Case Title: DirecTV v. Mattingly

Citation: 376 Md. 302

Docket Number: 130/02

State: maryland

Court: Maryland Supreme Court

Date: 2003-07-31T00:00:00Z

Document:
DIRECTV v. Mattingly
No. 130, September Term, 2002
Headnote:
Under the plain language of a company-authored initial customer agreement
between the company and a customer, the company was contractually
obligated to provide its customer with “written notice describing” any change
made in all subsequent attempts to modify the customer agreement.  In this
case, the company merely provided the customer with a copy of a new
modified document and did not include any description or mention, of which
specific provisions were being amended or added.  As the company had the
unilateral power to amend the customer agreement and voluntarily included the
notice provision in the initial customer agreement, three subsequent attempts
to modify the initial customer agreement were not valid, thus the changes,
including the addition of an arbitration provision, contained within subsequent
modified documents, are invalid.
Circuit Court for St. Mary’s County
Case #18-C-99-000715OC
IN THE COURT OF APPEALS OF
MARYLAND
No. 130
September Term, 2002
DIRECTV, Inc.
v.
John A. Mattingly, Sr.
Bell, C. J.
Eldridge
Raker
Wilner
Cathell
Harrell
           Battaglia,
JJ.
Opinion by Cathell, J.
Raker and Harrell, JJ. Dissent
Filed: July 31, 2003
1 Respondent also filed suit against Hughes Electronics Corporation (Hughes),
petitioner’s parent company.  The Court of Special Appeals, however, upheld the circuit
court’s dismissal of respondent’s claims against Hughes, stating, “we see no error in the
court’s decision to dismiss the claims against Hughes without prejudice, because the facts
alleged by [respondent], even if taken as true, failed to state a claim against Hughes.” 
Mattingly v. Hughes Electronics Corp., 147 Md. App. 624, 644, 810 A.2d 498, 510
(2002)(alteration added).  No issue as to this dismissal was raised in the Petition to this
Court.
2 In the alternative to its Motion to Dismiss, petitioner filed a Petition to Stay
Proceedings and Compel Arbitration.  The circuit court issued an order which stated, “Upon
consideration of the Defendant’s Motion to Dismiss or, In the Alternative, Petition to Stay
Proceedings and Compel Arbitration, and good cause having been shown . . . . ORDERED
that the Motion is GRANTED, and it is FURTHER ORDERED that this action is dismissed
without prejudice.”
3 As previously noted, the Court of Special Appeals upheld the trial court’s dismissal
of respondent’s claims against Hughes.  The Court of Special Appeals also addressed other
issues that have not been presented to this Court.  That court declined to address respondent’s
alternative claim, which argued that petitioner’s arbitration clause was unenforceable as it
was unconscionable.  We likewise need not address whether the arbitration clause was
unconscionable.
This case arises out of a February 1997 subscription contract between DIRECTV,
petitioner, a provider of satellite television services, and one of its customers, John A.
Mattingly, Sr., respondent.  On August 6, 1999, respondent filed suit against petitioner1
alleging that petitioner improperly charged him an administrative late fee of $2.81.  On
November 9, 2001, the Circuit Court for St. Mary’s County granted petitioner’s motion to
dismiss2 respondent’s suit without prejudice.  Respondent appealed that judgment to the
Court of Special Appeals.  On November 4, 2002, that court reversed the trial court’s
dismissal of respondent’s suit against petitioner.3  Mattingly v. Hughes Electronics Corp.,
147 Md. App. 624, 810 A.2d 498 (2002).  Petitioner then filed a Petition for Writ of
Certiorari with this Court, and, on March 12, 2003, we granted the petition.  DIRECTV, Inc.
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v. Mattingly, 373 Md. 406, 818 A.2d 1105 (2003).  Petitioner presents two questions for our
review:
“1.
Whether the Court of Special Appeals erred by holding, contrary to
established Maryland law, that a party may avoid an agreed upon
contract modification by showing that the modification provisions of
the original contract were not followed?
“2.
Whether Maryland should join other jurisdictions in holding that
modifications to Customer Agreements may be consummated by the
customer’s acceptance of the services in accordance with the terms of
the modified agreement?”
We answer in the negative the first of petitioner’s questions and hold that petitioner failed
to provide sufficient notice of the changes to the provisions of the initial agreement contained
in the subsequent 1997 modified document, which changes included an arbitration provision,
because, pursuant to the plain language of petitioner’s initial customer agreement with
respondent, petitioner did not discuss, mention or even highlight any change in the customer
agreement.  Under the specific facts of the case sub judice, petitioner’s failure to adequately
follow the notice provisions of the initial customer agreement that petitioner alone authored,
foreclosed respondent’s ability to reasonably make an informed decision regarding his
subscription for satellite television services.  Given our holding with regard to petitioner’s
first question, it is unnecessary to address petitioner’s second question.  Similarly, we do not
address any of respondent’s alternative arguments.  Accordingly, we affirm the judgment of
the Court of Special Appeals.
4 The initial agreement was executed in February of 1997.  Apparently the form
agreement used had a pre-printed effective date of August 28, 1996.
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I.  Facts
Respondent subscribed to petitioner’s satellite service in the course of purchasing the
necessary satellite television equipment at a Circuit City store in Waldorf, Maryland.  On
February 20, 1997, respondent made an oral agreement to accept petitioner’s satellite
television service subject to the terms and conditions of a written customer agreement to be
mailed to him thereafter.  As a result of respondent’s acceptance of the customer agreement,
petitioner immediately activated respondent’s satellite service.
The following day, petitioner mailed respondent an invoice for his purchase of the
satellite service.  Petitioner included the aforementioned initial customer agreement within
the envelope containing that invoice.  This customer agreement was entitled, “CUSTOMER
AGREEMENT effective as of August 28, 1996, until replaced”4 (hereinafter, the “initial
customer agreement”).  The first provision of the initial customer agreement,
“AGREEMENT TO TERMS AND CONDITIONS,” stated:
“Customer promises to pay amounts billed by DIRECTV for programming
services and related fees, taxes, and charges. Customer authorizes DIRECTV
to make inquiries into Customer’s credit worthiness, including receipt and
review of credit bureau information. Customer’s receipt of services constitutes
Customer’s acceptance of and agreement to all terms and conditions of this
Agreement. DIRECTV 
reserves the right to change these terms and conditions,
including the Applicable Fees and Charges. If any changes are made, we will
send you a written notice describing the change and its effective date. If a
change is not acceptable to you, you may cancel your service. If you do not
cancel your service, your continued receipt of any service is considered to be
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your acceptance of that change. In addition, the individual terms and
conditions in this Agreement, whether or not modified, shall survive the
cancellation of your service.” [Italicized emphasis added.]
