Patrick Strubel and Jeremy Gaddy secured an appellate win in a recent appeal to the Alabama Supreme Court. A summary of the featured case, Nissan North America, Inc. v. Adrienne Scott, is provided below.
- Nissan North America, Inc. (“Nissan”) appealed from an order of the Montgomery County Circuit Court compelling it to arbitrate the claims filed against it by the Plaintiff.
- On July 16, 2015, Adrienne Scott purchased a new 2015 Nissan Juke automobile from Jack Ingram Motors, Inc. (“Jack Ingram”). In connection with the purchase of the vehicle, Scott signed an arbitration agreement with Jack Ingram. Nissan was not a signatory to the arbitration agreement.
- On November 22, 2016, Scott filed suit against Jack Ingram and Nissan for negligence, wantonness, breach of warranty and product liability under the Alabama Extended Manufacturer’s Liability Doctrine. On December 27, 2016, Jack Ingram moved to compel arbitration of the claims filed against it based on the arbitration agreement Scott had signed. Scott filed a response indicating that, although she was willing to arbitrate her breach-of-warranty and negligence claims against Jack Ingram, she objected to litigating part of the case, i.e., her claims against Nissan, because, she said, “to do so would require all of the parties to incur extra expenses and could result in inconsistent judgments.” She indicated in her response that she was willing to arbitrate the case or to litigate the case, but she objected to having to do both. On February 22, 2017, the trial court entered an order holding that, “in the interest of judicial economy,” the entire matter should be arbitrated. Nissan filed a motion to reconsider, which the trial court denied. Nissan appealed pursuant to Ala. R. App. P. 4.
- On appeal, the Alabama Supreme Court held that “[j]udicial economy, however, is not a proper basis for compelling arbitration against a nonsignatory.” The Court went on to hold that “arbitration is a matter of contract, and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.” Because Nissan was a nonsignatory to the arbitration agreement, the Court reversed the trial court’s order and held that it was error to compel Nissan to arbitrate the claims filed against it.
To access the full opinion on this appellate win, click here.