Hill v. EAN Holdings, LLC

Dana Hill was the victim of a bait-and-switch auto financing scheme. He sought to buy a used car from Enterprise, and he planned to finance the car by trading in his old car, making a down payment, and taking out a loan. The Enterprise dealership assured Mr. Hill that they could find financing that met his requirements for the size of his monthly payment. Based on that assurance, Mr. Hill made a down payment to have the car Mr. Hill wanted shipped to his location.

But when Mr. Hill arrived to complete the car purchase, Enterprise told him that he needed to make a larger down payment and would have a higher monthly payment. Mr. Hill nevertheless agreed to buy the new-to-him car, traded in his old car, and signed a number of related documents, including a Motor Vehicle Delivery Agreement (MVDA). A month later, Mr. Hill received a call from the dealership informing him that the financing he agreed to had fallen through and that he needed to agree to different financing that would raise his monthly payments. Mr. Hill begrudgingly agreed. Two weeks later, Mr. Hill got another call saying the financing had fallen though again, and that he would need to make an additional down payment and would have a much higher monthly payment. Mr. Hill declined to sign a third set of financing documents, particularly since he had already made payments on the loan from the second set of financing documents.

Enterprise responded by repossessing the car and threatening to have Mr. Hill arrested. Mr. Hill contacted Enterprise and requested to have his old car and down payment returned. Enterprise refused. Mr. Hill sued Enterprise, bringing various tort claims, breach of contract claims, and allegations that Enterprise violated the Oklahoma Consumer Protection Act.

Enterprise moved to compel arbitration of Mr. Hill’s claims based, in relevant part, on the arbitration clause in the MVDA. But, among other things, the MDVA provides that it only becomes effective upon approval of the financing. Since financing was never approved, Mr. Hill argued, the MVDA—including its arbitration agreement—never came into effect. The trial court agreed and denied Enterprise’s motion to compel. Enterprise appealed, and the court of appeals reversed, reasoning that the severability doctrine required it to enforce the arbitration agreement even if the validity of the rest of the agreement was in question. Mr. Hill will now seek review in the Oklahoma Supreme Court.