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Lost arbitration agreement is enforceable
January 25, 2006 by Ross Runkel at LawMemo

Sorry, Your Honor, but I just can't seem to find the arbitration agreement that the customer signed. Can you help me out?

It seemed that a customer bought a car, and then some dispute arose between the customer and the car dealer. The dealer resisted having the dispute resolved in court, arguing that the customer had signed a written agreement to arbitrate. The only hitch was that the dealer could not produce the written agreement.

The lower court held that failure to produce the written agreement meant that there was a failure to prove that there was an agreement to arbitrate. (I can hear my first year law students laughing at this one.)

The dealer produced an affidavit to the effect that the dealer sold the car, all such transactions have arbitration agreements attached to them, and the form of the agreement would include the current dispute.

The 5th Circuit held that under the law of Mississippi it is not required that a party produce the writing if there is (1) proof that the writing actually existed at one time plus (2) proof of what was in the writing. (Can there possibly be a state that does not follow that rule?)

The question of whether there was an agreement to arbitrate is a question of state law, so the court held that the dispute must be arbitrated.

The case is Banks v. Mitsubishi Motors Credit (5th Cir 12/09/2005). Issued per curiam, no doubt because it was a no-brainer.

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