The initial customer agreement contains twenty-one other numbered provisions.  Within the
sixth numbered provision, entitled “FEES AND CHARGES,” is a sub-provision describing
administrative late fees.  It states, “If your payment is not received by DIRECTV before your
next statement is issued, you may be charged an Administrative Late Fee up to the amount
stated in Section 20 below.”  Section 20 states that an “Administrative Late Fee” is not to
exceed $5.00.  The initial customer agreement was silent as to arbitration.
On March 18, 1997, within a month of respondent’s subscribing to petitioner’s
satellite service, petitioner mailed another proposed customer agreement (hereinafter, the
“1997 modified document”) to respondent.  On its face it purported to be effective as of
March 1, 1997, a date prior to its mailing to respondent.  While that document differed from
the initial agreement, it was not accompanied by any separate notice of the changes, or by any
comparison of the existing agreement and new proposed agreement.  While appearing nearly
identical to the initial customer agreement, the 1997 modified document differed from its
predecessor in that it contained unhighlighted and otherwise undescribed changes, including
the addition of a twenty-third provision, entitled “ARBITRATION.”  The Arbitration
provision stated:
“Any controversy, claim, dispute or disagreement arising out of, or relating to,
this Agreement or any services provided by DIRECTV which cannot be settled
by the parties shall be resolved according to binding arbitration conducted in
accordance with the Commercial Arbitration Rules of the American
5 Petitioner sent monthly invoices to its customers outlining the specific charges and
programming for the customers’ subscriptions.  On the back of these invoices, petitioner
included provisions enumerating its policy regarding “Terms and Conditions,” “Application
of Payments,” “Administrative Late Fee,” policy for “Returned Checks” and procedures for
inquiring about “Errors or Questions About Your Statement,” “Changing or Reactivating
Services” and sending in payments to DIRECTV.  The invoice provisions did not include any
information describing, nor did they even mention, arbitration.
6 Similar to the initial customer agreement, the 1997 modified document called for
customers to cancel their service if they did not agree with any unilateral change made by
petitioner.  The “AGREEMENT TO TERMS AND CONDITIONS” section of the 1997
modified document, with italics denoting the changes from respondent’s initial customer
agreement, states:
“Customer promises to pay amounts billed by DIRECTV for programming
services and related fees, taxes, and charges. Customer authorizes DIRECTV
to make inquiries into Customer’s credit worthiness, including receipt and
review of credit bureau information. Customer’s receipt of services constitutes
Customer’s acceptance of and agreement to all terms and conditions of this
Agreement. DIRECTV reserves the right to change these terms and conditions,
including the Applicable Fees and Charges. If any changes are made, we will
send you a written notice describing the change and its effective date to your
(continued...)
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Arbitration Association then in effect. The decision of the arbitrator shall be
final and binding on the parties and any award of the arbitrator may be entered
in any court of competent jurisdiction.  Notwithstanding the foregoing, the
arbitrator shall not be authorized to award punitive damages with respect to
any such controversy, claim or dispute.  The cost of any arbitration hereunder,
including the cost of the record or transcripts thereof, if any, administrative
fees, attorneys’ fees and all other fees involved, shall be paid by the party
determined by the arbitrator to not be the prevailing party, or otherwise
allocated in an equitable manner as determined by the arbitrator.”
It is undisputed that no separate description or any explanation of the changes, i.e., the new
arbitration provision, was ever sent to respondent; the terms of the new document merely
contained the arbitration provision while the initial agreement did not.5  Upon receipt of this
new modified document, respondent did not cancel his service6 with petitioner and thus
6(...continued)
last known address. If a change is not acceptable to you, you may cancel your
service; provided, however, that if you do cancel service you will not be
entitled to a refund of any prepaid subscription amounts paid in connection
with a DIRECTV offer or promotion. If you do not cancel your service, your
continued receipt of any service is considered to be your acceptance of that
change. In addition, the individual terms and conditions in this Agreement,
whether or not modified, shall survive the cancellation of your service.” [Some
emphasis added.]
The specific changes of this particular section are not at issue here.
7 The facts indicate that several other alleged customer agreements were sent to
respondent from 1997 through 1999, each mailed after its purported effective date.  All of
these documents contained an arbitration provision.  The last document, dated October 1999,
was in a substantially different format.  In fact, the October 1999 document provided binding
arbitration (including the warning that “ARBITRATION MEANS THAT YOU WAIVE
YOUR RIGHT TO A JURY TRIAL”) after any informal resolution to the dispute failed.  It
is undisputed that respondent did not cancel his service after receiving these various modified
documents and further that no description or highlighting of any change, other than the mere
inclusion of the actual language of the changes themselves, was ever provided to respondent.
8 As previously mentioned, this suit included petitioner’s parent company, Hughes.
Hughes was dismissed from the case by the trial court and that dismissal was affirmed by the
Court of Special Appeals.  That issue is not before this Court.
9 The first count, “Consumer Protection Law Violation,” alleged violations of
Maryland’s Consumer Protection Act, Maryland Code (1975, 2000 Repl. Vol., 2001 Cum.
(continued...)
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continued to receive petitioner’s satellite services.7
In an invoice dated July 17, 1999, respondent was assessed a late fee by petitioner for
a total of $2.81 for a “Past Due” amount of $56.12.  Respondent paid this late fee and the
accompanying outstanding balance.  Then, on August 6, 1999, he filed a class action
complaint against petitioner8 for the purpose of challenging the legality of petitioner’s late
fee.  Respondent’s complaint was comprised of four counts.9  The complaint alleged, in part,
9(...continued)
Supp.), § 13-101 et seq. of the Commercial Law Article; the second count, “Unlawful
Liquidated Damages,” alleged violations of Article III, § 57 of the Maryland Constitution,
which sets the legal rate of interest at six percent; the third count, “Liquidated Damages
Impermissible by Statute,” alleges violations of Maryland Code (1975, 2000 Repl. Vol., 2001
Cum. Supp.), § 2-718 of the Commercial Law Article, and proffers that petitioner’s late fees
do not qualify as liquidated damages; and the fourth count, “Breach of Implied Covenant of
Good Faith and Fair Dealing,” alleged a breach of the titled covenants.  Count II is a claim
that originally was negated by the General Assembly’s passage of legislation authorizing a
retroactive regulation of late fees in consumer contracts; the legislation was in response to
this Court’s decision in United Cable Television of Baltimore Ltd. Partn. v. Burch, 354 Md.
658, 732 A.2d 887 (1999).  There is no dispute between the parties that this count was
revived for claims arising prior to the June 1, 2000 by this Court’s recent decision in Dua v.
Comcast Cable of Maryland, Inc., 370 Md. 604, 805 A.2d 1061 (2002).  Dua held that the
statute’s retroactivity provision was in violation of both the Maryland Declaration of Rights
and the Maryland Constitution.  Dua, 370 Md. at 610-11, 805 A.2d at 1065.
