Superior Court of California

County of Kern
Bakersfield Department 11

Date: 09/17/2019 BCV-19-101151

FENLEY VS REALOGY FRANCHISE GROUP LLC

Courtroom Staff

Honorable: David R. Lampe Clerk: Veronica D. Lancaster

NATURE OF PROCEEDINGS: RULING ON (1) DEFENDANT WISH PROPERTIES, |NC.'S PETITION TO

COMPEL ARBITRATION AND STAY PROCEEDINGS; AND (2) DEFENDANTS REALOGY FRANCHISE GROUP,
LLC AND SOTHEBY'S INTERNATIONAL REALTY, |NC.'S MOTION TO COMPEL ARBITRATION AND
JOINDER IN DEFENDANT WISH'S PETITION; HERETOFORE SUBMITTED 0N SEPTEMBER 17, 2019

RULING:

The Court denies Defendants’ petition to compel arbitration.

A court shall generally enforce an arbitration agreement absent waiver or grounds for rescission. (Code Civ. Proc.,

§ 1281.2.) There is ”a strong public policy in favor of arbitration as a speedy and relatively inexpensive means of

dispute resolution[.]" (St. Agnes Medical Center v. PacifiCare 0f Cali. (2003) 31 Ca|.4th 1187, 1204 (quotation marks

omitted).)

The statutes pertaining to arbitration (Code Civ. Proc., § 1281, 9 U.S.C. § 2) require a ”writing” but not

a signature. Thus, even an unsigned written arbitration agreement is enforceable. (See Valera Refining, Inc. v. M/T
Lauberhorn (5th Cir. 1987) 813 F.2d 60, 64; Genesco, Inc. v. T. Kakiuchi& C0,, Ltd. (2nd Cir. 1987) 815 F.2d 840,
846.)

In this vein, Defendants argue the lack of Plaintiff’s signature/initials after 1] 12 is unimportant, citing to Basura v.

U5 Home Corp .(2002) 98 Cal.App.4th 1205, 1216: ”[T]he lack of a perfected written arbitration agreement does
not conclusively establish the absence of an agreement to arbitrate.” Defendants argue, if the parties intended to
arbitrate their claims, a motion to compel arbitration should be granted ”notwithstanding its failure to initial the

arbitration provisions.” (/d.) That is the case here. Plaintiff’s knowledge of the Arbitration Agreement, her lack of

discussion with her supervisor at Wish Properties, Inc. about the Arbitration Agreement and her performance of
work for Wish Properties, Inc. is overwhelming evidence of her agreement to

arbitration.

MINUTE ORDER
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FENLEY VS REALOGY FRANCHISE GROUP LLC BCV-19-101151

Wish’s reliance on Basura is misleading. Basura stands for the proposition that the lack of a perfected written
arbitration agreement does not conclusively establish the absence of an agreement to arbitrate where there is

evidence to support this conclusion. In Basura, the evidence showed the parties orally agreed to arbitrate but
simply never reduced it to a signed agreement. That is not the case here.

Gathering further case law supporting arbitration despite a lack of signature, Wish cites to recent California cases
discussed consent to arbitrate. Specifically, Salgado v. Carrows Restaurant, Inc. (2019) 33 Cal.App.5th 356, and
Diaz v. Sohnen Enterprises (2019) 34 Cal.App.5th 126. Defendant notes the Diaz court stated: ”California law in this

area is settled: when an employee continues his or her employment after notification that an agreement to
arbitration is a condition of continued employment, that employee has impliedly consented to the arbitration
agreement." (Diaz v. Sohnen Enterprises, supra, 34 Cal.App.5th at p. 130.)

Case law applying to arbitration clauses is not a one-size-fits—all application. Defendants’ application of Salgado
and Diaz is not persuasive because the cases are factually dissimilar, primarily because the arbitration provision at
issue here was not introduced after the employment relationship was already under way, but also because there is

no indication Plaintiff was specifically told her employment was conditioned on acceptance of 1] 12.

