Judge: Joel L. Lofton, Case: 23AHCV02122, Date: 2024-02-08 Tentative Ruling
Case Number: 23AHCV02122 Hearing Date: February 8, 2024 Dept: X
Tentative Ruling
Judge Joel L. Lofton,
Department X
HEARING DATE: February 8, 2024 TRIAL
DATE: No date set.
CASE: KEVIN WANG, v. JP
MORGAN CHASE BANK, N.A.; and DOES 1 through 50, inclusive.
CASE NO.: 23AHCV02122
MOTION
TO COMPEL ARBITRATION
MOVING PARTY: Defendant JP Morgan Chase Bank,
N.A. (“Defendant”)
RESPONDING PARTY: Plaintiff
Kevin Wang
SERVICE: Filed November 27, 2023
OPPOSITION: Filed January 26, 2024
REPLY: Filed January 31, 2024
RELIEF
REQUESTED
Defendant moves to compel
Plaintiff to submit this case to arbitration.
BACKGROUND
This case arises out of Plaintiff Kevin Wang’s
(“Plaintiff”) claim that Defendant JP Morgan Chase Bank, N.A., negligently
allowed Plaintiff’s safe deposit box to be taken in its entirety from
Defendant’s possession without Plaintiff’s permission. Plaintiff filed this
complaint on September 13, 2023, alleging three causes of action for (1) gross
negligence, (2) breach of fiduciary
duty, and (3) conversion.
TENTATIVE RULING
Defendant’s motion to compel arbitration is
GRANTED.
This case
is ordered STAYED pursuant to Code of Civil Procedure section 1281.4.
LEGAL STANDARD
“California
and federal law both favor enforcement of valid arbitration agreements.” (Aanderud
v. Superior Court (2017) 13 Cal.App.5th 880, 889.) “A party who files
a motion to compel arbitration ‘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.’’ (Cisnero Alverez v. Altamed Health
Services Corporation (2021) 60 Cal.App.5th 572, 580.)
DISCUSSION
Defendant moves to compel Plaintiff to submit this claim to binding
arbitration.
The party moving to compel
arbitration “bears the burden of producing ‘prima facie evidence of a written
agreement to arbitrate the controversy.’ ” (Gamboa v. Northeast Community
Clinic (2021) 72 Cal.App.5th 158, 165 (“Gamboa”).) The moving party
“can meet its initial burden by attaching to the petition a copy of the
arbitration agreement purporting to bear the respondent's signature.” (Bannister
v. Marinidence Opco, LLC (2021) 64 Cal.App.5th 541, 543-44.) “If the moving
party meets its initial prima facie burden and the opposing party disputes the
agreement, then in the second step, the opposing party bears the burden of
producing evidence to challenge the authenticity of the agreement.” (Gamboa,
supra, 72 Cal.App.5th at p. 165.)
Defendant
provides that Plaintiff signed a Safe Deposit Box Contract Card on March 20,
2018. (Deck Decl. ¶ 3.) The contract card
provides: “"By signing this Contract Card I/we acknowledge
receipt of two keys, the JPMorgan Chase Bank, N.A. Safe Deposit Box Lease
Agreement and Service Confirmation, and agree to be bound by the agreements and
terms contained therein, as they may be amended." (Ibid.)
The
arbitration agreement provides: “You and we agree that upon the election of
either of us, any dispute relating in any way to this lease agreement will be
resolved by binding arbitration as discussed below, and not through litigation
in any court (except for matters in small claims court). This arbitration
agreement is entered into pursuant to the Federal Arbitration Act, 9 U.S.C. §§
1-16 (‘FAA’).” (Deck Decl. ¶ 5, Exhibit B at p. 2.) The
agreement also provides: “Claims or disputes between you and us
about your safe deposit box or any items stored in your safe deposit box are
subject to arbitration. Any claims or disputes arising from or relating to this
agreement, any prior agreement between us, or the advertising, the application
for, or the approval or establishment of your lease are also included. Claims
are subject to arbitration, regardless of what theory they are based on or
whether they seek legal or equitable remedies. Arbitration applies to any and
all such claims or disputes, whether they arose in the past, may currently
exist, or may arise in the future. All such claims or disputes are referred to
in this agreement as ‘Claims.’ ” (Id. ¶ 5, Exhibit B at p. 3.)
