         IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA

                                January 2020 Term                       FILED
                                                                     April 10, 2020
                                                                        released at 3:00 p.m.

                                   No. 18-0605                      EDYTHE NASH GAISER, CLERK
                                                                    SUPREME COURT OF APPEALS
                                                                         OF WEST VIRGINIA



      TD AUTO FINANCE LLC, FOCUS RECEIVABLES MANAGEMENT,
             and NORTHSTAR LOCATION SERVICES, LLC,
                     Defendants Below, Petitioners

                                        v.

               FREDDIE REYNOLDS and SHELBY REYNOLDS,
                       Plaintiffs Below, Respondents


           Appeal from the Circuit Court of Mercer County, West Virginia
                         The Honorable Mark Wills, Judge
                          Civil Action No. 17-C-372-MW

                                   AFFIRMED


                            Submitted: January 15, 2020
                               Filed: April 10, 2020


Daniel J. Konrad, Esq.                       Raymond S. Franks, II, Esq.
DINSMORE & SHOHL LLP                         BAILEY & GLASSER, LLP
Huntington, West Virginia                    Charleston, West Virginia
Attorney for Petitioners                     Steven J. Broadwater, Jr., Esq.
                                             HAMILTON, BURGESS, YOUNG
                                              & POLLARD, PLLC
                                             Fayetteville, West Virginia
                                             Attorneys for Respondents


JUSTICE WORKMAN delivered the Opinion of the Court.
JUSTICE HUTCHISON concurs and reserves the right to file a separate opinion.
CHIEF JUSTICE ARMSTEAD and JUSTICE JENKINS dissent and reserve the right to
file separate opinions.
                              SYLLABUS BY THE COURT


              1.      “When an appeal from an order denying a motion to dismiss and to

compel arbitration is properly before this Court, our review is de novo.” Syl. Pt. 1, W. Va.

CVS Pharmacy, LLC v. McDowell Pharmacy, Inc., 238 W.Va. 465, 796 S.E.2d 574 (2017).



              2.     “When a trial court is required to rule upon a motion to compel

arbitration pursuant to the Federal Arbitration Act, 9 U.S.C. §§ 1–307 (2006), the authority

of the trial court is limited to determining the threshold issues of (1) whether a valid

arbitration agreement exists between the parties; and (2) whether the claims averred by the

plaintiff fall within the substantive scope of that arbitration agreement.” Syl. Pt. 2, State

ex rel. TD Ameritrade, Inc. v. Kaufman, 225 W.Va. 250, 692 S.E.2d 293 (2010).



              3.     “‘Separate written instruments will be construed together and

considered to constitute one transaction where the parties and the subject matter are the

same, and where there is clearly a relationship between the documents.’ Syllabus point 3,

McCartney v. Coberly, –––W.Va. ––––, 250 S.E.2d 777 (1978), overruled on other

grounds by Syllabus point 2, Overfield v. Collins, 199 W.Va. 27, 483 S.E.2d 27 (1996).”

Syl. Pt. 1, McDaniel v. Kleiss, 202 W. Va. 272, 273-74, 503 S.E.2d 840, 841-42 (1998).



              4.     “Ordinarily an assignee acquires no greater right than that possessed

by his assignor, and he stands in his shoes; and an assignee takes subject to all defenses

and all equities which could have been set up against an instrument in the hands of an

                                              i
assignor at the time of the assignment.” Syl. Pt. 10, Lightner v. Lightner, 146 W.Va. 1024,

124 S.E.2d 355 (1962).




                                            ii
WORKMAN, Justice:

                This is an appeal from the Circuit Court of Mercer County’s denial of

petitioners TD Auto Finance LLC (“TD Auto Finance”), Focus Receivables Management,

LLC, and Northstar Location Services, LLC’s (collectively “petitioners”) motion to

compel arbitration of respondents Freddie and Shelby Reynolds’ (“respondents”) claims

against them. The circuit court found that a merger clause in the Retail Sales Installment

Contract supplanted a prior agreement to arbitrate contained in a credit application

executed by respondents.