In Salgado, the plaintiff had worked for Carrows for nearly 30 years before she was asked to execute an arbitration
agreement. She initiated suit prior to signing the arbitration agreement. The court concluded the dispute was
covered by the arbitration agreement and her subsequent execution of the agreement amounted to consent to
arbitrate because the language implied all disputes were covered, regardless of when they arose. The issue was
whether the arbitration agreement only applied to future events, post—signing. A distinction between the facts of
this case and Salgado is the fact that the plaintiff’s employment in Salgado was initiated and carried on without
any arbitration agreement, and the arbitration agreement came into the picture well into her employment. It is

I ll'
that fact that plays into Defendants Implied consent” premise.

In Diaz, the court found the plaintiff consented to arbitration of her disputes:

Erika Diaz, an employee of Sohnen Enterprises, filed a complaint alleging workplace

discrimination on December 22, 2016. Twenty days earlier, on December 2, 2016, she and her co-
workers received notice at an in-person meeting that the company was adopting a new dispute
resolution policy requiring arbitration of a|| claims. At that meeting, according to the declaration

of Marla Carr, the Chief Operating Officer of Sohnen, Carr informed all employees present,
including Diaz, about the new dispute resolution agreement. She included in her explanation that
continued employment by an employee who refused to sign the agreement would itself

constitute acceptance of the dispute resolution agreement. [1]] On December 19, 2016,

representatives of the company met privately with Diaz, who had indicated to Elaina Diaz on
December 14 that she did not wish to sign the agreement. Carr and Diaz advised her again, in

Spanish and English, that continuing to work constituted acceptance of the agreement. On
December 23, 2016, Diaz and her lawyer presented to Sohnen a letter dated December 20, 2016
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FENLEY VS REALOGY FRANCHISE GROUP LLC BCV-19-101151

 rejecting the agreement but indicating that Diaz intended to continue her employment. On the
same date, Diaz also served the complaint in this action.

(Diaz v. Sohnen Enterprises (2019) 34 Cal.App.5th 126, 128.)

As with Salgado, the facts are dissimilar to the facts in this case. In both Salgado and Diaz, employment was
already established and arbitration policies were implemented during the employment relationship. The clear

policy of the employers was that an employee’s continued employment constituted acceptance of the agreement.
In Diaz there is the added fact that plaintiff did not sign the agreement but the court nonetheless found she had
agreed to arbitrate by virtue of her decision to remain in Sohnen’s employ.

Defendants contend the arbitration provision has essentially been signed, and by executing the overall agreement,
Plaintiff agreed to the arbitration provisions contained in 1] 12. This gives no credit to the fact that 1] 12 had its own
signature line. Arguably a contract within a contract. Also, we have no evidence that her employment was
conditioned on signing the arbitration provision. It clearly was not, as she worked for Wish without signing it. The
fact the signature/initial line exists within the arbitration portion of the contract implies the contract within a

contract conclusion.

They also argue there was no ”opt in" or ”opt out" language or opportunity for the Plaintiff to opt out, citing to
Knepper v. Ogletree, Deakins, Nash, Smoak & Stewart, P.C., (C.D. Cal. March 26, 2019) No. 219CV00527JVSADS,
2019 WL 1449502, at *2.) This case does not, as Defendants hope, rule that there must be opt out language for
Plaintiff’s position to hold water. Knepper simply had specific opting language. In that case, the employees had
already agreed to arbitrate but a new version of the defendant’s policy was issued and the plaintiff could
specifically opt in or opt out.

”An arbitration clause is a contractual agreement. Courts ’interpret a contract to give effect to the parties’
intentions at the time of contracting.’ (Hernandez v. Badger Construction Equipment Co. (1994) 28 Cal.App.4th
1791, 1814, 34 Ca|.Rptr.2d 732.) ’When language in a contract is clear and explicit, that language governs
interpretation.’ (Esparza v. Sand & Sea, Inc. (2016) 2 Cal.App.5th 781, 789, 206 Ca|.Rptr.3d 474.)” (Salgado v.