10 No substantive amendments relating to the four previously mentioned counts within
the Complaint were made. The amendments were comprised of the addition of three
averments to the section of the Complaint entitled “PARTIES AND JURISDICTION.”
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that petitioner “knew or should have known that the due date for the payment of satellite
television services was unreasonably and unconscionably short and bore no relation to the
standard billing cycles of other similarly situated businesses” and that late fees were
“excessive and bore no relationship to the administrative charges incurred in processing late
payments.”  Respondent amended his complaint on September 7, 1999.10
Petitioner and Hughes sought to remove the case to the U.S. District Court for the
District of Maryland, but that court remanded the case because the lawsuit did not satisfy the
subject matter jurisdiction requirement that in diversity claims in federal court the amount
in controversy must exceed $75,000.  See 28 U.S.C. § 1332(a) (2003)(stating, “The district
courts shall have original jurisdiction of all civil actions where the matter in controversy
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exceeds the sum or value of $ 75,000, exclusive of interest and costs, and is between . . . (1)
Citizens of different States; . . . .”).  The case was then returned to the Circuit Court for St.
Mary’s County.  Petitioner and Hughes immediately moved for dismissal of respondent’s
complaint, alleging that his specific claims should be dismissed, or, in the alternative, that
the circuit court proceedings must be stayed and arbitration compelled.  The Circuit Court,
after a hearing, found that respondent was required to arbitrate his claims against petitioner
pursuant to the 1997 modified document and subsequent customer documents.  That court
then granted petitioner’s motion to dismiss without prejudice and respondent appealed to the
Court of Special Appeals.  As previously mentioned, the Court of Special Appeals reversed
the trial court’s dismissal of respondent’s complaint against petitioner and petitioner appealed
to this Court.
II.  Discussion
The determinative issue on review in this case is whether petitioner, under the plain
language of the initial customer agreement, satisfactorily notified respondent of unilateral
changes made to the initial customer agreement, with particular reference to the addition of
a mandatory arbitration provision.  Specifically, did petitioner comply with its own
contractual language mandating that “[i]f any changes are made, [petitioner] will send
[respondent] a written notice describing the change and its effective date.” (alterations
added)(emphasis added).   We hold that petitioner failed to abide by this provision of the
initial customer agreement which it authored, thus rendering the subsequent changes
11  In fact, respondent questions the very notion that the customer agreements between
him and petitioner are even binding contracts.  He argues that the monthly statements (i.e.,
the monthly bill or invoice) he receives from petitioner actually function as the binding
contract between the two, because the invoices include, not only the programming to be
received, the cost of the programming, identification of the two parties, the procedures for
payment and the duration of the agreement, but they also “state[] with particularity the
‘Terms and Conditions’” of the agreement (alteration added).  The Terms and Conditions on
the back of each monthly statement include petitioner’s policy regarding “Terms and
Conditions,” “Application of Payments,” “Administrative Late Fee,” policy for “Returned
Checks” and procedures for inquiring about “Errors or Questions About Your Statement,”
“Changing or Reactivating Services” and sending in payments to DIRECTV.  The invoices,
however, do not include any arbitration provision.  Petitioner argues that these invoices, sans
the arbitration provision, express the true terms of the contract between he and petitioner, not
the customer agreements.  It is not necessary, however, for this Court to address this issue,
because we hold that petitioner failed to fulfill its obligation under the terms and conditions
included in the initial customer agreement.
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contained within the 1997 modified document and subsequent documents, including adding
the arbitration clause, invalid.  As respondent did not have adequate notice of the arbitration
clause and therefore could not have voluntarily assented to arbitration, we hold that the Court
of Special Appeals was correct in finding that compelled arbitration was not required under
the contract.  While the arbitration clause and its applicability to the instant dispute provides
the shell of the case sub judice, arbitration is merely a context for the threshold issue – the
interpretation of a provision within a contract that did not contain an arbitration clause – the
initial customer agreement.  Our decision, therefore, rests solely upon this Court’s
interpretation of Maryland contract law and not on principles set forth within the substantive
law of arbitration.11
Contract Interpretation
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The long-standing principles of this Court’s interpretation of contracts were set out
in Wells v. Chevy Chase Bank, F.S.B., 363 Md. 232, 768 A.2d 620 (2001).  In Wells, we
interpreted an arbitration clause within a Cardholder Agreement between a bank and its
customer in order to ascertain whether the clause was agreed to by all parties.  We said:
“Our analysis begins, and in this case ends, with the words of the written
contract.
“The interpretation of a written contract is ordinarily a question of law
for the court and, therefore, is subject to de novo review by an appellate court.
Auction & Estate Reps., Inc. v. Ashton, 354 Md. 333, 341, 731 A.2d 441, 445
(1999); . . . Kendall v. Nationwide Ins. Co., 348 Md. 157, 170-71, 702 A.2d
767, 773 (1997); JBG/Twinbrook Metro Ltd. Partnership v. Wheeler, 346 Md.
601, 625, 697 A.2d 898, 911 (1997); Suburban Hosp., Inc. v. Dwiggins, 324
Md. 294, 306, 596 A.2d 1069, 1075 (1991). In determining the meaning of
contractual language, Maryland courts have long adhered to the principle of
the objective interpretation of contracts. Ashton, 354 Md. at 340, 731 A.2d at
444; . . . Adloo v. H.T. Brown Real Estate, Inc., 344 Md. 254, 266, 686 A.2d
298, 304 (1996); Maryland v. Attman/Glazer P.B. Co., 323 Md. 592, 604, 594
A.2d 138, 144 (1991); Cloverland Farms Dairy, Inc. v. Fry, 322 Md. 367, 373,
587 A.2d 527, 530 (1991); Feick v. Thrutchley, 322 Md. 111, 114, 586 A.2d
3, 4 (1991); Aetna Cas. & Sur. Co. v. Insurance Comm’r, 293 Md. 409, 420,
445 A.2d 14, 19 (1982). Under the objective interpretation principle, where the
language employed in a contract is unambiguous, a court shall give effect to
its plain meaning and there is no need for further construction by the court.
Ashton, 354 Md. at 340, 731 A.2d at 444; Wheeler, 346 Md. at 625, 697 A.2d
at 911; Insurance Comm’r, 293 Md. at 420, 445 A.2d at 19. ‘If a written
contract is susceptible of a clear, unambiguous and definite understanding . .
. its construction is for the court to determine.’ Rothman v. Silver, 245 Md.
292, 296, 226 A.2d 308, 310 (1967).