               Upon careful review of the briefs, the appendix record, the arguments of the

parties, and the applicable legal authority, we conclude that the credit application and Retail

Installment Sales Contract did not constitute contemporaneously-executed documents

which were part of a singular transaction. As such, the merger clause contained in the

Retail Installment Sales Contract served to supersede the arbitration agreement contained

in the previously-executed credit application and contained no requirement to arbitrate.

Accordingly, we affirm the circuit court’s denial of petitioners’ motion to compel

arbitration.



                      I. FACTS AND PROCEDURAL HISTORY

               On November 14, 2014, respondents purchased a new 2014 Chevrolet

Silverado truck from Crossroads Chevrolet (“Crossroads”). During their interactions with

Crossroads, respondents executed a credit application permitting Crossroads to effectively

                                              1
investigate and “shop” their credit around to potential financing companies for the purchase

of a vehicle. Upon negotiating and reaching an agreement as to the purchase of a 2014

Chevrolet Silverado, respondents subsequently executed a Retail Installment Sales

Contract (“RISC”) for the purchase of the truck.



              The credit application first executed by respondents states that by executing

the application, respondents “authorize dealer and any finance company, bank or other

financial institution to which the Dealer submits my application,” to investigate their credit

and employment history. The form credit application contains a paragraph that applies to

“applications submitted to TD Auto Financial LLC Only” and provides that “in exchange

for the time, effort, and expense in reviewing your application and for other valuable

consideration . . . [respondents] agree to all of the terms of the TD Auto Finance LLC

Contract of Arbitration contained in [the] application . . . .” The “Contract of Arbitration,”

which comprises page six 1 of the credit application, provides:

              Any claim or dispute, whether in contract, tort or otherwise
              (including any dispute over the interpretation, scope, or
              validity of this Important Contract of Arbitration or the
              arbitrability of any issue), between our employees, parents,
              subsidiaries, affiliate companies, agents, successors or
              assignees, which arises out of or relates to this application and
              Important Contract of Arbitration, any installment sale contract
              or lease agreement, or any resulting transaction or relationship
              (including any such relationship with third parties who do not
              sign this application and important Contract of Arbitration)


       1
        There is no page five of the document (skipping from page four to page six);
however, petitioners’ counsel represented that there was no such page in the document and
the non-serial page numbering was an error of some sort.
                                              2
              shall, at the election of any of us . . . . be resolved by a neutral,
              binding arbitration and not by a court action.

The record contains no information about precisely when, during the course of

respondents’ interaction with Crossroads, this document was executed. However, in oral

argument below and before this Court, counsel for petitioners conceded that common sense

suggests it was executed at some point prior to the RISC, as a necessary precursor to the

sales transaction.



              The RISC was executed by respondents and Crossroads to consummate the

purchase of the truck. The RISC provides that it is for the purchase of a 2014 Chevrolet

Silverado in the amount of $37,700.21 and financing in the amount of $46,811.18. The

final page of the document contains what is commonly known as a “merger” or

“integration” clause, as follows: “HOW THIS CONTRACT CAN BE CHANGED. This

contract contains the entire agreement between you and us relating to this contract. Any

change to this contract must be in writing and we must sign it. No oral changes are

binding.”



              This specific paragraph is signed by both respondents and a representative of

Crossroads. Importantly, however, the document concludes with a contemporaneous

assignment of the RISC from Crossroads to petitioner TD Auto Finance.                 The final

paragraph states: “Seller assigns its interest in this contract to TD AUTO FINANCE LLC

(Assignee) under the terms of Seller’s agreement(s) with Assignee.” It is signed by the



                                               3
President of Crossroads Chevrolet LLC. Petitioner TD Auto Finance’s name has been

typed into the form.



