Court Opinion

ID: 3217396
Source: CourtListenerOpinion
Date Created: 2016-06-27 22:06:46.181867+00
Date Added: 2024-06-11T13:28:03.491607
License: Public Domain

Filed 6/27/16 Urchasko v. Compass Airlines CA2/7
                  NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication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 SEVEN

JOHN URCHASKO,                                                       B264672

         Plaintiff and Respondent,                                   (Los Angeles County
                                                                     Super. Ct. No. BC558999)
         v.

COMPASS AIRLINES, LLC,

         Defendant and Appellant.

         APPEAL from a judgment and an order of the Superior Court of Los Angeles
County, Michael L. Stern, Judge. Reversed and remanded.
         Ogletree, Deakins, Nash, Smoak & Stewart, Lara C. de Leon, Angela Pak and
Jack. S. Sholkoff for Defendant and Appellant.
         Cummings & Franck, Scott O. Cummings and Lee Frank for Plaintiff and
Respondent.
                                                     __________
       After John Urchasko was fired, he sued his former employer, Compass
Airlines, LLC, in superior court asserting statutory and common law claims relating to
his employment and discharge. Compass petitioned to compel arbitration of his action.
The superior court denied the petition, finding Urchasko had not agreed to arbitration
and, alternatively, the arbitration agreement Urchasko had signed was unconscionable
and, therefore, unenforceable. On appeal Compass challenges both rulings. We reverse.

                 FACTUAL AND PROCEDURAL BACKGROUND
       1. The Lawsuit
       Urchasko worked as a maintenance supervisor for Compass from October 28,
2013 through February 3, 2014, when his employment was terminated. On
September 29, 2014 he sued Compass alleging causes of action for race and age
discrimination, sexual/sexual orientation harassment and retaliation in violation of the
California Fair Employment and Housing Act (FEHA) (Gov. Code, § 12900 et seq.), as
well as wrongful termination in violation of public policy and related statutory claims
under the Labor Code (Lab. Code, § 2802 [failure to reimburse for business expenses])
and the Business and Professions Code (Bus. & Prof. Code, § 17200 [unlawful business
practice]).
       2. Compass’s Petition To Compel Arbitration
       Compass answered the complaint on November 18, 2014 and on December 31,
2014 filed a petition to compel arbitration. According to the petition, when he applied for
a job with Compass, Urchasko completed an application that contained an arbitration
clause: “I UNDERSTAND AND AGREE that as a condition of my candidacy for
employment with Compass any legal claims or disputes that Compass and I may have
(including any dispute with any management or other employee or agent acting on behalf
of the Company) with respect to my application for employment, employment or
termination of employment (except for workers’ compensation and unemployment
compensation claims and claims arising out of any applicable collective bargaining
agreement) shall be decided exclusively by final and binding arbitration, conducted

                                             2
pursuant to the American Arbitration Association’s National Employment Dispute
Resolution Rules, before a neutral arbitrator, who shall be selected by mutual agreement
of the parties and bound to follow the applicable law. Both Compass and I intend for this
agreement to be construed as broadly as possible to cover, by way of example only, any
claims under federal, state or local statutes or common law . . . . I understand that this
means that neither Compass nor I can file a lawsuit in court regarding any employment-
related legal issue not covered by an applicable collective bargaining agreement . . . and
that both Compass and I specially waive the right to a jury trial on any such issue. This
agreement will be interpreted and enforced under the Federal Arbitration Act, 9 U.S.C.,
§ 1 et seq., where applicable and otherwise under the Minnesota Uniform Arbitration Act,
Minn. Stat. § 672.08, et seq.
       “. . . .
       “I ACKNOWLEDGE that the American Arbitration Association’s National
Employment Dispute Resolution Rules may be found on the Internet at the American
Arbitration Association’s website and that I may review those rules before signing this
application. If I do not wish to agree to this provision as part of the application process, I
understand that I must not sign the application, that my application will be incomplete,
and that I will not receive further consideration. I understand that this arbitration
provision is binding, regardless of whether I receive an offer of employment. I
UNDERSTAND THAT THIS IS AN AGREEMENT TO ARBITRATE DISPUTES,
AND IS NOT A CONTRACT OF EMPLOYMENT OR INTENDED TO ALTER ANY
EMPLOYMENT-AT-WILL STATUS THAT MAY ATTACH IF I AM HIRED.”
       On a separate line immediately following the paragraphs concerning arbitration,
the application stated, “Check the box below to certify that you have read and accept the
above statement.” The application further stated that the application “will be signed and
dated if you are selected for an interview, at the time of the interview.” Urchasko was
not asked to provide an electronic signature on the online application, and he did not
provide one.

