Unconscionability Challenge To Identical Arbitration Provision In Industry-Drafted Automobile Sales Contract Is Still Pending In Sanchez Before California Supreme Court.
Our next case is a fine example of ad hoc justice, for the Court of Appeal concludes that “on balance”, the arbitration provisions in a standard automobile industry sales contract are not unconscionable. A touch of procedural unconscionability here, but not so much substantive unconscionability as to overpower the recipe. Self-help and small claims court exclusions were noted, as were exceptions to finality that favored the dealer. “On balance,” concludes the Court, “the arbitration clause provides the parties with greater efficiency and speed, lower costs, and a more focused dispute resolution forum than would litigation.” Hernandez v. Thomas, Case No. D064036 (4/1 Jan. 8, 2015) (Haller, McConnell, McIntyre) (unpublished).
The Court notes that during “almost three years that Sanchez [v. Valencia Holding Co., LLC, 201 Cal.App.4th 74, review granted Mar. 21, 2012] has been pending, the high court has granted and held numerous petitions for review of Court of Appeal decisions addressing similar (if not identical) challenges to the identical arbitration provision.” Citing nine cases in addition to Sanchez, the Court observes, “intermediate courts have reached conflicting conclusions based on several different theories and rationales.”
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