Morel vs. The Irvine Company LLC

Plaintiff William Kwak is ordered to pay $4,000 to the defendants’ counsel Gulino Law Office by 7/13/26.

Plaintiff Kwak to give notice.

7 Morel vs. The Irvine Company LLC

2025-01524966 Motion to Compel Arbitration

Defendants IAC at Jamboree LLC and Irvine Management Company’s (IMC) motion to compel arbitration is GRANTED. (See 9 U.S.C. § 1 et seq. [FAA]; Victrola 89, LLC v. Jaman Properties 8 LLC (2020) 46 Cal.App.5th 337, 345-346 (Victrola) [parties may incorporate the FAA]; Quach v. California Commerce Club, Inc. (2024) 16 Cal.5th 562, 582 [parties may incorporate the FAA’s procedural provisions]; Johnson v. Walmart Inc. (9th Cir. 2023) 57 F.4th 677, 681 [FAA burdens]; Pinnacle Museum Tower Assn. v. Pinnacle Market Development (US), LLC (2012) 55 Cal.4th 223, 236 (Pinnacle) [applying FAA].)

Plaintiffs Helene Morel (Morel) and Shea Franko (Franko) are ORDERED to arbitrate their claims against defendants in accordance with the subject arbitration agreement. (Matosic Decl. at Ex. A [lease at arbitration (arb.) addendum].)

Existence of arbitration agreement. Defendants have met their first-step burden to demonstrate the existence of an agreement to arbitrate the controversy by producing a copy of the alleged arbitration agreement (reciting the terms verbatim) attached as an addendum to the subject lease. (See Matosic Decl. ¶ 5, Ex. A [lease, arb. addendum].) (See Matosic Decl. ¶ 5, Ex. A; Arthur Andersen LLP v. Carlisle (2009) 129 S.Ct. 1896, 1902-1903 [under FAA, state contract law governs the validity, revocability, and enforceability of an arbitration agreement, including the question of whether an arbitration agreement may be enforced by a nonparty]; see Banner Entertainment, Inc. v.

Superior Court (1998) 62 Cal.App.4th 348, 357 [the FAA does not apply until the existence of an enforceable arbitration agreement is established under state law principles]; Garcia v. Stoneledge Furniture LLC (2024) 102 Cal.App.5th 41, 51-52 [three-step burden shifting process].)

IAC may enforce the arbitration agreement as a party to that agreement. (See Matosic Decl. at Ex. A.) As for IMC, it signed the agreement as IAC’s property management company and “duly authorized agent” (see id. at Ex. A [lease, pp. 1 & 6; arb. addendum, pp. 1-2]), and has been sued based on its acts/omissions in that capacity. (See, e.g., Compl. ¶¶ 1.2, 3.1-3.8; see also ROA No. 24 [4/6/26 amendment to complaint, correcting name of defendant “The Irvine Company LLC” to IMC].) As such it may invoke the arbitration agreement as IAC’s agent. (Dryer v. Los Angeles Rams (1985) 40 Cal.3d 406, 409-410; Thomas v. Westlake (2012) 204 Cal.App.4th 605, 614-615.)

As for plaintiffs, Morel is bound by the arbitration agreement as a party to the agreement. As for Franko, there is no dispute that she Morel’s minor child. (See Compl. ¶ 1.5; see also ROA Nos. 46, 59 [guardian ad litem order].) In the arbitration agreement, Morel agreed that the agreement would “extend[] to and include[]” her “Occupants....” (Matosic Decl. at Ex. A [arb. addendum § 1, “This agreement to arbitration extends to and includes Resident, Resident’s Occupants...”].) And the lease expressly identifies Franko as one such “Occupant[].” (Id. at Ex.

A [lease ¶ 7].) While one must generally be a party to an arbitration agreement to be bound by it, there are a few circumstances in which a nonparty to an arbitration agreement can be bound by someone else’s consent. One such exception is where there is a parent-minor child relationship, such as the relationship between Morel and Franko, under the “well-grounded legal principle[]” that a parent can bind a minor child to an arbitration agreement. (Buckner v. Tamarin (2002) 98 Cal.App.4th 140, 142-143; see Pietrelli v.

