Contracts

A forum selection clause in defendant corporation's Delaware by-laws selecting the Delaware Chancery Court as the forum for any shareholder disputes was unenforceable in California state court because there is no right to a jury trial in Delaware Chancery Court so the forum selection clause operated as a pre-suit waiver of the constitutional right to a jury trial which cannot… Read More

Agreeing with Montemayor v. Ford Motor Co. (2023) 92 Cal.App.5th 958 and other recent cases refusing to follow Felisilda v. FCA US LLC (2020) 53 Cal.App.5th 486, this decision holds that a standard California car sale contract with an arbitration clause does not require the car buyer to arbitrate his warranty claims or Song Beverly Act claims against the car's… Read More

A health insurance company's verification of benefits (i.e., confirmation that the patient is insured, covered, and eligible for coverage) is not an enforceable oral promise to pay for the patient's treatment by a health care provider.  Here, summary judgment was properly granted against a health care provider's breach of oral and implied contract claims.  It produced no evidence to show… Read More

The district court did not err in denying defendant's motion to compel arbitration of plaintiff's claim that defendant discriminated against her in denying her a consolidation loan to combine her two existing student loans.  Defendant was judicially estopped from relying on the arbitration clause in the second loan because at an earlier hearing on whether that clause was unconscionable, defendant… Read More

The district court erred in holding that the delegation clause in the arbitration agreement in this case was unconscionable and therefore unenforceable.  The district court so ruled because the arbitration agreement also provided that if, for any reason, the dispute was not arbitrated, the parties waived a jury trial.  Such a pre-dispute waiver of jury trial is unenforceable under California… Read More

Applying Ixchel Pharma, LLC v. Biogen, Inc. (2020) 9 Cal. 5th 1130 to an at-will employment contract, this decision holds that to assert a tort claim for inducing breach of the contract, the plaintiff must allege independently wrongful conduct.  Here, plaintiff could not do so.  He lacked antitrust standing to rely on the antitrust violation that he had alleged as… Read More

Although recognizing that a minority of decisions apply a substantial evidence standard of review on appeal from an order granting or enforcement to a forum selection clause, this decision adopts what it says is the majority rule applying, instead, an abuse of discretion standard of review.  In this case, the contract included not only a clause selecting Illinois as the… Read More

The Song-Beverly Act (Civ. Code 1790.1) renders any waiver of its provisions contrary to public policy, unenforceable and void.  This decision holds that while the antiwaiver provision does not bar all settlement agreements resolving Song-Beverly Act claims, it did invalidate the waiver of Song-Beverly Act rights in the pre-litigation settlement agreement in this case because there was no evidence that… Read More

Disagreeing with Felisilda v. FCA US LLC (2020) 53 Cal.App.5th 486, this decision holds that a standard California car sale contract with an arbitration clause does not require the car buyer to arbitrate his warranty claims against the car's manufacturer.  Breach of warranty claims are based on statute, not the car sale contract, and so are not intertwined with the… Read More

Defendant disability insurer wrote plaintiff insured in 2015 that it had determined his disability arose from illness rather than accident and so would stop paying benefits in 2018 when he turned 65 as the policy allowed for illness-caused disability.  Plaintiff sued for breach of contract and breach of implied covenant in 2019, more than four years after the 2015 letter,… Read More

Under McGill v. Citibank, N.A. (2017) 2 Cal.5th 945, the trial court properly denied defendant's motion to compel arbitration because the arbitration clause forbade award of a public injunction in any forum.  Contrary to the defendant's argument, its arbitration agreement did not authorize the arbitrator to award a public injunction.  It provided instead that arbitration is to be “conducted only… Read More

Kinder was a patient at defendant's residential skilled nursing facility.  The trial court correctly denied a motion to compel arbitration of Kinder's personal injury claim because she did not sign the facility's arbitration agreement.  Instead, her adult child signed for her.  The facility produced no evidence to show that the signer had actual or ostensible authority to sign for Kinder. … Read More

Kaiser's arbitration clause satisfied H&S Code 1363.1's requirement that a health plan's arbitration clause be prominently displayed immediately before the patient's signature.  The enrollment was by computer.  The arbitration clause appeared just before a button marked "save" and a warning that by hitting that button, the patient would be agreeing to Kaiser's terms and conditions and enrolling in the health… Read More

The trial court did not err in denying a motion to compel arbitration in this case on the ground of unconscionability.  The employee was required as a condition of employment to sign the arbitration agreement and a separate confidentiality agreement.  The two had to be construed together since they both dealt with resolution of disputes arising out of plaintiff's employment… Read More

Though LA's city council adopted a resolution approving deeding a parcel of city-owned real property to plaintiff, the resolution was not a contract and did not bind the city to convey the property.  Instead, the city would be bound only if its charter provisions and administrative code provisions governing city contracts were properly followed.  Since discretion was involved in the… Read More

The force majeure clause in the parties' lease allowed a party to defer performance if a force majeure delayed, interrupted or prevented performance of obligations under the lease.  This decision holds that though COVID-19 and related governmental restrictions on use of the premises for its intended purpose as a brewpub, the pandemic did not delay, interrupt or prevent the tenant… Read More

Lamps Plus, Inc. v. Varela (2019) 139 S.Ct. 1407 only held that ambiguity could not be construed against drafter for purposes of determining whether the parties had agreed to classwide arbitration.  It did not hold that the construction against drafter principle is inapplicable to other types of ambiguities in the arbitration agreement.  In any event, there was no ambiguity in… Read More

Disagreeing with Davis v. TWC Dealer Group, Inc. (2019) 41 Cal.App.5th 662, this decision holding that the arbitration provision in Nissan dealerships' standard employment agreement is not unconscionable.  Though having a high degree of procedural unconscionability due to small print size and lengthy, obscure language, the clause is not substantively unconscionable.  Small print size and obtuse phrasing relate to procedural… Read More

This decision holds that a restaurant established that its business losses incurred due to government closure orders during the COVID-19 pandemic were within the basic coverage of its business interruption coverage but also fell within the virus exclusion and the exclusion for loss caused directly or indirectly by enforcement of an ordinance or law.  Hence, judgment for the insurer is… Read More

Disagreeing with Felisilda v. FCA US LLC (2020) 53 Cal.App.5th 486, this decision holds that a standard California car sale contract with an arbitration clause does not require the car buyer to arbitrate his warranty claims against the car's manufacturer.  A warranty claim is not based on the car sale contract, but instead is an obligation of the manufacturer that… Read More