                                              3
       Based on the information provided in his online application, Compass invited
Urchasko for an interview and subsequently hired him. As a condition of his
employment, on October 3, 2013 Urchasko signed a printed version of his electronic
application containing the arbitration provisions. Although the electronic version of the
application contained a box to check acknowledging the arbitration provisions, the
printed application Urchasko signed (and which Compass attached to its petition)
contained no such acknowledgment box, checked or otherwise. Compass’s recruiting
administrator, Chris Moser, testified that Urchasko must have checked the box on his
electronic application because Compass’s computer system was designed so that a person
who did not check the box would not be able to complete and submit the application. She
testified, “On investigation, due to a computer glitch” at the time his application was
printed, the box did not appear on the hard copy of the application Urchasko signed.
       3. Urchasko’s Opposition to the Petition To Compel Arbitration
       Urchasko opposed Compass’s petition to compel arbitration, insisting he had not
agreed to arbitrate disputes with the company. In his declaration Urchasko testified he
had filled out the application electronically and, to the best of his recollection, did not
check the box acknowledging his agreement to arbitrate. After Compass hired him,
Moser presented him with a stack of documents and told him he had to sign them to
finalize the employment process. One of those documents was the employment
application he had completed online. Urchasko asked Moser whether he had to read the
documents presented. Moser told him he did not have to read them, but he did need to
sign them if he wanted to be hired. Urchasko signed the documents, including the
application containing the arbitration provision, without reading them.
       Moser testified she regularly sat down with applicants during the job-offer
process, and it was, and remains, her practice to encourage all applicants to review all
documents before signing them. Compass also submitted with its reply the declaration of
Deb Viens, its recruiting supervisor. Viens testified that in January 2014 Urchasko
submitted a new job application seeking a different position with Compass in San
Francisco. In that application, which she attached to her declaration, Urchasko had

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                                           1
checked the box agreeing to arbitration. Urchasko was not selected for an interview for
that position, and he did not sign the 2014 agreement.
       4. The Trial Court’s Ruling Denying Compass’s Petition
       The trial court denied Compass’s petition to compel arbitration. In its May 27,
2015 statement of decision, the court ruled Compass had failed to demonstrate Urchasko
had agreed to arbitrate. “The defendant’s exhibit of an online application of an
arbitration clause followed by the phrase ‘Check the box below to certify that you have
read and accept the above [arbitration] statement’ is insufficient to show agreement by
the plaintiff to arbitrate his employment contract. That exhibit does not show any box, let
alone one checked by the plaintiff.” The court alternatively ruled the agreement,
provided to Urchasko on a take-it-or leave-it basis in “tiny font” “replete with confusing
exceptions, legalisms, and legal authorities” and without a copy of the American
Arbitration Association rules to which it referred, was unconscionable.
                                        DISCUSSION
       1. Standard of Review
       Code of Civil Procedure section 1280 et seq. authorizes a summary procedure to
enforce a valid agreement to arbitrate: “The petitioner bears the burden of proving the
existence of a valid arbitration agreement by the preponderance of the evidence, and a
party opposing the petition bears the burden of proving by a preponderance of the
evidence any fact necessary to its defense. [Citation.] In these summary proceedings, the
trial court sits as a trier of fact, weighing all the affidavits, declarations, and other
documentary evidence, as well as oral testimony received at the court’s discretion, to
reach a final determination.” (Engalla v. Permanente Medical Group, Inc. (1997)
15 Cal. 4th 951, 972.) “‘We will uphold the trial court’s resolution of disputed facts if
supported by substantial evidence. [Citation.] Where, however, there is no disputed
extrinsic evidence considered by the trial court, we will review its arbitrability decision

1      Urchasko objected to this evidence, asserting the 2014 application was irrelevant.
The court did not rule on his objection directly, but the record suggests it did not consider
the 2014 application in reaching its decision.

