Opinion ID: 1796043
Heading Depth: 2
Heading Rank: 2

Heading: Fulmer's Other Arguments

Text: As stated above, the trial court's denial of the appellants' motion to compel arbitration relied solely on our decision in Sisters of the Visitation. However, Fulmer asserts three other bases upon which we might affirm the trial court's denial of the appellants' motion to compel arbitration: [11] Fulmer's claims 1) that he lacked the necessary mental capacity when he entered into the contract with SCI-Alabama, 2) that the arbitration provision is unconscionable, and 3) that he should not be compelled to arbitrate his claims against SCI because SCI was not a party to the contract. Fulmer contends that he did not consent to arbitration because, when he entered into the contract with SCI-Alabama, he was suffering great emotional distress over the loss of his mother. He also contends that the arbitration provision is unconscionable primarily because the contract in which the provision appears is a contract of adhesion. These contentions do not support an affirmance of the order of the trial court for several reasons. First, Fulmer's breach-of-contract claim (and perhaps some of his other claims) is based upon Fulmer's own assertion that a valid contract exists between him and SCI-Alabama. It was only after the appellants filed their motion to compel arbitration that Fulmer asserted, in his response, that the contract was unconscionable and that he did not have the requisite mental capacity when he entered into it. Courts will not permit this type of inconsistent pleading  an obvious attempt to avoid arbitration while seeking the benefits of the contract. See, e.g., Credit Sales, Inc. v. Crimm, 815 So.2d 540, 546 (Ala.2001) (stating that a plaintiff cannot pick and choose between those contract provisions that benefit the plaintiff and those to which the plaintiff wishes not to be bound; instead, [the plaintiff] must accept or reject the entire contract); see also Leonard v. Terminix Int'l Co., 854 So.2d 529, 533 (plaintiffs who alleged unconscionability as a ground for avoiding arbitration sought rescission of their contracts with Terminix). Second, Fulmer's alleged lack of mental capacity, even if true, is a defense directed toward the contract as a whole, not just toward the arbitration provision. The resolution of such a defense is for an arbitrator, not a trial court, to decide. It is well settled that, with an exception not relevant here, [12] a challenge that concerns `the making of [a] contract in its entirety, rather than just ... the arbitration agreement itself' is for an arbitrator, rather than a court, to resolve. Mason v. Acceptance Loan Co., Inc., 850 So.2d 289, 294-95 (Ala.2002) [13] (quoting NationsBanc Invests., Inc. v. Paramore, 736 So.2d 589, 591 (Ala.1999) (quoting in turn Anniston Lincoln Mercury Dodge v. Conner, 720 So.2d 898, 902 (Ala.1998))). See also Green Tree Fin. Corp. of Alabama v. Wampler, 749 So.2d 409, 414 (Ala.1999) (holding that a charge of unconscionability was directed to the contract as a whole where the plaintiffs claimed that they were forced to sign [the contract] because of `tremendous economic duress' arising from a combination of sales pressure concerning the impending deadline on the availability of a no-money-down payment plan and what they describe as their limited financial condition). Our conclusion is demanded notwithstanding Fulmer's attempt to frame the issue as though he had the mental capacity to understand everything but the arbitration provision. See Wampler, 749 So.2d at 414 (Artful pleading cannot defeat the operation of this rule.... `[W]e must look beyond the ad hoc arguments of counsel in order to determine whether [the plaintiff's] claim actually bears upon the entire agreement or just the arbitration clause.' (quoting NationsBanc Investments, Inc., 736 So.2d at 591 (quoting in turn Anniston Lincoln Mercury Dodge, 720 So.2d at 901-02))). Finally, Fulmer's claim that the arbitration provision is unconscionable would be without merit, even had it been properly asserted. It is difficult to describe precisely what Fulmer's exact argument is with regard to his unconscionability claim. Fulmer relies on our decision in Leonard v. Terminix International Co., 854 So.2d 529 (Ala.2002), as support for his argument that the arbitration provision is procedurally unconscionable. However, the substance of Fulmer's argument appears to be that his contract with SCI-Alabama is one of adhesion, and because he signed the contract during a very stressful period in his life, the contract is unconscionable. Fulmer misconstrues our holding in Leonard. While the arbitration provision in Leonard was part of a contract of adhesion, it also included a limitation upon recovery of `indirect, special, and consequential damages or loss of anticipated profits,' and prohibited treatment of the plaintiff's claims as a class action. 854 So.2d at 538. We held that, under those circumstances, the arbitration provision was unconscionable because the terms were unreasonably favorable [toward the defendant] and patently unfair [toward the plaintiffs,] and therefore met the two-part unconscionability test set forth in American General Finance, Inc. v. Branch, 793 So.2d 738, 748 (Ala.2000). [14] 854 So.2d at 538; see also Leonard, 854 So.2d at 539 (This arbitration agreement is unconscionable because it is a contract of adhesion that restricts the Leonards to a forum where the expense of pursuing their claim far exceeds the amount in controversy.). The arbitration provision at issue in this case contains none of the problematic components discussed in Leonard. The provision in Fulmer's contract with SCI-Alabama provides: ANY CONTROVERSY OR CLAIM ARISING BETWEEN THE PARTIES (INCLUDING THE INTERPRETATION OF THIS ARBITRATION CLAUSE) SHALL BE SUBMITTED TO AND FINALLY RESOLVED BY MANDATORY AND BINDING ARBITRATION IN ACCORDANCE WITH THE STATUTES, RULES OR REGULATIONS GOVERNING ARBITRATIONS IN THE STATE WHERE THIS AGREEMENT HAS BEEN EXECUTED. IN THE ABSENCE OF SUCH STATUTES, RULES OR REGULATIONS, THE ARBITRATION PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE APPLICABLE RULES OF THE AMERICAN ARBITRATION ASSOCIATION (`AAA'); PROVIDED HOWEVER, THAT THE FOREGOING REFERENCE TO THE AAA RULES SHALL NOT BE DEEMED TO REQUIRE ANY FILING WITH THAT ORGANIZATION, NOR ANY DIRECT INVOLVEMENT OF THAT ORGANIZATION. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN APPLICABLE STATUTES, RULES OR REGULATIONS, THE ARBITRATOR SHALL BE SELECTED BY MUTUAL AGREEMENT OF THE PARTIES OR BY A COURT OF COMPETENT JURISDICTION IN THE CITY OR COUNTY IN WHICH SELLER IS LOCATED, UPON THE APPLICATION OF ONE OR BOTH PARTIES. THIS ARBITRATION PROVISION SHALL BE BINDING ON THE SELLER, YOU AS THE PURCHASER, AND ANY OTHER PERSON WHO CLAIMS TO BE A THIRD PARTY BENEFICIARY OF THIS AGREEMENT. (Capitalization in original.) Even assuming the contract between Fulmer and SCI-Alabama was a contract of adhesion, Fulmer's claim that his mental distress at the time he signed it made the arbitration provision unconscionable is unpersuasive. Sellers of goods and services do not have a general duty to test or ensure the mental capabilities of their customers; if the terms of the provision are not unreasonably favorable and patently unfair, the provision is not unconscionable. Fulmer bears the burden of proving that the terms of the arbitration provision are unconscionable, and he has not met that burden. Providian Nat'l Bank v. Screws, [Ms. 1020668, Oct. 3, 2003] ___ So.2d ___, ___ (Ala.2003) (Under Alabama law, arbitration provisions are not per se unconscionable. Rather, the party asserting the affirmative defense of unconscionability bears the burden of proving that the provision is unconscionable. (citation omitted)). [15]