Thompson v. Lithia Chrysler Jeep Dodge of Great Falls, Inc.
Montana Supreme Court
185 P.3d 332 (2008)
The Thompsons (plaintiffs) signed a Retail Installment Contract and Vehicle Buyer's Order to purchase a truck from Lithia Chrysler Jeep Dodge (defendant) at a 3.9 percent APR, with both documents requiring arbitration of disputes; the order stated the transaction would not be a binding contract until the financing terms were accepted by a financial institution. After the Thompsons took the truck home, Lithia demanded they accept a 4.9 percent APR or return it; the Thompsons left the truck but never got back their down payment or trade-in, and Lithia later obtained approval of the original 3.9 percent financing from Daimler Chrysler Financial (defendant) and made a payment to preserve that rate. The Thompsons sued, the defendants moved to compel arbitration, the district court granted the motion, and the Thompsons appealed.
Whether a contractual provision that requires acceptance by a third party of certain terms in order to make the contract binding is a condition precedent to the very formation of the contract, as determined by a court even if the contract otherwise requires arbitration.