               Respondents ultimately defaulted on their loan and petitioner TD Auto

Finance began collection efforts by referral to collection agencies—petitioners Focus

Receivables Management, LLC and Northstar Location Services, LLC. Respondents

allege that the collection agencies harassed them by phone even after being advised they

were represented by counsel. As a result, they filed a complaint asserting violations of the

West Virginia Consumer Credit and Protection Act, among other claims, 2 and naming

petitioners as defendants. Petitioners moved to compel arbitration on the basis of the

arbitration provision contained in the credit application. 3



               The circuit court denied the motion, finding that the credit application and

attendant arbitration clause constituted “an entirely separate transaction” from the RISC

inasmuch as “typically” a credit check and application precedes the negotiations regarding




       2
         In addition to their claims under the West Virginia Consumer Credit and Protection
Act, respondents alleged violations of the West Virginia Computer Crimes Act, intentional
infliction of emotional distress, and invasion of privacy.
       3
        In a supplemental filing below, petitioners asserted that the issue of arbitrability
must be determined by the arbitrator, rather than the circuit court, as a result of the
purported delegation provision in the arbitration agreement. The circuit court did not
address this issue and petitioners do not raise it in this appeal.

(continued . . .)
                                              4
the sale. 4 Accordingly, it found that the credit application and RISC were not part of the

same transaction and therefore were not required to be construed together. Further, the

circuit court found that petitioners’ failure to have an arbitration agreement signed at the

same time as the RISC, included in the RISC, or at a minimum, incorporated by reference

into the RISC, was fatal to its claim for arbitration. Petitioners then filed the instant appeal.



                              II. STANDARD OF REVIEW

              This Court has held that “[w]hen an appeal from an order denying a motion

to dismiss and to compel arbitration is properly before this Court, our review is de novo.”

Syl. Pt. 1, W. Va. CVS Pharmacy, LLC v. McDowell Pharmacy, Inc., 238 W.Va. 465, 796

S.E.2d 574 (2017). With this standard in mind, we consider the parties’ arguments.


                                     III. DISCUSSION

              With respect to a trial court’s consideration of a motion to compel arbitration,

this Court has held:

                     When a trial court is required to rule upon a motion to
              compel arbitration pursuant to the Federal Arbitration Act, 9
              U.S.C. §§ 1–307 (2006), the authority of the trial court is
              limited to determining the threshold issues of (1) whether a
              valid arbitration agreement exists between the parties; and (2)
              whether the claims averred by the plaintiff fall within the
              substantive scope of that arbitration agreement.




       4
         The circuit court noted that there was no evidence presented as to specifically when
the arbitration agreement was signed, but found that “the auto dealer cannot make an offer
especially as to financing rate terms until after the buyer has a credit check.” As indicated
supra, counsel for petitioners conceded to this order of events.
                                               5
Syl. Pt. 2, State ex rel. TD Ameritrade, Inc. v. Kaufman, 225 W.Va. 250, 692 S.E.2d 293

(2010). This case therefore requires this Court to determine whether the circuit court erred

in determining that no valid arbitration agreement existed. To do so, we turn to governing

West Virginia contract law: “[T]he issue of whether an arbitration agreement is a valid

contract is a matter of state contract law and capable of state judicial review.” State ex rel.

Clites v. Clawges, 224 W. Va. 299, 305, 685 S.E.2d 693, 699 (2009) (emphasis in original).

See also Chesapeake Appalachia, L.L.C. v. Hickman, 236 W. Va. 421, 436, 781 S.E.2d

198, 213 (2015) (observing that whether a valid arbitration agreement exists is determined

“[u]nder general principles of state contract law”); Syl. Pt. 4, in part, State ex rel. Richmond

Am. Homes of W. Va., Inc. v. Sanders, 228 W. Va. 125, 717 S.E.2d 909 (2011) (“[T]he trial

court may rely on general principles of state contract law in determining the enforceability

of the arbitration clause.”).



