Bellsouth Communications System, L.L.C. v. West

Citations: 902 So. 2d 653; 2004 Ala. LEXIS 326; 2004 WL 2757416Docket: 1030861

Court: Supreme Court of Alabama; December 2, 2004; Alabama; State Supreme Court

Lead Opinion SummaryLead Opinion Original

EnglishEspañolSimplified EnglishEspañol Fácil

BellSouth Communications System, L.L.C. appeals a Jefferson Circuit Court order denying its motion to compel arbitration in a lawsuit filed by plaintiff Thomas N. West. West, representing himself and a potential class, claims breach of contract, alleging that he contracted for BellSouth's Internet service at $15.95 per month but was charged $19.85 monthly and a $15.00 setup fee. He seeks compensatory damages for the alleged overcharges. West attached the service agreement to his complaint, which outlines that users agree to the terms by registering for the service. The agreement allows BellSouth to modify terms and pricing without prior notice, and asserts that it is governed by Georgia law. It states that if any provision is deemed invalid, the remaining provisions remain effective. The agreement constitutes the entire understanding between West and BellSouth regarding the service, superseding previous agreements. Additionally, usage of the service is subject to BellSouth's Acceptable Use Policies, which are also subject to change.

BellSouth's motion to compel arbitration contended that the only argument against arbitration was the addition of the arbitration provision to the initial agreement, which West claimed he had not agreed to. BellSouth maintained that West's agreement had been modified to include an arbitration clause by the time he filed his complaint on September 2, 2003. The motion included copies of both the initial agreement and the revised agreement with the arbitration clause, as well as an affidavit from Randall M. Kinkaid, asserting that the revised agreement had been posted on BellSouth's website.

West responded, arguing he had not consented to the arbitration clause and cited U.S. Supreme Court decisions and Alabama case law regarding contract formation and retroactive arbitration agreements. Following a hearing, the trial judge ruled against BellSouth's motion, noting that the online posting of the arbitration clause was not likely to be seen by most customers. The judge highlighted that the arbitration agreement limited West's rights, including barring class action claims and punitive damages.

The judge emphasized that the initial service agreement allowed for unilateral modifications through online postings, which would take effect upon posting. However, Kinkaid's affidavit did not clarify when the revised agreement was posted or confirm whether West had used the service after the posting. BellSouth's claim that West continued to use its service post-revision lacked evidentiary support. Ultimately, the court overruled BellSouth's motion to compel arbitration.

No evidence was presented during the hearing on BellSouth's motion to compel arbitration, nor was there any discussion regarding the date the revised agreement was posted online or whether West used BellSouth's Internet service after that date. The trial judge was informed that the revised agreement was 'in effect' when West filed his lawsuit. According to the initial agreement, any revised terms would only apply to services used by West post-posting. BellSouth claimed the initial agreement had been modified to include an arbitration clause when West filed his complaint. However, it remains unclear if West used the Internet service after the revised agreement was posted, and the damages he seeks stem from overcharges incurred before the revised agreement's posting.

Assuming the unilateral modification was effective upon posting, the revised agreement and its arbitration clause would apply only to services used after that date. The court noted that ambiguities in contracts are generally construed against the drafter, which in this case is BellSouth. Given that BellSouth drafted the service agreement and there was no evidence that the agreement was revised prior to West's action, nor evidence that he used the service after the revised posting, the court found sufficient grounds to affirm the trial court's decision to deny the motion to compel arbitration. The ruling was affirmed with concurrence from the judges involved.