“Further, ‘[t]he clear and unambiguous language of an agreement will
not give way to what the parties thought the agreement meant or was intended
to mean.’ Ashton, 354 Md. at 340, 731 A.2d at 444 (citing Adloo, 344 Md. at
266, 686 A.2d at 304; General Motors Acceptance Corp. v. Daniels, 303 Md.
254, 261, 492 A.2d 1306, 1310 (1985); Board of Trustees v. Sherman, 280 Md.
373, 380, 373 A.2d 626, 629 (1977)). See also Beckenheimer’s Inc. v. Alameda
Assocs. Ltd. Partnership, 327 Md. 536, 547, 611 A.2d 105, 110 (1992) (‘A
party’s intention will be held to be what a reasonable person in the position of
12 Specifically, the Wells Court stated:
“On or about January 16, 1996, Chevy Chase moved its home office to
Virginia. With the periodic statements mailed in January and February of 1996
to its cardholders, Chevy Chase included a notice of change of terms of the
Cardholder Agreement. The notice of change took the form of a restatement
and revision of the Cardholder Agreement, with the new or revised terms
italicized and, with respect to a waiver of jury trial provision, both italics and
all uppercase print was used. Solely for purposes of this appeal, and without
indicating any opinion on whether the Cardholder Agreement was effectively
amended or whether the amendments are substantively valid, we shall call the
product of the January and February mailings the ‘Amended Agreement.’  The
Amended Agreement provided that it was made in Virginia and was ‘subject
to and governed by Virginia law and applicable federal law and regulations.’
The Amended Agreement further recited that ‘[t]he parties agree that by
engaging in activities with or involving each other, they are participating in
transactions involving interstate commerce.’
“Also contained in the Amended Agreement was an alternative dispute
resolution section . . . .”
Wells, 363 Md. at 236, 768 A.2d at 622 (emphasis added).
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the other party would conclude the manifestations to mean’). The words
employed in the contract are to be given their ordinary and usual meaning, in
light of the context within which they are employed.  Kasten Constr. Co. v Rod
Enters., Inc., 268 Md. 318, 329, 301 A.2d 12, 18 (1973); Liller v. Logsdon,
261 Md. 367, 370, 275 A.2d 469, 470-71 (1971); Belmont Clothes, Inc. v.
Pleet, 229 Md. 462, 467, 184 A.2d 731, 734 (1962); ST Sys. Corp. v. Maryland
Nat’l Bank, 112 Md. App. 20, 34, 684 A.2d 32, 39 (1996).”
Id. at 250-51, 768 A.2d at 629-30.  The arbitration agreement in Wells, similar to the one in
this case, was not contained in the initial agreement between the parties; it was subsequently
added through an amendment process.  The Wells Court, however, specifically did not
address the issue we are presented with here, as it “assume[d], arguendo, that the Cardholder
Agreement ha[d] been validly amended.”  Id. at 250, 768 A.2d at 629 (alterations added).12
In the case sub judice, while petitioner asserts that the subsequent documents validly
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amended the initial customer agreement, respondent argues that the notice provision of the
initial customer agreement was not followed, thus he never received proper notice of the
proposed changes, and that all subsequent attempts to modify the initial agreement failed.
The determinative question in the case at bar, therefore, is, as we have said, whether
petitioner complied with the notice provisions of its initial customer agreement with
respondent, thus giving respondent adequate notice to make an informed acceptance of the
new modified documents.
Petitioner asserts that it did comply with the notice provision because it “sent written
copies of the revised Customer Agreements to [respondent], thereby giving him notice of
their new terms.” (alteration added).  Petitioner argues that the wording of the new document
stating, “This is your copy of the Customer Agreement . . . between DIRECTV and you as
a customer of DIRECTV.  Please keep this for your records,” coupled with the language
stating that the new document was “effective as of March 1, 1997, until replaced,” and that
“Customer’s receipt of services constitutes Customer’s acceptance of and agreement to all
terms and conditions of this Agreement,” constitutes adequate notice “describing the
change.”  Respondent argues that, while he did receive a copy of the 1997 modified
document, he received no notice or any description of any changes from the initial customer
agreement. He argues that petitioner did not make clear which, if any, provision was changed
or added and that it was thus impossible for him to knowingly agree to changes because he
had not been properly notified of them.
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We have said, “where the language employed in a contract is unambiguous, a court
shall give effect to its plain meaning and there is no need for further construction by the
court.”  Wells, 363 Md. at 251, 768 A.2d at 630.  See also Auction & Estate Reps., Inc. v.
Ashton, 354 Md. 333, 340, 731 A.2d 441, 444 (1999).  In ascertaining the plain meaning of
the notice provision of the initial customer agreement, we look to the actual language of the
key terms within the provision.  “Notice” is defined as “information or intelligence . . . an
intimation; warning . . . a note, placard, or the like conveying information or a warning . . .
a notification of the termination, at a specified time, of an agreement.”  The Random House
Dictionary of the English Language 986 (Jess Stein ed., unabr. ed., Random House 1983).
To “describe” is defined as “to tell or depict in written or spoken words; give an account of
. . . to pronounce, as by a designating term, phrase, or the like; label . . . to indicate; to be a
sign of; denote.”  Id. at 390.  Synonyms of “describe” include “portray, characterize,
represent; recount, tell, relate.”  Id.  “To describe is to convey an image or impression in
words designed to reveal the appearance, nature, attributes, etc., of the thing described.”  Id.
Finally, to “change” is “to make the form, nature, content, etc., of (something) different from
what it is or from what it would be if left alone.”  Id. at 246.
The words used clearly reveal the plain meaning of the initial customer agreement’s
notice provision.  In its simplest form, the provision denotes that if a change were to be made
to the initial customer agreement, petitioner would provide, in writing, “information or a
warning” that would  “convey an image or impression in words designed to reveal” the
13 In fact, this Court notes that it is very difficult, given the font and style of the
agreements, for one person, alone, to efficiently and effectively compare the two documents
at issue in this case.  Certainly, it would be difficult for the thousands, if not tens of
thousands, of petitioner’s ordinary customers.  One of the only methods of effectively
comparing each difference between the initial customer agreement and the document
attempting to modify it is to have one person read the initial customer agreement aloud while
another person simultaneously compares the spoken version of the initial customer agreement
with that of the written version of the latter document.  While this and other methods would
(continued...)
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“content” of the new modifications to the agreement that was “different from what” the
initial customer agreement stated, “or from what it would be if [the initial customer
agreement was] left alone.”  Id. at 246, 390, 986.  Basically, petitioner agreed to let
respondent know when a change occurred and what that change entailed, presumably before
the change purportedly became effective.  It is clear that this provision obligated petitioner
to provide respondent with information on the nature of what was actually changed between
the two documents.  Such a description was not provided in the case sub judice.
