                    NOT FOR PUBLICATION WITHOUT THE
                   APPROVAL OF THE APPELLATE DIVISION

                                      SUPERIOR COURT OF NEW JERSEY
                                      APPELLATE DIVISION
                                      DOCKET NO. A-1051-13T1


FIORELLA ROTONDI, on her own
behalf and on behalf of a
class of similarly situated
persons,

      Plaintiff-Respondent,

v.

DIBRE AUTO GROUP, L.L.C.,
d/b/a NORTH PLAINFIELD
NISSAN,

      Defendant-Appellant,

and

TD AUTO FINANCE, L.L.C.,

      Defendant.

____________________________________

          Argued March 24, 2014 – Decided July 9, 2014

          Before Judges Ashrafi and Leone.

          On appeal from Superior Court of New Jersey,
          Law Division, Union County, Docket No.
          L-1967-13.

          Thomas G. Russomano argued the cause for
          appellant (Schiller & Pittenger, P.C.,
          attorneys; Mr. Russomano, of counsel; Jay B.
          Bohn, on the brief).

          Lessie Hill argued the cause for respondent.
PER CURIAM

    Defendant Dibre Auto Group, L.L.C., which owns and operates

a car dealership named North Plainfield Nissan, appeals from an

order of the Law Division denying without prejudice its motion

to dismiss plaintiff's class action complaint and to compel

arbitration of her individual claims.   We affirm.1

    The facts relevant to the issues on appeal are essentially

undisputed.   In March 2011, plaintiff Fiorella Rotondi purchased

a 2011 Nissan Altima from North Plainfield Nissan.    The vehicle

was priced at $26,997 according to the Motor Vehicle Retail

Order that defendant prepared and plaintiff signed.   She was

granted a credit of $14,830 on a trade-in of her 2007 Honda

Civic, but that entire amount was used by defendant to pay off

her existing loan on the Honda Civic.   Additional charges were

added to the price of the Nissan Altima for: (1) Anti-Theft

Vehicle Security Etch (Optional), $199.98; (2) GAP (insurance),

$750.00; (3) State sales tax, $918.19; (4) Motor Vehicle Tire

Fee, $7.50; (5) Registration/Title Fee, $200.00; and (6)

Documentary Fee, $349.97.   With these additions, and a credit




1
  Although the order is without prejudice, Rule 2:2-3(a) states
that "all orders compelling or denying arbitration, whether the
action is dismissed or stayed, shall also be deemed a final
judgment of the court for appeal purposes."



                                2                          A-1051-13T1
for "Net Pay-Off of Trade-In" of $1,250, the total contract

price was $28,172.64.2

     Defendant arranged for financing by plaintiff to pay for

the new car.   Our record does not contain a legible copy of the

financing contract plaintiff signed with Chase as the lender,

but counsel represent that the amount financed was $25,865.17

for a period of seventy-two months (six years), with an interest

rate of 12.14% and monthly payments of $535.90.   Defendant's

salesperson told plaintiff she could return to the dealership

within one year to refinance the loan with better terms.

     A year later, in March 2012, plaintiff returned to

refinance her car loan.   Although plaintiff kept the same 2011

Nissan Altima, defendant dealership presented to her and she

signed another Motor Vehicle Retail Order in the same preprinted

form as the March 2011 order.   The price listed for the 2011

Nissan Altima that plaintiff already owned was $25,311.32, and a

trade-in was shown on the document of a 2010 Nissan Altima with

a trade-in value of $24,764.26 and the identical amount as the

Chase loan balance to be paid off with the trade-in value.      No




2
  The document does not explain why the trade-in value of the
2007 Honda Civic was determined to be the same amount as the
balance of plaintiff's existing car loan and yet she was granted
a credit for a "net pay-off of the trade-in."



                                3                          A-1051-13T1
vehicle identification number was provided for the 2010 Altima

being traded in; no such car was involved in the transaction.