Peacock (1993) 13 Cal.App.4th 943, 947 [“This authority is implied from the parent’s duties and rights as the child’s guardian.”]; see also Lee v. Southern California University for Professional Studies (2007) 148 Cal.App.4th 782, 786 [“limited circumstances exist under which a nonparty to an arbitration agreement can be bound by someone else’s consent,” for example, “agency, a spousal relationship or parent/minor child relationship”].) Franko is therefore also bound.

This shifts the burden to plaintiffs to present evidence of a factual dispute as to the existence of the arbitration agreement. (Garcia, supra, 102 Cal.App.5th at pp. 51-52.) Plaintiffs do not dispute the existence of the subject lease or arbitration agreement. In fact, plaintiffs admit that both exist (see Opp. at p. 3) and have not presented any evidence suggesting otherwise (indeed, they have not submitted any evidence at all). As such, the three-step burden shifting analysis stops here, and the court must find that defendants have met their burden to demonstrate the existence of an arbitration agreement. (Ramirez, supra, 102 Cal.App.5th at p. 837.)

Delegation clause. The arbitration agreement includes a clear and unmistakable delegation clause. (See Rent-A-Center, West, Inc. v. Jackson (2010) 561 U.S. 63, 70, fn. 1 (Rent-A-Center) [a delegation to the arbitrator is enforceable so long as it is clear and unmistakable]; Aanderud v. Superior Court (2017) 13 Cal.App.5th 880, 892 [delegation clause prerequisites]; Malone v. Superior Court (2014) 226 Cal.App.4th 1551, 1559-1560 [delegation clause that provided “ ‘[t]he arbitrator has exclusive authority to resolve any dispute relating to the interpretation, applicability, or enforceability of this binding arbitration agreement’ ” was clear and unmistakable]; Momot v.

Mastro (9th Cir. 2011) 652 F.3d 982, 988 [language delegating authority to arbitrator to determine “ ‘the validity or application of any of the provisions of’ ” the arbitration clause was a clear and unmistakable agreement to arbitrate the question of arbitrability]; see also Matosic Decl. at Ex. A [arb. addendum § 1.)

As such, the court must delegate the arbitrability issue to the arbitrator, unless plaintiffs can establish a defense to enforcement that is specific to the delegation clause itself (as opposed to the arbitration agreement as a whole). (See Malone, supra, 226 Cal.App.4th at pp. 1559-1560 [challenges to the arbitration agreement as a whole are not sufficient to challenge the delegation clause itself; any such defense “must be specific to the delegation clause”]; Rent-A-Center, supra, 561 U.S. at pp. 71-73 [a party’s challenge to the arbitration agreement as a whole does not invalidate the delegation clause; while courts may consider enforceability challenges specific to delegation clauses, the arbitrator is to consider challenges to the arbitration agreement as a whole]; accord, Nickson v. Shemran, Inc. (2023) 90 Cal.App.5th 121, 132.)

Delegation clause – defense to enforcement per Civil Code, § 1953, subd. (a)(4). Plaintiffs have raised two defenses specific to the delegation clause: (1) Civil Code section 1953, subdivision (a)(4); and (2) unconscionability. First, plaintiff contends that the delegation clause is “void” under California law, specifically, Civil Code section 1953, subdivision (a)(4) (section 1953(a)(4)), which provides that any provision in a residential lease “by which the lessee agrees to modify or waive” her “procedural rights in litigation in any action involving his rights and obligations as a tenant” shall be “void as contrary to public policy.” (Civ. Code, § 1953, subd. (a)(4).)

Plaintiffs’ reliance on section 1953(a)(4) fails because the arbitration agreement is governed by the FAA, and the FAA preempts state laws that discriminate against arbitration such as section 1943(a)(4). (See Matosic Decl. at Ex. A [arb. addendum § 1]; Chamber of Commerce of the United States of America v. Bonta (9th Cir. 2023) 62 F.4th 473, 483, 486 (Chamber of Commerce).)

“[T]he FAA preempts a state rule that discriminates against arbitration by discouraging or prohibiting the formation of an arbitration agreement.” (Chamber of Commerce of the United States of America v. Bonta (9th Cir. 2023) 62 F.4th 473, 483, 486 (Chamber of Commerce).) “[A] state rule discriminates against arbitration even if it does not expressly refer to arbitration, but instead targets its defining characteristics.” (Id., at p. 486.) This includes “a rule that prohibits an agreement ... that waives the right to a jury trial....” (Id. at p. 483.)

