Arbitration - Vehicle Fire - Non-Signatory Vehicle Manufacturer - Nissan North America v. Scott


Nissan North America v. Scott, [Ms. 1160656, Aug. 11, 2017] __ So. 3d __ (Ala. 2017). This unanimous decision by Justice Sellers (Stuart, C.J., and Parker, Shaw, and Wise, JJ., concur) reverses the trial court’s order requiring Nissan to arbitrate claims arising from a vehicle fire. Plaintiff purchased a new 2015 Nissan Juke from Jack Ingram Motors, Inc. (“Jack Ingram”). The vehicle subsequently spontaneously caught fire and plaintiff sued Jack Ingram and Nissan for personal injuries.

Pursuant to an arbitration agreement in the sales contract, Jack Ingram moved to compel arbitration. The plaintiff conceded that she was obligated to arbitrate her claims against Jack Ingram, but argued that she should not be required to arbitrate with Jack Ingram and to litigate with Nissan, and that the trial court should either order both Ingram and Nissan to arbitrate plaintiff’s claims or require Jack Ingram and Nissan to litigate plaintiff’s claims. The trial court granted Jack Ingram’s motion to compel arbitration and also required Nissan to arbitrate. Ms. at 6.

On Nissan’s appeal, the Court concluded that the circuit court erred in requiring the nonsignatory manufacturer to arbitrate.

The trial court agreed with Scott to compel Nissan, a nonsignatory to their arbitration agreement, to arbitrate the claims asserted against it, citing “judicial economy” as the reason for its holding. Judicial economy, however, is not a proper basis for compelling arbitration against a nonsignatory.


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