Judge: Steven J. Kleifield, Case: 22STCV20655, Date: 2023-04-13 Tentative Ruling

Inform the clerk if you submit on the tentative ruling. If moving and opposing parties submit, no appearance is necessary.

Case Number: 22STCV20655    Hearing Date: April 13, 2023    Dept: 57

Defendant Nissan North America, Inc. has moved to compel arbitration in this Song-Beverly Consumer Warranty Act case. In support of its motion, Nissan argued, inter alia, that the doctrine of equitable estoppel requires Plaintiff Maria Paz to arbitrate her claims against Nissan based on an arbitration clause in the agreement that she signed with the dealer, Defendant Mossy Nissan Escondido, from which she purchased the vehicle.  In making this argument, Nissan relied on the decision of the Third District of the Court of Appeal in Felisilda v. FCA US LLC (2020) 53 Cal.App.5th 486. In Felisilda, the Court held that under the doctrine of equitable estoppel, the plaintiffs were bound to arbitrate their claims against an automobile manufacturer that was not a signatory to the purchase agreement between the plaintiffs and the dealer from which the plaintiffs bought the vehicle in question and which contained an arbitration clause.  In addition to equitable estoppel, Nissan argued that its motion to compel arbitration could be granted based on the notion that Nissan was a third-party beneficiary of the agreement between Paz and the dealer, which, according to Nissan, had an agency relationship with Nissan.

On April 4, 2023, Division 8 of the Second District Court of Appeal in Song-Beverly Act litigation known as the Ford Motor Warranty Cases (Case Number B312261) declined to follow Felisilda.  Instead, that Court held that the plaintiffs in that litigation were not bound under the doctrine of equitable estoppel to arbitrate their claims against an automobile manufacturer based on an arbitration clause in the purchase agreement between the plaintiffs and the dealer from which the plaintiffs bought the vehicles in question.  The Court also addressed whether the motion to compel arbitration could be granted based on third beneficiary and agency theories.  The Court's answered no as to both theories.

After she filed her opposition to Nissan's motion and before Nissan filed its reply brief, Paz submitted a notice of supplemental authority, which directed the Court's attention to the decision in the Ford Motor Warranty Cases.  Paz's notice addressed  the implications of the Ford Motor Warranty Cases for the equitable estoppel, third-party beneficiary and agency hooks on which Nissan hung its motion to compel arbitration.  Nissan's reply brief was filed two after Paz's notice of supplemental authority.  The reply brief referenced Paz's notice, but did not respond substantively to it.  Instead, Nissan requested leave to file a response to Paz's notice of supplemental authority.  The Court will afford Nissan that opportunity.  To that end, Nissan is directed to file a response to Paz's notice of supplemental authority within 14 days from the April 13, 2023 hearing on its motion.   The hearing will be continued to a date in May 2023 that is convenient for the parties and the Court.  That date will be set at the April 13 hearing.