Judge Michael P. Linfield, Case 21STCV32367 2023-01-30 Tentative Ruling

Judge: Michael P. Linfield, Case: 21STCV32367, Date: 2023-01-30 Tentative Ruling

The Court is denying the motion for the legal reasons set forth below. However, the Court cannot struthiously ignore the policy implications that would inure should our Courts grant Nissan’s motion. Since there are arbitration provisions in virtually every lease agreement, upholding Defendant’s motion to compel arbitration would prevent any Lemon Law case from being heard in our State’s courts. The Song-Beverly Act is a “strongly pro-consumer” law aimed at protecting Californians who buy or lease a car. (Murillo v. Fleetwood Enterprises, Inc. (1998) 17 Cal.4th 985, 990.) Upholding such a motion would eviscerate these consumer protection statutes passed by our Legislature.

On September 1, 2021, Plaintiffs Santos Puac and Viviana Ibarra filed their Complaint against Defendant Nissan North America, Inc. on causes of action involving the Song-Beverly Consumer Warranty Act.

On August 23, 2022, the Court issued its Order granting in part Plaintiffs’ motion to compel further responses to their special interrogatories, set one and motion to compel further responses to their requests for production of documents, set one.

On December 15, 2022, Defendant filed its Motion to Compel Arbitration and Stay Proceedings. Defendant concurrently filed: (1) Memorandum of Points and Authorities; (2) Declaration of Andrew P. Lissin; (3) Request for Judicial Notice; and (4) Proposed Order.

On December 21, 2022, the Court issued its order granting in part Plaintiff’s Motion for Issue, Evidentiary, Monetary, and/or Terminating Sanctions for Defendant’s Failure to Comply with the Court’s August 23, 2022 Order Re Plaintiff’s Request for Production of Documents (Set One) and Special Interrogatories (Set One). The Court awarded monetary sanctions for Plaintiffs and against Defendant and its Counsel, jointly and severally, in the total amount of $500.00. The Court denied all other requests for sanctions.

On January 17, 2023, Plaintiffs filed their Opposition. Plaintiffs concurrently filed: (1) Declaration of Guy Mizrahi; (2) Evidentiary Objections; and (3) Request for Judicial Notice.

(2) Notice of Entry of Dismissal and Proof of Service in the matter of Dina C. Felisilda, et al. v. FCA US LLC, et al. (34-2015-00183668).

Judicial notice is denied as to both items. Judicial notice is denied as superfluous to the first item. Any party that wishes to draw the Court’s attention to a matter filed in this action may simply cite directly to the document by execution and filing date. (See Cal. Rules of Court, rule 3.1110(d).) In addition, judicial notice is denied as irrelevant to the second item. “Although a court may judicially notice a variety of matters (Evid. Code, §¿450 et seq.), only relevant material may be noticed” (Am. Cemwood Corp. v. Am. Home Assurance Co. (2001) 87 Cal.App.4th 431, 441, fn. 7.)

(1) Order denying Defendant’s Motion to Compel Arbitration in Safley v. BMW of North America, LLC (S.D. Cal., Feb. 5, 2021, No. 20-CV-00366);

(2) Retail Installment Sales Contract in Safley v. BMW of North America, LLC (S.D. Cal., Feb. 5, 2021, No. 20-CV-00366);

(3) Retail Installment Sales Contract in In re Toyota Motor Corp. Hybrid Brake Mktg., Sales, Practices & Prod.Liab.Litig., No 10m12172 CJC (RNB) (C.D. Cal., Oct. 10, 2011);

(4) Second Retail Installment Sales Contract in In re Toyota Motor Corp. Hybrid Brake Mktg., Sales, Practices & Prod.Liab.Litig., No 10m12172 CJC (RNB) (C.D. Cal., Oct. 10, 2011);

(5) Order denying Defendant’s Motion to Compel Arbitration in Erin Armendarez v. Nissan North America, Inc. (Los Angeles Superior Court, Case 21STCV20996);

