Baker v. Autos, Inc.
2015 ND 57
| N.D. | 2015Background
- Baker bought a 2003 Pontiac Grand Am from Autos, Inc. (Global Auto) and financed it via a retail installment contract totaling $5,470.94, including a $195 document administration fee and a $200 loan fee.
- Baker was late on payments, the car was repossessed, and the contract was assigned to RW Enterprises.
- Baker sued in state court asserting usury and Retail Installment Sales Act violations, among other claims, naming Global Auto, RW Enterprises, and its principals as defendants.
- The case was removed to federal court but later remanded to state court after amendments eliminated federal claims; Baker sought class certification for all similarly situated buyers.
- The district court denied class certification, and Baker appealed; the Supreme Court reversed, holding the district court misapplied the law to the 13 sub-factors and remanded for reconsideration.
- Key issue on remand: whether common questions exist despite contract variations and whether Baker can fairly represent a class of hundreds of purchasers.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did the district court properly apply the 13 sub-factors for class certification? | Baker argues the court erred in applying sub-factors (B), (D), (F), (G), and (K) and misapplied law to commonality. | Defendants contend the district court reasonably weighed the sub-factors and considered manageability and individualized issues. | No; the Court held the district court erred in applying several sub-factors and remanded to reconsider them. |
| Is there commonality among putative class members despite contract variation? | Baker asserts a common nucleus exists regarding fees and disclosures across contracts. | Defendants argue contract variations defeat common questions and overwhelm common issues. | Yes; the Court found a common nucleus of facts and law regarding loan fee, document administration fee, late fee, and related usury/RISA issues. |
| Is Baker an adequate and representative class representative? | Baker contends she is adequate to represent the class; no conflict or lack of resources is shown. | Defendants argued Baker’s contract-specific remedy undermines typicality and adequacy. | The majority found Baker’s adequacy sufficient on remand; the issue required further consideration once the other sub-factors are properly analyzed. |
Key Cases Cited
- Rogelstad v. Farmers Union Grain Terminal Ass’n Inc., 226 N.W.2d 370 (N.D. 1975) (reversed denial of certification; common legal questions on usury)
- Bice v. Petro-Hunt, L.L.C., 2004 ND 113, 681 N.W.2d 74 (N.D. 2004) (commonality easily satisfied; damages variations do not defeat commonality)
- Klagues v. Maintenance Eng’g, 2002 ND 59, 643 N.W.2d 45 (N.D. 2002) (manageability and predominate considerations; standard under Rule 23)
- Werlinger v. Champion Healthcare Corp., 1999 ND 173, 598 N.W.2d 820 (N.D. 1999) (adequacy and hear related class action standards)
- Rose v. United Equitable Ins. Co., 2002 ND 148, 651 N.W.2d 683 (N.D. 2002) (discretion in balancing sub-factors; emphasizes broad discretion)
- Amchem Prods., Inc. v. Windsor, 521 U.S. 591 (U.S. 1997) (predominance and class certification framework context)