Petitioner merely presented the new modified document to respondent; it did not
include any explanation or description of what was actually changed.  In fact, the new 1997
modified document appeared nearly identical to the initial customer agreement.  The same
format was used, along with identical type and font.  In order to be aware of which provisions
were altered by the 1997 modified document, if any, respondent would have had to physically
compare the initial customer agreement side-by-side with the new document.  He would have
had to meticulously comb through both documents line by line and compare each word of the
initial customer agreement’s fine print to the fine print within the newer document.13  Only
13(...continued)
allow a customer to actually decipher which provisions have been altered or added within the
latter document, it is certainly not what is commonly thought of, or even contemplated, when
reading a provision promising “a written notice describing the change.”
14 If a customer were to have misplaced, discarded or lost their initial customer
agreement due to a hurricane, tornado, flood, fire or other inadvertent cause, it would be
impossible for them to have any notice of the changed or added provisions.  We fail to see
how petitioner’s inclusion of only the new document provides these customers with a
reasonable “written notice describing the change.”
15 We again note that petitioner was the author of the customer agreements and
voluntarily included the notice provision within them.  Petitioner, as the modifying party, was
in a better position than its customers to examine the documents and highlight, describe or
explain each change or addition.  Petitioner also, by the terms of its customer agreements,
had the unilateral authority to amend any of the agreements’ terms.  Petitioner was well
aware of the notice provision and its plain meaning (or should have been) and cannot now
escape the terms of its own initial contract when those terms no longer conform with
petitioner’s interests.
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then could respondent even know if a change was made and what it was, let alone be
cognizant of the probable impact of the alterations.14  Because petitioner provided to
respondent only the new modified document itself and did not identify which provisions were
changed or added, it necessarily failed to afford a satisfactory description of the changes.
This failure to describe the changes violated petitioner’s initial customer agreement with
respondent.15  As respondent was not given proper notice of the changes to his initial
customer agreement with petitioner, respondent could not have constructively assented to the
arbitration provision, as found by the circuit court, and thus the terms of the initial customer
agreement, without an arbitration provision, control.
Petitioner argues that “Maryland law allows parties to modify their agreements in
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almost any manner they see fit.”  Petitioner continues to argue that “Once the contract has
been modified or replaced by a new contract, a party cannot avoid the terms of the
subsequent contract by claiming that the modification provisions of the original contract were
not followed.”  Petitioner cites several Maryland Court of Appeals cases for the proposition
that parties are able to waive written provisions of a contract by their conduct.  See Univ.
Nat’l Bank v. Wolfe, 279 Md. 512, 369 A.2d 570 (1977)(holding that parties to a contract
may waive the requirements of a written contract by their conduct where, over a period of
approximately two years, 40 of about 100 checks drawn on the depositor’s account contained
only one authorized signature while the written contract required two signatures and the
depositor, after receiving monthly statements, made no complaint during that time); Taylor
v. Univ. Nat’l Bank, 263 Md. 59, 63-64, 282 A.2d 91, 94 (1971)(holding, in a bank’s claim
against business partners for unpaid notes where the partners contended that a dealer
agreement obligated the bank to accept papers from the business without recourse to the
partners until the agreement was modified in writing, that parties may waive the requirements
of a written contract by their conduct, and there was sufficient evidence of the modification,
as the initial agreement did not obligate the bank to purchase paper from the individuals;
modification in that case occurred after “execution of the loan guarantee agreement and then
by the very act of negotiating the notes to the Bank which notes provided for recourse”);
Pumphrey v. Pelton, 250 Md. 662, 245 A.2d 301 (1968)(holding that an individual ice cream
franchisee did not breach a contract with the state franchiser by selling non-Dairy Queen
-17-
products where the franchiser acquiesced to the sale of non-Dairy Queen products, because
the franchiser was aware of non-Dairy Queen products being sold by the franchisee and other
franchisees in the area); Freeman v. Stanbern Constr. Co., 205 Md. 71, 78, 106 A.2d 50, 54
(1954)(remanding a case for trial and directing the trial court to allow evidence of an oral
modification to a written contract where the trial court erroneously excluded evidence of an
oral modification of a contract between a contractor and subcontractor, because “even though
a written contract stipulates that it may not be varied except by an agreement in writing,
nevertheless the parties, by a subsequent oral agreement, may modify it by mutual
consent”)(emphasis added).  None of these cases, however, concern a plain meaning
interpretation of the type of notice clause in the case sub judice, i.e., whether a party to a
contract complied with the notice provisions of its contract resulting in the other party
receiving valid notice of the proposed changes pursuant to the terms of the initial contract.
The facts of the preceding cases present situations where the parties’ conduct amounted to
mutual assent, or the practical equivalent thereof, to an unwritten practice or change after
being fully cognizant of that change of circumstances or procedure.  As the situation before
this Court presents a dissimilar factual record from this body of case law, petitioner’s reliance
on these cases is misplaced.
Additionally, in the circumstances of the case sub judice, unlike the parties in the
cases proffered by petitioner, the conduct of the respondent does not indicate an informed
acceptance of the new contractual terms.  No mention of any specific change was included
16 This provision in the documents subsequent to the initial customer agreement also
includes “to your last known address” after the words “effective date.”
-18-
in the 1997 modified document or subsequent modified documents as mandated by both the
initial customer agreement and the 1997 modified document.  The very nature of notice
provisions is to provide the customer with enough information to make an informed decision
regarding any amendments and/or new provisions found within the replacement document.
In addition, under petitioner’s rationale the notice provision of the initial customer
agreement would be effectively nullified.  In fact, petitioner included the very same notice
provision, “If any changes are made, we will send you a written notice describing the change
and its effective date,”16 in its June 1, 1999, July 1, 1997 and March 1, 1997 documents.
Customers, therefore, could look to the very first numbered provision in the new 1997
modified document and read the exact same language, promising them “a written notice
describing the change,” as was included in their initial customer agreement.  As further
examination of the document would reveal no description, or mention, of any change,
customers could argue that they reasonably believed that no material change was included.
Petitioner’s actions essentially appear to be an attempt to insert new language into its
customer agreements without the knowledge and/or comprehension of its customers.
Under these circumstances, i.e., where a party voluntarily included a notice of changes
provision in a customer agreement it authored and had unilateral authority to amend, a
holding by this Court that respondent impliedly agreed to changes and new terms within an
-19-
agreement regardless of whether petitioner complied with the notice provision it authored,
would be the practical equivalent of writing the notice provision out of the customer
agreement.  This Court has long declined to unnecessarily read provisions of contracts as
meaningless:
“A recognized rule of construction in ascertaining the true meaning of
a contract is that the contract must be construed in its entirety and, if
reasonably possible, effect must be given to each clause so that a court will not
find an interpretation which casts out or disregards a meaningful part of the
language of the writing unless no other course can be sensibly and reasonably
followed.”