(6) Order denying Defendant’s Motion to Compel Arbitration in Maria L. Perez v. Nissan North America, Inc. (Los Angeles Superior Court, Case 21STCV15095);

(7) Order denying Defendant’s Motion to Compel Arbitration in Luis Rivas v. Nissan North America, Inc. (Los Angeles Superior Court, Case 21STCV10527);

(8) Order denying Defendant’s Motion to Compel Arbitration in Kimberlin Monroe v. Nissan North America, Inc. (Orange Superior Court, Case 30-2022-01254154-CU-BC-CJC); and

Judicial notice of items Nos. 1-8 is denied as irrelevant. “Although a court may judicially notice a variety of matters (Evid. Code, §¿450 et seq.), only relevant material may be noticed” (Am. Cemwood Corp. v. Am. Home Assurance Co. (2001) 87 Cal.App.4th 431, 441, fn. 7.) Judicial notice is denied as to item No. 9 because a case of the 9^th Circuit need not be judicially noticed; it can just be cited.

Plaintiffs filed Evidentiary Objections. The following are the Court’s rulings as to the Evidentiary Objections.

Objection
1	SUSTAINED
2	SUSTAINED
3	SUSTAINED
4	SUSTAINED

The declarant is Defendant’s counsel. The crux of the declaration is that counsel is “informed and believes” that various of his client’s documents are what they purport to be, or that they were kept in “the regular course of [his client’s] business.” (See Liss Declaration, ¶¶ 4, 5, 7, 8.) The Court recognizes that attorney Liss has only been a member of the California State Bar since June 1, 2022. (See https://apps.calbar.ca.gov/attorney/Licensee/Detail/343980.) However, as indicated above, all of the relevant statements in the declaration are objectionable. The Court expects counsel to familiarize himself with the Evidence Code prior to future submissions to the Court. (Cf, e.g., (Nazir v. United Airlines, Inc. (2009) 178 Cal.App.4th 243, 257, fn. 6.)

“A written agreement to submit to arbitration an existing controversy or a controversy thereafter arising is valid, enforceable and irrevocable, save upon such grounds as exist for the revocation of any contract.” (Code Civ. Proc., § 1281.)

“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 [unless it makes certain determinations].” (Code Civ. Proc., § 1281.2.)

“If a court of competent jurisdiction, whether in this State or not, has ordered arbitration of a controversy which is an issue involved in an action or proceeding pending before a court of this State, the court in which such action or proceeding is pending shall, upon motion of a party to such action or proceeding, stay the action or proceeding until an arbitration is had in accordance with the order to arbitrate or until such earlier time as the court specifies.” (Code Civ. Proc., § 1281.4, rest of statute omitted for brevity.)

“Under both federal and state law, arbitration agreements are valid and enforceable, unless they are revocable for reasons under state law that would render any contract revocable. . . . Reasons that would render any contract revocable under state law include fraud, duress, and unconscionability.” (Tiri v. Lucky Chances, Inc. (2014) 226 Cal.App.4th 231, 239, citations omitted.)¿

“The party seeking to compel arbitration bears the burden of proving by a preponderance of the evidence the existence of an arbitration agreement.¿The party opposing the petition bears the burden of establishing a defense to the agreement's enforcement by a preponderance of the evidence.¿In determining whether there is a duty to arbitrate, the trial court must, at least to some extent, examine and construe the agreement.” (Id.)

Defendant moves the Court to enter an order compelling Plaintiff to arbitration this action and staying the action pending completion of arbitration. (Memorandum of Points and Authorities, p. 15:25–27.) Defendant argues: (1) that Plaintiffs agree to the sales contract and arbitration provision; (2) that Plaintiffs’ claims are subject to arbitration under the Federal Arbitration Act; (2) that the arbitration provision is valid and enforceable; (3) that Defendant may enforce the arbitration provision in the sales contract; (4) that Defendant has not waived its right to arbitrate these claims; and (5) that the question of arbitrability is for the arbitrator to decide. (Motion, pp. 2:2, 6:1, 6:25, 7:21, 8:1–2, 12:24, 13:20.)

