Judge: Mark E. Windham, Case: 23STLC05434, Date: 2024-01-16 Tentative Ruling

Case Number: 23STLC05434    Hearing Date: January 16, 2024    Dept: 26

Brzuska, et al. v. MIG Motor Cars, Inc., et al.

PETITION TO COMPEL ARBITRATION AND STAY PROCEEDINGS

(CCP §§ 1281.2, et seq., 638)

TENTATIVE RULING:

Plaintiffs Joseph L. Brzuska and Virgil L. Severns’ Motion to Compel Arbitration is GRANTED. THE ACTION IS STAYED PENDING ARBITRATION.

ORDER TO SHOW CAUSE REGARDING STATUS OF ARBITRATION IS SET FOR JUNE 11, 2024 AT 9:30 AM IN DEPARTMENT 26 IN THE SPRING STREET COURTHOUSE.

ANALYSIS:

On August 24, 2023, Plaintiffs Joseph L. Brzuska and Virgil L. Severns (“Plaintiffs”) filed the instant

action for violation of Consumer Legal Remedies Act, violation of Business & Professions Code section 17200, et seq., and claim against surety against Defendants MIG Motor Cars, Inc. dba M. Motorsport (“Defendant MIG”) and Hudson Insurance Company (“Defendant Hudson”). The action arises out of Plaintiff’s purchase of a motor vehicle regarding which certain facts were not disclosed. (Compl., filed 08/24/23, ¶¶14-37.) Defendants MIG filed an answer on October 4, 2023.

Plaintiff filed the instant Motion to Compel Arbitration against Defendant MIG on October 27, 2023. Defendant MIG filed an opposition on December 4, 2023 and an amended opposition on December 19, 2023. Plaintiff replied on January 9, 2024.

Discussion

The Motion is brought pursuant to Code of Civil Procedure section 1281, et seq., which provides in relevant part:

On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party thereto refuses to arbitrate such 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, unless it determines that:

(a) The right to compel arbitration has been waived by the petitioner; or

(b) Grounds exist for the revocation of the agreement.

(Code Civ. Proc., § 1281.2, subds. (a)-(b).) Plaintiffs provide evidence of the existence of the arbitration agreement in the Retail Installment Sales Contract (“RISC”). (Motion, Heydari Decl., Exh. 2, p. 6; Exh. 3.) On May 26, 2023, Plaintiff requested that Defendant MIG agree to arbitrate the parties’ dispute. (Id. at Heydari Decl., ¶¶3-4 and Exh. 1.) Defendant MIG has not agreed to arbitration. (Ibid.) Therefore, Plaintiffs have demonstrated that they are entitled to an order compelling Defendant MIG to arbitration pursuant to the terms of the arbitration agreement.

In opposition, Defendant MIG argues that there are insufficient allegations of an “arbitrable controversy” because Plaintiff signed numerous disclosures regarding the condition of the subject motor vehicle. (Opp., Mahmoudi Decl., ¶2 and Exhs. A-D.) The opposition argument that these exhibits overcome the allegations in the Complaint, however, is itself proof of the existence of an arbitrable controversy regarding the merits of each party’s position. Defendant MIG then argues that Plaintiff has not attached or cited the arbitration provision on the grounds that the RISC cited above is not properly authenticated. This objection is overruled as it does not address Plaintiffs’ affidavit attesting that the attached RISC is the one they signed. (Motion, Exh. 3.)

Finally, Defendant MIG argues that Plaintiffs have waived the right to arbitration by responding the discovery propounded by Defendant MIG and propounding a deposition subpoena to a third party. (Opp., Anaya Decl., ¶¶2-3; Supp. Opp., p. 2:1-13.) Regarding waiver,

State law, like the FAA, reflects a strong policy favoring arbitration agreements and requires close judicial scrutiny of waiver claims. (Christensen v. Dewor Developments (1983) 33 Cal.3d 778, 782, 191 Cal.Rptr. 8, 661 P.2d 1088.) Although a court may deny a petition to compel arbitration on the ground of waiver (§ 1281.2, subd. (a)), waivers are not to be lightly inferred and the party seeking to establish a waiver bears a heavy burden of proof. [Citations omitted.]

In Sobremonte v. Superior Court (1998) 61 Cal.App.4th 980, 72 Cal.Rptr.2d 43, the Court of Appeal referred to the following factors: “In determining waiver, a court can consider ‘(1) whether the party's actions are inconsistent with the right to arbitrate; (2) whether “the litigation machinery has been substantially invoked” and the parties “were well into preparation of a lawsuit” before the party notified the opposing party of an intent to arbitrate; (3) whether a party either requested arbitration enforcement close to the trial date or delayed for a long period before seeking a stay; (4) whether a defendant seeking arbitration filed a counterclaim without asking for a stay of the proceedings; (5) “whether important intervening steps [e.g., taking advantage of judicial discovery procedures not available in arbitration] had taken place”; and (6) whether the delay “affected, misled, or prejudiced” the opposing party.’ ”

(St. Agnes Medical Center v. PacifiCare of California (2003) 31 Cal.4th 1187, 1195-1196.) Defendant MIG has not met this “heavy burden of proof.” The action was filed in August 2023 and the instant Motion was brought two months later with only minimal discovery participation. The litigation machinery has not been substantially invoked, nor did Plaintiff bring this Motion close to the trial date or after substantial delay.

Therefore, Defendant MIG has not demonstrated grounds to deny the instant Motion. In light of the Motion to Compel Arbitration being granted, a stay of the action is appropriate under Code of Civil Procedure section 1281.4.

Conclusion

Plaintiffs Joseph L. Brzuska and Virgil L. Severns’ Motion to Compel Arbitration is GRANTED. THE ACTION IS STAYED PENDING ARBITRATION.

ORDER TO SHOW CAUSE REGARDING STATUS OF ARBITRATION IS SET FOR JUNE 11, 2024 AT 9:30 AM IN DEPARTMENT 26 IN THE SPRING STREET COURTHOUSE.

Moving party to give notice.