              The issue before the Court is whether the arbitration provision respondents

agreed to in the credit application survives the “merger clause” in the RISC, which states

that the RISC constitutes the “entire agreement” between the parties. This Court has

explained that “[a] ‘merger clause’ is ‘[a] provision in a contract to the effect that the

written terms may not be varied by prior or oral agreements because all such agreements

have been merged into the written document.’” Frederick Bus. Properties Co. v. Peoples

Drug Stores, Inc., 191 W. Va. 235, 240 n.2, 445 S.E.2d 176, 181 n.2 (1994) (quoting

Black’s Law Dictionary 989 (6th ed. 1990)). Under the credit application, there is a clear

agreement to arbitrate with TD Auto Finance; however, the RISC contains no such

                                               6
arbitration agreement nor reference to the prior agreement, and explicitly purports to be the

“entire agreement” between the parties. 5



              Petitioners contend that the arbitration agreement contained in the credit

application and the RISC, which is silent on dispute resolution, are not in conflict and

unmistakably demonstrate an agreement to arbitrate any claims involving petitioner TD

Auto Finance. Citing highly similar extra-jurisdictional caselaw, petitioners contend that

the arbitration agreement and RISC are “separate and distinct” collateral documents

executed as part of a singular transaction and therefore must be construed together.

Respondents, also citing factually-similar caselaw supportive of its position, maintain that

the scope and purpose of the credit application was substantially unrelated to the ultimate

vehicle purchase and therefore is merely a prior agreement which was “merged” into the

RISC. The RISC, which respondents contend is the governing document, contains no

requirement to arbitrate.



              Several courts have had opportunity to examine the effect of a merger clause

on separately executed arbitration agreements in cases with similar facts—vehicle

purchasers who agree to arbitrate in one document but contemporaneously sign an

installment sales contract that contains no arbitration provision, but includes a merger



       5
          Petitioners contend that the RISC is effectively a “third-party” contract that cannot
affect its arbitration rights under the credit application inasmuch as Crossroads, and not TD
Auto Finance, executed the RISC. As more fully discussed infra, this argument is without
merit.
                                              7
clause stating that it is the “entire agreement.” These courts have universally cited to some

iteration of the following well-recognized contract principle:       “[A]bsent anything to

indicate a contrary intention, written instruments executed at the same time, by the same

contracting parties, for the same purpose, and in the course of the same transaction will be

considered and construed together as one contract or instrument, even though they do not

by their terms refer to each other.” 11 Williston on Contracts § 30:26 (4th ed.).



              For example, in Johnson ex rel. Johnson v. JF Enterprises, LLC 400 S.W.3d

763, 768 (Mo. 2013), the Missouri Supreme Court rested its resolution on the “general rule

that contemporaneously signed documents relating to one subject matter or transaction are

construed together[.]” The Johnson court found that a separate, stand-alone arbitration

agreement was enforceable where it was executed as one of a “pile of documents” which

were executed “within minutes of each other, in a single sitting, as part of a single sales

transaction.” Id. at 768. Explaining that “[t]o protect the sanctity of the parties’ written

contract, all the provisions in the writing can and should be harmonized and given effect,”

it concluded that a valid arbitration agreement was created. Id. at 768. See also Kates v.

Chad Franklin Nat’l Auto Sales North, LLC, No. 08-0384-CV-W-FJG, 2008 WL 5145942,

at *4 (W.D. Mo. Dec. 1, 2008) (finding stand-alone arbitration agreement applicable and

observing “the merger clause does not prohibit the forming of a separate arbitration

agreement contemporaneously with the other contracts in this matter.”).




                                             8
              Similarly, in Najera v. David Stanley Chevrolet, Inc., 406 P.3d 592 (Okla.

Civ. App. 2017), the court found an arbitration agreement contained in a previously

executed purchase agreement 6 was not rendered a nullity by the merger clause in the RISC.

The court reasoned that by signing numerous documents contemporaneously, the totality

of the documents formed the agreement and that to conclude that the RISC was the “only

and complete agreement of the parties, execution of these other [contemporaneously-

executed] documents would be rendered nugatory.” Id. at 597. See also Ramick v.

Howard-GM II, Inc., 414 P.3d 397, 400 (Okla. Civ. App. 2018) (requiring RISC to be

construed with purchase agreement requiring arbitration where contracts were “‘relating to

the same matters’” and “‘parts of substantially one transaction’” (citations omitted)). The

Najera court relied on the Tenth Circuit’s reasoning in Mooneyham v. BRSI, LLC, 682 Fed.

