Court Opinion

ID: 864634
Source: CourtListenerOpinion
Date Created: 2013-04-27 00:20:32.26531+00
Date Added: 2024-06-11T15:26:52.756264
License: Public Domain

IN THE SUPREME COURT OF MISSISSIPPI

                      NO. 2002-CA-01716-SCT

PRE-PAID LEGAL SERVICES, INC., BROOKS
WERKHEISER, DYRE LAW FIRM, PLLC AND
ARNOLD D. DYRE

v.

CLARA MEALEY, TYRONE GREEN, GEORGE
LEE SANDERS, SR., MARY COLLINS, STEVE
BRENGETTSY, EMMA DAVIS, DONNA GAYLOR,
VONTRICY McDANIEL, LINDA MONTGOMERY,
DOROTHY NIX, WILLIE ROBY, ALBERT
THOMPSON, TELETER TUCKER, JACQUELINE
WATKINS, MARY B. WILLIAMS, SHIRLEY
JOHNSON, DELORIS CORLEY, SABRINA
DIXON, CHARLENE JOHNSON, ANNIE KING,
ANNIE L. LEE, SHIRLEY McDANIEL, DAPHNE
MONTGOMERY, MARY WILSON, CHARLES
HUSBAND, TESSA SMITH AND WILLIAM
SMITH

DATE OF JUDGMENT:             8/29/2002
TRIAL JUDGE:                  HON. LILLIE BLACKMON SANDERS
COURT FROM WHICH APPEALED:    WILKINSON COUNTY CIRCUIT COURT
ATTORNEYS FOR APPELLANTS:     RICHARD L. JONES
                              ROBERT L. GIBBS
                              ANNE CLARKE SANDERS
                              ANDREA LA’VERNE FORD EDNEY
                              TESELYN AFRIQUE MELTON
                              BRIAN C. KIMBLE
                              ERNEST G. TAYLOR
                              JOHN BENTON CLARK
                              SHANDA L. LEWIS
                              C. MICHAEL ELLINGBURG
ATTORNEYS FOR APPELLEES:      J. BRAD PIGOTT
                              J. DOUGLAS MINOR
                              BARRY W. GILMER
NATURE OF THE CASE:           CIVIL - CONTRACT
DISPOSITION:                  AFFIRMED AND REMANDED - 06/10/2004
MOTION FOR REHEARING FILED:
MANDATE ISSUED:

       EN BANC.

       SMITH, CHIEF JUSTICE, FOR THE COURT:

¶1.    Plaintiffs filed an action in the Circuit Court of Wilkinson County against defendants

Pre-Paid Legal Services, Inc., Harlan C. Stonecipher, Brooks Werkheiser, Dyre Law Firm,

PLLC, and Arnold D. Dyre seeking redress for alleged misconduct including, but not limited

to, deceptive trade practices, conspiracy, fraud and negligence. Plaintiffs also sought a

declaratory judgment stating that they were under no contractual obligation to submit any

of the claims against any of the defendants to arbitration. Subsequently, plaintiffs filed a

motion for partial summary judgment as to the absence of any applicable arbitration clause

between the parties. The trial court granted the motion and found that none of the plaintiff’s

had signed any agreement which included an arbitration clause or any obligation or promise

to arbitrate any claim or dispute with any defendant or any entity affiliated with and

defendant. Furthermore, the court found that the purported arbitration clause of which

defendants seek the benefit is unconscionable and unenforceable under Mississippi law.

Aggrieved, the defendants have appealed the partial summary judgment and declaratory

judgment pursuant to the Federal Arbitration Act, 9 U.S.C. § 16(a)(2) and (3), asking this

Court to find that the plaintiffs are obligated to arbitrate their claims and that there exists a

genuine issue of material fact, which precludes summary judgment. We affirm and remand.

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                                             FACTS

¶2.    Clara Mealey and 26 other plaintiffs1 (Plaintiffs) commenced this action against Pre-

Paid Legal Services, Inc., Harlan C. Stonecipher, Brooks Werkheiser,2 Dyre Law Firm,

PLLC, and Arnold D. Dyre3 on June 17, 2002, in the Circuit Court of Wilkinson County,

Mississippi. They assert nine separate causes of action including (1) violation of the

Mississippi Deceptive Advertising Act, (2) violation of the Mississippi Deceptive Trade

Practices Act, (3) fraud, (4) civil conspiracy, (5) professional negligence, (6) negligent

misrepresentation, (7) breach of fiduciary duty, and (8) illegal payments. Plaintiffs also seek

a declaratory judgment that they are under no obligation to arbitrate any of these claims

against these defendants.

