Court Opinion

ID: 40574
Source: CourtListenerOpinion
Date Created: 2010-04-25 20:49:38+00
Date Added: 2024-06-11T09:39:10.728365
License: Public Domain

United States Court of Appeals
                                                                           Fifth Circuit
                                                                        F I L E D
                       REVISED JANUARY 26, 2006
                                                                       December 9, 2005
             IN THE UNITED STATES COURT OF APPEALS Charles R. Fulbruge III
                                                                              Clerk
                       FOR THE FIFTH CIRCUIT

                             No. 04-61031

     KATRINA BANKS, ET AL.

                                         Plaintiffs,

     KATRINA BANKS, ET AL.

                                          Plaintiffs-Appellees,

                                versus

     MITSUBISHI MOTORS CREDIT OF AMERICA, ET AL,

                                         Defendants,

     MITSUBISHI MOTORS CREDIT OF AMERICA, ET AL,

                                          Defendants-Appellants.

              Appeals from the United States District Court for
                    the Southern District of Mississippi
     _________________________________________________________

Before REAVLEY, DAVIS and WIENER, Circuit Judges.

                                  1
PER CURIAM:

      Reviewing the district court’s denial of Mitsubishi Motors Credit of America,

Inc. and Triad Financial Corporation’s (collectively “Appellants”) motions to

compel arbitration de novo, we reverse and remand for the following reasons:

      1.    The district court held that Appellants did not provide signed

      arbitration agreements, and therefore, failed to show that there existed a

      valid agreement to arbitrate between the parties. Appellants admit that they

      did not produce a copy of the signed arbitration agreements, but argue that

      they proffered the affidavit of John M. Thames, Jr., President of Thames

      Autoplex (hereinafter “Thames affidavit”) establishing that: (1) Appellees

      purchased cars from Thames Autoplex; (2) the signed arbitration agreements

      could not be located; (3) “Thames requires that every customer purchasing or

      attempting to purchase a vehicle from Thames execute an Arbitration

      Agreement” and that “[Appellees] could not have purchased the vehicles

      from Thames without having signed such an Arbitration Agreement”; and (4)

      Thames’ standard arbitration agreement applies to “all claims, demands,

      disputes or controversies of every kind or nature ... arising from, concerning

      or relating to any of the negotiations involved in the sale, lease or financing of

      the vehicle.” Because Appellees failed to provide any evidence in response

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to the Thames affidavit, it “was unimpeached and uncontradicted and its

credibility was in no manner brought into question.” United States v.

Johnson, 208 F.2d 729, 730 (5th Cir. 1953).

2.    Based on the Thames affidavit, Appellants contend that they proved

by a preponderance of the evidence that the parties agreed to arbitrate this

dispute. We agree.

      Arbitration must proceed by agreement: “[A]rbitration 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.” May v. Higbee Co., 372 F.3d 757,

763 (5th Cir. 2004) (quoting AT&T Techs., Inc. v. Communications Workers

of Am., 475 U.S. 643, 648, 106 S. Ct. 1415, 89 L.Ed.2d 648 (1986)).

Therefore, when considering a motion to compel arbitration, the court must

initially “determine whether the parties agreed to arbitrate the dispute in

question.” Webb v. Investacorp, Inc., 89 F.3d 252, 258 (5th Cir. 1996).

“This determination involves two considerations: (1) whether there is a valid

agreement to arbitrate between the parties; and (2) whether the dispute in

question falls within the scope of that arbitration agreement.” Id.

      Where the issue is whether the parties have a valid and enforceable

agreement to arbitrate, courts apply the contract law of the state governing the

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      agreement. Wash. Mut. Fin. Group, LLC v. Bailey, 364 F.3d 260, 264 (5th

      Cir. 2004). Mississippi contract law applies here.*

             Under Mississippi law, “where there is no writing to evidence the

      contract or the writing itself has been destroyed or lost, the parties may use

      ‘parol evidence’ or outside evidence to prove that a valid contract existed and

      what the terms of that contract were meant to be.” Murphree v. W.W.

      Transp., 797 So.2d 268, 273 (Miss. App. 2001) (citing Williams v. Evans,

      547 So.2d 54, 57 (Miss. 1989)). Accordingly, the loss or destruction of an

      instrument will not prevent its enforcement. See Bolden v. Gatewood, 164

      So.2d 721, 731 (Miss. 1964) (“It is also well settled that parol evidence is

      admissible to show the making of a contract which has been lost or

      destroyed.”). However, “a party must undertake a twofold burden in order

      to recover on a document that he cannot produce. Such a party must

      demonstrate both (a) the former existence and the present unavailability of the

      missing document, and (b) the contents of the missing document.” Williams,

      547 So.2d at 57 (quoting Connecticut Bank and Trust Co. v. Wilcox, 201

      *
        Neither party disputes that Mississippi law applies. Appellees are citizens
of Mississippi. In addition, the subject transactions were entered into in
Mississippi. Mississippi follows the “center of gravity” approach to choice-of-law
issues. See Boardman v. United Servs. Auto Ass’n, 470 So.2d 1024, 1031 (Miss.
1985).
                                          4
Conn. 570, 518 A.2d 928, 930 (1986)).

      We hold that the uncontradicted Thames affidavit shows by a

preponderance of the evidence: (1) the existence of an agreement to arbitrate

between the parties, albeit through circumstantial evidence that Appellees

purchased a car from Thames, every car purchaser is made to sign an

arbitration agreement, and that Appellees could not have purchased a car

without executing an arbitration agreement; (2) the present unavailability of

the arbitration agreement; and (3) the contents of the missing arbitration

agreement. Accordingly, we conclude that there was a valid agreement to

arbitrate between the parties.

3.     The district court determined that the other Plaintiffs’ claims in

this case, for which Appellants were able to produce signed copies of the

arbitration agreements, fell within the scope of the arbitration agreement.

Because Appellees asserted the same claims as the other Plaintiffs, their

arbitration agreements are identical, and Appellees do not contend that their

claims fall outside the scope of the arbitration agreement, we conclude that

Appellees’ claims fall within the scope of the arbitration agreement.

REVERSED AND REMANDED.

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