Judge: Gary Y. Tanaka, Case: 22TRCV00514, Date: 2023-04-27 Tentative Ruling

Case Number: 22TRCV00514    Hearing Date: April 27, 2023    Dept: B

LOS ANGELES SUPERIOR COURT – SOUTHWEST DISTRICT

Honorable Gary Y. Tanaka                                                                                        Thursday, April 27, 2023
Department B                                                                                                                          Calendar No. 12

PROCEEDINGS

Gloria Udengwu, et al. v. Fruitvale Operating Company, LP, et al.

22TRCV00514

1.      Fruitvale Operating Company, LP’s Motion to Compel Arbitration and to Stay Action

TENTATIVE RULING

Fruitvale Operating Company, LP’s Motion to Compel Arbitration and to Stay Action is granted.  

Background

            Plaintiff filed the Complaint on June 27, 2022. Plaintiff alleges the following facts. Plaintiff provided nursing staff and personnel to Defendant pursuant to the contract. However, Defendant failed to pay for the services.

            Motion to Compel Arbitration

            “California law reflects a strong public policy in favor of arbitration as a relatively quick and inexpensive method for resolving disputes.  [Citation.]  To further that policy, [Code of Civil Procedure] section 1281.2 requires a trial court to enforce a written arbitration agreement unless one of three limited exceptions applies.  [Citation.]  Those statutory exceptions arise where (1) a party waives the right to arbitration; (2) grounds exist for revoking the arbitration agreement; and (3) pending litigation with a third party creates the possibility of conflicting rulings on common factual or legal issues.  (§ 1281.2, subds. (a)–(c).)”  Acquire II, Ltd. v. Colton Real Estate Group (2013) 213 Cal.App.4th 959, 967.

            “The petitioner bears the burden of proving the existence of a valid arbitration agreement by the preponderance of the evidence, and a party opposing the petition bears the burden of proving by a preponderance of the evidence any fact necessary to its defense.  In these summary proceedings, the trial court sits as a trier of fact, weighing all the affidavits, declarations, and other documentary evidence, as well as oral testimony received at the court’s discretion, to reach a final determination.”  Giuliano v. Inland Empire Personnel, Inc. (2007) 149 Cal.App.4th 1276, 1284.

            “The party opposing arbitration has the burden of demonstrating that an arbitration clause cannot be interpreted to require arbitration of the dispute.  Nonetheless, this policy does not override ordinary principles of contract interpretation.  [T]he contractual terms themselves must be carefully examined before the parties to the contract can be ordered to arbitration:  Although [t]he law favors contracts for arbitration of disputes between parties, there is no policy compelling persons to accept arbitration of controversies which they have not agreed to arbitrate.”  Rice v. Downs (2016) 247 Cal.App.4th 1213, 1223 (internal citations and quotations omitted).

            In Rowe v. Exline (2007) 153 Cal.App.4th 1276, 1286, the Court of Appeal found that “a nonsignatory sued as an agent of a signatory may enforce an arbitration agreement.”  Id. at 1286.  In addition, “a nonsignatory who is the agent of a signatory can even be compelled to arbitrate claims against his will.”  Id. at 1285, citing Harris v. Superior Court (1986) 188 Cal.App.3d 475, 477–78.  Further, “in many cases, nonparties to arbitration agreements are allowed to enforce those agreements where there is sufficient identity of parties.”  Valley Casework, Inc. v. Comfort Construction, Inc. (1999) 76 Cal.App.4th 1013, 1021.  This includes nonparties as agents of a party as well as “a third party beneficiary of an arbitration agreement.”  Ibid. 

            “Under the doctrine of equitable estoppel, [...] a nonsignatory defendant may invoke an arbitration clause to compel a signatory plaintiff to arbitrate its claims when the causes of action against the nonsignatory are intimately founded in and intertwined with the underlying contract obligations. By relying on contract terms in a claim against a nonsignatory defendant, even if not exclusively, a plaintiff may be equitably estopped from repudiating the arbitration clause contained in that agreement. Where the equitable estoppel doctrine applies, the nonsignatory has a right to enforce the arbitration agreement.” Felisilda v. FCA US LLC (2020) 53 Cal.App.5th 486, 495–96 (internal citations and quotations omitted).

            Defendant moves for an order compelling arbitration of Plaintiff’s claims and for an order for stay pending completion of arbitration.  The motion is made pursuant to Code of Civil Procedure §1281 et seq. on the grounds Plaintiff is bound by a written agreement to arbitrate the subject matter of the Complaint. (Defendant’s Ex. 1.)

            Plaintiff filed a notice of non-opposition to the motion.  Moving Defendant has met its initial burden to show the existence of a valid arbitration clause between the parties, the burden shifts to Plaintiff to show that the arbitration clause should not be enforced. Rice, supra, 247 Cal.App.4th at 1223.  As noted, Plaintiff filed a notice of non-opposition.

            Therefore, Defendant’s Motion to Compel Arbitration and to Stay Action is granted.

    The instant action is ordered stayed. The Court sets an OSC re: status of arbitration for _________________.

            Defendant is ordered to give notice of this ruling.