Myers v. Affordable Recovery Solutions

THIS OPINION HAS NO PRECEDENTIAL VALUE. IT SHOULD NOT BE
CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING
EXCEPT AS PROVIDED BY RULE 268(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

Joyce Myers, Respondent,

v.

Titlemax of South Carolina, Inc. and Affordable
Recovery Solutions a/k/a ARS, Defendants,

Of which Affordable Recovery Solutions a/k/a ARS is
the Appellant.

Appellate Case No. 2015-001401

Appeal From Allendale County
Perry M. Buckner, III, Circuit Court Judge

Unpublished Opinion No. 2017-UP-098
Heard February 8, 2017 – Filed March 8, 2017

AFFIRMED

Patrick M. Higgins, of Howell, Gibson & Hughes, P.A.,
of Beaufort, for Appellant.

Mark Brandon Tinsley, of Gooding & Gooding, P.A., of
Allendale, and Robert Norris Hill, of Law Office of
Robert Hill, of Lexington, for Respondent.
PER CURIAM: In this negligence action, Appellant Affordable Recovery
Solutions seeks review of the circuit court's order denying Appellant's motion to
compel arbitration. Appellant argues the circuit court erred in concluding there
was no significant relationship between Respondent Joyce Myers' tort claims and
the loan agreements containing the arbitration clause in question. Appellant also
argues the circuit court erred in concluding the alleged torts were unforeseeable
when Myers executed the loan agreements. Myers raises two additional sustaining
grounds: (1) Appellant cannot enforce the arbitration clause because Appellant
lacks privity with Myers and (2) Appellant waived any right it has to enforce the
arbitration clause. We affirm.

"There is no set rule as to what constitutes a waiver of the right to arbitrate;
the question depends on the facts of each case." Toler's Cove Homeowners Ass'n
v. Trident Constr. Co., 355 S.C. 605, 612, 586 S.E.2d 581, 585 (2003).

Generally, the factors our courts consider to
determine if a party waived its right to compel arbitration
are: (1) whether a substantial length of time transpired
between the commencement of the action and the
commencement of the motion to compel arbitration; (2)
whether the party requesting arbitration engaged in
extensive discovery before moving to compel arbitration;
and (3) whether the non-moving party was prejudiced by
the delay in seeking arbitration. These factors, of course,
are not mutually exclusive, as one factor may be
inextricably connected to, and influenced by, the others.

Thus, a party may waive its right to compel
arbitration if a substantial length of time transpires
between the commencement of the action and the
commencement of the motion to compel arbitration.
What is "a substantial length of time" varies from one
case to the next, depending on the extent of discovery
conducted and the corresponding presence or absence of
prejudice to the party opposing arbitration.
Rhodes v. Benson Chrysler-Plymouth, Inc., 374 S.C. 122, 126, 647 S.E.2d 249, 251
(Ct. App. 2007) (emphases added). In evaluating prejudice,

our courts often examine whether the party requesting
arbitration took "advantage of the judicial system by
engaging in discovery." This inquiry, however, is just
part of a broader, common sense approach our courts
take to determine whether a motion to compel arbitration
should be granted or denied: (1) if the parties conduct
little or no discovery, then the party seeking arbitration
has not taken "advantage of the judicial system,"
prejudice will likely not exist, and the law would favor
arbitration; (2) if the parties conduct significant
discovery, then the party seeking arbitration has taken
"advantage of the judicial system," prejudice will likely
exist, and the law would disfavor arbitration. Of course,
cases do not always fit neatly into clearly defined
categories, which is why our law resists a formulaic
approach and motions to compel arbitration are resolved
only after a fact-intensive inquiry. Accordingly, each
case turns on its particular facts.

Id. at 127, 647 S.E.2d at 251–52 (emphasis added) (citation omitted) (quoting
Evans v. Accent Manufactured Homes, Inc., 352 S.C. 544, 548, 575 S.E.2d 74, 76
(Ct. App. 2003)).

Here, Myers did not serve Appellant with the Complaint until March 10,
2014, several months after she filed it. Further, Appellant asserts it filed its motion
to compel within six days of learning of the arbitration agreement's existence
through TitleMax's response to Myers' Request for Production in August 2014.
Therefore, we evaluate only those actions of Appellant that post-date its belated
detection of the arbitration agreement in August 2014. See Eason v. Eason, 384
S.C. 473, 480, 682 S.E.2d 804, 807 (2009) ("Waiver is a voluntary and intentional
abandonment or relinquishment of a known right." (quoting Parker v. Parker, 313
S.C. 482, 487, 443 S.E.2d 388, 391 (1994))); id. ("Stated differently, waiver
requires a party to have known of a right and known he was abandoning that
right.").

Nonetheless, several weeks after filing the motion to compel arbitration,
Appellant took Myers' deposition, allowed the deposition of one of its employees
to be taken, participated in the deposition of another witness, and subsequently
participated in mediation. This conduct unfairly prejudiced Myers by (1) depriving
her of the time and money required to participate in the depositions and the
mediation and (2) "obtaining information from her it might not have been able to
otherwise obtain" in arbitration. Evans, 352 S.C. at 551, 575 S.E.2d at 77
(recognizing the appellant "persisted with discovery by deposing [the respondent]
after" moving to compel arbitration and, thus, "availed itself of discovery tools
unavailable in arbitration, thereby prejudicing [the respondent] by obtaining
information from her it might not have been able to otherwise obtain" (emphasis
added)); see id., cited with approval in Johnson v. Heritage Healthcare of Estill,
LLC, 416 S.C. 508, 514, 788 S.E.2d 216, 219 (2016) (holding that the appellant,
"[a]s the party seeking arbitration, . . . bore the onus to halt discovery by seeking
the court's protection" under Rule 26(c)(1), SCRCP)1; id. (holding the appellant's
"prolongation of discovery necessitated [the respondent's] pursuit of discovery,
thereby forcing her to incur costs she would not have incurred in arbitration"); see
also Rhodes, 374 S.C. at 128 n.3, 647 S.E.2d at 252 n.3 ("Depositions involve
substantial time, effort, and money . . . .").

Based on the foregoing, we conclude Appellant waived any right it had to
enforce the arbitration clause in Myers' loan agreements, and we affirm the circuit
court's order on this basis. See Rule 220(c), SCACR (stating the appellate court
may affirm for any reason appearing in the record on appeal). Therefore, we need
not reach the remaining issues in this appeal. 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 address the remaining issues on appeal when resolution of
a prior issue is dispositive).

1
Rule 26(c)(1) states, in pertinent part,

Upon motion by a party or by the person from whom
discovery is sought, and for good cause shown, the court
in which the action is pending or alternatively, on matters
relating to a deposition, the court in the circuit where the
deposition is to be taken may make any order which
justice requires to protect a party or person from
annoyance, embarrassment, oppression, or undue burden
by expense, including one or more of the following: (1)
that the discovery not be had . . . .

(emphases added).
AFFIRMED.

GEATHERS and MCDONALD, JJ., and MOORE, A.J., concur.