Filed 10/27/22 Towell v. O’Gara Coach Co. CA2/1

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions 

not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion 

has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION ONE

SELENA TOWELL,

Plaintiff and Respondent,

v.

O’GARA COACH COMPANY, LLC 

et al.,

Defendants and Appellants.

 B310742

 (Los Angeles County

 Super. Ct. No. 19STCV45961)

APPEAL from an order of the Superior Court of Los

Angeles County, William F. Highberger, Judge. Affirmed.

Kolar & Associates, Elizabeth L. Kolar and Benjamin T. 

Runge for Defendants and Appellants.

Berenji Law Firm, Shadie L. Berenji and Kristopher N. 

Tayyeb for Plaintiffs and Respondents.

______________________
2

Before plaintiff and respondent Selena Towell began 

working at a car dealership owned by defendant and appellant

Westlake Coach Company, LLC (Westlake), an affiliate of 

defendant and appellant O’Gara Coach Company, LLC (O’Gara), 

she digitally signed an employment application that contained a

clause requiring her to pursue any claims against defendants in 

individual arbitration. Two days later, Towell signed an at-will

employment agreement in which Westlake offered her an option 

to opt out of a waiver of her right to pursue class actions in court. 

Towell checked the box indicating that she opted out of the class 

action waiver. Two weeks after that, on her first day on the job,

Towell physically signed the employment application, certifying 

that she was the person who submitted the application in the 

first place.

Towell subsequently filed a class-action complaint against 

defendants, and the question in this case is which of the two

documents she signed controls. The trial court concluded that 

the opt-out provision in the at-will employment agreement 

superseded the arbitration agreement in the employment 

application, and on that basis denied defendants’ motion to 

compel arbitration. Defendants contend this was error, but we 

disagree and affirm.

FACTS AND PROCEEDINGS BELOW

Because this case revolves almost entirely around the 

interpretation of the two documents Towell signed, we quote 

them at length.

A. The Employment Application

The first document is titled “Application for Employment.” 

On the first four pages of the document, Towell entered the 
3

information typical of an employment application, such as her 

name and address, the position she was applying for (new car 

sales), and her employment history, in the spaces provided on the 

form.

The fifth page of the document is titled “Applicant 

Statement and Agreement” and consists of several paragraphs of 

very small text,1 with a space for Towell to sign at the bottom. 

Near the top of the page is a paragraph reading, “The Company 

and Employee (hereinafter collectively referred to as the ‘Parties’) 

hereby agree to use a system of alternative dispute resolution 

which involves binding arbitration to resolve all disputes which 

may arise out of the employment context. Because of the mutual 

benefits . . . which private binding arbitration can provide both 

the Company and Employee, Employee and the Company both 

agree that any claim, dispute, and/or controversy arising from, or 

relating in any way to, Employee’s employment relationship or 

application or consideration for employment with the company 

. . . shall be submitted to, and shall be resolved through, final and 

binding arbitration before an arbitrator selected in accordance 

with the procedures of the arbitration service selected by the 

party against whom the claim is brought . . . . This agreement 

shall be governed by the Federal Arbitration Act (9 U.S.C. § 1, et 

seq.) (‘FAA’) and to the extent not inconsistent with the FAA, the 

1 The trial court concluded that the font size was less than 

seven points, and found Towell’s estimate of 5.5 points 

“plausible.” The copy of the document in the appellate record 

appears to have been shrunk down somewhat from its original 

size, but even if it were increased to full size, the text of the 

arbitration provisions would be very small.
4

procedures set forth in the California Code of Civil Procedure 

[section] 1280[ ] et seq.”

The next paragraph provides that, “[i]n order to provide for 

the efficient and timely adjudication of claims, the Parties agree 

that the arbitrator is prohibited from consolidating the claims of 

others into one proceeding, and thus, the arbitrator will hear only 

the Employee’s individual claims and does not have the authority 

to fashion a proceeding as a class or collective action or to award 

relief to a group of employees in one proceeding. Thus, the 

Company has the right to defeat any attempt by me to file or join 

other employees in a class, collective, or joint action lawsuit or 

arbitration (collectively ‘class claims’).”

Below this paragraph, the document states, in all capital 

letters: “THE COMPANY AND EMPLOYEE HEREBY WAIVE 

ANY RIGHT ANY OF US MAY HAVE TO A JURY TRIAL OF 

ANY CLAIM OR CONTROVERSY COVERED BY THIS 

AGREEMENT.” Then, further down the page, another all-caps 

warning: “WHETHER TO AGREE TO ARBITRATION IS AN 

IMPORTANT BUSINESS DECISION. IT IS YOUR DECISION 

TO MAKE, AND YOU SHOULD TAKE CARE TO CONDUCT 

FURTHER RESEARCH AND TO CONSULT WITH OTHERS—

INCLUDING BUT NOT LIMITED TO AN ATTORNEY—

REGARDING THE CONSEQUENCES OF YOUR 

DECISION . . . .”

Finally, near the bottom of the page, a last warning in all 

capital letters: “DO NOT SIGN UNTIL YOU HAVE READ THE 

ABOVE STATEMENT & AGREEMENT.”

