                   THE STATE OF SOUTH CAROLINA
                        In The Supreme Court

           Latoya Brown, Petitioner,

           v.

           Dick Smith Nissan, Inc. and Old Republic Surety
           Company, Respondents.

           Appellate Case No. 2013-000417



       ON WRIT OF CERTIORARI TO THE COURT OF APPEALS



                        Appeal From Richland County
                    Alison Renee Lee, Circuit Court Judge


                            Opinion No. 27556
                Heard February 3, 2015 – Filed August 5, 2015


                                 REVERSED


           William T. Toal, of Johnson, Toal & Battiste, P.A., of
           Columbia, for Petitioner.

           Joseph Gregory Studemeyer, of Columbia, for
           Respondents.



     JUSTICE BEATTY: Latoya Brown entered a contract to purchase a
Mazda 6 automobile from Dick Smith Nissan, Inc. ("Dick Smith") with the
assistance of salesman Robert Hiller. The purchase was contingent on acquiring
third-party financing. Due to continuing and unresolved issues with financing,
Brown returned the vehicle to Dick Smith. The car was later repossessed and sold
by Sovereign Bank with a deficiency against Brown. Brown filed a complaint
against Dick Smith and Old Republic Surety Company ("Old Republic"), the
surety on Dick Smith's licensing bond, alleging violations of the South Carolina
Dealers Act1 ("Dealers Act"). The trial judge, in a bench trial, found in favor of
Brown and awarded damages plus interest as well as attorney's fees and costs.
Dick Smith and Old Republic appealed and the Court of Appeals reversed,
concluding that any misconceptions that Brown had about her financing were
caused by Sovereign Bank, not Dick Smith. Brown v. Dick Smith Nissan, Inc., Op.
No. 2012-UP-688 (S.C. Ct. App. filed Dec. 28, 2012). We granted Brown's
petition for a writ of certiorari to review the decision of the Court of Appeals and
now reverse.

                       I.     Factual / Procedural History

      Shortly after graduating from college, Brown went to Dick Smith to buy a
car and was assisted by Hiller. She informed him that she wanted to pay no more
than $250 per month for a car payment. Hiller showed Brown pictures of pre-
owned cars on his computer. Brown selected a Mazda 6 and Hiller prepared a
buyer's order for the Mazda 6. He then directed Brown to the finance department.
Brown talked to Kent Guthrie in the finance department and signed an installment
contract, which identified the Mazda 6, the payment amount, the total number of
payments, and when the first monthly payment would be due. The contract also
included a clause that the contract was contingent on financing by a third-party
source. After providing proof of insurance, Brown took possession of the Mazda
6.

        Initially, Dick Smith told Brown that BB&T would finance her purchase.
Brown, however, received a denial letter from BB&T. Brown then contacted
Hiller to inquire about financing. Hiller told Brown that Dick Smith would
continue to seek financing for the Mazda 6. Thereafter, Brown received denial
letters from multiple financial institutions, including Nissan Motor Acceptance
Corporation. As a result, Brown called Hiller again concerning her financing.

1
  The South Carolina Regulation of Manufacturers, Distributors, and Dealers Act
(the "Dealers Act") is codified at S.C. Code Ann. §§ 56-15-10 to -600 (2006 &
Supp. 2014).
Hiller reassured her that he was still working on securing financing for her. Brown
told Hiller that if he could not get her financed, she would return the Mazda 6.

       Sovereign Bank was one of the many financial institutions originally
solicited by Kent Guthrie. Because his initial attempts were not successful,
Guthrie again contacted Sovereign Bank. In negotiating with Sovereign Bank,
Guthrie misrepresented that Brown was the relative of a long-time Dick Smith
employee and that Guthrie needed a favor on the deal. Sovereign Bank approved
financing for a Nissan Altima as requested by Guthrie.2 However, Sovereign Bank
requested proof of income of $2,800 per month. At the time, Brown's monthly
income was approximately $1,800.

        Hiller called Brown and told her that Sovereign Bank had approved her
financing. After Hiller told Brown that she was approved by Sovereign Bank,
Brown received a denial letter from Sovereign Bank. Brown went back to Dick
Smith and spoke with Hiller. She showed him her denial letter and he responded
that Sovereign Bank had approved her application and would finance the car.
Brown requested proof of financing. Hiller then went to Guthrie and returned with
a form entitled "Sovereign Bank Application Status." The document indicated
that: (1) Brown's financing was approved for a Nissan Altima, (2) Brown was
Hiller's relative, and (3) proof of income of $2,800 per month was required in order
to finance the purchase.

