Wisconsin Auto Title Loans, Inc., Plaintiff-Appellant-Petitioner, v. Kenneth M. Jones, Defendant-Respondent., 2006 WI 53

Summary

The loan agreement included the arbitration provision at issue and broadly stated that all disputes would be decided by binding arbitration, yet it carved out for the company the right to enforce the borrower's payment obligations in the event of default. The loan made to the borrower was set out on a pre-printed loan agreement drafted by the company who was experienced in the business of making short-term auto loans. The pre-printed form contract involved was what was known in law as an adhesion contract. The court held that the unconscionable one-sidedness of the arbitration provision was sufficient to hold the arbitration provision substantively unconscionable. Under the loan agreement, the borrower may bring any affirmative defenses to the replevin action in circuit court. Thus, the borrower was permitted to argue that the replevin action could not be sustained because the loan agreement was unconscionable. Also, the arbitration fee supported the conclusion that the arbitration ...