Beneath this warning appears Towell’s electronic signature 

dated July 6, 2018. Immediately below the electronic signature is 

another statement: “I hereby certify that this application was 
5

previously submitted by me online and that the information is 

accurate,” followed by Towell’s signature and the date, July 18, 

2018.

B. The At-will Employment Agreement

The second document is titled “At-Will Employment and 

Arbitration Agreement.” It begins by defining Towell’s

employment as at-will and subject to termination at any time by 

either party. It then includes several paragraphs similar to those 

quoted above in the employment application requiring the parties 

to resolve their claims in arbitration rather than in court. 

Paragraph 4 of the document states, “Unless I have exercised my 

right to opt out of the terms of this Paragraph as provided for

herein, I agree that any claim brought under this binding 

arbitration Agreement shall be brought in the individual capacity 

of myself or the Dealership. This binding arbitration Agreement 

shall not be construed to allow or permit the consolidation or 

joinder of other claims or controversies involving any other 

employees or parties, or permit such claims or controversies to 

proceed as a class or collective action. No arbitrator shall have 

the authority under this agreement to order any such class or 

collective action. Any dispute regarding the scope or 

enforceability of this Agreement shall be resolved by a court, not 

by the arbitrator. By signing this agreement, I am agreeing to 

waive any substantive or procedural rights that I may have to 

bring or participate in an action brought on a class or collective 

basis. . . .”

The following paragraph, however, allows the employee to 

opt out of the arbitration requirement in cases involving class 

claims. It states, “Due to the nature of the Class-Collective 

Action Waiver set forth in paragraph 4 above, the Dealership has 
6

provided me with the ability to opt out of the Class-Collective

Action Waiver. Accordingly, I acknowledge and understand that 

my agreement to waive the right to pursue or participate in the 

consolidation or joinder of other claims or controversies involving 

any other employees or parties, or have such claims or 

controversies proceed on a class or collective action, is voluntary 

and that execution of this document is not a condition of 

employment. I understand that I may elect to opt out of the 

Class-Collective Action Waiver and retain any right I may have 

to bring an action in court and bring an action on a class or 

collective basis by checking this box.” A checkmark appears in 

the box immediately following.

Towell signed the document and dated it July 8, 2018.

C. Lawsuit and Motion to Compel Arbitration

On December 23, 2019, Towell filed a class action 

complaint against O’Gara, alleging several violations of 

employment law. Towell claimed that she worked on behalf of 

O’Gara as a lease retention manager at a car dealership in 

Thousand Oaks from approximately July 18, 2018 to 

December 18, 2018. Towell was paid on a commission basis for 

selling cars, and she alleged that O’Gara failed to pay at least the 

minimum wage, and failed to pay for required non-commission 

work, among other claims. She later amended the complaint to 

include Westlake, the O’Gara affiliate that owned the dealership 

where she had worked.2

2 The record does not establish the exact relationship 

between O’Gara and Westlake. Defendants’ brief states that 

“O’Gara is an affiliate of Westlake in that they indirectly, 

th[r]ough one or more intermediaries, share common control.” 
7

On November 16, 2020, defendants filed a motion to compel 

arbitration, alleging that by signing the employment application, 

Towell agreed to address all disputes regarding her employment 

in individual arbitration. Towell opposed the motion on the 

ground that the opt-out provision in the at-will employment 

agreement superseded the employment application. In the 

alternative, she argued that the arbitration agreement in the 

employment application was unenforceable because it was 

procedurally and substantively unconscionable. Finally, Towell 

argued that any arbitration agreement was unenforceable to the 

extent that Towell’s claims fell within Labor Code section 229, 

which bars the enforcement of arbitration agreements in cases 

seeking the recovery of unpaid wages.

The trial court denied the motion, finding that Towell’s 

decision to opt out of the class action waiver was controlling. The 

court did not reach the issues of unconscionability or Labor Code 

section 229. Defendants filed a timely notice of appeal of the trial 

court’s order denying the motion.

DISCUSSION

“Arbitration agreements are ‘valid, enforceable and 

irrevocable, save upon such grounds as exist for the revocation of 

any contract.’ (Code Civ. Proc., § 1281.) ‘California law, like 

federal law, favors enforcement of valid arbitration agreements.’ ” 

The employment application listed Towell’s employer as “O’Gara 

Coach – Westlake,” and the at-will employment agreement 

identified Westlake as the employer. This opinion addresses only 

the question of whether Towell agreed to arbitrate her claims, 

and we need not and do not decide which defendant is potentially 

liable to Towell under any theory.
8

(Baxter v. Genworth North America Corp. (2017) 16 Cal.App.5th 

713, 721.) The denial of a motion to compel arbitration is an 

appealable order (Code Civ. Proc., § 1294, subd. (a)), and “ ‘ “ ‘we 

review the arbitration agreement de novo to determine whether it 

is legally enforceable, applying general principles of California 

contract law.’ ” ’ ” (Baxter, supra, at p. 722.)