Further, even if a state law is purportedly “generally applicable,” the FAA preempts the law if it “interferes with fundamental attributes of arbitration,” such as a categorical rule of unconscionability declaring a particular type of agreement against public policy. (AT&T Mobility LLC v. Concepcion (2011) 563 U.S. 333, 331-334 (Concepcion); Chamber of Commerce, at p. 483.)

Specifically, “the FAA preempts a state rule that discriminates against arbitration by discouraging or prohibiting the formation of an arbitration agreement.” (Chamber of Commerce, supra, 62 F.4th at p. 486.) “[A] state rule discriminates against arbitration even if it does not expressly refer to arbitration, but instead targets its defining characteristics.” (Id., at p. 486.) This includes “a rule that prohibits an agreement ... that waives the right to a jury trial....” (Id. at p. 483.) Further, even if a state law is “generally applicable,” the FAA preempts the law if it “interferes with fundamental attributes of arbitration,” such as a categorical rule of unconscionability declaring a particular type of agreement against public policy. (AT&T Mobility LLC v. Concepcion (2011) 563 U.S. 333, 331-334 (Concepcion); Chamber of Commerce, supra, 62 F.4th at p. 483.)

This is precisely what we have here. Section 1953(a)(4) prohibits and renders “void” an agreement modifying or waiving a tenant’s procedural rights in litigation, including the right to a jury trial. (Civ. Code, § 1953, subd. (a)(4); Jaramillo v. JH Real Estate Partners, Inc., supra, 111 Cal.App.4th at p. 404 [“Inherent in an arbitration agreement is a waiver of any right to jury trial.”].) “Because a person who agrees to arbitrate disputes must necessarily waive the right to bring civil actions regarding those disputes in any other forum,” the statute “burdens the defining feature of arbitration agreements,” and is therefore preempted by the FAA. (Chamber of Commerce, supra, 62 F.4th at p. 487; see id. at pp. 483, 486; Concepcion, supra, 563 U.S. at pp. 331-334.)

Therefore, section 1953(a)(4) does not render the delegation clause void.

Delegation clause – defense to enforcement on the ground of unconscionability. Plaintiffs also argue that the delegation clause itself is unconscionable. “The general principles of unconscionability are well established. A contract is unconscionable if one of the parties lacked a meaningful choice in deciding whether to agree and the contract contains terms that are unreasonably favorable to the other party.” (OTO, L.L.C. v. Kho (2019) 8 Cal.5th 111, 125 (OTO).) The doctrine of unconscionability has both a (1) procedural and (2) substantive element. (OTO, supra, 8 Cal.5th at p. 125.) “The procedural element addresses the circumstances of contract negotiation and formation, focusing on oppression or surprise due to unequal bargaining power.” (Pinnacle, supra, 55 Cal.4th at p. 246.) “Substantive unconscionability pertains to the fairness of an agreement’s actual terms and to assessments of whether they are overly harsh or one-sided.” (Ibid.)

Both procedural and substantive unconscionability must be present before an arbitration provision is rendered unenforceable on unconscionability grounds. (Id. at p. 247.)

Plaintiffs have failed to demonstrate that the delegation clause is procedurally unconscionable. While plaintiffs contend that the arbitration agreement, including the delegation clause, was “presented to residential tenants without meaningful negotiation, in a context of severe bargaining power disparity” (Opp. at p. 13), plaintiffs have not submitted any evidence establishing this. Nothing shows that they did not in fact have a meaningful opportunity to negotiate the terms of the delegation clause or that there was a “severe bargaining power disparity” between the parties at the time they entered into the agreement.

Further, even if plaintiffs had demonstrated procedural unconscionability (which they have not), plaintiffs have also failed to demonstrate substantive unconscionability. A delegation clause is treated as a separate agreement to arbitrate. (Malone, supra, 26 Cal.App.4th at p. 1559.) Thus, the question here is whether plaintiffs have shown the delegation clause itself is substantively unconscionable. (Ibid.) Plaintiffs have not pointed to any particular language of the delegation clause that renders it substantively unconscionable.

