“Self-executing” Means Party Does Not Have to File Petition Pursuant to CCP 1281.2 to Compel Arbitration
In Tutti Mangia Italian Grill, Inc. v. American Textile Maintenance Co., 197 Cal.App.4th 733, 128 Cal.Rpr.3d 551 (2011) a dispute arose between ATM, a supplier of restaurant lines, and TMIG, a restaurant. ATM commenced an arbitration pursuant to an arbitration agreement. TMIG refused to participate, taking the position that an arbitration clause incorporating rules of the AAA is unenforceable, and citing Gilbert Street Developers, LLC v. La Quinta Homes, LLC, 174 Cal.App.4th 1185, 94 Cal.Rptr.3d 918 (2009) (Gilbert Street.)
Above: Chef in North Beach Italian Restaurant. 1941. John Collier, photographer. Library of Congress.
The arbitrator disagreed, and rendered an award, entered as a judgment, and affirmed by the Court of Appeal. Gilbert Street was distinguishable, for in that case, the arbitration provision incorporated by reference future rules of the AAA, rendering that agreement unenforceable.
The Court of Appeal also addressed whether the arbitration provision was self-executing, or whether a petition had to be filed with the Court under CCP section 1281.2 to get the arbitration ball rolling. Section 1281.2 was "designed to afford a remedy where the parties have not provided for the contingency that has arisen or where the contractual scheme has failed." Brink v. Allegro Builders, Inc.,58 Cal.2d 577, 25 Cal.Rptr. 556 (1962). Section 1281.2 is not the exclusive means for starting an arbitration. Where the arbitration provision was sufficiently specific, as was the case here, no petition needed to be filed. The provision was indeed self-executing.
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