Defendants argue that if we apply the general principles of 

contract law, we must conclude that there is a binding arbitration 

agreement between the parties. In particular, defendants point 

to the rule that “[i]n the absence of fraud, mistake, or another 

vitiating factor, a signature on a written contract is an objective 

manifestation of assent to the terms set forth there. [Citation.]

If the terms are unambiguous, there is ordinarily no occasion for 

additional evidence of the parties’ subjective intent.” (Rodriguez 

v. Oto (2013) 212 Cal.App.4th 1020, 1027.) On July 18, 2018, 

Towell signed the employment application, which included a 

provision stating that “[t]his agreement is the entire agreement 

between the Company and the employee regarding the rights of 

the Company or employee to terminate employment with or 

without good cause and this agreement takes the place of all 

prior and contemporaneous agreements, representations, and 

understandings of the employee and the Company.” Thus, 

according to defendants, Towell’s signature created a new 

contract that voided all prior contracts with defendants, 

including the at-will employment agreement in which Towell 

opted out of the waiver of her right to file a class-action 

employment claim. (See Thiele v. Merrill Lynch, Pierce, Fenner & 

Smith (S.D.Cal. 1999) 59 F.Supp.2d 1060, 1064 [“In California, a 

subsequent written contract alters the terms of a previous

contract”].)
9

If the July 18 “wet-ink” signature were the only signature 

on the at-will employment agreement, defendants’ argument 

might be persuasive. But when Towell was presented with the 

employment application as she began work at the car dealership 

on July 18, her electronic signature was already present on the 

document, along with the date she first signed it, July 6, 2018. 

Below that first signature was the statement, “I hereby certify 

that this application was previously submitted by me online and 

that the information is accurate.” Below that single line, Towell

signed the document a second time.

In this context, it is not at all clear that Towell’s July 18 

signature served to create a new contract and supersede all prior 

agreements. Towell proposes another plausible interpretation: 

that the purpose of signing the document a second time was 

merely to authenticate her original electronic signature. (See, 

e.g., Ruiz v. Moss Bros. Auto Group, Inc. (2014) 232 Cal.App.4th 

836, 842 [motion to compel arbitration denied because the 

defendant failed to prove authenticity of the plaintiff’s electronic 

signature].)

We find Towell’s interpretation of the July 18 signature 

more persuasive than defendants’ interpretation. First, it is 

consistent with the statement immediately above the second 

signature, “I hereby certify that this application was previously 

submitted by me online and that the information is accurate.” 

Second, as the trial court noted, the text pertaining to a waiver of 

class-action claims was printed in very small type and 

interspersed among several other provisions on the page above 

the signatures, with no place for Towell to sign her initials to 

indicate that she agreed to waive her class-action rights. If the 

parties meant for Towell’s second signature to void the opt-out 
10

clause that she had signed merely 10 days earlier, we would 

expect that intention to be stated clearly and unequivocally.

3

Another consideration supporting Towell’s interpretation is 

the principle that, if the meaning of a standardized contract 

cannot be resolved through other means, it must be construed 

against the drafter. (Civ. Code, § 1654; Badie v. Bank of America

(1998) 67 Cal.App.4th 779, 798.) Defendants prepared both of the 

contracts in this case and controlled the sequence in which Towell 

signed them. According to a declaration from a human resources 

employee who worked on behalf of Westlake, Towell’s experience 

was consistent with Westlake’s standard procedures. If 

defendants’ interpretation of the documents were correct, it 

would mean that defendants’ policy was to offer their new 

employees an opportunity to opt out of waiving their class-action 

rights, but then to require the employees to void that waiver 

when they began work and signed the employment application 

for a second time. This is an absurd outcome. Defendants had 

the ability to design their employment contracts as they wished.

If they did not mean for employees like Towell to have the right 

3 Defendants object to the trial court’s reasoning, claiming 

that there is no legal authority establishing a minimum text size 

or requirement to sign one’s initials in order to establish a valid 

arbitration agreement. This misses the point. The question is

not whether the employment application created a valid 

arbitration agreement in the first place, but whether Towell’s 

second signature on the document should be interpreted as 

voiding her subsequent decision to opt out. In these 

circumstances, the size of the text and the lack of initials are a 

reasonable factor in determining the meaning of Towell’s second 

signature.
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to opt out of the class-action waiver, they could have declined to 

offer the option in the first place.

In the absence of a clear indication to the contrary, we will 

not interpret Towell’s second signature on the employment 

application as a decision to surrender an option defendants had 

explicitly offered her merely 10 days earlier. By opting out of the 

class action waiver, Towell retained her right to file a class action 

suit. There is no agreement between the parties to arbitrate 

Towell’s class-action claims, and the trial court did not err by 

denying defendants’ motion.

DISPOSITION

The trial court’s order is affirmed. Towell is awarded her

costs on appeal.

NOT TO BE PUBLISHED

BENKE, J.*

We concur:

ROTHSCHILD, P. J.

BENDIX, J.

* Retired Associate Justice of the Court of Appeal, Fourth 

Appellate District, assigned by the Chief Justice pursuant to 

article VI, section 6 of the California Constitution.