COLORADO SPRINGS, Colo.–The Colorado Court of Appeals has overruled a district court ruling involving Ent Credit Union and its motion to compel arbitration with a member who had filed suit and alleged she had not been given sufficient notice of a change in the membership agreement.
At issue in the case Macasero v. ENT was whether member Cecelia Macasero had actual or constructive notice of the new provision.
In 2014, after Cecilia Macasero bought a car with Ent as her creditor, she also bought a Guaranteed Automobile Protection (GAP) waiver. The credit union in 2019 updated the membership agreement’s terms to add an arbitration agreement titled “Arbitration and Waiver of Class Action.”
Macasero alleged she was not made aware of the change. But the Appeals Court disagreed and said she had implicitly agreed to the terms.
‘Sufficiently Clear’
“The division concludes the plaintiff was placed on constructive notice of the change in terms because she received the notice in the manner she had agreed upon, and the notice was sufficiently clear and conspicuous considering the parties’ prior course of dealing, the email was designed in such a way that the notice was reasonably conspicuous and the change in terms was easily accessible,” the ruling states. “Macasero argues that by adding the arbitration agreement to the existing terms and conditions, Ent seeks to incorporate a document by reference into the existing membership agreement. This is not the case. Because the membership agreement preexisted and contained a clause allowing Ent to unilaterally change the terms, it is a modified contract.
Remanded to District Court
“Because the district court incorrectly determined that the plaintiff did not have the constructive notice, the division reverses the district court’s order and remands to the district court for further proceedings,” the court added.
The court’s full ruling can be found here.
GAP insurance has been a hot topic in Colorado. As CUToday.info earlier reported here, in early 2022, Ent Credit Union, along with Premier Members Credit Union and Credit Union of Denver distributed combined refunds totaling more than $6 million, following an investigation by Attorney General Phil Weiser.
“An investigation into all three credit unions revealed those payments were sometimes never given to borrowers. In the settlement, Colorado Springs-based Ent Credit Union refunded money to 19,011 borrowers, Boulder-based Premier Members Credit Union refunded money to 2,563 borrowers and Credit Union of Denver refunded amounts paid to 744 borrowers,” the report explained.
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