Sagner v. Glenangus Farms, Inc., 234 Md. 156, 167, 198 A.2d 277, 283 (1964).  See also
Bausch & Lomb, Inc. v. Utica Mut. Ins. Co., 330 Md. 758, 782, 625 A.2d 1021, 1033 (1993);
Dahl v. Brunswick Corp., 277 Md. 471, 478-79, 356 A.2d 221, 226 (1976). 
Petitioner argues that the initial customer agreement “simply does not require
DIRECTV to send separate written notice describing a change” and that the Court of Special
Appeals should not have required them to do so.  Petitioner misreads the opinion of the
intermediate appellate court because the Court of Special Appeals did not hold that separate
written notice was required.  The Court of Special Appeals stated:
“we conclude that DIRECTV agreed that Mattingly would be bound by any
changes that it made to the 1996 Agreement only if DIRECTV gave him some
sort of written notice advising him about a particular change, and identifying
that change clearly enough that he could find and review it in the revised
agreement. Thus, DIRECTV obligated itself to send Mattingly enough
information that he could exercise an informed decision as to whether he
wished to continue DIRECTV service, with the understanding that he would be
required to arbitrate any claims he might have against DIRECTV. Whether it
did so by a separate mailing, or by a separate document sent along with the
17 This is not to say that other changes, e.g., alterations in fees, programming, etc., are
necessarily invalid.  Notice, i.e., a description of the change, in other contexts, like changes
in fees, may have been provided on the billing statement/invoice itself or in another manner.
There is no question, however, that the arbitration clause in this case was not mentioned in
any writings but the actual provisions of the 1997 modified and subsequent documents
themselves.
-20-
new agreement and the billing invoice, or otherwise by a separate provision in
that invoice or another document, DIRECTV had a contractual duty to give
Mattingly some written warning, (i.e., ‘notice’) that the new 1997 Agreement
included a new arbitration clause significantly limiting his right to litigate in
court (i.e., ‘describing the change’).”
Mattingly, 147 Md. App. at 636, 810 A.2d at 506 (emphasis added).  The intermediate
appellate court merely illustrated a few examples of how petitioner may have fulfilled its
obligation under its contract with respondent.  The court did not make its holding based on
petitioner’s failure to send separate written notice to respondent, but on the fact that
petitioner failed to give respondent “some written warning,” or any description, of the
changes.  Id.  Sending a separate mailing could be merely one method used to satisfy the
requirement.
Petitioner also argues that the Court of Special Appeals’ decision “conflicts with
numerous federal courts’ decisions under the Federal Arbitration Act, which enforce
arbitration agreements mailed to customers after they enter into their initial contract.”  This
argument is without merit.  First and foremost, our holding does not rest on FAA grounds;
it is not limited to the addition of arbitration provisions.17  We never reach the questions
controlled by the FAA because we hold that there was never a valid agreement to arbitrate
-21-
due to petitioner’s failure to give proper notice of the changes that the 1997 modified
document made to the initial customer agreement.  That initial customer agreement contained
no arbitration clause.  We have merely interpreted petitioner’s initial contract under Maryland
principles of contract law and have concluded that the plain meaning of its notice provision
required petitioner to provide a description of the changes made in any subsequent modified
document; petitioner did not do so, thus no valid contractual modification has occurred.
In light of the fact that the controlling issue in this case is not dependant on a
subsequent attempt to impose an arbitration clause, all of the federal arbitration cases which
petitioner cites are distinguishable on the grounds that they did not involve a question of
whether the party authoring the contract complied with the very notice provision it drafted
and included in its initial agreement with a customer.  See Carnival Cruise Lines, Inc. v.
Shute, 499 U.S. 585, 589-90, 111 S. Ct. 1522, 1525, 113 L. Ed. 2d 622, 629-30
(1991)(holding that customers paying for tickets for a vacation on a cruise ship through a
travel agent who were later sent their tickets by the cruise line, had notice of a forum
selection clause written in fine print on the ticket itself, and were bound by it; no change of
terms provisions was involved); Hill v. Gateway 2000, Inc., 105 F.3d 1147, 1149-50 (7th Cir.
1997)(holding that a customer purchasing a computer via a telephone order was bound by
the arbitration clause within terms and conditions contained in the box the computer was
shipped in, because the computer was not returned within the thirty days mandated by the
terms and conditions; a change in the terms and conditions of the agreement was not in
-22-
issue); Bischoff v. DIRECTV, Inc., 180 F. Supp. 2d 1097, 1103-06 (C.D. Cal.
2002)(involving a customer challenging the arbitration clause contained within DIRECTV’s
October 1999 customer agreement, which was included in that customer’s initial agreement
with DIRECTV; DIRECTV’s compliance with its notice of changes provision was not in
issue); Bank One, N.A. v. Coates, 125 F. Supp. 2d 819, 826-87 (S.D. Miss. 2001)(involving
a credit card customer who did not dispute the fact that Bank One sent him detailed notice
of an amended cardholder agreement, which included an arbitration clause; the customer only
challenged that he agreed to the amendment and that the agreement was, itself, substantively
unfair and unconscionable); Herrington v. Union Planters Bank, N.A., 113 F. Supp. 2d 1026,
1030-31 (S.D. Miss. 2000)(customers challenged an amended deposit agreement with a bank,
including an arbitration provision, on the grounds that the words “revised” and “amended”
were not synonymous; it was “undisputed that the plaintiffs were given notice”); Marsh v.
First USA Bank, N.A., 103 F. Supp. 2d 909, 916-19 (N.D. Tex. 2000)(although customers
who initially had no arbitration provision in their cardholder agreements with First USA
Bank challenged whether they received notice of the added arbitration agreement, the bank
provided affidavits, depositions and testimony establishing that notice was given in several
forms, including provisions on the customer’s actual billing statement labeled “SUMMARY
OF CHANGES” and inserts with notice of the change); Stiles v. Home Cable Concepts, Inc.,
994 F. Supp. 1410, 1412-17 (M.D. Ala. 1998)(involving a factual situation whereby a
customer argued that he did not understand changes to a cardholder agreement, including the
-23-
addition of an arbitration clause, but where he did not dispute that the financier, AGFC,
provided him with notice of the changes to his cardholder agreement; the notice included a
toll-free phone number and address to contact AGFC regarding changes to the account and
a separate document entitled “IMPORTANT NOTICE OF CHANGE OF TERMS . . . ,”
which set out the changes in the agreement, a summary of the changes, a provision allowing
the customer to sever the new provisions if he/she did not agree to them and a self-addressed
postage paid envelope to send a rejection of the changes to the company).  The factual
circumstances of these cases illustrate the material differences between the issues presented
therein from the determinative question raised in the case sub judice.