       Brown called Sovereign Bank to verify the status of her financing request.
A representative from the bank informed her that financing was approved for a
Nissan Altima. Brown then advised the bank that she was buying a Mazda 6, not a
Nissan Altima, and asked to change the paperwork to reflect the correct car.
Sovereign Bank refused to do so and told her to contact Dick Smith. Brown
contacted Dick Smith and it inexplicably refused to take any corrective action.
Unbeknownst to Brown, Dick Smith had accepted payment from Sovereign Bank
for the Nissan Altima.

       The day after Brown received the denial letter from Sovereign Bank, she
returned the Mazda 6 and its keys to the Dick Smith dealership. She indicated that
she returned the Mazda 6 because she did not believe it was financed. Shortly

2
  The different application numbers on Brown's denial letter and approval letter
demonstrates that Brown was initially denied financing by Sovereign Bank. The
second application indicated that the loan was for a Nissan Altima.
thereafter, Sovereign Bank sent Brown a letter informing her that it had
repossessed the Mazda 6 and sold it, resulting in a deficiency of $3,843 for which
Brown was responsible. Brown filed suit against Dick Smith and Dick Smith's
licensing bond issued by Old Republic, alleging violations of section 56-15-30(a)
of the Dealers Act.3

                            II.    Standard of Review

       An action brought under the Dealers Act is an action at law. See Adams v.
Grant, 292 S.C. 581, 582, 358 S.E.2d 142, 143 (Ct. App. 1986) (recognizing that
an action under the Dealers Act is an action at law). "In an action at law tried
without a jury, an appellate court's scope of review extends merely to the
correction of errors of law." Temple v. Tec-Fab, Inc., 381 S.C. 597, 599-600, 675
S.E.2d 414, 415 (2009). "The Court will not disturb the trial court's findings unless
they are found to be without evidence that reasonably supports those findings." Id.

                                  III.   Discussion

                                          A.

       The Dealers Act prohibits a motor vehicle dealer from, inter alia, engaging
in "any action which is arbitrary, in bad faith, or unconscionable and which causes
damage to any of the parties or to the public." S.C. Code Ann. § 56-15-40(1)
(2006). "Arbitrary conduct is readily definable and includes acts which are
unreasonable, capricious or nonrational; not done according to reason or judgment;
depending on will alone." Taylor v. Nix, 307 S.C. 551, 555, 416 S.E.2d 619, 621
(1992). Bad faith is "[t]he opposite of good faith, generally implying or involving
actual or constructive fraud, or a design to deceive or mislead another, or a neglect
or refusal to fulfill some duty or some contractual obligation, not prompted by an
honest mistake as to one's rights or duties, but by some interested or sinister
motive." State v. Griffin, 100 S.C. 331, 331, 84 S.E. 876, 877 (1915) (citation
omitted). "Unconscionability has been recognized as the absence of meaningful
choice on the part of one party due to one-sided contract provisions, together with
terms which are so oppressive that no reasonable person would make them and no



3
  Section 56-15-30(a) states, "Unfair methods of competition and unfair or
deceptive acts or practices as defined in § 56-15-40 are hereby declared to be
unlawful." S.C. Code Ann. § 56-15-30(a) (2006).
fair and honest person would accept them." Fanning v. Fritz's Pontiac-Cadillac-
Buick, Inc., 322 S.C. 399, 403, 472 S.E.2d 242, 245 (1996).

                                          B.

       For several reasons, Brown contends the Court of Appeals erred in reversing
the decision of the trial judge. First, Brown argues the Court of Appeals erred in
finding the inaccuracies4 on the financing application were "puffing"5 and that
those inaccuracies did not amount to bad faith, fraud, or a deceptive act. She states
the inaccuracies were false statements, which constituted a clear violation of both
federal and state law.6 Second, Brown alleges the Court of Appeals failed to
identify that Dick Smith received funding for a Nissan Altima, not a Mazda 6.
Because the financing of the Mazda 6 was a condition precedent for the installment
contract she signed, Brown submits that she was never obligated to make monthly
payments on the car and was entitled to return it.

       In response, Dick Smith claims that Brown abandoned the Mazda 6 against
its advice. Dick Smith also maintains that Brown was not harmed by any of its
actions. However, even if she was harmed, it was because of Sovereign Bank's
"erroneous letter" and not any statements from Dick Smith.



4
 Brown was falsely listed as a family member, the collateral was incorrect, and
Brown made less than the required monthly income.
5
    "Puffing" is defined as:

        The expression of an exaggerated opinion ─ as opposed to a factual
        misrepresentation ─ with the intent to sell a good or service. Puffing
        involves expressing opinions, not asserting something as a fact.
        Although there is some leeway in puffing goods, a seller may not
        misrepresent them or say they have attributes that they do not possess.

