California Mediation and Arbitration

Reviews: Your Blogger Had Two Articles Recently Published In The Daily Journal

The articles are:

Outsourcing the violation of constitutional rights to private parties, Sept. 8, 2021.

Do Justices studiously try to avoid deciding cases on the basis of ideology? A review of Justice Stephen Breyer's "The Authority of the Courts and the Peril of Politics," Oct. 19, 2021.

NOTE: While I have provided links, they tend to be of limited benefit, because the Daily Journal is behind a paywall. 

Arbitration: Fourth District Div. 2 Addresses Issues Of Unconscionability, Delegation, Severability, And Fraud In Employee Arbitration Agreement

Ineffective Delegation Clauses, Fraud In The Execution, And Unconsciconability Result In Reversals.

        In Najarro v. Sup. Ct. of the County of San Bernardino; Horizon Personnel Services Inc., et al, E076328   (4/2  10/22/21) (Raphael, Codrington, Slough), the court does plenty of slicing and dicing, because there  are two arbitration agreements, two sets of employees, employees who read Spanish, employees who don't read Spanish, a valid delegation clause, an ineffective delegation clause, evidence of unconscionability, and undecided issues of procedural unconscionability. It's a lengthy opinion, and here is the  court's own summary: "Because the first version [of the arbitration agreement] does not clearly and unmistakably delegate questions of arbitrability to the arbitrator, we grant the writ petition as to the employees who signed that version. As to two of these employees, the trial court must decide whether this first version is unconscionable, guided by our discussion below. As to the other two employees who signed this version, we find that the arbitration agreement is unenforceable for the separate reason of fraud in the execution. We also find that fraud in the execution voids the agreement for two of the employees who signed the other, second version of the arbitration agreement."

        COMMENT: One interesting takeaway is that a delegation clause that delegates issues to the arbitrator to decide may stumble and become ineffective if it is coupled with a severability clause allowing a court to decide some issues. So delegation clauses and severability clauses can interact and must therefore be drafted with care. A second takeaway is that when, as here, there was evidence as to some employees of fraud in the execution that was not rebutted, the court can decide there was no agreement to arbitrate, and need not move on to decide other defenses such as unconscionability. And a  third takeaway is that when the employees speak a foreign language (here, Spanish), or are illiterate, the courts have heightened awareness of the issue of procedural unconscionability.

Arbitration, PAGA: Third District Agrees With Other California Appellate Courts That PAGA Representative Actions Are Not Waivable

Court Declines Invitation To Treat Iskanian As Overruled Sub Silentio.

        The Third District Court of Appeal joins other California appellate courts ruling that PAGA representative actions are not waveable, and affirms the trial court's order denying employer's motion to compel arbitration. Carllie Williams v. RGIS, LLC, No. C091253 (3rd Dist.  10/18/21). In reaching that result, the Court notes that the Ninth Circuit has ruled that Iskanian is still good law. The California court refused to speculate how SCOTUS might rule if confronted with PAGA representative claims and a motion to compel arbitration.

        The Court noted that the reason it published its opinion, despite its agreement with a multitude of other cases, was because the issue was one of first impression for the Third District.