Opinion ID: 1835835
Heading Depth: 1
Heading Rank: 3

Heading: Med Center Cars, Inc. d/b/a Med Center Mazda

Text: The arbitration agreement signed by Kimberly Smith is found in the Buyer's Order. It reads:  DISPUTE RESOLUTION AGREEMENT BUYER HEREBY ACKNOWLEDGES AND AGREES THAT ALL DISPUTES AND CONTROVERSIES OF EVERY KIND AND NATURE BETWEEN BUYER AND SELLER ARISING OUT OF OR IN CONNECTION WITH THE PURCHASE OF THIS VEHICLE WILL BE RESOLVED BY ARBITRATION WITH THE PROCEDURE SET FORTH ON THE REVERSE SIDE OF THIS BUYER'S ORDER. In pertinent part, the dispute-resolution procedure set out on the reverse side of the buyer's order provides:  All disputes and controversies of every kind and nature between the parties hereto arising out of or in connection with this contract, its subject matter or its negotiation, as to the existence, construction, validity, interpretation or meaning, performance, nonperformance, enforcement, operation, breach of contract, breach of warranty, continuance or termination thereof or any claim alleging fraud in fact, fraud in the inducement, deceit, or suppression of any material fact shall be submitted to binding arbitration pursuant to the provisions of the Federal Arbitration Act and according to the commercial rules of the American Arbitration Association then in effect in Birmingham, Alabama. Such arbitration proceedings may be initiated by either party by notice in writing to the other and to the American Arbitration Association. Each party shall bear his own arbitration costs and expenses. . . . . The parties stipulate that the provisions hereto shall be a complete defense to any suit, action, or proceeding instituted in any federal, state, or local court or before any administrative tribunal with respect to any controversy or dispute arising hereunder. (Emphasis added.) Med Center Mazda contends that both of the Smiths are signatories to a valid arbitration agreement. However, the Smiths contend that neither Douglas Smith nor Med Center Mazda signed the buyer's order containing the arbitration agreement and, thus, that no valid agreement to arbitrate exists. Therefore, according to the Smiths, Med Center Mazda cannot compel arbitration. Arbitration agreements are a matter of contract law, and a court interpreting such an agreement should consider the intent of the parties. See Allstar Homes, Inc., d/b/a/ Best Value Mobile Homes v. Waters, 711 So.2d 924 (Ala.1997); Allied-Bruce Terminix, supra. Kimberly Smith signed the buyer's order, dated February 13, 1993, which contains a written dispute-resolution agreement on the front side and the dispute-resolution procedure on the reverse side. However, Med Center did not sign the buyer's order. Med Center's name is printed on the buyer's order to the right of Kimberly Smith's signature, and appears without a signature, as follows: [Not valid unless accepted by seller or its authorized representative] ACCEPTED BY SELLER: MED CENTER CARS, INC. d/b/a MED CENTER MAZDA BY: ____________ This Court recently stated in Ex parte Pointer, 714 So.2d 971, 972 (Ala.1997), quoting Crown Pontiac, Inc. v. McCarrell, 695 So.2d at 618-19 (Ala.1997): `The purpose of a 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). Conversely, in this case the absence of a signature under the arbitration clause shows a lack of mutuality and assent, where the contract contains a signature line specifically for the arbitration clause, but where McCarrell did not sign on that line, although he signed on other lines that similarly indicated agreement to specific terms.' 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. Moreover, the Smiths and Med Center Mazda entered a sales contract on the same day the buyer's order was executed; however, the sales contract does not contain an arbitration clause or a merger clause. The signatures of both Douglas Smith and Kimberly Smith and the signature of a Med Center representative appear in the sales contract. We conclude that a valid sales contract, which does not contain an arbitration agreement, was executed between the Smiths and Med Center. Therefore, neither Kimberly Smith nor Douglas Smith can be compelled to arbitrate their claims against Med Center Mazda. We affirm the trial court's order denying Med Center Mazda's motion to compel arbitration against Kimberly Smith and Douglas Smith.