In Gonzalez v. Metro Nissan of Redlands, 2013 WL 4858770 (Cal.App. 4 Dist. 2013), an unpublished decision, the Court of Appeal entered the Sanchez fray, and came down on the side of enforcing the arbitration clause in the LawPrinting RISC. “Because we have no guidance from the Supreme Court, and because we cannot rely on the decisions of our sister courts, we are forced to analyze the issue independently. Obviously, no matter which side we come down on, reasonable minds could differ; the Supreme Court will have the final word. Nevertheless, we explain our reasons, as we are constitutionally required to do (Cal. Const., art. VI, § 14), in the hope of contributing to the grand dialectical process of the common law. Ultimately, we conclude that the arbitration clause is enforceable and not unconscionable.” Plaintiffs filed to prove more than minimal procedural unconscionability:
The Gonzalezes point out that the arbitration clause came after the last signature line. However, above the last signature line that the Gonzalezes did sign were the words, “YOU ACKNOWLEDGE THAT YOU HAVE READ ALL PAGES OF THIS CONTRACT, INCLUDING THE ARBITRATION CLAUSE ON PAGE 7, BEFORE SIGNING BELOW.” This was actually quite conspicuous. ¶ The Gonzalezes also point out that they did not sign a hard copy of the contract; they signed via an electronic pad. The record is somewhat vague about exactly how much of the wording of the contract also showed up on the pad. However, this is beside the point, as, again, the Gonzalezes had an opportunity to read and review a hard copy before signing. ¶ Finally, both of the Gonzalezes testified that they were subjectively unaware of the arbitration clause. However, the failure to read a contract provision that is otherwise clear and conspicuous falls short of es-tablishing surprise. ( San Francisco Newspaper Printing Co. v. Superior Court (1985) 170 Cal.App.3d 438, 443 [“failing to read the contract is no excuse, otherwise all contracts of adhesion would be unenforceable at the whim of the adhering party”].)
The Court of Appeal found no substantive unconscionability in the Clause’s requirement that appeals proceed before a 3-arbitrator for which the appellant must front the fees.
Little v. Auto Stiegler, Inc. (2003) 29 Cal.4th 1064 held that a provision for appealing arbitration awards to a second arbitrator only if they were over $50,000 was so one-sided as to be unconscionable. ( Id. at pp. 1071–1074.) The provision in this case is distinguishable, because it gives both sides a reasonable opportunity to challenge an extreme award. In a dispute over the sale of a motor vehicle for personal use, from $1 to $100,000 is a reasonable range to establish for likely awards; an award outside this range raises a suspicion of bias or error. Moreover, both sides could reasonably seek to limit their risk. The lower limit of $1 protects plaintiffs; the upper limit of $100,000 protects defendants. Even assuming that sellers are most likely to be defendants and buyers are most likely to be plaintiffs, this double-tailed range does not favor sellers. ¶ . . . The Gonzalezes argue that the costs requirement is one-sided in practice because the seller is likely to have deeper pockets than the buyer. It has been held that “where a consumer enters into an adhesive contract that mandates arbitration, it is unconscionable to condition that process on the consumer posting fees he or she cannot pay.” ( Gutierrez v. Autowest, Inc. (2003) 114 Cal.App.4th 77, 89, fn. omitted.) Here, however, the buyer does not have to pay fees for the initial arbitration. Ordinarily, the award in the initial arbitration — including a $0 award — would be final and binding. Thus, the provision for a second arbitration is a significant benefit to the buyer, as well as to the seller. Conditioning access to this additional, optional level of review on the ability to pay the associated costs is not unconscionable.
The Court of Appeal found no unconscionability in the sellers’/Holders’ preservation of self-help remedies.
Next, the Gonzalezes argue that the self-help and small claims exceptions make the arbitration clause one-sided because they effectively exempt most of a dealer’s claims from arbitration. The self-help exception makes sense in light of the basic purpose of arbitration. “Arbitration has become highly favored as an economical, efficient alternative to traditional litigation in law courts. [Citations.]” ( Saika v. Gold (1996) 49 Cal.App.4th 1074, 1076.) Self-help, by definition, does not involve litigation. Requiring the parties to forego self-help in favor of arbitration would only make the resolution of disputes slower and more expensive, rather than the converse. Indeed, if the arbitration clause did not expressly allow self-help, we would construe it as allowing self-help implicitly; when one party resorts to self-help, just as when one party files a lawsuit, it is then up to the other party to demand arbitration of any remaining dispute. The only risk that the party exercising self-help might face would be a subsequent claim that it had waived its own right to demand arbitration.
Finally, the Court of Appeal found the class-action waive not-unconscionable.
The Gonzalezes’ third cause of action was brought under the Consumers Legal Remedies Act (Civ.Code, § 1750 et seq.) (the CLRA). The CLRA provides that any waiver of the right to bring a class action under its provisions is void. (Civ.Code, §§ 1751, 1781.) De-fendants respond that this portion of the CLRA, when applied to claims that are subject to arbitration, is preempted by the Federal Arbitration Act (9 U.S.C. § 1 et seq. (the FAA)). ¶ In Fisher v. DCH Temecula Imports LLC (2010) 187 Cal.App.4th 601, 617–619 (Fourth Dist., Div. Two), this court held that the FAA does not preempt the CLRA’s ban on class action waivers. Thereafter, the United States Supreme Court held that the FAA does preempt a state rule that a class action waiver in an arbitration agreement is unconscionable. ( AT & T Mobility LLC v. Concepcion (2011) ––– U.S. ––––, –––– [131 S.Ct. 1740, 1746–1753, 179 L.Ed.2d 742].) However, it is not at all clear from Concepcion that the FAA also preempts the CLRA’s ban on class action waivers, because this ban is not limited to waivers in arbitration agreements. ¶ We need not decide this question. Even assuming the class action waiver is illegal and/or unconscionable, it is severable. (See Little v. Auto Stiegler, Inc., supra, 29 Cal.4th at p. 1074–1076.) Admittedly, the “poison pill” provision of the arbitration clause states, “If a waiver of class action rights is deemed or found to be unenforceable for any reason in a case in which class action allegations have been made, the remain-der of this Arbitration Clause shall be unenforceable.” (Italics added.) Here, however, there are no class action allegations. Hence, the arbitration clause is enforceable regardless of whether the class action waiver is valid.