    As with the 2011 Retail Order, the 2012 order also added

charges for: (1) Anti-Theft Vehicle Security Etch (Optional),

$199.98; (2) State sales tax, $196.49; (3) Registration/Title

Fee, $150.00; and (4) Documentary Fee, $349.97.    There was no

GAP insurance or tire fee listed, but there was a new additional

charge added of $2,060.00 for a service contract.     There was

nothing entered as a "Net Pay-Off of Trade-In."     The total

contract price was $28,267.76.

    The re-financed loan was assigned to defendant TD Auto

Finance, LLC.   The amount financed was $26,767.76 for a new term

of seventy-two months, with an interest rate of 8.69%, and

monthly payments of $480.00.     So, while the interest rate and

monthly payments were reduced, plaintiff was required to make an

additional year of monthly payments for the same car, and she

was charged again for a number of items added to the base price

of the car.

    The 2011 and 2012 Retail Orders had identical mandatory

arbitration agreements that plaintiff signed.    In relevant part

those sections of the Orders stated:

         AGREEMENT TO ARBITRATE ANY CLAIMS. READ THE
         FOLLOWING ARBITRATION PROVISION CAREFULLY,
         IT LIMITS YOUR RIGHTS, INCLUDING THE RIGHT
         TO MAINTAIN A COURT ACTION.



                                  4                         A-1051-13T1
         The parties to this agreement agree to
         arbitrate any claim, dispute, or
         controversy, including all statutory claims
         and any state or federal claims, that may
         arise out of or relating to the sale or
         lease identified in this agreement. By
         agreeing to arbitration, the parties
         understand and agree that they are waiving
         their rights to maintain other available
         resolution processes, such as court action
         or administrative proceeding, to settle
         their disputes. Consumer Fraud, Used Car
         Lemon Law, and Truth-in-Lending claims are
         just three examples of the various types of
         claims subject to arbitration under this
         agreement. The parties also agree to (i)
         waive any right to pursue any claims arising
         under this agreement, including statutory,
         state or federal claims, as a class action
         arbitration, or (ii) to have an arbitration
         under this agreement consolidated with any
         other arbitration or proceeding. . . . If
         any part of this arbitration clause, other
         than waivers of class action rights, is
         found to be unenforceable for any reason,
         the remaining provisions shall remain
         enforceable. If a waiver of class action
         and consolidation rights is found
         unenforceable in any action in which class
         action remedies have been sought, this
         entire arbitration clause shall be deemed
         unenforceable, it being the intention and
         agreement of the parties not to arbitrate
         class actions or in consolidated
         proceedings. . . . THIS ARBITRATION
         PROVISION LIMITS YOUR RIGHTS, INCLUDING YOUR
         RIGHT TO MAINTAIN A COURT ACTION. PLEASE
         READ IT CAREFULLY PRIOR TO SIGNING.

         [(underscoring added).]

    In May 2013, plaintiff filed a five-count class action

complaint and jury demand.   She then amended the pleading twice.

Her second amended complaint alleged in seven counts: (1)



                                5                           A-1051-13T1
violation of the Consumer Fraud Act, N.J.S.A. 56:8-2 to -106,

(2) unjust enrichment, (3) theft by deception, (4) civil

conspiracy, (5) common law fraud, (6) violation of the Plain

Language Act, N.J.S.A. 56:12-1 to -13, and (7) violation of the

Truth in Lending Act.   The complaint described the class on

behalf of which plaintiff filed suit as all those person "who

purchased and/or refinanced a new or used vehicle" from March

29, 2011, to the time of the pleading, adding the following list

of specific attributes of the class members:

