Adams, et al. v. Greenpoint Credit, LLC
| Docket Number: | 2004-CT-02415-SCT Linked Case(s): 2004-CA-02415-COA ; 2004-CT-02415-SCT ; 2004-CA-02415-COA |
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| Supreme Court: | Opinion Link Opinion Date: 12-07-2006 Opinion Author: RANDOLPH, JUSTICE Holding: THE JUDGMENT OF THE COURT OF APPEALS IS AFFIRMED IN PART AND VACATED IN PART. |
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| Additional Case Information: |
Topic: Contract - Arbitration - Third-party beneficiary Judge(s) Concurring: SMITH, C.J., WALLER AND COBB, P.JJ., EASLEY, CARLSON AND DICKINSON, JJ. Dissenting Author : DIAZ AND GRAVES, JJ Concur in Part, Dissent in Part 1: Diaz and Graves, JJ., Concur in Part and Dissent in Part Without Separate Written Opinion Procedural History: Dismissal Nature of the Case: CIVIL - CONTRACT Writ of Certiorari: yes Appealed from Court of Appeals |
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| Trial Court: |
Date of Trial Judgment: 11-01-2004 Appealed from: MONROE COUNTY CIRCUIT COURT Judge: Sharion R. Aycock Disposition: Granted Appellee's Motion to Dismiss & Motion to Compel Arbitration as to the claims asserted against GreenPoint, finding that “[p]ursuant to the terms of the Agreement and applicable law, Eddie Adams and Beth Brown are bound to submit their claims to arbitration … as required by the Agreement. Case Number: CV-02-509-BM |
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| Note: | The judgment of the court of appeals is affirmed in part and vacated in part. See the original COA opinion at http://www.mssc.state.ms.us/Images/OPINIONS/CO31912.PDF | |
| Party Name: | Attorney Name: | |||
| Appellant: | EDDIE ADAMS AND BETH BROWN |
W. HOWARD GUNN
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| Appellee: | GREENPOINT CREDIT, LLC AND SECURITY BANK OF AMORY | MICHAEL STEPHEN MACINNIS, C. MICHAEL MALSKI, JON JERDONE MIMS, JEFFREY DALE RAWLINGS |
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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 - Third-party beneficiary |
| Summary of the Facts: | Eddie Adams and his wife, Linda Adams, purchased a used mobile home. They entered into a “Retail Installment Contract, Security Agreement, Waiver of Trial by Jury and Agreement to Arbitration or Reference or Trial by Judge Alone (Contract)” with creditor BankAmerica Housing Services. The contract was assigned to GreenPoint, Inc. Several years later, GreenPoint drafted $232.69 from the joint checking account of Eddie Adams and Beth Brown, at Security Bank of Amory. The check was “Signed: Linda G. Adams” by “Authorized Representative Greenpoint Credit.” In fact, Linda G. Adams was deceased at the time the draft was presented. Adams and Brown discovered that GreenPoint had presented the draft to Security Bank and subsequently sued GreenPoint and Security Bank, asserting claims of fraud, negligence, intentional and/or negligent infliction of mental and emotional distress, breach of contract, and defamation. GreenPoint filed a motion to dismiss and to compel arbitration. The court granted the motion to dismiss and to compel arbitration as to the claims asserted against GreenPoint. Adams and Brown appealed, and the Court of Appeals affirmed in part and reversed and remanded in part, finding that Adams was properly compelled to submit to arbitration, while Brown was not. The Supreme Court granted certiorari. |
| Summary of Opinion Analysis: | The arbitration agreement stated that “[a]ny controversy or claim between or among you or me or our assignees arising out of or relating to this Contract or any agreements or instruments relating to or delivered in connection with this Contract, including any claim based on or arising from an alleged tort, shall, if requested by either you or me, be determined by arbitration, reference, or trial by judge as provided below.” Therefore, the Court of Appeals correctly found that Adams’ claims are subject to arbitration. GreenPoint concedes that Brown did not sign the contract. Moreover, the arbitration provision covers “you or me or our assignees ... .” Clearly, Eddie and Linda Adams constitute the “you;” the “me” is GreenPoint; and no claim is being made that Brown is an assignee. The plain language of the provision does not extend to Brown. However, arbitration agreements can be enforced against non-signatories if such nonsignatory is a third-party beneficiary. In order for the third person beneficiary to have a cause of action, the contracts between the original parties must have been entered for his benefit, or at least such benefit must be the direct result of the performance within the contemplation of the parties as shown by its terms. The right of the third party beneficiary to maintain an action on the contract must spring from the terms of the contract itself. In this case, nothing in the plain language of the arbitration provision indicates a clear intent of the parties to make Brown a third-party beneficiary. She did not sign the contract, was in no way alluded to in the contract, and, based on the record, received no benefits from the contract. As a non-signatory, non-third-party beneficiary, Brown is effectively a stranger to the contract. As Brown is not a third-party beneficiary to whom the benefits of the contract attach, she is not bound by the arbitration provision. Neither does the record support binding Brown to the arbitration provision under the doctrine of equitable estoppel. The record does not reflect that GreenPoint relied upon and detrimentally changed its position as a result of representations made by Brown. While the Court of Appeals correctly found Adams subject to arbitration under the contract he signed with GreenPoint, while Brown is not constrained by same, the Court of Appeals erred in granting a stay in the circuit court proceedings of Brown against GreenPoint and Security Bank. On remand it lies within the circuit judge’s discretion to stay the claims between the nonarbitrating parties pending outcome of the arbitration simply as a means of controlling its docket. |
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