The agreement also contains an opt out provision that
Plaintiff did not enforce. (Deck Decl. ¶ 7.) Defendant has demonstrated the
existence of a valid agreement to arbitrate the claims at issue in the present
case. In opposition, Plaintiff argues that the agreement should not be enforced
because there was no mutual consent, the agreement is unconscionable, and
Defendant waived its right to arbitrate.
Plaintiff argues that there was no mutual assent in the
agreement to arbitrate. However, the contract card bears Plaintiff’s signature,
Plaintiff does not contest that he signed the agreement, and the card states
that he is agreeing to the safe deposit box lease agreement. Plaintiff has not
demonstrated that he did not assent to the contract. Plaintiff also argues that
he is not alleging a breach of contract claim, making the arbitration claim inapplicable.
Plaintiff cites no authority for this position. Additionally, the agreement
provides that “[c]laims or disputes between you and us about your
safe deposit box or any items stored in your safe deposit box are subject to
arbitration).” (Deck Decl. ¶ 5, Exhibit B at p. 3.) Plaintiff’s
argument is rejected.
Plaintiff also argues that the agreement is
unconscionable.
“ ‘[U]nconscionability has both a
“procedural” and a “substantive” element,’ the former focusing on ‘oppression’
or ‘surprise’ due to unequal bargaining power, the latter on “overly harsh” or
“one-sided” results. [citation.] ‘The prevailing view is that [procedural and
substantive unconscionability] must both be present in order for a court to
exercise its discretion to refuse to enforce a contract or clause under the
doctrine of unconscionability.’ ” (Armendariz v. Foundation Health Psychare
Services, Inc. (2000) 24 Cal.4th 83, 114.)
“Procedural unconscionability
‘addresses the circumstances of contract negotiation and formation, focusing on
oppression or surprise due to unequal bargaining power.’ ” (Carbajal v.
CWPSC, Inc., supra, 245 Cal.App.4th at p. 243.)
Plaintiff provides that the contract
was provided on a take-it-or-leave-it basis and was not provided all the
documents. “When . . . there is no other indication of oppression or surprise,
‘the degree of procedural unconscionability of an adhesion agreement is low,
and the agreement will be enforceable unless the degree of substantive
unconscionability is high.’ ” (Serpa v. California Surety Investigations,
Inc. (2013) 215 Cal.App.4th 695, 704.) Because Plaintiff provides he was
not provided all the documents, he has demonstrated some level of procedural
unconscionability.
“Substantive unconscionability pertains to the
fairness of an agreement's actual terms and to assessments of whether they are
overly harsh or one-sided.” (The McCaffrey Group, Inc. v. Superior Court (2014)
224 Cal.App.4th 1330, 1348.) “A contractual provision is not substantively unconscionable
simply because it provides one side a greater benefit.” (Carbajal, supra, 245
Cal.App.4th at p. 248.) In support of his motion, Plaintiff fails to argue or
demonstrate the existence of any substantive unconscionability within the
contract. Because both procedural and substantive unconscionability must exist
and Plaintiff has failed to demonstrate substantive unconscionability,
Plaintiff’s arguments are rejected.
Plaintiff lastly argues that Defendant
has waived its right to arbitrate because one round of discovery has been
propounded and responded to. “A party claiming the other party has waived its
right to arbitrate must show prejudice. [Citation.] A party does not waive this
right merely by participating in litigation.” (Gamma Eta Chapter of Pi Kappa
Alpha v. Helvey (2020) 44 Cal.App.5th 1090, 1101.) Plaintiff has failed to
demonstrate prejudice or that Defendant waived its right to compel arbitration.
Defendant’s motion to compel
arbitration is granted.
CONCLUSION
Defendant’s
motion to compel arbitration is GRANTED.
This case
is ordered STAYED pursuant to Code of Civil Procedure section 1281.4.
A status
hearing regarding arbitration is scheduled for December 4th, 2024,
at 8:30am
Moving
Party to give notice.
Dated: February 8,
2024 ___________________________________
Joel
L. Lofton
Judge
of the Superior Court
Parties who intend to submit on this tentative must send an email to the court
indicating their
intention to submit. alhdeptx@lacourt.org