Court Opinion

ID: 4588222
Source: CourtListenerOpinion
Date Created: 2020-11-20 00:01:58.472941+00
Date Added: 2024-06-11T08:48:40.402105
License: Public Domain

Filed 11/19/20 Marchetti v. Ford of Simi Valley, Inc. 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   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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has not been certified for publication or ordered published for purposes of rule 8.1115.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

ELIZABETH MARCHETTI, et                                    B297026
al.,
                                                           (Los Angeles County
         Plaintiffs and                                    Super. Ct. No. BC700684)
         Appellants,

         v.

FORD OF SIMI VALLEY,
INC.,

         Defendant and
         Respondent.

      APPEAL from an order of the Superior Court of Los
Angeles County, Amy D. Hogue, Judge. Affirmed in part and
vacated in part.
      Sanchez Law, J. Elias Sanchez; Liddle & Liddle, and
Raymond Zakari for Plaintiffs and Appellants.
      Manning, Leaver, Bruder & Berberich, Gary H. Prudian,
and Kimberly L. Phan for Defendant and Respondent.
                   ____________________________
       Elizabeth and Frank Marchetti appeal from a trial court
order granting Ford of Simi Valley, Inc.’s (FOSV) motion to
compel arbitration. The Marchettis contend they did not consent
to arbitration. Alternatively, they argue that the arbitration
agreement is unenforceable because it purports to waive claims
for public injunctive relief contrary to McGill v. Citibank, N.A.
(2017) 2 Cal. 5th 945 (McGill). We will affirm the trial court’s
order.

                          BACKGROUND
      The Marchettis filed a class action complaint in April 2018
based on their December 2017 purchase of a 2015 Ford Explorer
Sport from FOSV. The Marchettis alleged that FOSV advertised
the vehicle for a specific price both on a cell phone app and on
FOSV’s Web site, but then refused to sell the vehicle for the
advertised price.1 The Marchettis purchased the vehicle at the
higher price.
      As part of their transaction, the Marchettis signed a
document entitled “RETAIL INSTALLMENT SALE CONTRACT
– SIMPLE FINANCE CHARGE (WITH ARBITRATION
PROVISION).”2 In their opening brief, the Marchettis describe
the contract as “a one page, double-sided form” that the

      1 The complaint alleged that the vehicle was advertised for
sale for $31,650, but that FOSV “steadfastly refused to sell the
[vehicle] for anything less than $33,995 - $2,345 above the
advertised price.”
      2 The declaration of Frank Marchetti opposing the motion
to compel arbitration explained that the Marchettis “paid in full”
for the vehicle “on December 28, 2017 with no financing.”

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Marchettis objected to signing because it “was not suitable to [the
Marchettis’] non-financed cash purchase, but Ford insisted that if
Marchetti wished to purchase the vehicle, Marchetti had no
option other than to do so with Ford’s contract.”
       On the front page, the agreement contained a box that
read: “Agreement to Arbitrate: By signing below, you agree
that, pursuant to the Arbitration Provision on the reverse side of
this contract, you or we may elect to resolve any dispute by
neutral, binding arbitration and not by a court action. See the
Arbitration Provision for additional information concerning the
agreement to arbitrate.” The box included spaces for buyer and
co-buyer signatures, both of which appear to contain signatures.
       The back of the document contained the following:

       The Marchettis’ complaint alleged violations of the
Consumers Legal Remedies Act (CLRA) (Civ. Code, §§ 1750 et
seq.), the False Advertising law (FAL) (Bus. & Prof. Code, §§

