                       THE STATE OF SOUTH CAROLINA
                           In The Court of Appeals

              Marcus Kevin Grant, individually and in a representative
              capacity for all others similarly situated, Respondent,

              v.

              Jud Kuhn Chevrolet, Appellant.

              Appellate Case No. 2017-001897



                            Appeal From Horry County
                     Benjamin H. Culbertson, Circuit Court Judge


                                 Opinion No. 5757
                   Submitted March 2, 2020 – Filed August 12, 2020


                                    REVERSED


              Harry Clayton Walker, Jr., Haynsworth Sinkler Boyd,
              PA, of Charleston, and Robert Lawrence Reibold, of
              Haynsworth Sinkler Boyd, PA, of Columbia, both for
              Appellant.

              Lawrence Sidney Connor, IV, of Kelaher Connell &
              Connor, PC, of Surfside Beach, for Respondent.


WILLIAMS, J.: In this action filed pursuant to the South Carolina Regulation of
Manufacturers, Distributors, and Dealers Act (the Dealers Act),1 Jud Kuhn
Chevrolet (Dealer) appeals the circuit court's order compelling class arbitration.
On appeal, Dealer contends the arbitration clause is silent as to class arbitration,

1
    S.C. Code Ann. §§ 56-15-10 to -600 (2018 & Supp. 2019).
and thus, he argues the circuit court erred in inferring the parties' consent to class
arbitration from the Dealers Act and the American Arbitration Association's
(AAA's) Supplementary Rules for Class Arbitrations (the Supplementary Rules).
We reverse.2

FACTS/PROCEDURAL HISTORY

Purchaser bought a Chevrolet Camaro from Dealer, and the parties signed a
purchase agreement, which included a closing fee of $399. The purchase
agreement also contained the following arbitration clause:

             ARBITRATION REQUIRED BY THIS
             AGREEMENT. The parties agree that instead of
             litigation in a court, any dispute, controversy or claim
             arising out of or relating to the sale of the motor vehicle
             or to this Purchase Order, including the validity or lack
             thereof of this contract, to any other document or
             agreement between the parties relating to sale of the
             motor vehicle, or to any other document or agreement
             between the parties relating to the motor vehicle,
             including the parties' retail installment contract, if any,
             shall be settled by binding arbitration administered by the
             [AAA] under its Commercial Arbitration Rules. Such
             arbitration shall be conducted in Columbia, SC. Each
             party will pay its own costs, and any filing fee charged
             by the [AAA] shall be split evenly between the parties.
             Any judgment on the award rendered by the arbitrator
             may be entered in any court of competent jurisdiction.

Purchaser later filed a class action complaint against Dealer, alleging Dealer
"negligently violated the Dealers Act" in numerous ways, including "charging a

2
  Neither party challenges the circuit court's finding that Marcus Kevin Grant's
(Purchaser's) action is subject to arbitration; therefore, it is the law of the case. See
Shirley's Iron Works, Inc. v. City of Union, 403 S.C. 560, 573, 743 S.E.2d 778, 785
(2013) ("An unappealed ruling is the law of the case and requires affirmance.");
Berry v. McLeod, 328 S.C. 435, 442, 492 S.E.2d 794, 798 (Ct. App. 1997) ("There
is no appeal from this ruling, and thus, it becomes the law of the case.").
Accordingly, the only issue before this court is whether the circuit court erred in
finding the parties consented to class arbitration.
closing fee which does not represent closing costs actually incurred" by Dealer.
Purchaser sought judgment against Dealer "for the amount of the closing fee for
each class member, doubled pursuant to the Dealers Act, plus punitive damages up
to three times the actual damages." Dealer timely answered, asserting Purchaser's
claims were subject to mandatory arbitration, and subsequently moved to stay the
case and compel bilateral arbitration. The circuit court held a hearing, but it
declined to rule on the motion, allowing Dealer the opportunity to respond to
Purchaser's motion in opposition to bilateral arbitration in which he requested the
court either deny Dealer's motion to compel arbitration or, alternatively, grant the
motion but permit class arbitration. Dealer filed an amended motion to compel
bilateral arbitration. At the subsequent hearing, the circuit court granted Dealer's
motion in part, holding it would compel arbitration; however, the court ordered the
parties to submit briefs as to whether class or bilateral arbitration was proper.

