Judge: Daniel S. Murphy, Case: 21STCV12304, Date: 2024-01-05 Tentative Ruling

Case Number: 21STCV12304    Hearing Date: January 5, 2024    Dept: 32

BACKGROUND

            On May 31, 2023, Plaintiff Ava Welsing-Kitcher filed this action against Defendants Karplus Warehouse, Inc. and The Western Surety Company, asserting claims arising from Plaintiff’s purchase of a Hyundai vehicle. Plaintiff filed the First Amended Complaint on July 31, 2023. Plaintiff alleges that the dealer failed to transfer title to her as promised. As a result, Plaintiff was unable to sell the vehicle. By the time Plaintiff received the title, the vehicle had decreased in value. Plaintiff also alleges that the vehicle had not been previously used as a rental as the dealer represented, but was instead used as a rideshare.

            On November 27, 2023, Defendants filed the instant motion to compel arbitration. Plaintiff has not filed an opposition.  

LEGAL STANDARD

“On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party to the agreement refuses to arbitrate that controversy, the court shall order the petitioner and the respondent to arbitrate the controversy if it determines that an agreement to arbitrate the controversy exists….” (Code Civ. Proc, § 1281.2.) “The party seeking arbitration bears the burden of proving the existence of an arbitration agreement, and the party opposing arbitration bears the burden of proving any defense, such as unconscionability.” (Pinnacle Museum Tower Assn. v. Pinnacle Market Development (US), LLC (2012) 55 Cal.4th 223, 236.)

DISCUSSION

I. Prima Facie Proof of an Agreement to Arbitrate

“The moving party ‘can meet its initial burden by attaching to the motion or petition a copy of the arbitration agreement purporting to bear the opposing party's signature.’” (Gamboa v. Northeast Community Clinic (2021) 72 Cal.App.5th 158, 165, quoting Bannister v. Marinidence Opco, LLC (2021) 64 Cal.App.5th 541, 543-44.)

Here, Plaintiff signed a sale contract containing an arbitration provision and additionally signed an addendum providing that the arbitration would proceed through the American Arbitration Association (AAA). (Pichvai Decl., Ex. A, B.) Therefore, Defendants have satisfied their burden of proving the existence of an arbitration agreement.

II. Arbitration Provider

            Plaintiff refused to arbitrate before AAA and indicated that she would only submit to arbitration before JAMS or “other organizations.” (Pichvai Decl., Ex. F, H.) The sale contract provides that Plaintiff “may choose the American Arbitration Association . . . or any other organization to conduct the arbitration subject to [Defendants’] approval.” (Id., Ex. A.) However, Plaintiff signed an addendum providing that the parties “agree to resolve that dispute with the American Arbitration Association.” (Id., Ex. B.) Plaintiff cannot renege on her express agreement to arbitrate before AAA.

            Even if the original term in the sale contract controlled, meaning Plaintiff could choose AAA or “any other organization,” Plaintiff’s choice would be subject to Defendants’ approval. (See Pichvai Decl., Ex. A.) In other words, the contract provides Defendants with the ultimate discretion over the arbitration provider. There is no indication that Defendants have selected AAA in bad faith. (See Third Story Music, Inc. v. Waits (1995) 41 Cal.App.4th 798, 804 [“a discretionary power must be exercised in good faith”].) Therefore, the claims are subject to arbitration before AAA under both the original sale contract and the addendum.

            Plaintiff’s failure to oppose the motion constitutes a concession that her claims must be arbitrated before AAA.

CONCLUSION

            Defendants’ motion to compel arbitration is GRANTED. The case is stayed in its entirety pending the outcome of arbitration.