                                 3
17500 et seq.), and the Unfair Competition law (UCL) (Bus. &
Prof. Code, §§ 17200 et seq.). As part of their CLRA cause of
action, the Marchettis requested on behalf of themselves and a
putative statewide class “an injunction requiring [FOSV] to make
appropriate changes to their sales practices such that they honor
all advertised prices and no longer refuse to sell a vehicle for the
price that vehicle has been advertised for sale.” And as part of
their UCL cause of action, the Marchettis requested that the trial
court “enjoin [FOSV] from continuing to conduct business in a
deceptive, unlawful, unfair and fraudulent manner so that the
general public may be protected from the future wrongful conduct
of [FOSV]. Specifically, [the Marchettis] request that [FOSV] be
enjoined from selling used vehicles for any price in excess of the
price at which those vehicles have been advertised for sale by
[FOSV].”
       FOSV moved the trial court for an order compelling
arbitration and either dismissing or staying the case pending
arbitration. The trial court concluded that the class action
waiver in the arbitration agreement did not purport to require
the Marchettis to waive their requests for public injunctive relief
and was, therefore, enforceable. Based on its conclusion that the
arbitration agreement did not purport to waive public injunctive
relief, the trial court granted FOSV’s motion to compel
arbitration.
       The Marchettis filed a timely notice of appeal.3

      3 “A trial court order compelling arbitration ordinarily is
reviewable only after the arbitration is complete and a party
appeals from the resulting judgment.” (Aanderud v. Superior
Court (2017) 13 Cal. App. 5th 880, 888 (Aanderud).) In their
notice of appeal, the Marchettis cited the death knell doctrine as

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                           DISCUSSION
       The Marchettis contend that the trial court’s order granting
FOSV’s motion to compel arbitration was flawed in two respects.
First, the Marchettis argue that FOSV failed to establish the
existence between the parties of an agreement to arbitrate.
Second, the Marchettis argue that the arbitration agreement at
issue is unenforceable as contrary to California public policy
because it purports to require them to waive substantive claims
for public injunctive relief.
   A. Applicable Law
       “[U]nder both federal and California law, arbitration
agreements are valid, irrevocable, and enforceable, save upon
such grounds as exist at law or in equity for the revocation of any
contract.” (Armendariz v. Foundation Health Psychcare Services,
Inc. (2000) 24 Cal. 4th 83, 98, fn. omitted.) “ ‘When deciding
whether the parties agreed to arbitrate a certain matter
(including arbitrability), courts generally . . . should apply
ordinary state-law principles that govern the formation of
contracts.’ [Citation.] Thus, an arbitration agreement is
governed by contract law and is construed like other contracts to
give effect to the intention of the parties. [Citations.] ‘If
contractual language is clear and explicit, it governs.’ [Citations.]

the basis for appealability of the trial court’s order. The death
knell doctrine “permits the appellate court to review an order
denying a motion to certify a class when it is unlikely the case
will proceed as an individual action.” (Ibid.) “The doctrine has
been applied to permit immediate appeal from an order made in a
putative class action requiring arbitration of individual claims
and waiving class arbitration because such an order is effectively
the ‘death knell’ of the class litigation.” (Ibid.; accord Franco v.
Athens Disposal Co. (2009) 171 Cal. App. 4th 1277, 1288.)

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       “A petition to compel arbitration is simply a suit in equity
seeking specific performance of a contract. [Citation.] The party
seeking to compel arbitration bears the burden of proving the
existence of an arbitration agreement, while the party opposing
the petition bears the burden of establishing a defense to the
agreement’s enforcement. [Citation.]” (Aanderud, supra, 13
Cal.App.5th at p. 890.)
       Our review is de novo. (Aanderud, supra, 13 Cal.App.5th
at p. 890.)
    B. Assent to Arbitration Agreement
       The Marchettis contend that FOSV did not carry its burden
of proving the existence of an arbitration agreement because,
according to the Marchettis, “it is clear that the form contract
[that the parties signed] did not express the parties’ mutual
consent and understanding.” The Marchettis contend that the
contract is essentially meaningless because it is a financing
agreement and the Marchettis did not finance their vehicle.
FOSV “required [the Marchettis] to sign the form contract, with
all of the financing terms, even though there was no question
that [the Marchettis were] not agreeing to any of the financing
terms because it was agreed that [the Marchettis were] paying
the full purchase price,” the Marchettis argue.
       Whether the contract’s financing provisions applied to the
Marchettis’ purchase, the arbitration provision—on its face—did:
“Any claim or dispute, whether in contract, tort, statute or
otherwise (including the interpretation and scope of this
Arbitration Provision, and the arbitrability of the claim or
dispute) . . . which arises out of or relates to your credit
application, purchase or condition of this vehicle, this contract or
any resulting transaction or relationship . . . shall . . . be resolved

