Judge Jill Feeney, Case 21STCV41834 2022-10-13 Tentative Ruling

This is an action for negligence, negligent hiring, training, retention, and supervision arising from a vehicle collision which took place in March 2020. Plaintiff Tillie Eze was a passenger when the driver who picked her up via the Uber application allegedly fell asleep at the wheel, failed to stop, and rear-ended the vehicle in front of the driver’s vehicle. Plaintiff filed her Complaint against Uber Technologies, Inc., Rasier, LLC., and Rasier-CA, LLC on November 12, 2021.

Plaintiffs argue that no arbitration agreement exists because the alleged agreement was entered into two years after the incident. Additionally, the arbitration agreement does not cover Plaintiff’s claims against the driver, Defendant Preza, and the matter should remain with the Court to prevent conflicting rulings. Lastly, Plaintiff argues Defendants have unreasonably delayed seeking to compel arbitration.

Uber argues that the arbitration agreement may encompass claims that accrue prior to the parties entering into the agreement; (2) CCP Section 1281.2 is inapplicable because the parties agreed that the Federal Arbitration Act would apply and, in any event, the existence of additional defendants does not foreclose arbitration; and (30 Uber did not unreasonably delay in seeking to arbitrate where arbitration was raised an affirmative defense and has attempted to reach a stipulation to arbitrate.

Code Civ. Pro. section 1281.2 permits a party to file a petition to request that the Court order the parties to arbitrate a controversy. Under section 1281.2, a party is permitted to file a motion to request an order directing the parties to arbitrate a controversy. Section 1281.2 also states that the Court may grant the motion if the Court determines that an agreement to arbitrate the controversy exists.

When a motion to compel arbitration is filed and accompanied by prima facie evidence of a written agreement to arbitrate the controversy, the court itself must determine whether the agreement exists and, if any defense to its enforcement is raised, whether it is enforceable. (Rosenthal v. Great Western Financial Sec. Corp. (1996) 14 Cal.4th 394, 413.) The moving party bears the burden of proving its existence by a preponderance of the evidence because the existence of the agreement is a statutory prerequisite to granting the petition. (Ibid.)

Since binding arbitration is a matter of contract, the parties may freely delineate the area of its application, and a proceeding to compel arbitration is in essence a suit in equity to compel specific performance of a contract. (Freeman v. State Farm Mutual Auto Insurance Co. (1975) 14 Cal.3d 473, 479; Morris v. Zuckerman (1967) 257 Cal.App.2d 91, 96.) Arbitration, as a general rule, should be upheld by the court, unless it can be said with assurance that an arbitration clause is not susceptible to an interpretation covering the asserted dispute. (Bos Material Handling, Inc. v. Crown Controls Corp. (1982) 137 Cal.App.3d 99, 105; O’Malley v. Wilshire Oil Co. (1963) 59 Cal.2d 482, 490-491.) The court should, nonetheless, give effect to the parties’ intentions in light of the usual and ordinary meaning of the contractual language and the circumstances under which the agreement was made. (Victoria v. Superior Court (1985) 40 Cal.3d 734, 744.)

Uber alleges that that in January 2022, Plaintiff was presented with a pop-up screen in the Uber application notifying Plaintiff that Uber updated its terms of use. (Buoscio Decl., ¶8.) Eze was presented with hyperlinks to Uber’s terms of use and privacy notice. (Id., Exhibit A.) The pop-up contained a clickbox which a user could select stating “By checking this box, I have reviewed and agreed to the Terms of Use and acknowledge the Privacy notice.” (Id., ¶9.) Plaintiff checked this box. (Id.) The terms that were in effect at the time Plaintiff agreed to be bound by them stated the following:

(1) Covered Disputes: Except as expressly provided below in Section 2(b) you and Uber agree that any dispute, claim or controversy in any way arising out of or relating to (i) these Terms and prior versions of these Terms, or the existence, breach, termination, enforcement, interpretation, scope, waiver, or validity thereof; (ii) your access to or use of the Services at any time; (iii) incidents or accidents resulting in personal injury to you or anyone else that you allege occurred in connection with your use of the Services…regardless of whether the dispute, claim or controversy occurred or accrued before or after the date you agreed to the Terms…(iv) your relationship with Uber, will be settled by binding arbitration between you and Uber, and not in a court of law. This Arbitration Agreement survives after your relationship with Uber ends.”

Under the Arbitration Rules and Governing Law paragraph of the Dispute resolution section, the agreement states “the Federal Arbitration Act, 9 U.S.C §1 et seq. (“FAA”), will govern its interpretation and enforcement and proceedings pursuant thereto.” (Id.) Thus, the Federal Arbitration Act governs the motion to compel arbitration. (See Victrola 89, LLC v. Jamon Properties 8 LLC (2020) 46 Cal.App.5th 337, 346 [finding the FAA governs a motion to compel arbitration when an agreement provides its ‘enforcement’ shall be governed by the FAA].) Therefore, the Court’s inquiry is limited to a determination of (1) whether a valid arbitration agreement exists and (2) whether the arbitration agreement covers the dispute. (9 U.S.C., § 4;¿Chiron Corp. v. Ortho Diagnostics Systems, Inc.¿(9th Cir. 2000) 207 F.3d 1126, 1130;¿Howsam¿v. Dean Witter Reynolds, Inc.¿(2002) 537 U.S. 79, 84;¿see¿Simula, Inc. v. Autoliv, Inc.¿(9th Cir. 1999) 175 F.3d 716 [if the finding is affirmative on both counts the FAA requires the Court to enforce the arbitration agreement in accordance with its terms].)

Uber meets its burden of proving the existence of a valid arbitration agreement between Uber and Plaintiff. Additionally, Uber demonstrates that the agreement covers incidents or accidents arising from Plaintiff’s use of Uber’s services, including incidents that occurred prior to the date of the agreement. Because this is an action for an accident which occurred while Plaintiff was a passenger using Uber services, the action is within the scope of the arbitration agreement.

Plaintiff first argues that the arbitration agreement does not cover the March 2020 accident because she did not agree to arbitrate at the time of the collision. This argument fails because it is well settled that an arbitration agreement may be applied retroactively to transactions which occurred prior to execution of the arbitration agreement. (Salgado v. Carrows Restaurants, Inc. (2019) 33 Cal.App.5th 356, 362.)

Next, Plaintiff argues that the existence of another defendant in the case, the driver, precludes arbitration pursuant to Code of Civil Procedure Section 1281.2(c) due to the possibility of inconsistent decisions. Putting aside the issue of the earlier dismissal of this defendant and whether the statute of limitations has run, the FAA compels arbitration here. (Moses H. Cone Hospital v. Mercury Constr. Corp. (1983) 460 U.S. 1, 20 (“Under the [FAA] an arbitration agreement must be enforced notwithstanding the presence of other persons who are parties to the underlying dispute but not to the arbitration agreement” even if enforcement “requires piecemeal resolution.”)

Finally, Plaintiff argues that Defendants’ motion should be denied because Uber delayed bringing the motion by eight months. However, it appears Defendants demanded arbitration in January 2022, just two months after Plaintiff filed her Complaint. Defendants spent five months determining whether Plaintiff would stipulate to arbitration. After Defendants sent a formal meet and confer letter requesting that Plaintiff stipulate to the arbitration, Plaintiff represented to Uber that Plaintiff could not stipulate to arbitration until Plaintiff served Defendant Preza. (Reply, p.9.) However, service never occurred and Defendant Preza was dismissed. The Court finds that Defendants’ delay was not unreasonable.