Southern Pioneer Life Insurance Co. v. Thomas
Arkansas Supreme Court
385 S.W.3d 770, 2011 Ark. 490 (2011)
Facts
Danny and Irma Thomas (plaintiffs) purchased a vehicle, financed through Chrysler Financial, by completing a credit application (application) and retail installment contract (RIC) that included an arbitration provision. The RIC included an option to purchase life insurance from Southern Pioneer Life Insurance Company (Southern Pioneer) (defendant). The Thomases financed the insurance premium over the life of their vehicle loan, which they paid off five years before the loan’s maturity date. The Thomases initiated a class-action lawsuit for reimbursement of the portion of the premium charged between the payoff date and expiration of the insurance policy on the date of maturity. Southern Pioneer moved to compel arbitration, asserting that the dispute involved breach of the RIC that contained the arbitration provision. The Thomases argued that the dispute arose out of an insurance contract governed by Arkansas Code § 16-108-201(b) and the McCarran-Ferguson Act, 15 U.S.C. §§ 1011 et. seq., which prohibited arbitration of insurance claims. Southern Pioneer’s motion was denied. The court found that the Arkansas Code applied to preclude arbitration. Southern Pioneer appealed.
Rule of Law
Issue
Holding and Reasoning (Baker, J.)
Concurrence (Henry, J.)
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