Plaintiff opposes the Motion, arguing: (1) that Defendant waived it right to arbitrate when it engaged in conduct inconsistent with an intent to arbitrate; (2) that Defendant failed to submit a properly authenticated arbitration clause; (3) that the arbitration agreement is unconscionable; (4) that Defendant cannot compel arbitration because it is a nonsignatory that is not a party to the arbitration clause; (5) that Plaintiff is not equitably estopped from refusing arbitration; (6) that the Federal Arbitration Act does not apply here because this sales contract does not involve interstate commerce; and (7) that public policy does not favor arbitration. (Opposition, pp. 2:5–6, 6:1, 6:21, 8:12–13, 12:14, 15:20–21, 17:9.)

There are at least three independent grounds on which the Court must deny the motion to compel arbitration.

First, since the Court has sustained Plaintiff’s objections, the exhibits submitted by Defendant are not authenticated. Therefore, the Court does not have sufficient evidence before it to find that an arbitration agreement exists.

Second, the Court agrees that Defendant is not a signatory to the arbitration clause, that the arbitration agreement does not support a finding that Defendant has standing to invoke the clause, and that the allegations at hand do not support a finding that Plaintiff is equitably estopped from refusing arbitration. Moreover, because Defendant is a not a signatory to the arbitration clause, Defendant does not have standing to invoke the clause’s arbitrability subclause. (Pinela v. Neiman Marcus Group, Inc. (2015) 238 Cal.App.4th 227, 239 [“Unless the parties clearly and unmistakably provide otherwise, the question of whether the parties agreed to arbitrate is to be decided by the court, not the arbitrator.”].)

Finally, the Court finds that Defendant has clearly waived its right to arbitration in this matter. As discussed above in the Background section of this Order, Plaintiffs filed their Complaint nearly 18 months ago on September 1, 2021. There have been three prior hearings in this matter. Multiple prior motions have been resolved regarding discovery and sanctions. Trial is scheduled for March 13, 2023 — barely six weeks from now.

It is well established that a party’s failure to “properly timely assert” a right to arbitration may constitute a waiver of the right to arbitrate. (Guess?, Inc. v. Super. Ct. (Kirkland) (2000) 79 Cal.App.4th 553, 557.) Waiver may also be found where a party has “previously taken steps inconsistent with an intent to invoke arbitration,” such as by engaging in litigation in the Superior Court for an extended period of time. (Id.)

An unreasonable delay, by itself, may constitute a waiver of the right to arbitrate. (Burton v. Cruise (2010) 90 Cal.App.4th 939, 945; Spracher v. Paul M. Zagaris, Inc. (2019) 39 Cal.App.5th 1135, 1137–39.) Unreasonable delay has been found where there the party seeking arbitration has waited as little as three months to file its motion. (Guess?, supra, at 555; See also, Augusta v. Keehn & Associates (2011) 193 Cal.App.4th 331, 338–39 (6.5-month delay); Adolph v. Coastal Auto Sales (2010) 184 Cal.App.4th 1443, 1449, 1451–52 (6-month delay); Kaneko Ford Design v. Citipark, Inc. (1988) 202 Cal.App.3d 1220, 1228–29 (5.5-month delay).)

“Arbitration loses much, if not all, of its value if undue time and money is lost in the litigation process preceding a last-minute petition to compel.” (Burton v. Cruise (2010) 190 Cal.App.4th 939, 948.)

For the reasons discussed above, Defendant does not meet its burden here. (Tiri, supra, at 239.) The Court does not reach Plaintiff’s other arguments regarding unconscionability, applicability of the Federal Arbitration Act, or the issue of public policy.

The Court DENIES Defendant’s Motion to Compel Arbitration and Stay Proceedings.