Although Nissan Motor Acceptance Corporation is a nonsignatory as to the contracts in this case, this case is distinguishable from recent cases in which we held that a nonsignatory could not compel arbitration. See Ex parte Martin, [Ms. 1951420, November 8, 1996] 703 So.2d 883 (Ala. 1996); Exparte Jones, 686 So.2d 1166 (Ala. 1996).

The distinction between this case and Martin and Jones represents a significant difference. Nissan became an assignee of the Jim Burke contract; therefore, it can assert the terms of that contract, including the arbitration clause.

This arbitration case arises out of Bernette Ross's purchase of an automobile, sold to her by Jim Burke Automotive, Inc. ("Jim Burke"), and financed by Nissan Motor Acceptance Corporation ("Nissan"). Ross sued Jim Burke and Nissan, alleging, among other things, fraud. Jim Burke and Nissan moved to stay the proceeding below and to compel arbitration. The trial court granted Jim Burke's motion to compel arbitration, but denied Nissan's motion. Nissan appealed.² We reverse and remand.

In January 1995, Ross purchased a new car from Jim Burke. The purchase transaction involved two pertinent documents: (1) a retail buyer's order, which contained an arbitration clause signed by Ross and Jim Burke; and (2) a retail sales contract, which was assigned to Nissan. The retail buyer's order specifically incorporates the retail sales contract.

Ross alleges that Jim Burke used a rebate, or incentive payment, to artificially lower her payments from $468 per month to $125 per month for approximately 7 months. Ross further alleges that Jim Burke misrepresented that at the end of the 7-month period, she could trade in her new vehicle for another vehicle and continue to make payments of only $125 per month. After the 7 months expired, no trade-in occurred. Ross's payments rose to $468 per month; she had difficulty making those higher payments, and in February 1996 she returned the car to Jim Burke. Nissan sold the car at a private auction and then sought to collect the $7,000 balance due on Ross's note. In response, Ross sued Jim Burke and Nissan, alleging, among other things, misrepresentation of material facts in the sale of the automobile.

Section 2 of the Federal Arbitration Act ("FAA") provides in pertinent part:

"A written provision in any . . . contract evidencing a transaction involving interstate commerce to settle by arbitration a *Page 326 controversy thereafter arising out of such contract or transaction . . . shall be valid, irrevocable, and enforceable. . . ."

The retail buyer's order signed by Ross and Jim Burke provides in pertinent part:

"All disputes and controversies of every kind and nature between the parties hereto arising out of or in connection with this contract, its subject matter or its negotiation . . . or any claim alleging fraud in fact, fraud in the inducement, deceit, or suppression of any material fact shall be submitted to binding arbitration. . . .

". . . .

"The contract consists of the following documents: . . . this retail buyer's order . . . retail sales contract and security agreement. . . ."

(Emphasis added.)

Ross's retail sales contract, signed by Ross and assigned to Nissan, provides:

"NOTICE: [Jim Burke] intends to sell this contract to Nissan Motor Acceptance Corporation, which, if it buys the contract, will become the owner of the contract and your creditor. . . .

". . . .

"If [Jim Burke] transfer[s] this contract to an assignee you will be given notice thereof and you agree that the assignee will have all of our rights and remedies under the contract . . . ."

(Emphasis added.)

Nissan contends simply that under the retail buyer's order Ross agreed to arbitrate "all disputes"; that the order specifically incorporated the retail sales contract; and that Nissan became a party to the retail sales contract when Jim Burke assigned it to Nissan. Nissan argues that through the assignment it steps into the shoes of Jim Burke, the assignor, and is entitled to arbitration, under the express provisions of the arbitration clause. We agree.

As an assignee, Nissan simply steps into the shoes of the assignor, Jim Burke, a signatory to the arbitration agreement.Upchurch v. West, 234 Ala. 604, 609, 176 So. 186, 190 (1937), overruled on other grounds, Dominex, Inc. v. Key,456 So.2d 1047 (Ala. 1984). A valid assignment gives the assignee the same rights, benefits, and remedies that the assignor possesses. Id. Accord John D. Calamari Joseph M. Perillo, The Law ofContracts, § 18-3 at 633, 634 (2d ed. 1977). Thus, Nissan has the right to compel arbitration. See, e.g., I.S. Joseph Co. v.Michigan Sugar Co., 803 F.2d 396, 400 (8th Cir. 1986) (stating that, assuming a valid assignment, the assignee could enforce an arbitration provision entered into by the assignor);Chatham Shipping Co. v. Fertex S.S. Corp., 352 F.2d 291, 294 (2d Cir. 1965) (stating that "absent contrary expression, assignment of a contract carries with it a right to arbitration therein provided"); Gruntal Co., v. Steinberg, 843 F. Supp. 1 (D.N.J. 1994) (stating that "a successor to or assignee of a contract containing an arbitration clause may be obligated to arbitrate pursuant to that arbitration clause"); Banque deParis et des PaysBas v. Amoco Oil Co., 573 F. Supp. 1464 (S.D.N.Y. 1983) (stating that an assignee may pursue the claims of the assignor and may enforce an arbitration provision the assignor had agreed to).

The trial court improperly denied Nissan's motion to compel arbitration. We therefore reverse the trial court's order and remand the cause for further proceedings not inconsistent with this opinion.⁴

REVERSED AND REMANDED. *Page 327

HOOPER, C.J., and MADDOX, SHORES, and HOUSTON, JJ., concur.

COOK, J., concurs specially.

BUTTS, J., concurs in the result.