         1. who purchased or refinanced the vehicle
            from defendant, North Plainfield Nissan.
            Who traded in any vehicle during the
            purchase and/or refinance.
         2. who did not receive a dollar value for the
            traded in vehicle.
         3. who did not trade in any vehicle during
            the refinance however the contract
            referenced a trade in description and
            allowance.
         4. who were charged a fee for anti-theft
            vehicle security etching twice, once on
            the purchase and again on the refinance.
         5. who were charged documentary fees.
         6. who were charged sales tax on the
            refinanced vehicle when there wasn't a
            sale.
         7. who were charged a sales tax less than the
            amount required by the State of New
            Jersey.
         8. who were charged a registration/title fee
            on the refinance when these documents were
            not provided.
         9. who were charged a documentary fee
            including document delivery service on the


                                6                          A-1051-13T1
             refinance when no documents were
             delivered.
          10. who were charged a finance fee.
          11. where the contract was assigned to TD
              Auto Finance, LLC.

    Defendant moved to dismiss the second amended complaint and

instead to compel arbitration of any individual claims of

plaintiff.   The Law Division heard argument of counsel and

denied the motion without prejudice.   The court reasoned that

the provision of the arbitration agreement quoted above that

refers to plaintiff's agreement to "waive any . . . claims . . .

as a class action arbitration" was unclear and ambiguous as to

whether plaintiff's recourse was to pursue a class action in the

courts.   The court also stated that factual issues existed

regarding whether the arbitration clause and waiver of class

actions was an unconscionable term of the two Retail Orders, and

that discovery would be permitted to develop that issue.      The

court stated that defendant could renew its motion to compel

arbitration as further evidence developed through discovery.

    Defendant appeals, contending that the Federal Arbitration

Act ("FAA"), 9 U.S.C.A. §§ 1 to 16, United States Supreme Court

case law applying the FAA, and N.J.S.A. 2A:24-1 all mandate that

the court enforce the arbitration agreements contained in the




                                7                           A-1051-13T1
two contracts executed by the parties.3   Defendant cites a number

of federal and state cases holding that arbitration is a favored

method of dispute resolution and arbitration agreements should

be enforced in accordance with the terms of the parties'

contract.    See, e.g., Volt Info. Sciences, Inc. v. Bd. of Trs.

of Leland Stanford Junior Univ., 489 U.S. 468, 478, 109 S. Ct.

1248, 1255, 103 L. Ed. 2d 488, 500 (1989); Garfinkel v.

Morristown Obstetrics & Gynecology Assocs. P.A., 168 N.J. 124,

131-32 (2001); Malik v. Ruttenberg, 398 N.J. Super. 489, 494-95

(App. Div. 2008).

     The FAA provides that the arbitration provision of a

contract affecting commerce "shall be valid, irrevocable, and


3
  Defendant does not elaborate on its contention regarding
N.J.S.A. 2A:24-1, and relies instead on its analysis of the
federal law as applied by the United States Supreme Court. The
New Jersey statute states:

               A provision in a written contract to
            settle by arbitration a controversy that may
            arise therefrom or a refusal to perform the
            whole or a part thereof or a written
            agreement to submit, pursuant to section
            2A:24-2 of this title, any existing
            controversy to arbitration, whether the
            controversy arise out of contract or
            otherwise, shall be valid, enforceable and
            irrevocable, except upon such grounds as
            exist at law or in equity for the revocation
            of a contract.

            [Ibid.]




                                 8                          A-1051-13T1
enforceable, save upon such grounds as exist at law or in equity

for the revocation of any contract."   9 U.S.C.A. § 2.

Defendant acknowledges that general contract defenses, such as

fraud, duress, and unconscionability, are available under the

FAA to invalidate arbitration agreements.   See Doctor's Assocs.,

Inc. v. Casarotto, 517 U.S. 681, 687, 116 S. Ct. 1652, 1656, 134

L. Ed. 2d 902, 909 (1996); Gras v. Assocs. First Capital Corp.,

346 N.J. Super. 42, 47 (App. Div. 2001), certif. denied, 171

N.J. 445 (2002).   To those defenses, we have added the

requirement that a waiver of rights to pursue judicial remedies

must be stated in clear language, unambiguously.   Rockel v.

Cherry Hill Dodge, 368 N.J. Super. 577, 586-87 (App. Div.),

certif. denied, 181 N.J. 545 (2004).

