Judge Upinder S. Kalra, Case Number: 23STCP03617, Date: 2025-04-28 Tentative Ruling

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1. An Order compelling Respondent Scott Holland to private arbitration with Alternative Resolutions Centers, LLC.

On November 7, 2024, Petitioner Jamra, Jamra & Hanasab, L.L.P. (Petitioner) filed a Verified Petition to Compel Arbitration a fee dispute with Respondent Scott Holland (Respondent) resulting from an arbitration agreement from a legal services contract.

On November 12, 2024, the court sent Notice of Hearing on the Petition to Petitioner, who subsequently filed proof of service on December 4, 2024.

On March 13, 2025, the parties stipulated to continue the hearing date on the Petition.

Pursuant to Code of Civil Procedure (CCP) §1281.2, generally, on a petition to compel arbitration, the court must grant the petition unless it finds either (1) no written agreement to arbitrate exists; (2)¿the right to compel arbitration has been waived; (3) grounds exist for revocation of the agreement; or (4) litigation is pending that may render the arbitration unnecessary or create conflicting¿rulings on common issues.¿

When seeking to compel arbitration, the initial burden lies with the moving party to demonstrate the existence of a valid arbitration agreement by prepondernace of evidence.¿ (Ruiz v. Moss Bros. Auto Group (2014) 232 Cal.App.4th 836, 841-42; Gamboa v. Northeast Community Clinic (2021), 72 Cal.App.5th 158, 164-65.)¿ It is sufficient for the moving party to produce a copy of the arbitration agreement or set forth the agreement’s provisions.¿ (Gamboa, 72 Cal.App.5th at 165.)¿ The burden then shifts to the opposing party to prove by a preponderance of evidence any defense to enforcement of the contract or the arbitration clause.¿ (Ruiz, 232 Cal.App.4th at 842; Gamboa, 72 Cal.App.5th at 165.)¿ Subsequently, the moving party must establish with the preponderance of admissible evidence a valid arbitration agreement between the parties.¿ (Ibid.)¿ The trial court then weighs all the evidence submitted and uses its discretion to make a final determination.¿ (Ibid.)¿ “California law, ‘like [federal law], reflects a strong policy favoring arbitration agreements and requires close judicial scrutiny of waiver claims.’”¿ (Wagner Const. Co. v. Pacific Mechanical Corp. (2007) 41 Cal.4th 19, 31.)¿

If the court orders arbitration, then the court shall stay the action until arbitration is completed.¿ (See Code Civ. Proc., § 1281.4.)

Petitioner contends that there is a binding arbitration agreement, that Respondent waived his right to proceed with arbitration before the Beverly Hills Bar Association, and that the court should compel arbitration with Alternative Resolution Centers, LLC.

Respondent argues that the court should not enforce the agreement because it is unconscionable. Respondent additionally argues that Petitioner failed to properly, clearly, and consistently bill Respondent for services and that the agreement is voidable for Petitioner’s failure to comply with Bus. & Prof. Code § 6148.

Petitioner replies that Respondent had significant freedom to seek other counsel, did not provide evidence he was pressured to sign the agreement, that the fee agreement fully or substantially complies with Bus. & Prof. Code § 6148, and the court may enforce the agreement by severing any offending clause.

In determining the enforceability of an arbitration agreement, the court considers “two ‘gateway issues’ of arbitrability: (1) whether there was an agreement to arbitrate between the parties, and (2) whether the agreement covered the dispute at issue.”¿ (Omar v. Ralphs Grocery Co. (2004) 118 Cal.App.4th 955, 961 (Omar).)¿¿¿¿¿¿¿

The moving party can meet its initial burden of proving the existence of an arbitration agreement by attaching a copy of the agreement to this motion bearing the signature of the opposing party. (See Bannister v. Marinidence Opco, LLC (2021) 64 Cal.App.5th 541, 541-543 [“The party seeking arbitration can meet its initial burden by attaching to the petition a copy of the arbitration agreement purporting to bear the¿respondent's signature.”].) Alternatively, the moving party can meet its initial burden by setting forth the agreement’s provisions in the motion. (See Cal. Rules of Court, rule 3.1330; see also Condee v. Longwood Management Corp. (2001) 88 Cal.App.4th 215, 219.)¿¿¿

Here, Petitioner met its burden by attaching a copy of the signed retainer agreement that contains the arbitration clause (the Agreement). (Petition pgs. 5-15.)

“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 v. Northeast Community Clinic (2021) 72 Cal. App. 5th 158,165 (Gamboa).) The evidence must be sufficient to create a factual dispute to shift the burden back to the arbitration proponent who retains the ultimate burden of proving, by a preponderance of the evidence, the authenticity of the signature. (Iyere v. Wise Auto Group (2023) 87 Cal.App.5th 747, 755 (Iyere).)¿¿

Accordingly, Petitioner has established that an agreement to arbitrate exists.