Appx. 655, 660 (2017) which found that the merger clause may have precluded

“incorporation of other agreements into the RISC[] [b]ut the clause doesn’t preclude

incorporation of other agreements into the transaction as a whole.”




       6
          Importantly, however, the Purchase Agreement in Najera containing the
arbitration provision also provided that the agreement “and all written contracts relating to
the same transaction . . . and made as part of substantially the same transaction . . . shall be
taken together and read as one document setting forth the terms of the parties agreement.”
Id. at 595 (emphasis in original). See also Bank Julius Baer & Co., Ltd. v. Waxfield Ltd.,
424 F.3d 278 (2d Cir. 2005) abrogated on other grounds by Granite Rock Co. v. Int’l Bhd.
of Teamsters, 561 U.S. 287 (2010) (finding merger clause “at odds” with Purchase
Agreement incorporation clause providing that rights and remedies in Agreement,
including arbitration, are “cumulative and not exclusive of any rights or remedies provided
under any other agreement”).
                                               9
              Courts in other states have used similar reasoning to conclude that a merger

clause does not necessarily foreclose the enforceability of agreements reached in collateral

documents, where they are contemporaneously executed as part of a single transaction. See

Ritter v. Grady Automotive Group, Inc., 973 So.2d 1058, 1062 (Ala. 2007) (finding stand-

alone arbitration agreement valid and holding merger clause “does not bar evidence of

contemporaneous collateral agreements between the parties”); Lowe v. Nissan of Brandon,

Inc., 235 So.3d 1021 (Fla. Dist. Ct. App. 2018) (upholding arbitration agreement in

Purchase    Agreement      where    executed      with   other   purchase   documentation

contemporaneously); Wells Fargo Auto Finance, Inc. v. Wright, 698 S.E.2d 17, 19 (Ga. Ct.

App. 2010) (finding stand-alone arbitration agreement valid where “retail sales contract,

installment contract, and the [Arbitration] Agreement were executed simultaneously”);

Bartkus v. Thomas Motors of Joliet, Inc., No. 09-C-3005, 2009 WL 2766719 (N.D. Ill.

Aug. 27, 2009) (suggesting that contemporaneous execution of RISC and purchase order

requiring arbitration supersedes merger clause). 7



              Other courts, however, have interpreted merger clauses more strictly,

refusing to allow predecessor or contemporaneous documents, which purport to add to or


       7
         The Fourth Circuit has reached the same conclusion under similar facts, which has
been followed as precedent by the Maryland Court of Appeals. See Rota-McLarty v.
Santander Consumer USA, Inc., 700 F.3d 690, 700 (4th Cir. 2012) (“[T]he Buyer’s Order
and RISC were made a part of a single transaction, and should be interpreted together[.]”);
see also Ford v. Antwerpen Motorcars Ltd., 117 A.3d 21 (Md. 2015) (citing Rota-McLarty
in support of rejection of merger clause in RISC as supplanting separate agreement to
arbitrate in Buyer’s Order).

                                             10
alter the “final agreement,” to require arbitration or other matters. In Duval Motors Co. v.

Rogers, 73 So.3d 261 (Fla. Dist. Ct. App. 2011), the purchaser signed a Retail Buyer’s

Order containing an arbitration agreement, as well as a RISC containing the identical

merger language as in the case at bar. The Duval court explained that the purpose of a

merger clause is “‘to affirm the parties’ intent to have the parol evidence rule applied to

their contracts.’” Id. at 265 (citations omitted). And as such, the parol evidence rule

“precludes consideration of . . . evidence ‘to contradict, vary, defeat, or modify a complete

and unambiguous written instrument, or to change, add to, or subtract from it, or affect its

construction.’” Id. (citations omitted). The court therefore found that the integration or

merger clause precluded applicability of the arbitration provision in the other document.

See also Weiszhaar v. Hampton Automotive Group, Inc., No. 5:12-cv-46/RS-GRJ, 2012

WL 2034783 (N.D. Fla. June 6, 2012) (same).