Thereafter, the circuit court filed an order compelling class arbitration, finding
"there is no conflict between the state's public policy of allowing class actions
under the Dealers Act and the [Federal Arbitration Act's (FAA's)3] liberal policy
favoring arbitration." The circuit court found that unlike in Stolt-Nielsen S.A. v.
AnimalFeeds International Corp.,4 the arbitration clause contained in the purchase
agreement at issue was not silent as to class arbitration. Specifically, the circuit
court inferred the parties' consent to class arbitration because the purchase
agreement is subject to the Dealers Act, which allows for class actions in
arbitration disputes, and the arbitration clause specifically referenced the AAA,
which contains the Supplementary Rules. This appeal followed.

STANDARD OF REVIEW

"Determinations of arbitrability are subject to de novo review, but if any evidence
reasonably supports the circuit court's factual findings, this court will not overrule
those findings." Pearson v. Hilton Head Hosp., 400 S.C. 281, 286, 733 S.E.2d
597, 599 (Ct. App. 2012).

LAW/ANALYSIS

Dealer contends the arbitration clause is silent as to class arbitration, and thus, he
argues the circuit court erred in inferring the parties' consent to class arbitration
from the Dealers Act and the Supplementary Rules. We agree.

3
    9 U.S.C. §§ 1 to 307 (2018).
4
    559 U.S. 662 (2010).
"The [FAA] requires courts to enforce covered arbitration agreements according to
their terms." Lamps Plus, Inc. v. Varela, 139 S. Ct. 1407, 1412 (2019). "Unless
the parties have contracted to the contrary, the FAA applies in federal or state court
to any arbitration agreement regarding a transaction that in fact involves interstate
commerce, regardless of whether or not the parties contemplated an interstate
transaction." Henderson v. Summerville Ford-Mercury Inc., 405 S.C. 440, 448,
748 S.E.2d 221, 225 (2013) (quoting Munoz v. Green Tree Fin. Corp., 343 S.C.
531, 538, 542 S.E.2d 360, 363 (2001)). "While the interpretation of an arbitration
agreement is generally a matter of state law, . . . , the FAA imposes certain rules of
fundamental importance, including the basic precept that arbitration 'is a matter of
consent, not coercion.'" Stolt-Nielsen, 559 U.S. at 681 (quoting Volt Info. Scis.,
Inc. v. Bd. of Trs. of Leland Stanford Junior Univ., 489 U.S. 468, 479 (1989)).

"Whether enforcing an agreement to arbitrate or construing an arbitration clause,
courts and arbitrators must 'give effect to the contractual rights and expectations of
the parties.'" Id. at 682 (quoting Volt Info. Scis., 489 U.S. at 479). "From these
principles, it follows that a party may not be compelled under the FAA to submit to
class arbitration unless there is a contractual basis for concluding that the
party agreed to do so." Id. at 684 (first emphases added). "An implicit agreement
to authorize class-action arbitration, however, is not a term that the arbitrator may
infer solely from the fact of the parties' agreement to arbitrate." Id. at 685
(emphasis added); see also Lamps Plus, 139 S. Ct. at 1417–18 (alterations in
original) ("[C]lass arbitration, to the extent it is manufactured by [state law]
rather than consen[t], is inconsistent with the FAA." (quoting AT&T Mobility LLC
v. Concepcion, 563 U.S. 333, 348 (2011))).

