Cite as 2013 Ark. App. 517
Susan Williams ARKANSAS COURT OF APPEALS
2019.01.02
DIVISION IV
12:39:49 -06'00' No. CV-13-3
Opinion Delivered September 78, 2073
BANK OF THE OZARKS, INC., and
BANK OF THE OZARKS APPEAL FROM THE LONOKE
APPELLANTS COUNTY CIRCUIT COURT
[NO. CV -2011-777)
V.
HONORABLE SANDY HUCKABEE,
ROBERT WALKER, ANN B. HINES, JUDGE
and JUDITH BELK
APPELLEES REVERSED AND REMANDED
RHONDA K.\VOOD,Judge
Appellanr, Bank of the Ozarks, appeals from the denial of its motion to compel
arbitration of appellees'class-action complaint.lThe circuit court ruled that rhe arbitration
clause in the deposit agreement between the bank and appellees was unconscionable. The
bank argues that the circuit coult erred and that the arbitration clause is enforceable. We
agree and reverse and remand for entry of an order compelling arbitration.
Appellees each have a checking account with the bank. A deposit agreement
govems these relationships and includes, among other things, an arbitration clause,2 a class-
I An order denying a motion to compel arbitration is immediately appeaiable. Ark.
R. App. P.-Civil 2(a)(12) (2012).
2
The arbitration clause reads as follows:
ARBITRATION. You or we may require that any controversy or
claim relating to this agreement, or breach of it, be resolved through
arbitration administered by rhe American Arbitration Association under its
Cite as 2013 Ark. App. 517
action waiver, and a jury-trial waiver. Appellees have filed a class-action complaint,
arguing that the bank had intentionally processed more expensive debit transactions first in
order to capitalize on overdraft charges. In lieu of an answer, the bank moved to compel
arbitration under the agreement. However, the circuit court found that the arbitration
provision was unconscionable and unenforceable and denied the bank's motion to compel.
-We
review the circuit court's order denying a motion to compel de novo on the
record. Aduance Am. Seruicing oJ Ark., Inc. u. McGinnis,375 Ark. 24,289 S.'W.3d 37
(2008). In a de novo review, we review the evidence and the law without deference to
the trial court's rulings. Terminix Int'l Co, u. Tiuitt, 104 Ark. App. 1,22,289 S.'w.3d 485
(2008). Arbitrarion is strongly favored as a matter of public policy as a less expensive and
more expeditious means of settling litigation and relieving docket congestion . CEI Eng'g
Assocs. u. Elder Constr. Co., 2009 Ark. App. 259, 306 S.W.3d 447.
In assessing whether a particular contract or provision is unconscionable, we review
the totaliry of the circumstances surrounding the negotiation and execution of the
contract. State ex rel. Bryant v. R E A Inu. Co.,336 Ark. 289, 985 S.'W.2d299 (1999).
Two important considerations are whether there is a gross inequaliry of bargaining power
between the parties to the contract and whether the aggrieved parry was made aware of
and comprehended the provision in question. Id.
Here, the circuit court also considered additional factors that federal district courts
in Arkansas have applied regarding unconscionabiliry. First, it considered whether the
commercial rules. Judgment on any award rendered by the arbitrator may be
entered in any court having jurisdiction.
Cite as 2013 Ark. App. 517
words were hidden in a rnaze of fine print and whether the agreed upon terms were in a
prolix printed form drafted by the parry seeking to enforce the disputed rerms. See Enderlin
u. XM Satellite Radio Holdings, 12r., No. 4:06-CV-0032 GTE,2008 WL 830262 (E.D.
Ark. Mar. 25,2008). Second, the court considered whether the arbitration provision's
terms were "harsh, one-sided, or oppressive." Cobeyn u. Trauelers Indem. Co., No.
1:09CV00034 JLH, 2009 WL 3148755 (E.D. Ark. Sept. 24, 2009)."Whiie no Arkansas
state case requires it, the circuit court appeared to rule that the arbitration clause was both
substantively and procedurally unconscionable. Without deciding whether both are
required, we hold that appellees failed to prove either one.
First, the record lacks any evidence surrounding the negotiations and execution of
the deposit agreement. No evidence, testimony, or affidavits were presented, and the
court relied only on the pleadings and arguments of counsel. Statements by counsel are
not evidence. See Roberts u. Creen Bay Packaging, lnc.,101 Ark. App. 160, 2725.W.3d 125
(2008). Thus, the court couid not know whether appellees read the deposit agreement,
understood its cerms, or any of the circumstances surrounding its execution. Second, there
is nothing unconscionable about the arbitration clause itself. Either parry can request
arbitration, so the provision does not oflend the mutualiry doctrine. See Asbury Auto. Used
Car Ctr. u. Brosh,364 Ark. 386,391,,220 S.W.3d 637,640-41 (2005) (holding that
"[m]utualiry within the arbitration agreement icself is required" and that "[a] lack of
mutuality to arbitrate in arbitration clauses renders the clauses void as to the bound
parry.").This belies the circuit court's conclusion that the arbitration clause was one-sided
because either parry could choose arbitration over a courtroom.
Cite as 2013 Ark. App. 517
In short, appellees presented no persuasive proof on the relevant unconscionabiliry
considerations. Therefore, it was error for the circuit court to deny the bank's motion to
compel on those grounds. Appellees only presented counsel's arguments regarding the
agreement's execution. Those arguments are not evidence. Further, nothing in the
agreement itself is substantively unconscionable-it contains mutual promises, and either
parfy can require arbitration. lJnder our de novo review, we reverse the order denying
the motion and remand the case for entry of an order compelling arbitration. See CEI
Eng'g, supra.
Finally, appellees argue, for the first time on appeal, that no valid agreement to
arbitrate even exists. It is true that "[a] threshold inquiry is whether an agreement to
arbitrate exists; that is, whether there has been mutual agreement, with notice as to the
terms and subsequent assen t." Alltel Corp. u. Sumner,360 Ark. 573, 576,203 S.W.3 d 77,
80 (2005). But we do not consider arguments raised for the first time on appeal and will
not address an argument on appeal rf a parry has failed to obtain a ruling below. Boellner u.
Clinical Study Ctrs.,2011 Ark. 83,378 S.W.3d 745. 'Whether an arbitration agreement
exists was neither raised nor ruled on below, and we do not consider it now. See Gwin v.
Daniels, 357 Ark. 623, 184 S.W.3d 28 (2004) (stating that failure to obtain a ruling
precludes appellate review because, under appellate jurisdiction, we can only review a
lower court's rulings or orders).
Reversed and remanded.
GRrmnR and HlxsoN,JJ., agree.