¶3.    Plaintiffs essentially claim that Pre-Paid used deceptive marketing practices to lure

them into signing a contract for legal services with National Pre-Paid Legal Services of

Mississippi, Inc. (National) that was grossly deficient in comparison to the services they

were told that they would receive. Harlan C. Stonecipher is the CEO and Chairman of the

Board for Pre-Paid. Brooks Werkheiser is a former Regional Vice President for Pre-Paid

and is currently a licensed agent of National Pre-Paid of Mississippi. Plaintiffs also assert

       1
        Tyrone Green, George Lee Sanders, Sr., Mary Collins, Steve Brengettsy, Emma Davis,
Donna Gaylor, Vontricy McDaniel, Linda, Dorothey Nix, Willie Roby, Albert Thompson,
Teleter Tucker, Jacqueline Watkins, Mary B. Williams, Shirley Johnson, Deloris Corley, Sabrina
Dixon, Charlene Johnson, Annie King, Annie L. Lee, Shirley McDaniel, Daphne Montgomery,
Mary Wilson, Charles Husband, Tessa Smith, and William Smith.
       2
          Pre-Paid Legal Services, Inc., Stonecipher, and Werkheiser will collectively be referred
to in the discussion section as "Pre-Paid," not to be confused with "National Pre-Paid of
Mississippi," which will be referred to, but is not a party to this action.
       3
           Dyre Law Firm, PLLC, and Arnold D. Dyre will collectively be referred to as "Dyre."

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that Dyre Law Firm and Arnold Dyre, individually, were accomplices in these alleged

misdeeds as the attorney that is provided for in the contracts signed with National.

¶4.    Subsequently, on July 22, 2002, plaintiffs filed a motion for partial summary

judgment as to the absence of any applicable arbitration clause. In response, the defendants

noted that all of the plaintiffs’ claims arose out of contracts they entered into for legal

services with National. The defendants also provided a copy of their standard contract which

contains the following provision in nine point font on the fifth page of a six-page contract:

       K. Settlement of Disputes: In the event of a dispute, the parties will agree on
       an impartial attorney who will decide such dispute and that decision will be
       binding on all parties to such dispute.

Defendants are non-signatories to these contracts, yet steadfastly maintain that they are

entitled to the protection of its arbitration provision.

¶5.    On August 29, 2002, the trial court entered an order granting plaintiffs’ motion for

partial summary judgment and declaratory judgment. The court ruled that the plaintiffs had

not signed an agreement to arbitrate the claims asserted in this matter and that the purported

arbitration clause put forth by the defendants was unconscionable and unenforceable. Final

judgment to this effect was entered on the same day.

¶6.    Both Pre-Paid and Dyre appeal pursuant to the Federal Arbitration Act, 9 U.S.C. §

16(a)(2) and (3). Defendants argue that the circuit court erred in finding that the plaintiffs

had no obligation to arbitrate their claims and that there were genuine issues of material fact

which preclude summary judgment. The plaintiffs filed a motion to dismiss the appeal, and

we denied the motion, finding the trial court order was a final decision with respect to

arbitration.

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                                        ANALYSIS

¶7.    The following issues are presented on appeal:

       I.     WHETHER THE TRIAL COURT ERRED BY ENTERING A
              FINAL JUDGMENT DECLARING THAT THE PLAINTIFFS’
              CLAIMS AGAINST THE PROVIDER COMPANY AND
              PROVIDER ATTORNEYS DO NOT REQUIRE ARBITRATION
              EVEN THOUGH PLAINTIFFS ENTERED INTO A PRE-PAID
              LEGAL SERVICES CONTRACT CONTAINING AN
              ARBITRATION CLAUSE.

       II.    WHETHER THE TRIAL COURT ERRED IN GRANTING THE
              PLAINTIFFS’ MOTION FOR PARTIAL SUMMARY
              JUDGMENT.

¶8.    This case and Pre-Paid Legal Services, Inc. v. Battle, 2004 WL 636292 have been

considered by this Court with all issues reviewed. Our recent decision in Pre-Paid v. Battle

controls the disposition of all issues raised in the case sub judice because the contract under

scrutiny is the same. In Pre-Paid v. Battle, we determined that there is not a valid, binding

arbitration agreement contained in this pre-paid legal expense agreement. Therefore, we

reach the same conclusion here.

                                      CONCLUSION

¶9.    For these reasons, we affirm the trial court’s judgment and remand this case for

further proceedings consistent with this opinion.

¶10.   AFFIRMED AND REMANDED.

     WALLER, P.J., EASLEY, CARLSON, GRAVES AND DICKINSON, JJ.,
CONCUR. COBB, P.J., DISSENTS WITHOUT SEPARATE WRITTEN OPINION.
DIAZ AND RANDOLPH, JJ., NOT PARTICIPATING.

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