Brewer v. Missouri Title Loans
2012 Mo. LEXIS 62
| Mo. | 2012Background
- Brewer borrowed $2,215 secured by auto title; APR 300%.
- Contract required binding, individual arbitration under FAA; class arbitration waiver included.
- Arbitration terms were non-negotiable; Brewer could not renegotiate terms.
- Title lender retained court access for repossession even as borrower arbitration remained mandatory.
- No consumer had ever successfully arbitrated or recovered under these terms; large damages unlikely.
- Missouri Supreme Court previously held class waiver unconscionable and struck the arbitration agreement, later remanded after Concepcion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does Concepcion permit state unconscionability defenses to arbitration formation? | Brewer: unconscionability formation defense valid. | Missouri Title Loans: preemption limits defenses to formation case-by-case. | Case-by-case analysis permitted; not a total preemption. |
| Is the arbitration clause procedurally unconscionable? | Brewer asserts non-negotiable terms and unequal bargaining power. | Title Loans contends no procedural defect proven. | Not proven; procedural unconscionability not established. |
| Is the arbitration clause substantively unconscionable under Missouri law? | Terms are one-sided; self-help repossession; attorney-fee provisions favor lender; high interest. | Terms permissible if supported by consideration and not mutually reciprocal. | Arbitration clause substantively unconscionable; unenforceable. |
| What is the proper remedy for unconscionability? | Strike class waiver and preserve individual arbitration. | Remedy should align with Concepcion; sever class waiver only. | Arbitration clause revoked; class-waiver severed; remanded for further proceedings. |
Key Cases Cited
- AT&T Mobility, LLC v. Concepcion, 563 U.S. 333 (2011) (FAA preempts Discover Bank rule; case-by-case defense analysis)
- Marmet Health Care Ctr., Inc. v. Brown, 565 U.S. _ (2012) (Remand to assess state common-law defenses pre-empted by FAA)
- Robinson v. Title Lenders, Inc., 364 S.W.3d 505 (Mo. banc 2012) (State defenses to formation applied case-by-case; arbitration formation focus)
- Vincent v. Schneider, 194 S.W.3d 853 (Mo. banc 2006) (Consolitates unconscionability framework in Missouri)
- Doctors Advs., Inc. v. Casarotto, 517 U.S. 681 (1996) (Savings clause allows generally applicable defenses, not arbitration-specific ones)
- Sanger v. Yellow Cab Co., Inc., 486 S.W.2d 477 (Mo. banc 1972) (Unconscionability requires meeting of minds and voluntary assent)