                                   6
by neutral, binding arbitration and not by a court action.” (Italics
added.)
      Neither is the Marchettis’ assent to the agreement
ambiguous. In a box on the front page of the two-page
agreement, the Marchettis signed under a paragraph that states:
“By signing below, you agree that, pursuant to the Arbitration
Provision on the reverse side of this contract, you or we may elect
to resolve any dispute by neutral, binding arbitration and not by
a court action. See the Arbitration Provision for additional
information concerning the agreement to arbitrate.”
      We conclude, as did the trial court, that an agreement to
arbitrate exists between the parties.
   C. Arbitrability
      The Marchettis contend that their claims against FOSV are
not arbitrable because the arbitration agreement purports to
waive claims for public injunctive relief. Citing McGill, they
argue that the arbitration agreement’s failure to carve out claims
for public injunctive relief renders the arbitration agreement
unenforceable. Among other responses, FOSV contends that the
arbitration agreement’s delegation clause delegates questions of
arbitrability, including the enforceability of the arbitration
agreement based on waiver of public injunctive relief, to the
arbitrator. We agree with FOSV.
      In Henry Schein Inc. v. Archer and White Sales, Inc. (2019)
___ U.S. ___, ___ (Henry Schein), the United States Supreme
Court explained that “[w]hen the parties’ contract delegates the
arbitrability question to an arbitrator, a court may not override
the contract. In those circumstances, a court possesses no power
to decide the arbitrability issue. That is true even if the court
thinks that the argument that the arbitration agreement applies

                                 7
to a particular dispute is wholly groundless.” “[A] court, in
response to a motion by an aggrieved party, must compel
arbitration ‘in accordance with the terms of the agreement’ when
the court is ‘satisfied that the making of the agreement for
arbitration or the failure to comply therewith is not in issue.’ ”
(Id. at p. ___.) We are satisfied that the parties entered into an
agreement to arbitrate. The Marchettis have failed to comply.
And the parties’ agreement to arbitrate delegates questions of
arbitrability to the arbitrator.
       At least one other California court has reached the same
conclusion. In Aanderud, supra, 13 Cal. App. 5th 880, our
colleagues in the Fifth District concluded that “it is the arbitrator
who will consider the conscionability of the agreement and the
scope of the arbitration clause, including whether the class
arbitration is available under the arbitration provision, and
whether the provision purports to waive the Aanderuds’ right to
seek public injunctive relief in all fora and, if so, what impact this
has on the enforceability of the arbitration provision as a whole.”
(Id. at p. 897, italics added.)
       We conclude that the Marchettis agreed to arbitrate their
disputes, including questions of the interpretation and scope of
their arbitration agreement and the arbitrability of specific
claims. Consistent with that conclusion and the United States
Supreme Court’s guidance in Henry Schein, we affirm the trial
court’s order granting FOSV’s motion to compel arbitration.
       We note that in section II.B. of its order, the trial court
reached conclusions about the enforceability of the parties’
arbitration agreement based on its interpretation of the
agreement and findings regarding public injunctive relief. As did
our colleagues in Aanderud, we will vacate the portion of the trial

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court’s order in which the trial court made findings that the
parties’ arbitration agreement reserved for the arbitrator.
(Aanderud, supra, 13 Cal.App.5th at p. 897.)

                          DISPOSITION
      Section II.B. of the trial court’s order is vacated. The order
granting the motion to compel arbitration is affirmed in all other
respects, and the cause is remanded to the trial court for further
proceedings consistent with this opinion. The respondent is
awarded its costs on appeal.
      NOT TO BE PUBLISHED

                                           CHANEY, J.

We concur:

             BENDIX, Acting P. J.

             FEDERMAN, J.*

      *Judge of the San Luis Obispo Superior Court, assigned by
the Chief Justice pursuant to article VI, section 6 of the
California Constitution.

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