AmSouth Bank v. Quimby
| Docket Number: | 2006-CA-00826-SCT | |
| Supreme Court: | Opinion Link Opinion Date: 09-06-2007 Opinion Author: WALLER, P.J. Holding: Affirmed |
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| Additional Case Information: |
Topic: Contract - Arbitration - Line of credit account - Retroactive application Judge(s) Concurring: SMITH, C.J., EASLEY, CARLSON, DICKINSON, RANDOLPH AND LAMAR, JJ. Concurs in Result Only: DIAZ, P.J., AND GRAVES, J. Procedural History: Bench Trial Nature of the Case: CIVIL - CONTRACT |
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| Trial Court: |
Date of Trial Judgment: 05-10-2006 Appealed from: SMITH COUNTY CIRCUIT COURT Judge: Robert G. Evans Disposition: Denied Appellant's Motion to Compel Arbitration Case Number: 2005-59 |
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| Party Name: | Attorney Name: | |||
| Appellant: | AMSOUTH BANK |
E. BARNEY ROBINSON, III |
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| Appellee: | CHARLES QUIMBY | STANLEY A. SOREY, EUGENE C. TULLOS |
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Synopsis provided by:  If you are interested in subscribing to the weekly synopses of all Mississippi Supreme Court and Court of Appeals hand downs please contact Tammy Upton in the MLI Press office. |
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| Topic: | Contract - Arbitration - Line of credit account - Retroactive application |
| Summary of the Facts: | Charles Quimby filed a complaint against AmSouth Bank and American Heritage Life Insurance Company alleging that their failure to pay benefits under a credit disability insurance policy constituted a tortious breach of contract and caused him emotional distress. Both defendants filed answers, and AmSouth filed a motion to compel arbitration. The circuit court denied the motion to compel arbitration. AmSouth appeals. |
| Summary of Opinion Analysis: | Quimby’s line of credit account, or loan, does not fall within the meaning of the various depository accounts listed and defined in the March 2000 and March 2004 Customer Agreements. Even if there is ambiguity within the Customer Agreements such that an argument could be made for its inclusion, ambiguity within a contract is construed against the drafter. The March 2004 and October 2004 Customer Agreements did not cover Quimby’s claims for another reason: There was no explicit, retroactive application language in any of the arbitration clauses. AmSouth relied on the use of the word ‘any’ in its Customer Agreements to indicate retroactive application. For example, the October 2004 arbitration clause stated a party may elect that “any controversy . . . relating to . . . any account. . .” be resolved by arbitration. The March 2004 Customer Agreement likewise covered “any account” or “the collection of any amounts due under the Agreement or any account.” In addition, there is evidence in the record that AmSouth did not intend its Customer Agreements to apply retroactively. Even if implied acceptance by continued use of the account was sufficient to bind Quimby to the arbitration terms in the March 2004 and October 2004 Customer Agreements, the effective dates of the Customer Agreements occurred after the accrual of his claims against AmSouth and American Heritage. The record supports the conclusion that the parties intended the revisions to the Customer Agreements to apply prospectively to claims which occurred after their stated effective dates. The record indicates that Quimby’s pursuit of his claims began after his disability, but before the effective dates of the 2004 Customer Agreements. A letter from American Heritage to Quimby’s counsel, dated November 19, 2002, indicated that Quimby’s failure to submit a proper notice of disability claim would result in the denial of benefits for lack of coverage. This letter is proof within the record that Quimby’s claims pre-dated the effective dates of the 2004 Customer Agreements. AmSouth argues that its revised Customer Agreement contains an arbitration clause that became effective March 17, 2000, and covers this dispute because its effective date preceded Quimby’s disability claim. The March 2000 revision indeed contained an arbitration clause. However, by its own terms, the March 2000 Customer Agreement did not apply to line of credit accounts. AmSouth argues that the explicit terms of the revised Customer Agreements submitted all questions concerning the scope of the arbitration agreement to the arbitrator. Since the March 2000 Customer Agreement, by its own terms, did not cover Quimby’s line of credit account, no revised Customer Agreement predating Quimby’s disability claim required the question of arbitrability to be submitted to an arbitrator. |
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