                                                5
de novo.’” (Lane v. Francis Capital Management LLC (2014) 224 Cal. App. 4th 676, 683
(Lane); accord, Avery v. Integrated Healthcare Holdings, Inc. (2013) 218 Cal. App. 4th
50, 60.)
       2. The Trial Court Erred in Denying Compass’s Petition To Compel Arbitration
               a. Urchasko signed an agreement to arbitrate
       Under both federal and state law the “‘threshold question presented by a petition
to compel arbitration is whether there exists an agreement to arbitrate.’” (Cruise v.
Kroger Co. (2015) 233 Cal. App. 4th 390, 396; see Engineers & Architects Assn. v.
Community Development Dept. (1994) 30 Cal. App. 4th 644, 653 [the right to compel
arbitration rests on the existence of a valid agreement to arbitrate; “[t]here is no public
policy favoring arbitration of disputes which the parties have not agreed to arbitrate”];
Banner Entertainment, Inc. v. Superior Court (1998) 62 Cal. App. 4th 348, 356 [same].)
       As with any other contract, an agreement to arbitrate requires the mutual consent
of the parties. (HM DG, Inc. v. Amini (2013) 219 Cal. App. 4th 1100, 1109; see
Bustamante v. Intuit, Inc. (2006) 141 Cal. App. 4th 199, 208 [“contract formation requires
mutual consent, which cannot exist unless the parties ‘agree upon the same thing in the
same sense’”]; Civ. Code, § 1580 [same].) Mutual consent is ascertained from the
language of the written agreement alone, whenever possible. (Civ. Code, § 1639; see
Civ. Code, § 1638 [“[t]he language of the contract governs its interpretation, if the
language is clear and explicit and does not involve an absurdity”]; Alexander v.
Codemasters Group Limited (2002) 104 Cal. App. 4th 129, 141 [mutual consent is
determined under an objective standard—“the reasonable meaning” of parties’ words and
acts—and not by “their unexpressed intentions or understandings”].)
       In determining that Urchasko had not agreed to arbitration, the trial court
emphasized the language in the printed October 3, 2013 agreement requesting that
Urchasko “[c]heck the box below to certify that you have read and accept the above
statement.” Because the printed agreement contained no such acknowledgment box,
checked or otherwise, the court ruled Urchasko had not acknowledged or agreed to
arbitration.

                                              6
       Accepting the court’s resolution of all factual conflicts in favor of the judgment
for which substantial evidence exists, including Urchasko’s testimony that he did not
check any box acknowledging the arbitration clause on his electronic application or on
the printed hard copy, we nonetheless conclude the trial court erred in ruling the absence
of a marked acknowledgment in the October 3, 2013 agreement was dispositive on the
question of mutual assent. There is no dispute Urchasko signed the printed application,
which expressly stated his signature constituted an agreement to arbitrate and specifically
instructed him not to sign the agreement if he did not agree to arbitration. Urchasko’s
signature on that agreement, therefore, unquestionably constituted an objective
manifestation of his assent to arbitration. (Cf. Banner Entertainment v. Superior Court,
supra, 62 Cal.App.4th at p. 358 [“[w]hen it is clear, both from a provision that the
proposed written contract would become operative only when signed by the parties as
well as from any other evidence presented that both parties contemplated that acceptance
of the contract’s terms would be signified by signing it, the failure to sign the agreement
means no binding contract was created”]; see generally Beck v. American Health Group
Internat., Inc. (1989) 211 Cal. App. 3d 1555, 1562 [on issues of mutual assent, objective
intent, as evidenced by the words of the instrument, not the parties’ subjective intent,
governs our interpretation]; Alexander v. Codemasters Group Limited, supra,
104 Cal.App.4th at p. 141 [same].)
       In an attempt to rebut this conclusion, Urchasko argues by not checking the box in
his electronic application, he effectively submitted a counteroffer, which Compass then
accepted. (See Berg v. Darden (2004) 120 Cal. App. 4th 721, 723 [counteroffer operates
as rejection of offer].) If Compass were relying on the electronic version of the
application submitted by Urchasko to compel arbitration, we would agree the absence of
both a signature and a checked box supported the trial court’s finding of lack of mutual
assent to arbitration. But Compass did not accept Urchasko’s counteroffer, if, in fact, he
made one. After Urchasko returned that form, Compass presented him with the hard
copy version of the application—either reasserting its original proposal or providing a
counter to Urchasko’s counteroffer. Urchasko signed that hard copy agreement without