III.  Conclusion
Under the plain language of the petitioner-authored initial customer agreement
between petitioner and respondent, petitioner was contractually obligated to provide
respondent with “written notice describing” any change made in all subsequent proposed
customer agreements.  In the case sub judice, petitioner merely provided respondent with a
copy of the new modified document and did not include any highlighting or other special
notice or description, or even mention, which provisions were amended or added.  Coupling
those facts with petitioner’s purported unilateral power to amend the customer agreement and
petitioner’s voluntary inclusion of the notice provision in the initial and three subsequent
documents, we hold that the initial customer agreement was not validly modified to include
the  arbitration provision contained within the March 1, 1997 and subsequent modified
-24-
documents.  Because there was no valid modification of the initial customer agreement, that
initial customer agreement, without an arbitration provision, controls any disputes between
the parties in this case.  We hold, therefore, that the Court of Special Appeals was correct in
not compelling arbitration and in reversing the trial court’s dismissal of respondent’s claims
against petitioner.
JUDGMENT OF THE COURT OF
SPECIAL 
APPEALS 
AFFIRMED;
C O S T S  
T O  
B E  
P A I D  
B Y
PETITIONER.
IN THE COURT OF APPEALS OF
MARYLAND
No. 130
September Term, 2002
DIRECTV, INC.
v.
JOHN A. MATTINGLY, SR.
Bell, C.J.
Eldridge
                    Raker
Wilner
Cathell
Harrell
Battaglia,
JJ.
Dissenting Opinion by Raker and Harrell, JJ.
Filed:    July 31, 2003
Raker and Harrell, JJ. dissenting.
We respectfully dissent.  The Circuit Court for St. Mary’s County properly dismissed
this case on the ground that the parties agreed to arbitrate any disputes related to their
-2-
contractual relationship, including the amount of the “late fees” incurred by respondent.
Respondent is required to arbitrate his claim against petitioner because he agreed to arbitrate
and his claim falls within the scope of that agreement.  Our fundamental disagreement with
the Majority is its conclusion that Mattingly’s undisputed conduct in continuing to receive
and pay for  DIRECTV’s services following receipt of each of the replacement Customer
Agreements, most of which were received before the late fee dispute arose (the instant
litigation was initiated on 6 August 1999; Mattingly paid the late fee assessed on 17 July
1999, without protest, but filed his putative class action suit thereafter), was not conduct
sufficient to indicate agreement with the inclusion of the arbitration requirement in the
replacement Customer Agreements.
Petitioner, DIRECTV, sent written notice to respondent of the changes made to the
customer agreement and the effective dates of the changes.  The three pre-dispute customer
agreements mailed to respondent—effective March 1, 1997, July 1, 1997, and June 1,
1999—all gave explicit notice of the added arbitration agreement provision, as follows:
“ARBITRATION:
“Any controversy, claim, dispute or disagreement arising out of,
or relating to, this Agreement or any services provided by
DIRECTV which cannot be settled by the parties shall be
resolved according to binding arbitration conducted in
accordance with the Commercial Arbitration Rules of the
American Arbitration Association then in effect.” 
Simply because petitioner did not specifically “warn” of or describe the changes separately
did not render the changes invalid.  Nor was petitioner required to send a separate written
-3-
notice describing changes in the Customer Agreement.  Respondent had adequate notice of
the changes, including the arbitration provision—all he had to do was to read the document
petitioner enclosed with the bill statement.  Contrary to respondent’s contention, it was hardly
“impossible” for him to agree knowingly to the changes.  
The Majority anguishes over the imaginary hardships that would be visited upon
Mattingly (or other theoretical ordinary consumer) were he held to be obliged to read each
replacement Agreement in order to appreciate what the proposed changes might be (Maj. slip
op. at 15).  Even a gross visual comparison of the respective replacement Agreements,
however, should lead the average person to realize immediately that changes were present.
To begin with, the Customer Agreements, in all of their iterations in this record, are not
policies of insurance (a pejorative reference as used here).  They are instead relatively short,
comprising a single, 8 ½” x 11" page with print on both sides arranged in three columns and
then folded, accordion-style, so that it resembles a pamphlet with what would then become
six “pages.”  Each numbered  provision bears a subject matter title in bold print.  The size
of the print, except for the larger DIRECTV logo and the title “CUSTOMER
AGREEMENT,” appears to be of pitch 6 or 7 in size. 
The heading of the cover page of the original Agreement clearly states that it is
“effective as of August 28, 1996, until replaced” (emphasis added).  The heading of the
cover page of each replacement Agreement indicates a new effective date, also “until
replaced.”  It does not strain reasonable expectations to assume that the average consumer
-4-
should appreciate that receipt of a Customer Agreement bearing a new effective date, thus
replacing an earlier Agreement, likely contains some changes.  Common sense “dictates that
a revised . . . agreement contains terms and conditions that are different from its
predecessor.”  Herrington v. Union Planters Bank, N.A., 113 F.Supp. 2d 1026, 1031 (S.D.
Miss. 2000).
The Majority insists that to be aware of changes to the customer agreement,
respondent would have had to “meticulously comb through both documents line by line and
compare each word of the initial customer agreement’s fine print to the fine print of the
newer document.”  The Majority therefore worries that if a customer were to misplace,
discard or lose their initial customer agreement “due to a hurricane, tornado, flood, fire or
other inadvertent cause, it would be impossible for them to have any notice of the changed
or added provisions.”
As even the Majority must concede, however, the initial 28 August 1996 Agreement,
which Mattingly clings to in this litigation, states, in pertinent part, in its short, opening
paragraph numbered 1, also on the cover page of the “pamphlet”:
1) AGREEMENT TO TERMS AND CONDITIONS:
 *               *               *
Customer’s receipt of services constitutes Customer’s
acceptance and agreement to all terms and conditions of this
Agreement.  DIRECTV reserves the right to change these terms
and conditions, including the Applicable Fees and Charges.  If
any changes are made, we will send you a written notice
describing the change and its effective date.  If a change is not
1Even were we addressing an insurance policy, where the insured’s “duty is not
necessarily to read the policy but simply to act reasonably under the circumstances”
(Teamsters v. Corroon Corp., 369 Md. 724, 739, 802 A.2d 1050, 1059 (2002)), the
circumstances of this case (a short agreement where the customer is on notice of the
likelihood of changes in replacement Agreements bearing later effective dates) suggest to us
a reasonable duty on Mattingly’s part to read the first and subsequent Agreements.
-5-
acceptable to you, you may cancel your service.  If you do not
cancel your service, your continued receipt of any service is
considered to be your acceptance of that change.
*              *               *
(emphasis in original).