              Likewise, the Florida appeals court in HHH Motors, LLP v. Holt, 152 So.3d

745, 748 (Fla. Dist. Ct. App. 2014) found that a purchase agreement containing an

arbitration provision did not survive the merger clause in the RISC, stating succinctly: “If

[the dealer] intended for credit buyers to be subject to the arbitration clause, then it could

have said so in the RISC, but did not.” Accord Harbor Village Home Center, Inc. v.

Thomas, 882 So.2d 811, 816 (Ala. 2003) (finding that retail installment contract was “fully

integrated agreement of the parties” and rejecting arbitration agreement which contained

no purchase terms nor merger clause of its own); Ex parte Palm Harbor Homes, Inc., 798

So.2d 656, 661 (Ala. 2001) (finding that drafters of installment contract “could easily have

                                             11
included in the merger clause a specific reference to . . . free-standing instruments, thus

identifying the instrument as a part of the integrated agreement” but failure to do so

precluded consideration of arbitration provisions contained in free-standing documents);

Salvagne v. Fairfield Ford, Inc., 794 F. Supp.2d 826, 832 (S.D. Ohio 2010) (finding RISC

to be “standing alone, a fully integrated contract that by its terms was binding” and rejecting

argument that terms contained in delivery agreement may alter RISC); Gonzalez v.

Consumer Portfolio Servs., Inc., No. CL04-00092, 2004 WL 2334765 (Cir. Ct. of Va.,

Rockingham Co. Sept. 2, 2004) (refusing to enforce arbitration due to merger clause in

RISC and construing contract against drafter).



              Like the courts above, this Court has also recognized, generally, that

contemporaneous documents which comprise a single transaction may be construed

together:

                     “Separate written instruments will be construed
              together and considered to constitute one transaction where the
              parties and the subject matter are the same, and where there is
              clearly a relationship between the documents.” Syllabus point
              3, McCartney v. Coberly, –––W.Va. ––––, 250 S.E.2d 777
              (1978), overruled on other grounds by Syllabus point 2,
              Overfield v. Collins, 199 W.Va. 27, 483 S.E.2d 27 (1996).

Syl. Pt. 1, McDaniel v. Kleiss, 202 W. Va. 272, 503 S.E.2d 840 (1998). Elaborating on

this general rule, the McDaniel Court explained that “we have found a single contract to

exist where the two agreements were signed contemporaneously or where the earlier

contract was specifically referenced in the later contract.” Id. at 279, 503 S.E.2d at 847.



                                              12
We have not, however, had occasion to address the effect of a merger clause on this general

principle.



               While the cases argued by the parties represent divergent approaches to the

effect of a merger clause on contemporaneously-executed documents and are tantalizingly

similar in their facts, we find that this case does not require the Court to cast its lot with

one approach or the other. Rather, our general rule on the construction of competing

contractual agreements along with the particular facts of this case are sufficient to resolve

the issue at hand. As noted above, our rule provides that contemporaneously executed

agreements between the same parties and relating to the same subject matter may be

construed together as part of one contract or transaction.              Commensurately, the

distinguishing factors in the cases cited by petitioners reveal that the competing documents

were 1) signed contemporaneously as part and parcel of a larger purchase transaction; and

2) were either purchase-type agreements which, like the RISC, purport to govern the

purchase or stand-alone arbitration agreements executed during consummation of the

transaction.



               In this case, however, it is undisputed that the credit application 1) was signed

before and not contemporaneously with the RISC in consummation of the purchase; and

2) was not, by its subject matter, part or parcel of the purchasing documents or transaction.