"Class arbitration is not only markedly different from the 'traditional individualized
arbitration' contemplated by the FAA, it also undermines the most important
benefits of that familiar form of arbitration." Lamps Plus, 139 S. Ct. at 1415
(quoting Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612, 1623 (2018)); see also id. at
1416 ("[W]ith class arbitration[,] 'the virtues Congress originally saw in arbitration,
its speed and simplicity and inexpensiveness, would be shorn away and arbitration
would wind up looking like the litigation it was meant to displace.'" (quoting Epic
Sys., 138 S. Ct. at 1623)). "In bilateral arbitration, parties forgo the procedural
rigor and appellate review of the courts in order to realize the benefits of private
dispute resolution: lower costs, greater efficiency and speed, and the ability to
choose expert adjudicators to resolve specialized disputes." Stolt-Nielsen, 559 U.S.
at 685. Therefore, "courts may not infer consent to participate in class arbitration
absent an affirmative 'contractual basis for concluding that the party agreed to do
so.'" Lamps Plus, 139 S. Ct. at 1416 (quoting Stolt-Nielsen, 559 U.S. at 684)).
"Neither silence nor ambiguity provides a sufficient basis for concluding that
parties to an arbitration agreement agreed to undermine the central benefits of
arbitration itself." Id. at 1417.

Based on a plain reading of the arbitration clause contained in the purchase
agreement, we find the language is silent as to class arbitration as it only states
"any dispute, controversy or claim arising out of or relating to the sale of the motor
vehicle or to this Purchase Order . . . shall be settled by binding arbitration
administered by the [AAA] under its Commercial Arbitration Rules." Further,
nothing else in the purchase agreement indicates Dealer affirmatively consented to
class arbitration as required by our precedent. See Oxford Health Plans LLC v.
Sutter, 569 U.S. 564, 565 (2013) ("Class arbitration is a matter of consent: An
arbitrator may employ class procedures only if the parties have authorized them.");
Stolt-Nielsen, 559 U.S. at 684 ("[A] party may not be compelled under the FAA to
submit to class arbitration unless there is a contractual basis for concluding that the
party agreed to do so." (first emphases added)). Thus, we find the circuit court
erred in inferring Dealer's consent to class arbitration from the Dealers Act and the
Supplementary Rules.5 See Lamps Plus, 139 S. Ct. at 1417–18 (alterations in
original) ("[C]lass arbitration, to the extent it is manufactured by [state law]
rather than consen[t], is inconsistent with the FAA." (quoting Concepcion, 563
U.S. at 348)); Stolt-Nielsen, 559 U.S. at 685 ("An implicit agreement to authorize
class-action arbitration . . . is not a term that the arbitrator may infer solely from
the fact of the parties' agreement to arbitrate." (emphasis added)); Lamps Plus, 139
S. Ct. at 1416 ("[C]ourts may not infer consent to participate in class arbitration
absent an affirmative 'contractual basis for concluding that the party agreed to do
so.'" (quoting Stolt-Nielsen, 559 U.S. at 684)). Accordingly, we hold Purchaser's
action is subject to bilateral arbitration, and the circuit court erred in issuing an
order compelling class arbitration.6

5
  We also note the circuit court's reliance on the Supplementary Rules to infer the
parties' consent to class arbitration was in error because Rule 3 of the
Supplementary Rules states, "In construing the applicable arbitration clause, the
arbitrator shall not consider the existence of these Supplementary Rules, or any
other AAA rules, to be a factor either in favor of or against permitting the
arbitration to proceed on a class basis." American Arbitration Association,
Supplementary Rules for Class Arbitrations 4 (2011).
6
  Dealer alternatively argues the circuit court erred in issuing its order compelling
class arbitration because the arbitration clause contained in the purchase agreement
unambiguously selects bilateral arbitration. Because our finding above is
CONCLUSION

Based on the foregoing, the circuit court's order compelling class arbitration is

REVERSED.7

KONDUROS and HILL, JJ., concur.




dispositive, we need not address this argument. See Futch v. McAllister Towing of
Georgetown, Inc., 335 S.C. 598, 613, 518 S.E.2d 591, 598 (1999) (holding an
appellate court need not review remaining issues when its determination of a prior
issue is dispositive of the appeal).
7
  We decide this case without oral argument pursuant to Rule 215, SCACR.