Because this language does not promise that the “written notice” of changes will take any
particular form, it is not unreasonable to expect that a subsequent, replacement Customer
Agreement, bearing a different effective date on its cover page, serves, upon receipt, as
written notice sufficient to put the average consumer on notice to examine it for changes.1
Even a cursory examination of any of the replacement Customer Agreements in this record
would have revealed to the average person the particular change that is the gravamen of the
present case.  A reasonable person, on notice of possible changes, but who may not wish to
scrutinize comparatively all of the “fine print” unless there was some more manifest indicium
of change, might look to see if any additional numbered provisions had been added.  The
initial 28 August1996 Agreement contained twenty-two numbered sections, with the last, No.
22, entitled “MINIMUM LEVEL OF SERVICE.”  The last numbered provision of each
replacement Agreement was No. 23, entitled “ARBITRATION,” preceded by No. 22,
“MINIMUM LEVEL OF SERVICE.”  Thus, had Mattingly exercised the simple expedient
2Access to satellite (or even cable) television has not yet risen in American society,
we hope, to the level of shelter, food, health care, or other fundamental necessity of life. 
-6-
of ascertaining the total number of provisions in each Agreement, using the 28 August 1996
Agreement as a base, he would have discovered (if he did not) the very provision he now
seeks to avoid so that he may maintain a potential class action lawsuit over the allegedly
usurious late fee charge of $2.81.  By the even simpler expedient of canceling his
subscription for satellite tv service following receipt of any of the pre-dispute replacement
Agreements, Mattingly could have vindicated his objection to the unilateral imposition of
mandatory arbitration, albeit at the possible loss thereafter of his ability to view “The
Sopranos” or “The Shield,”2 unless and until cable television is extended to his
neighborhood.
In a recent case, Allstate Ins. Co. v. Stinebaugh, ____Md.____ (2003) (No. 81,
September Term, 2002) (filed 12 May 2003), the Court, in the context of a dispute over
whether an agreement to arbitrate existed, was confronted with the issue of “the legal effect
of an agreement that contemplates judicial resolution of a particular dispute, upon a prior,
general arbitration agreement.”  Stinebaugh, slip op. at 1.  Noting that no reported Maryland
appellate decision addressed the issue (Stinebaugh, slip op. at 15), the Court discussed an
Oklahoma case, Shawnee Hosp. Auth. v. Dow Constr., 812 P.2d 1351 (Okla. 1990), that
decided that question in an analogous factual context to Stinebaugh.  Favorably citing to the
-7-
 Dow decision, we iterated “the following principles of contract law relied on by the
Oklahoma court”:
Before full performance, contractual obligations may be
discharged by a subsequent agreement whose effect is to alter,
modify, or supersede the terms of the original agreement or to
rescind it altogether.  A claim under an earlier contract will be
governed by a later agreement if the latter operates to supersede
to rescind the former.  Where not expressly stated, the legal
effect of the later contract on the former must be gathered from
a four-corners’ examination of the contractual instrument in
question.
Stinebaugh, slip op. at 16, citing Dow, 812 P.2d at 1353-54 (footnotes omitted).  The Court
then stated that
[W]e have embraced legal tenets similar to those
employed by our sister state regarding arbitration and contract
law.  Arbitration is “consensual; a creature of contract.”  Curtis
G. Testerman Co. [v. Buck], 3340 Md. [569] at 579, 667 A.2d
[649] at 654 [(1995)] (quoting Thomas J. Stipanowich,
Arbitration and the Multiparty Dispute: The Search for
Workable Solutions, 72 IOWA L.REV. 473, 476 (1987) (citation
omitted)).  As such, “[a] party cannot be required to submit any
dispute to arbitration that it has not agreed to submit,” id.
(quoting Gold Coast Mall [Inc. v. Larmar Corp.], 298 Md. [96]
at 103, 468 A.2d [91] at 95 [(1983)]), and “[t]he intention of the
parties controls on whether there is an agreement to arbitrate.”
Crown Oil [& Wax Co. v. Glen Constr. Co.,], 320 Md. [546] at
558, 578 A.2d [1184] at 1189 [(1990)].  Further, like Oklahoma,
we have recognized that rights and obligations under contracts
may be discharged by subsequent agreements.  See, e.g., [ ]Linz
v. Schuck, 106 Md. 220, 234, 67 A.286, 290 (1907) (stating that
modification is “an abandonment of the original contract and the
creation of a new contract”).
Stinebaugh, slip op. at 16-17 (footnote omitted; some internal citations omitted).
-8-
Most courts enforce arbitration agreements that were entered into in the manner that
the parties entered into the instant agreement.  In Bank One, N.A. v. Coates, 125 F. Supp.2d
819 (S.D. Miss. 2001), the court enforced an arbitration agreement added by a credit card
company to the customer agreement by mailing an amendment to the card holders whose
complaints previously had not been subject to arbitration.  The court said:
“Given, then, that the original cardholder agreement permitted
amendments, the arbitration provision is not rendered
unenforceable simply by virtue of the fact that Bank One
undertook to add the arbitration provision via amendment.
Consistent with the terms of the original agreement, Bank One
could validly amend its agreement to add an arbitration clause,
just as it could have amended the agreement to add or change
any other term on the agreement.”
Id. at 831.
Respondent essentially argued that the changes were “procedurally unconscionable”
and therefore should not be enforceable.  The original agreement permitted unilateral
amendment by DIRECTV following written notice to its customers.  Consistent with the
terms of the original agreement, DIRECTV could add an arbitration provision, unless the
manner in which it was added is deemed to be unfair.  We do not find DIRECTV’s chosen
method to be unfair.  DIRECTV sent respondent notification of the amendment and
specifically gave him the option of rejecting the services if he did not agree to the new terms
and conditions, including the arbitration provision.  In short, the parties agreed to arbitrate.
We are persuaded that the replacement Customer Agreements, received before the
dispute arose, were sufficient written notice to Mattingly of DIRECTV’s insertion of a
3DIRECTV, in a 13 September 1999 letter to Mattingly’s counsel from its counsel,
offered, subject to the arbitrator’s decision whether Mattingly’s claim was frivolous or
brought for harassment purposes, to pay the filing fees of the American Arbitration
Association (AAA), the AAA’s hearing fees, hearing room rental fees, and the arbitrator’s
compensation and expenses.
-9-
mandatory arbitration provision as a proposed modification in the contractual agreement to
govern their respective future performance and rights, that it was not onerous to expect
Mattingly to have appreciated that that change had been made, and that Mattingly had a
reasonable and fair opportunity to cancel the contract if he objected to the arbitration
provision.  He elected to continue to receive DIRECTV’s services, subject to the mandatory
arbitration provision, and should not be allowed now to avoid arbitration of the dispute over
the late fee.3  Accordingly, we would reverse the judgment of the Court of Special Appeals
and order that court to affirm the judgment of the Circuit Court for St. Mary’s County.