                                             7
crossing out or otherwise altering any of its terms, including the arbitration provisions.
As discussed, his failure to check a nonexistent box on an agreement that expressly
provided his signature indicated his consent to arbitrate did not amount to a rejection of
the arbitration terms; and the trial court did not so find.
       Urchasko’s failure to read the hard copy of the agreement is no defense. (See
Desert Outdoor Advertising v. Superior Court (2011) 196 Cal. App. 4th 866, 872 [“[a]
cardinal rule of contract law is that a party’s failure to read a contract, or to carefully read
a contract, before signing it is no defense to the contract’s enforcement”]; Madden v.
Kaiser Foundation Hospitals (1976) 17 Cal. 3d 699, 710 [“one who assents to a contract
is bound by its provisions and cannot complain of unfamiliarity with the language of the
                 2
instrument”].)
              b. The agreement to arbitrate covers this dispute
       The October 3, 2013 arbitration agreement, by its terms, covers “any legal claims
or disputes that Compass and I may have (including any dispute with any management or
other employee or agent acting on behalf of the Company) with respect to my application
for employment, employment or termination of employment . . . .” It states, “Both
Compass and I intend for this agreement to be construed as broadly as possible to cover,
by way of example only, any claims under federal state or local statutes or common
law . . . .” Plainly, every claim in Urchasko’s lawsuit—his statutory claims for
discrimination, harassment, retaliation and unlawful employment practices and his claim
for wrongful termination—fall well within the scope of the agreement. (See Baltazar v.
Forever 21, Inc. (2016) 62 Cal. 4th 1237, 1249 (Baltazar) [examples of statutory claims

2       This general proposition that a person who signs a contract is bound by its terms
whether or not he read it may be subject to exception when the contract is one of
adhesion and the provision in dispute is not plain or conspicuous and is contrary to the
reasonable expectation of the weaker party. (Smith v. Westland Life Ins. Co. (1975)
15 Cal. 3d 111, 122-123; cf. San Francisco Newspaper Printing Co. v. Superior Court
(1985) 170 Cal. App. 3d 438, 443 [not all contracts of adhesion are unconscionable for
failure to read; otherwise “all contracts of adhesion would be unenforceable at the whim
of the adhering party”].) We discuss unconscionability in section 2c, below.

                                               8
identified in agreement were included in agreement without limitation; they “do not alter
the substantive scope of the agreement”]; Lane, supra, 224 Cal.App.4th at p. 683
[agreement to arbitrate all employment-related claims including all wage and hour
benefic claims, contract claims and claims for wrongful termination encompassed
employee’s claims against employer arising out of employment].)
              c. The arbitration agreement is not unconscionable
                i. Governing law
       A petition to compel arbitration based on a written agreement to arbitrate, whether
the contract is governed by the California Arbitration Act (CAA) (Code Civ. Proc.,
§ 1280 et seq.) or, as here, by the Federal Arbitration Act (FAA) (9 U.S.C. § 1 et seq.), is
properly denied when grounds exist to revoke the agreement. (See Code Civ. Proc.,
§§ 1281, 1281.2; see Sonic-Calabasas A, Inc. v. Moreno (2013) 57 Cal. 4th 1109, 1143
(Sonic Calabasas) [“FAA ‘permits arbitration agreements to be declared unenforceable
“upon such grounds as exist at law or in equity for the revocation of any contract”’
[citation] including ‘“generally applicable contract defenses, such as fraud, duress, or
unconscionability”’”].)
       Unconscionability “refers to an absence of meaningful choice on the part of one of
the parties together with contract terms which are unreasonably favorable to the other
party. [Citation.] As that formulation implicitly recognizes, the doctrine of
unconscionability has both a procedural and a substantive element, the former focusing
on oppression or surprise due to unequal bargaining power, the latter on overly harsh or
one-sided results.” (Baltazar, supra, 62 Cal.4th at p. 1243 [internal quotation marks
omitted]; Pinnacle Museum Tower Assn. v. Pinnacle Market Development (US), LLC
(2012) 55 Cal. 4th 223, 246 (Pinnacle) [same].)
       “[T]here are degrees of procedural unconscionability. At one end of the spectrum
are contracts that have been freely negotiated by roughly equal parties, in which there is
no procedural unconscionability. . . . Contracts of adhesion that involve surprise or other
sharp practices lie on the other end of the spectrum. [Citation.] Ordinary contracts of
adhesion, although they are indispensable facts of modern life that are generally enforced