Instead they complain that the delegation clause “remove[s] from judicial scrutiny the very question of whether the arbitration addendum is enforceable” by delegating that issue to the arbitrator. (Opp. at pp. 13-14.) But there is nothing substantively unconscionable about this. Parties may delegate questions of enforceability to an arbitrator, as was done here (Rent- A-Center, supra, 561 U.S. at p. 70, fn. 1; Garcia, supra, 102 Cal.App.5th at p. 50), and doing so does not tend to favor one side or the other. “Normally, we assume the arbitrator will act reasonably and in conformity with the law” (Ramirez v.

Charter Communications, Inc. (2024) 16 Cal.5th 478, 506), and nothing before the court suggests the arbitrator will not reasonably and/or fairly decide any issues of arbitrability.

Plaintiffs have therefore failed to demonstrate that the delegation clause is unconscionable. (See Pinnacle, supra, 55 Cal.4th at p. 246 [both procedural and substantive unconscionability must be present before a provision is rendered unenforceable on unconscionability grounds].)

As for plaintiffs’ remaining contentions directed at the arbitration agreement as a whole, they are not sufficient to challenge the delegation clause itself. (See Malone v. Superior Court, supra, 226 Cal.App.4th at pp. 1559-1560; Tiri v. Lucky Chances, Inc., supra, 226 Cal.App.4th at p. 244.)

Accordingly, the delegation clause must be enforced, and the remaining arbitrability issues must be decided by the arbitrator. (Henry Schein, supra, 586 U.S. at p. 65 [“When the parties’ contract delegates the arbitrability question to an arbitrator, the courts must respect the parties’ decision as embodied in the contract.”].)

Therefore, the court must delegate the remaining issues for the arbitrator to decide, including, inter alia, plaintiffs’ remaining challenges to the arbitration agreement as a whole. (Henry Schein, Inc. v. Archer and White Sales, Inc. (2019) 586 U.S. 63, 65, 69 [“When the parties’ contract delegates the arbitrability question to an arbitrator, the courts must respect the parties’ decision as embodied in the contract.”].)

Surreply. On 7/2/26, long after the time to file any further opposition papers, plaintiffs filed a surreply (consisting of a brief in response to the reply), labeled as another “opposition.” No authority provides for the filing of a surreply absent leave of court. (See Code Civ. Proc., § 1005, subd. (b); see also Bozzi v. Nordstrom, Inc. (2010) 186 Cal.App.4th 755, 765.) There is also no proof of service of the surreply. The court therefore declines to consider it.

This action is STAYED pending completion of arbitration. (Code Civ. Proc., § 1281.4.)

The Order to Show Cause re: Dismissal set September 18, 2026 at 8:30 a.m. is vacated.

An Alternative Dispute Resolution (ADR) Review hearing is scheduled for February 26, 2027 at 8:30 a.m. in Department C44.

Defendants shall give notice.

8 Nationwide Insurance Company vs. Cal- Coast Packing & Crating, Inc.

2025-01501912 Motion for Determination of Good Faith Settlement

Defendant Hutchinson Logistics & Consulting, LLC’s Motion for Determination of Good Faith Settlement is GRANTED.

Defendant Hutchinson Logistics & Consulting LLC seeks an order finding the settlement between itself and Plaintiff Nationwide to be in good faith.

California Civil Procedure Code § 877.6, subdivision (a)(1) provides that any party to an action in which it is alleged that two or more parties are joint tortfeasors or co-obligors on a contract debt shall be entitled to a hearing on the issue of the good faith of a settlement entered into by the plaintiff or other claimant and one or more alleged tortfeasors or co-obligors, upon giving notice in the manner provided in subdivision (b) of Section 1005.

California Civil Procedure Code § 877.6, subdivision (a)(2) states that a settling party may give notice of settlement to all parties and to the court, together with an application for determination of good faith settlement and a proposed order. A nonsettling party may file a notice of motion to contest the good faith of the settlement. (Id.) The issue of the good faith of a settlement may be determined by the court on the basis of affidavits served with the notice of hearing and any counter affidavits filed in response. (Code Civ.

Proc., § 877.6, subd. (b).) A determination by the court that the settlement was made in good faith shall bar any other joint tortfeasor or coobligor from any further claims against the settling tortfeasor or co-obligor for equitable comparative contribution, or partial or comparative indemnity, based on comparative negligence or comparative fault. (Code Civ. Proc., § 877.6, subd. (c).)

The purpose of the court’s review of a settlement for good faith is to determine whether the settlement prejudices the interests of nonsettling tortfeasors. (Tech-Bilt, Inc. v. Woodward-Clyde &