The credit application is merely an authorization to investigate respondents’ credit score

and employment information and present that information to various finance companies to

                                              13
determine which company may wish to extend financing to them. The credit application

is not part of the purchase transaction documentation and governs an entirely different

subject matter—the credit investigation and approval process. There is nothing about a

simple credit application which ostensibly purports to govern any of the terms of the

ultimate vehicle purchase or financing. See Lowe, 235 So.3d at 1027 (“‘The test for

determining arbitrability of a particular claim under a broad arbitration provision is whether

a “significant relationship” exists between the claim and the agreement containing the

arbitration clause, regardless of the legal label attached to the dispute.’” (quoting Murphy

v. Courtesy Ford, LLC, 944 So.2d 1131, 1133 (Fla. Dist. Ct. App. 2006)); cf. Ashland Oil,

Inc. v. Donahue, 159 W. Va. 463, 469, 223 S.E.2d 433, 437 (1976) (finding lease

agreement and dealer contract sufficiently related where both “deal with the operation of a

gasoline station at identified premises[;] provide for the same initial term and automatic

extensions from year to year; [] provide for the sale and delivery of gasoline; [] provide for

the conduct of the business on the part of Donahue with skill and diligence”).



              In this regard, the McDaniel case is instructive. In McDaniel, the Court

examined an insurance policy and subsequent release to determine whether their terms

were conflicting and which document governed the parties’ responsibilities as pertained to

preserving the insurance company’s subrogation rights. The Court determined that the

policy and release, while plainly related to each other, were “two separate and distinct

contracts” by virtue of the “difference in the subject matter addressed in each document[.]”

Id. at 278-79, 503 S.E.2d at 846-47. Acknowledging the relationship between the two

                                             14
documents, the Court stated that “absent the existence of the automobile insurance policy,

there would have been no reason for Aetna to negotiate the release.” Id. at 279, 503 S.E.2d

at 847. However, it found that “this fact alone [is] insufficient upon which to find that the

two documents are so closely related that they become a single contract.” Id. While the

insurance contract may have given rise to the coverage for the loss described in the release,

the release itself purported to govern the terms of a “particular known loss.” Id.



              Similarly, here, while the credit application may have been a common

precursor to a vehicle purchase governed by a RISC, the completely different subject

matter of the two documents and lack of contemporaneous execution—which also

demonstrates their distinct purposes—are insufficient to view them as part of a single

transaction. Therefore, the RISC and its merger clause—stating that it represents the

“entire agreement” between the parties as pertains to the purchase of the vehicle—must

govern. The RISC’s failure to include an arbitration provision or incorporate by reference

any prior arbitration agreement, therefore, is fatal to petitioners’ demand for arbitration.



              Petitioners, however, maintain that the arbitration agreement language in the

credit application specifically extended the requirement to arbitrate to any subsequently-

executed RISC and therefore serves to effectively “reach out” and incorporate itself into

the RISC. As indicated, the arbitration provision in the credit application states that it

applies to “any installment sale contract or lease agreement, or any resulting transaction or

relationship . . . .” This language, however, is fully at odds with the purpose of the merger

                                             15
clause contained in the RISC: to merge any preexisting agreements into one, final

agreement governed exclusively by the terms contained within the four corners of the

RISC. To make the preexisting arbitration agreement applicable to the RISC, the opposite

must have occurred: the final, “entire” agreement—the RISC—should have incorporated

the prior arbitration agreement by reference. Cf. Art’s Flower Shop v. Chesapeake &

Potomac Tel. Co., 186 W.Va. 613, 615, 413 S.E.2d 670, 672 (1991) (finding prior contract

incorporated by reference where subsequent contract specifically stated “‘all other terms

and conditions to remain as previously signed’”).              Other courts have similarly

rejected this attempted “reverse incorporation.” See Salvagne, 794 F. Supp.2d at 833

(“[T]he RISC must clearly reach out and incorporate the [prior] Spot Delivery Agreement,

not the other way around.”); Duval Motors, 73 So.3d at 269 ([T]he important inquiry is

whether the [final] RISC incorporates the [prior Buyer’s Order], not whether the [Buyer’s

Order] incorporates the RISC.”). 8



              Finally, we dispense with petitioners’ contention that, since Crossroads was

the original signatory to the RISC, petitioners’ rights under the credit application arbitration


       8
         Further, the unlimited scope of such an attempted “reverse incorporation” leads to
an absurd, theoretical possibility: that respondents would be obligated to arbitrate any
claim arising out of any subsequent transaction or relationship regardless of how attenuated
in time or subject matter. This untenable reading, coupled with tedious and frequently
indecipherable competing documents foisted upon vehicle purchasers make Justice
McDonald’s sardonic comment particularly apt: “[A] lay person interested in buying a []
car would be well advised to bring along a lawyer, a magnifying glass, and perhaps an
English major, to decipher [sales contracts].” Antwerpen Motorcars, 117 A.3d at 29
(McDonald, J., concurring).

