DERRICK R UPCHURCH, ET AL. VS BC DESIGN AND DEVELOPMENT, INC., ET AL.

Tentative Rulings

Case Number: *******2131 Hearing Date: April 22, 2022 Dept: 54

Hearing Date: April 22, 2022

Department 54, Judge Maurice A. Leiter

Motion to Compel Arbitration

Moving Party: Defendant Nathalie Doug dba Doug and Associates

Responding Party: Plaintiffs Derrick R. Upchurch and Sari M. Upchurch

T/R: DEFENDANT’S MOTION TO COMPEL ARBITRATION IS GRANTED. THE ACTION IS STAYED.

DEFENDANT TO NOTICE.

If the parties wish to submit on the tentative, please email the courtroom at SMCdept54@lacourt.org with notice to opposing counsel (or self-represented party) before 8:30 am on the day of the hearing.

The Court considers the moving papers, opposition and reply.

BACKGROUND

On August 31, 2021, Plaintiffs Derrick R. Upchurch and Sari M. Upchurch sued Defendants BC Design and Development, Inc., et al., asserting ten causes of action for breach of contract, fraud, and negligence. This action arises from the remodel of Plaintiff’s home.

ANALYSIS

“On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party thereto refuses to arbitrate a controversy, the court shall order the petitioner and the respondent to arbitrate the controversy if it determines that an agreement to arbitrate the controversy exists….” (CCP 1281.2.) The right to compel arbitration exists unless the court finds that the right has been waived by a party’s conduct, other grounds exist for revocation of the agreement, or where a pending court action arising out of the same transaction creates the possibility of conflicting rulings on a common issue of law or fact. (CCP 1281.2(a)-(c).) “The party seeking arbitration bears the burden of proving the existence of an arbitration agreement, and the party opposing arbitration bears the burden of proving any defense, such as unconscionability.” (Pinnacle Museum Tower Assn. v. Pinnacle Market Development (US), LLC (2012) 55 Cal.4th 223, 236.)

A. Existence of Arbitration Agreement

Defendant Nathalie Doug dba Doug and Associates moves to compel arbitration based on the arbitration provision in the contract for services by Defendant for Plaintiffs. Plaintiff Derrick Upchurch executed the contract on September 11, 2017. (Decl. Doug , Exh. A.) The agreement provides, "Claims, disputes or other matters in question between the parties to this Agreement arising out of or relating to this Agreement or breach thereof shall be subject to and decided by arbitration." (Id. 14.1.) This action arises out of and relates to Defendant’s performance of services under the contract.

In opposition, Plaintiffs argue that Plaintiff Sari Upchurch is not bound by the agreement because she did not sign it. The Court is unpersuaded by this argument. Plaintiffs’ complaint states both Plaintiffs entered into a written agreement for Defendant’s services, both Plaintiffs have brought a cause of action for breach of that agreement, and the agreement is addressed to both Plaintiffs. This shows Plaintiff Sari’s assent to the agreement. (See e.g. Vita Planning & Landscape Architecture, Inc. v. HKS Architects, Inc. (2015) 240 Cal.App.4th 763, 773 [Allegation of the existence of a contract in the complaint is a judicial admission and the absence of signatures does not make an agreement unenforceable.])

Defendant has established an agreement to arbitrate. The burden shifts to Plaintiffs to establish any defenses to enforcement.

B. Enforceability

Plaintiffs asserts that the arbitration agreement is both procedurally and substantively unconscionable as an adhesion contract. Regarding procedural unconscionability, the California Supreme Court has stated:

“[T]here are degrees of procedural unconscionability. At one end of the spectrum are contracts that have been freely negotiated by roughly equal parties, in which there is no procedural unconscionability . . . . Contracts of adhesion that involve surprise or other sharp practices lie on the other end of the spectrum. [Citation.] Ordinary contracts of adhesion, although they are indispensable facts of modern life that are generally enforced (see Graham v. Scissor–Tail, Inc. (1981) 28 Cal.3d 807, 817–818, 171 Cal.Rptr. 604, 623 P.2d 165), contain a degree of procedural unconscionability even without any notable surprises, and ‘bear within them the clear danger of oppression and overreaching.’ (Id. at p. 818 [171 Cal.Rptr. 604, 623 P.2d 165].)” (Gentry v. Superior Court (2007) 42 Cal.4th 443, 469, 64 Cal.Rptr.3d 773, 165 P.3d 556.)

(Baltazar v. Forever 21, Inc. (2016) 62 Cal.4th 1237, 1244.)

Plaintiffs claim that they did not have an opportunity to negotiate the contracts, and Defendant failed to provide the AAA rules for construction cases. In the moving papers and reply, Defendant emphasizes that both Plaintiffs are attorneys. Plaintiffs do not dispute this. This is a contract for services into which neither party was required to enter and both parties had equal bargaining power. Plaintiffs, as attorneys, were aware of this. There is no procedural unconscionability. The Court need not address substantive unconscionability. (See Dotson v. Amgen, Inc. (2010) 181 Cal.App.4th 975, 981 [Agreements must be both procedurally and substantively unconscionable to be unenforceable.])

Plaintiffs also argues that Defendant has waived the right to compel arbitration and there is a risk of conflicting rulings. These arguments are unpersuasive. Defendant promptly sought arbitration after Plaintiffs filed this action and the risk of conflicting rulings is not sufficiently great to deny arbitration.

Defendant’s motion to compel arbitration is GRANTED. The action is STAYED.