    In Muhammad v. County Bank of Rehoboth Beach, 189 N.J. 1,

22 (2006), cert. denied, 549 U.S. 1338, 127 S. Ct. 2032, 167 L.

Ed. 2d 763 (2007), our State Supreme Court held void as

unconscionable and against the public policy of this State

arbitration clauses in adhesion contracts that barred class

actions, where small individual claims could not be practically

pursued.   In reaching that holding, the Court cited with

approval a similar decision of the California Supreme Court in

Discover Bank v. Superior Court, 113 P.3d 1100, 1110 (Cal.

2005).   Muhammad, supra, 189 N.J. at 20.




                                9                           A-1051-13T1
    Subsequently, the United States Supreme Court overruled

Discover Bank, and effectively overruled Muhammad, in AT&T

Mobility LLC v. Concepcion, 563 U.S. ___, ___, 131 S. Ct. 1740,

1750, 179 L. Ed. 2d 742, 755 (2011).   The Court held that the

FAA preempts a determination under state law that a waiver of

class actions in an arbitration clause is unenforceable on

grounds of state public policy or per se unconscionability.       See

id. at ___, 131 S. Ct. at 1753, 179 L. Ed. 2d at 758-59.

    Consequently, defendant correctly argues in this appeal

that the class action waiver provisions of the Retail Orders are

not subject to a defense of per se unconscionability on public

policy grounds.

    Furthermore, we held in Rockel, supra, 368 N.J. Super. at

580, that a claim of unconscionability based on alleged

violation of the Consumer Fraud Act does not in itself void an

arbitration clause.   Rather, unconscionability as a contract

defense has to be determined on a case-by-case basis.     Ibid.

When unconscionability is based on alleged Consumer Fraud

violations, the issue can be decided in the arbitration hearing.

Gras, supra, 346 N.J. Super. at 52-53.

    Most recently in NAACP of Camden County East v. Foulke

Management Corp., 421 N.J. Super. 404 (App. Div. 2011), appeal

dism'd, 213 N.J. 47 (2013), we held that a class action waiver




                                10                          A-1051-13T1
in a transaction to purchase a new car was not per se invalid,

id. at 441, but that the arbitration provisions of the several

contract documents in that case were inconsistent and therefore

not enforceable.   Id. at 444-45.

    Similarly in this case, we agree with the trial judge that

the reference in the arbitration clauses to "class action

arbitration" is potentially confusing.   On the one hand, the

arbitration clauses state that the parties to the contract agree

to arbitrate all claims.   On the other hand, "class action

arbitration" is waived.    Since the agreement seems to preserve

other types of claims, only subject to arbitration, and since it

does not state explicitly that the consumer may not pursue any

class action whatsoever, one might infer that a class action

must be brought in the courts.

    In Foulke Management, supra, 421 N.J. Super. at 425, we

emphasized the need for clarity in an arbitration clause.     See

also Garfinkel, supra, 168 N.J. at 132 ("[A] party's waiver of

statutory rights 'must be clearly and unmistakably established,

and contractual language alleged to constitute a waiver will not

be read expansively.'" (quoting Red Bank Reg'l Educ. Ass'n v.

Red Bank Reg'l High Sch. Bd. of Educ., 78 N.J. 122, 140 (1978));

Moore v. Woman to Woman Obstetrics & Gynecology, L.L.C., 416

N.J. Super. 30, 37 (App. Div. 2010) ("Courts decline to enforce




                                 11                         A-1051-13T1
an arbitration agreement that is not sufficiently clear as to

the rights the party is waiving.").   We conclude that a

prohibition against class actions is not enforceable in either

of the two contracts plaintiff signed because it is not stated

with clarity.

