions in the leases which the plaintiffs named in the second amended complaint signed.[7] Both these leases (the Lexus 2 *604 and Brumos 2 agreements) provide for binding arbitration of all disputes concerning the lease or any related transaction, at the election of either party to the agreement. Both arbitration provisions also contain express class action waivers. The Lexus 2 agreement provides that "[a] claim can only be arbitrated on an individual basis and not as a class action." This agreement further provides that "[t]here shall be no right to arbitrate a claim as a representative of others or in a private attorney general capacity and there shall be no joinder or consolidation of parties, except for parties to the same contract." The Brumos 2 agreement provides that leasing customers "give up any right [they] may have to bring a class-action lawsuit or class arbitration, or to participate in either as a claimant, and . . . agree to give up any right [they] may have to consolidate [their] arbitration with the arbitration of others."[8] We conclude that, under our precedent, the class action waivers in the two leases we have to consider violate public policy by hampering important remedial purposes of FDUTPA, because they are designed to prevent individuals with small claims arising out of a motor vehicle dealer's alleged violation of section 501.976, Florida Statutes (2005), from seeking remedies as a class. On that ground, we affirm the orders below (to the extent they deny Brumos and S.D.S. arbitration of claims arising out of the Lexus 2 and Brumos 2 agreements).[9]

III.

The validity of an arbitration provision is a purely legal question a reviewing court considers de novo. See Gainesville Health Care Ctr., Inc. v. Weston, 857 So.2d 278, 283 (Fla. 1st DCA 2003); Brasington v. EMC Corp., 855 So.2d 1212, 1215 (Fla. 1st DCA 2003); see also Stewart Agency, Inc. v. Robinson, 855 So.2d 726, 728 (Fla. 4th DCA 2003). The Federal Arbitration Act (FAA), 9 U.S.C. §§ 1-16, applies here because the lease agreements "evidenc[e] a transaction involving commerce" within the meaning of the FAA. See 9 U.S.C. § 2 (2006). Both agreements expressly provide, moreover, that the FAA applies.[10]See Allied-Bruce Terminix Cos. v. Dobson, 513 U.S. 265, 273-77, 115 S.Ct. 834, 130 L.Ed.2d 753 (1995) (construing the words "involving commerce" to include any *605 contract "affecting commerce" and to signal Congress' "intent to exercise [its] commerce power to the full"); E. Funding, L.L.C. v. Roman, 882 So.2d 1059, 1060 (Fla. 4th DCA 2004). See also United States v. McCoy, 323 F.3d 1114, 1129 (9th Cir.2003) (observing that "[t]he automobile, if anything, is the paradigm of modern interstate commercial activity"); id. ("[C]ars are themselves instrumentalities of commerce, which Congress may protect.") (quoting United States v. Oliver, 60 F.3d 547, 550 (9th Cir.1995)). No party objects to application of the federal act here, nor do we find any requirement in the Florida Arbitration Code, §§ 682.01-682.22, Florida Statutes (2005), that the FAA does not also impose in these circumstances.

Pursuant to the FAA, any "written [arbitration] provision in . . . a contract evidencing a transaction involving commerce . . .

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Bluebook (online)
976 So. 2d 600, 2007 WL 4145222, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sds-autos-inc-v-chrzanowski-fladistctapp-2007.