“[T]he decision as to whether a contractual arbitration clause covers a particular dispute rests substantially on whether the clause in question is ‘broad’ or ‘narrow.’” (Bono v. David (2007) 147 Cal.App.4th 1055, 1067.) “‘A “broad” clause includes those using language such as “any claim arising from or related to this agreement”‘ [Citation] or ‘arising in connection with the [a]greement’ [Citation.]” (Rice v. Downs (2016) 248 Cal.App.4th 175, 186 [italics omitted].) “But clauses requiring arbitration of a claim, dispute, or controversy ‘arising from’ or ‘arising out of’ an agreement, i.e., excluding language such as ‘relating to this agreement’ or ‘in connection with this agreement,’ are ‘generally considered to be more limited in scope than would be, for example, a clause agreeing to arbitrate “‘any controversy … arising out of or relating to this agreement[.]’” [Citations.]” (Id. at p. 186-87 [italics omitted].) “Several Ninth Circuit cases have held that agreements requiring arbitration of ‘any dispute,’ ‘controversy,’ or ‘claim’ ‘arising under’ or ‘arising out of’ the agreement are intended to encompass only disputes relating to the interpretation and performance of the agreement.” (Id. at p. 187.)¿

“any dispute or controversy between you and JJH regarding the construction, application or performance of any services under this Agreement, and any claim arising out of or relating to this Agreement or its breach, shall be submitted to binding arbitration (and not by a lawsuit or resort to court process except as California law provides for judicial review and/or confirmation of arbitration proceedings) upon the written request of one party after the service of that request on the other party.”

Under California law and the FAA, an arbitration agreement may be invalid based upon grounds applicable to any contract, including unconscionability, fraud, duress, and public policy.¿ (Sanchez v. Western Pizza Enterprises, Inc. (2009) 172 Cal.App.4th 154, 165-166.) Once it is determined that a valid arbitration agreement exists, the burden shifts to the opposing party to “prove by a preponderance of the evidence any defense to the petition.” (Lacayo v. Catalina Restaurant Group Inc. (2019) 38 Cal.App.5th 244, 257, review denied (Nov. 13, 2019)).¿¿¿

In Armendariz, the California Supreme Court stated that when determining whether an arbitration agreement was unconscionable, there is both a procedural and a substantive element. (Armendariz v. Foundation Health Psychcare Service, Inc. (2000) 24 Cal.4th 82, 114 (Armendariz)).¿¿¿¿

Courts determine whether an agreement is procedurally unconscionable by looking at surprise and oppression. Oppression is an “inequality of bargaining power, when one party has no real power to negotiate or a meaningful choice. Surprise occurs when the allegedly unconscionable provision is hidden.” (Carmona v. Lincoln Millennium Car Wash, Inc.¿(2014) 226 Cal.App.4th 74, 84 (Carmona).) Examples of contracts that are procedurally unconscionable are contracts of adhesion, which is a “standardized contract, which, imposed and drafted by the party of superior bargaining strength, relegates to the subscribing party only the opportunity to adhere to the contract or reject it.” (Armendariz, supra, at p. 113). “The circumstances relevant to establishing oppression include, but are not limited to (1) the amount of time the party is given to consider the proposed contract; (2) the amount and type of pressure exerted on the party to sign the proposed contract; (3) the length of the proposed contract and the length and complexity of the challenged provision; (4) the education and experience of the party; and (5) whether the party’s review of the proposed contract was aided by an attorney. (OTO, L.L.C. v. Kho (2019) 8 Cal.5th 111, 126-27 (OTO); see also Sanchez v. Superior Court (2025) 108 Cal.App.5th 615, 626 (Sanchez).)¿¿

Here, there is no procedural unconscionability. Notably, there is no evidence that Respondent was required to retain Petitioner for services. Indeed, Respondent’s evidence of duress shows the same stresses of civil litigation experienced by any litigant.[1] This contrasts the client in Sanchez. There, the court found substantial procedural unconscionability because, among other things, the agreement was a contract of adhesion, the client was in danger of losing his home and had traveled from Bakersfield to Costa Mesa to retain that attorney, was not advised to or provided an opportunity to consult an outside attorney, and was not provided an explanation or translation in Spanish despite limited education and English speaking skills. (Sanchez, supra, 108 Cal.App.5th at p. 627.) In contrast, the Agreement here includes language encouraging Respondent to seek advice of outside counsel, Respondent has not challenged he cannot read the Agreement, and there is insufficient evidence that Respondent needed to retain counsel that minute.

Accordingly, there is no procedural unconscionability. The court need go no further.[2]

[1] The court acknowledges that litigation is stressful and in no way diminishes Respondent’s feeling overwhelmed by participating in marriage dissolution proceedings. The court is not aware, however, that warrants duress for procedural unconscionability analysis.

[2] Even so, the court notes that Petitioner’s position that the court could sever any unfair terms and compel arbitration is well taken.