                                             9
[citation] contain a degree of procedural unconscionability even without any notable
surprises, and bear within them the clear danger of oppression and overreaching.
[Citations.] [C]ourts must be particularly attuned to this danger in the employment
setting, where economic pressure exerted by employers on all but the most sought-after
employees may be particularly acute.” (Baltazar, supra, 62 Cal.4th at p. 1244 [internal
quotation marks omitted].)
       Both procedural and substantive unconscionability must be present for the court to
refuse to enforce a contract under the doctrine of unconscionability although they need
not be present in the same degree. (Baltazar, supra, 62 Cal.4th at p. 1243; Pinnacle,
supra, 55 Cal.4th at p. 246.) Essentially the court applies a sliding scale to the
determination: “‘The more substantively oppressive the contract term, the less evidence
of procedural unconscionability is required to come to the conclusion that the term is
unenforceable, and vice versa.’” (Pinnacle, at p. 247; accord, Baltazar, at p. 1244;
Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal. 4th 83, 114.)
       “The ultimate issue in every case is whether the terms of the contract are
sufficiently unfair, in view of all relevant circumstances, that a court should withhold
enforcement.” (Sanchez v. Valencia Holding Co., LLC (2015) 61 Cal. 4th 899, 911-912;
see generally Baltazar, supra, 62 Cal.4th at p. 1245 [“[c]ommerce depends on the
enforceability, in most instances, of a duly executed written contract[;] [a] party cannot
avoid a contractual obligation merely by complaining that the deal, in retrospect, was
unfair or a bad bargain”].)
       The trial court’s unconscionability determination, absent conflicting extrinsic
evidence, is question of law subject to de novo review. (Pinnacle, supra, 55 Cal.4th at
p. 236; Roman v. Superior Court (2009) 172 Cal. App. 4th 1462, 1468-1469.) When the
extrinsic evidence is in conflict, we review the court’s resolution of that factual dispute
for substantial evidence. (Patterson v. ITT Consumer Financial Corp. (1993)
14 Cal. App. 4th 1659, 1663.)

                                             10
                 ii. Although there are some aspects of procedural unconscionability,
                    the absence of any substantive unconscionability is fatal to
                    Urchasko’s unconscionability argument
       As the trial court observed, there are some aspects of procedural unconscionability
in the printed “Application for Employment, Applicant Certification and Agreement”
Urchasko signed. The agreement was offered on a take-it-or-leave-it basis as a condition
of employment with no opportunity for negotiation. In addition, while perhaps more
user-friendly in its electronic form, the printed agreement contained small print (in 10
point font or less) and, according to Urchasko, was given to him as part of a “stack” of
documents to sign in order to complete the employment process. (The size and contents
of the “stack” was not established.)
       On the other hand, the document is neither long nor dense. Four of its five and
one-half pages are the employment application, consisting of substantial unused space
and including background information written by the applicant such as name, address,
phone number, past employment and past job duties. The portion of the document titled
“Applicant Certification and Agreement” is only five paragraphs long on a single page,
two of which are the arbitration provisions, set apart from the rest of the agreement and
preceded by the words in all capital letters, “I UNDERSTAND AND AGREE . . . .” In
addition, far from being replete with legalese, the arbitration agreement contains
straightforward language reflecting a broad agreement to arbitrate any employment-
related claim. (See Lane, supra, 224 Cal.App.4th at p. 690 [printed contract contained no
“hidden” terms and was not unconscionable even if it was adhesive in nature].) Crediting
Urchasko’s testimony, as we must to the extent it supports the judgment, Urchasko was
not lied to or otherwise manipulated into signing the agreement. He simply elected not to
read it. (See Baltazar, supra, 62 Cal.4th at p. 1245 [“Baltazar was not lied to, placed
under duress, or otherwise manipulated into signing the arbitration agreement. The
adhesive nature of the employment contract requires us to be ‘particularly attuned’ to her
claim of unconscionability [citation], but we do not subject the contract to the same
degree of scrutiny as ‘[c]ontracts of adhesion that involve surprise or other sharp