    In addition, plaintiff argues that the arbitration clause

in the 2012 Retail Order is not enforceable because there was no

sale or lease of a vehicle at that time.   Rather, the

transaction was a refinancing of the car she bought a year

earlier and already owned.   While the refinancing was real and

desired by plaintiff, the terms of a new sale with additional

charges was not.   Plaintiff contends there was no "meeting of

the minds" in entering into the March 2012 written agreement.

    We view this argument as alleging that the 2012 contract

was fraudulent in the making.   See, e.g., Amsterdam v. De Paul,

70 N.J. Super. 196, 200 (App. Div. 1961); N.J. Mortg. & Inv. Co.

v. Dorsey, 60 N.J. Super. 299, 302 (App. Div.), aff'd o.b., 33

N.J. 448 (1960); see also McDonald v. Central R.R. Co., 89

N.J.L. 251, 254 (E. & A. 1916) ("A misrepresentation of the

contents of a document by which one is induced to sign a paper

thinking it is other than it really is, is the typical case of

fraud in the execution; it is a case where the defrauded party

may properly say, 'I never agreed to that . . . .'").




                                12                         A-1051-13T1
Alternatively, we view plaintiff as contending that the contract

was voidable because of a mistake of fact — that is, she

believed she was signing a refinancing agreement but the

document was for a non-existent sale.   See Restatement (Second)

of Contracts §§ 151-155 (1981) (common law principles applicable

to mistake in the formation of a contract).

    Defendant's general manager has certified that it is common

for car dealers to prepare a new sales order when they arrange

for a refinancing through their lender sources, especially a new

lender.   He claims that the transaction is, in effect, a sale of

the vehicle by the buyer back to the dealer and then a resale of

the same vehicle to the buyer.   However, this explanation does

not address why the 2012 Retail Order prepared by defendant

designates a non-existent 2010 Nissan Altima as the vehicle that

plaintiff was trading in.   There is no document evidencing a

sale of the 2011 Nissan Altima from plaintiff back to defendant.

Defendant's explanation also does not address why the trade-in

value of plaintiff's car is listed as $24,764.26, which is the

amount of her outstanding loan balance to Chase, while the sale

price for the same car being purportedly resold to plaintiff on

the same day is designated as $25,311.22.     There is no

indication in the record that plaintiff was ever informed that

defendant would charge a net $546.96 to refinance her original




                                 13                         A-1051-13T1
loan, and plaintiff alleges that such a charge is unlawful and

fraudulent.

    Plaintiff also alleges fraud in the 2012 transaction for

other reasons, including the re-charging for anti-theft security

etching and vehicle documentation and related fees, a new charge

for a service contract that she claims she did not request, and

allegedly no true savings on her original loan.   She contends

that, since she requested only a refinancing of her loan and not

another purchase of a vehicle, there was no meeting of the minds

on the 2012 contract, and therefore, the arbitration clause is

part of a void contract and not enforceable.

    In Foulke Management, supra, 421 N.J. Super. at 425, we

stated that "an agreement to arbitrate must be the product of

mutual assent, as determined under customary principles of

contract law. . . . There must be, as our cases instruct, a

'meeting of the minds.'"   We held that: "because arbitration

provisions are often embedded in contracts of adhesion, courts

take particular care in assuring the knowing assent of both

parties to arbitrate, and a clear mutual understanding of the

ramifications of that assent."   Ibid.

    Here, the trial court permitted discovery to develop the

parties' competing contentions regarding the enforceability of

the arbitration provisions.   Our conclusion that the "class




                                 14                       A-1051-13T1
action arbitration" waivers were not stated with sufficient

clarity to constitute a complete abandonment of court

proceedings to pursue a class action makes it unnecessary for us

to address further plaintiff's argument that the 2012 Retail

Order was a fraud and a sham and should not be enforced for that

alternative reason.

    Since plaintiff did not file a cross-appeal, we have no

occasion to address whether the trial court's denial of

defendant's motion to compel arbitration should have been with

or without prejudice.   The parties and the trial court are free

to address that issue in further proceedings consistent with

this decision.

    Affirmed.




                                15                        A-1051-13T1