Black's Law Dictionary 1353 (9th ed. 2009).
6
  See 18 U.S.C. § 1005 (2002) (proscribing thirty years' imprisonment for anyone
who intends to defraud any bank and receives money); S.C. Code Ann. § 16-13-10
(2003) (providing that it is unlawful for a person to publish as true any false
writing or instrument of writing).
       The factual findings of the trial judge, which are supported by the record,
demonstrate that Sovereign Bank received a credit application to finance a Nissan
Altima and approved financing for a Nissan Altima. The record does not reflect an
error on the part of Sovereign Bank. In contrast, Dick Smith made false statements
to Sovereign Bank and Brown regarding the financing for the Mazda 6. Dick
Smith also made no effort to correct the problem after receiving the credit
application approval that listed the Nissan Altima instead of the Mazda 6. In fact,
even after Brown advised Dick Smith that Sovereign Bank refused to substitute the
Mazda 6 for the Nissan Altima, Dick Smith took no corrective action. As a result,
Brown was erroneously required to pay Sovereign Bank for a car that she did not
agree to buy and did not possess.

       The subsequent repossession of the Mazda 6 and deficiency against Brown
were the result of Dick Smith's failure to timely take corrective action to ensure
that the Mazda 6 (versus the Nissan Altima) was financed by Sovereign Bank.
Even assuming that Sovereign Bank would agree to substitute collateral in this
case, there is no evidence that there was ever an attempt by Dick Smith to
substitute collateral prior to Brown returning the vehicle. The likely conclusion is
that the collateral was not substituted until the Mazda 6 was repossessed months
after Brown returned it to Dick Smith.

       Further, we disagree with the Court of Appeals that the inaccuracies in the
information provided to Sovereign Bank was merely "puffing" used to assist
Brown in getting financing and that the inaccuracies did not cause her damage.
Inaccuracies in a financing application are a serious cause for concern. Financing
a car that Brown did not purchase was neither "puffing" nor helpful to Brown. The
fact that Brown was required to pay for a car that she did not possess was actually
damaging as is shown by Sovereign Bank's collection efforts. Moreover, Dick
Smith's refusal to timely assist in transferring the collateral resulted in Brown
being expected to pay for a car for which she would not be able to obtain title.

       Additionally, we reject Dick Smith's argument that it was absolved of
culpability under the Dealers Act because it affirmatively warned Brown that her
vehicle would be repossessed. The violation of the Dealers Act occurred in the
methods it employed to procure financing for Brown and the fact that it failed to
assist Brown in correcting its mistakes that caused the issues with the Mazda 6. In
the words of the trial judge:
      Dick Smith failed to verify the financing on the Mazda or provide
      Plaintiff with any additional information regarding the financing.
      Instead, Dick Smith showed Plaintiff an approval letter7 from
      Sovereign Bank based on incorrect information and correlating to a
      loan in a different amount, pertaining to a different vehicle, and
      incorrectly listing Brown's income as $2,800 per month. Dick Smith
      did not inform Plaintiff that it had received the payment from
      Sovereign Bank. Dick Smith made no effort to assist Plaintiff
      regarding the paperwork on the Mazda. By failing to verify the
      financing of the proper vehicle and representing to Plaintiff that she
      was approved for financing on the vehicle she possessed, Plaintiff was
      treated in an unfair and deceptive manner by representatives of Dick
      Smith. Thus, irrespective of Plaintiff's interactions with Sovereign
      Bank, Dick Smith failed to act in good faith in its dealings with
      Plaintiff.

       As evidenced by the above-quoted language, the trial judge concluded that
Dick Smith acted in bad faith when it made no effort to assist Brown in correcting
the financing paperwork or transferring collateral on the loan. We agree with this
conclusion as Dick Smith failed to fulfill its obligation to timely arrange for
substituting collateral or correcting Brown's loan documents.

       Without dispute, the installment contract was contingent on third-party
financing for a Mazda 6. Here, the record establishes that Dick Smith knowingly
applied for, and received, financing for a Nissan Altima and not a Mazda 6.
Assuming, without deciding, that this was an oversight on the part of Dick Smith,
Dick Smith refused to assist in correcting the alleged mistake even after being
advised that their assistance was necessary. Notably, Dick Smith's finance
manager testified that a telephone call from Dick Smith was sufficient to transfer
collateral. Yet, Dick Smith failed to perform this simple act.

       Based on the foregoing, we agree with the trial judge's conclusion that Dick
Smith violated the Dealers Act as it acted in bad faith and Brown was damaged by
this action.

                                IV.    Conclusion

7
  The "approval letter" was actually just a computer print-out from the
"DealerTracker" website.
      Despite evidence in the record to support the trial judge's findings of fact,
the Court of Appeals ignored those findings and substituted its own. By doing so,
the Court of Appeals exceeded its standard of review. Accordingly, we reverse the
Court of Appeals and reinstate the trial judge's decision.

      REVERSED.

     KITTREDGE, HEARN, JJ., and Acting Justice James E. Moore,
concur. PLEICONES, Acting Chief Justice, concurring in result only.