Carrows Restaurants, Inc., 33 Cal. App. 5th 356, 359—60, 244 Cal. Rptr. 3d 849, 851—52 (Ct. App. 2019), as
modified (Mar. 25, 2019), review denied (June 26, 2019).) Further, where the agreement requires the parties’
signatures, it is appropriate to deny a petition or motion to compel arbitration.

The contract presented lends itself more towards Plaintiff’s argument than Defendants. Contrary to Defendant’s
sub—argument that the initiaI/signature line after 1] 12 simply indicates an employee’s understanding of the
applicable arbitration provisions, the language of the contract clearly implies it is a separate agreement:

ASSOCIATE—LICENSEE UNDERSTANDS ARBITRATION AND WAIVER AGREEMENT: Associate—

MINUTE ORDER
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FENLEY VS REALOGY FRANCHISE GROUP LLC BCV-19-101151

 Licensee represents and warrants that he/she understands the meaning and effect of the
arbitration and waiver agreements in this Paragraph 12 and has been provided a reasonable time
and opportunity to consult with legal counsel regarding this agreement to arbitrate. Associate-
Licensee hereby agrees to the provisions of these Paragraphs 12 A—G (initial) ASSOCIATE—
LICENSEE

(See Declaration ofJulie Weber, Exhibit A, page 4 (filed in support of Wish’s petition).)

We are not facing a question of whether a particular dispute or claim falls within the provisions of the arbitration
provision, but rather whether Plaintiff ever consented to arbitrate in the first place, regardless of the substance of

her claim. The inclusion of a separate initiaI/signature line at the conclusion of 1] 12 of the independent contractor
agreement implies execution of that provision is necessary for it to apply. Defendants vehemently disagree
but...why require the separate signature if it is meaningless?

Plaintiff will prepare an order consistent with this ruling for the court’s signature and pursuant to California Rules
of Court, rule 3.1312.

Copy of minute order mailed to all parties as stated on the attached certificate of mailing.

MINUTE ORDER FINALIZED BY: VERONICA LANCASTER ON: SEPTEMBER 17, 2019

MINUTE ORDER
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FENLEY VS REALOGY FRANCHISE GROUP LLC BCV-19-101151

 FENLEY VS REALOGY FRANCHISE GROUP LLC
BCV-19-101151
CERTIFICATE OF MAILING

The undersigned, of said Kern County, certify: That I am a Deputy Clerk of the Superior Court 0f the State 0f California,
in and for the County of Kern, that I am a citizen 0f the United States, over 18 years 0f age, Ireside in or am employed in
the County of Kern, and not a party to the Within action, that I served the Minute Order dated September 1 7, 2019
attached hereto 0n all interested parties and any respective counsel 0f record in the Within action by depositing true copies
thereof, enclosed in a sealed envelope(s) With postage fully prepaid and placed for collection and mailing 0n this date,
following standard Court practices, in the United States mail at Bakersfield California addressed as indicated on the
attached mailing list.

Date of Mailing: September 17, 2019

Place 0f Mailing: Bakersfield, CA

I declare under penalty 0f perjury under the laws 0f the State 0f California that the foregoing is true and correct.

Tamarah Harber-Pickens
CLERK OF THE SUPERIOR COURT
Date: September 17, 2019

Signed: 9/17/2019 02:01 PM

By:
Veronica Lancaster, Deputy Clerk

MAILING LIST

JOSHUA DAVID BUCK M WEBER

JULIE
THIERMAN BUCK LLP KAUFMAN DOLOWICH & VOLUCK LLP
7287 LAKESIDE DRIVE 11755 WILSHIRE BLVD STE 2400
RENO NV 89511 LOS ANGELES CA 90025

ADAM J KARR
OMELVENY & MYERS LLP
400SOUTH HOPE STREET
LOS ANGELES CA 90071

Certificate of Mailing
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