                                              16
agreement cannot be affected by the terms of what is essentially a third-party contract

between respondents and Crossroads. As assignee of the RISC, petitioner TD Auto

Finance stands in the shoes of Crossroads. Therefore, for purposes of examining the

formation, validity, and enforceability of the RISC and defenses thereto, the fact that

petitioner TD Auto Finance is not an original signatory, but rather an assignee, is of no

consequence. As is universally-recognized:

                    [A]n assignee acquires no greater right than that
             possessed by his assignor, and he stands in his shoes; and an
             assignee takes subject to all defenses and all equities which
             could have been set up against an instrument in the hands of an
             assignor at the time of the assignment.

Syl. Pt. 10, Lightner v. Lightner, 146 W.Va. 1024, 124 S.E.2d 355 (1962). Therefore,

             “‘[t]he assignee is subject to any defenses that would have been
             good against the [assignor]; the assignee cannot recover more
             than the assignor could recover; and the assignee never stands
             in a better position than the assignor.’” “[A]n assignee gains
             nothing more, and acquires no greater interest than had his
             assignor.” In other words, “the common law puts the assignee
             in the assignor’s shoes, whatever the shoe size.”

             ***

             Corbin on Contracts states, “[t]he essential purpose of the
             principle is to protect the obligor, the party who must perform
             the correlative duty of the assigned right,” so that the risk to
             the obligor is not materially enlarged over the risk created by
             its agreement with the assignor. In other words, the purpose
             behind the rule is that an assignee has rights and liabilities
             identical to those of its assignor.




                                           17
Sunridge Dev. Corp. v. RB & G Eng’g, Inc., 230 P.3d 1000, 1003-04 (Utah 2010) (citations

omitted) (emphasis added). 9 Therefore, to the extent that Crossroads could not have

compelled respondents to arbitrate their claims due to the absence of such an agreement in

the RISC, neither can petitioners. Accordingly, we conclude that the arbitration provisions

in the credit application did not survive the merger clause of the RISC, thereby nullifying

respondents’ obligation to arbitrate their claims against petitioners.



                                   IV. CONCLUSION

               For the reasons set forth hereinabove, we affirm the June 8, 2018, order of

the Circuit Court of Mercer County, West Virginia, denying petitioners’ motion to compel

arbitration.

                                                                                   Affirmed.




       9
         In a similar vein, while not argued by respondents, we further find that petitioners
are likely estopped from disavowing the merger clause contained in the RISC. When
respondents defaulted on their vehicle loan, petitioners sought to collect the debt
presumably pursuant to the terms of the RISC, as its assignee. Petitioners cannot avail
themselves of the terms of the RISC for purposes of collection, but disavow the
applicability of certain other of its terms: “[A] party may be estopped from asserting
[defenses which] preclude[] enforcement of the contract’s [provisions] when he has
consistently maintained that other provisions of the same contract should be enforced to
benefit him.” Int’l Paper Co. v. Schwabedissen Maschinen & Anlagen GMBH, 206 F.3d
411, 418 (4th Cir. 2000). See Invista S.A.R.L. v. Rhodia, S.A., 625 F.3d 75, 85 (3d Cir.
2010) (noting estoppel prevents party “from ‘cherry-picking’ the provisions of a contract
that it will benefit from and ignoring other provisions that don't benefit it or that it would
prefer not to be governed by”); see also, e.g. Lowe, 235 So.3d at 1027 (observing that “the
essential terms of the contract for the [] claim Ms. Lowe raises” were contained in
arbitration-requiring Purchase Agreement).

                                             18