                                             11
practices.’”]; see also San Francisco Newspaper Printing Co. v. Superior Court (1985)
170 Cal. App. 3d 438, 443 [where the nonassignability clause was clear and conspicuous,
plaintiff’s failure to read it is no “excuse,” even in contract of adhesion].)
       Although the agreement suffers from a moderate degree of procedural
unconscionability, it is devoid of any substantive unconscionability. As discussed, that
the agreement was offered as a “mandatory, non-negotiable requirement” as a condition
of employment, which the trial court evaluated as substantive unconscionability, relates
to procedural unconscionability. (Pinnacle, supra, 55 Cal.4th at p. 247 [“[P]rocedural
unconscionability requires oppression or surprise. ‘“Oppression occurs where a contract
involves lack of negotiation and meaningful choice, surprise where the allegedly
unconscionable provision is hidden within a prolix printed form.”’”]; Lane, supra,
224 Cal.App.4th at p. 689 [same].) Nor is there a lack of mutuality, as Urchasko
contends, which would constitute a form of substantive unconscionability. (See
Armendariz v. Foundation Health Psychcare Services, Inc., supra, 24 Cal.4th at p. 117
[arbitration agreement that imposes on an employee the obligation to arbitrate but does
not impose the same obligation on the employer lacks mutuality and is substantively
unconscionable]; Serpa v. California Surety Investigations, Inc. (2013) 215 Cal. App. 4th
695, 705.)
       According to Urchasko, the provision stating “this is not a contract of
employment” permits Compass to “claim there is no contract and avoid arbitration,”
while the “employee has to submit to arbitration.” This one-sided aspect of the contract,
he argues, effectively makes Compass’s obligation to arbitrate illusory. (See generally
Mattei v. Hopper (1958) 51 Cal. 2d 119, 122 [an agreement is illusory if it leaves one
party “free to perform or to withdraw from the agreement at his own unrestricted
pleasure”].)
       Urchasko’s argument is based on a truncated, and misleading, excerpt of the
language in the agreement. The document provides, “THIS IS AN AGREEMENT TO
ARBITRATE DISPUTES, AND IS NOT A CONTRACT OF EMPLOYMENT OR
INTENDED TO ALTER ANY EMPLOYMENT AT-WILL STATUS THAT MAY

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ATTACH IF I AM HIRED.” When all the language of the provision is considered, not
just the snippet proffered by Urchasko, it is apparent that both Compass and Urchasko are
required to arbitrate any employment-related disputes. The agreement to arbitrate is not
one-sided nor is Compass’s duty to arbitrate illusory. (See Baltazar, supra, 62 Cal.4th at
p. 1246 [agreement to arbitrate any claim arising out of or in any way related to the hire
or employment or termination of employment broadly imposed a mutual obligation to
arbitrate on both the employer and employee]; Serpa v. California Surety Investigations,
Inc., supra, 215 Cal.App.4th at p. 705.)
       Finally, Urchasko emphasizes the arbitration agreement incorporated by reference
the rules of the American Arbitration Association (AAA) and directed the
applicant/employee to the AAA’s website without including the rules for immediate
review. Even if the failure to attach the AAA rules governing the arbitration is an
appropriate factor to consider in assessing procedural unconscionability (see Lane, supra,
224 Cal.App.4th at p. 690 [incorporation of AAA rules by reference without attaching
them could be a small factor in support of a finding of procedural unconscionability;
standing alone, or even in the context of an adhesion contract, without more, it is not
enough to support a finding of procedural unconscionability]; accord, Peng v. First
Republic Bank (2013) 219 Cal. App. 4th 1462, 1472), this argument does not support a
finding of substantive unconscionability. As the Court explained in Baltazar in rejecting
a similar contention, “Baltazar’s argument [failure to attach the AAA rules governing
arbitration that were incorporated by reference] might have force if her unconscionability
challenge concerned some element of the AAA rules of which she had been unaware
when she signed the arbitration agreement. But her challenge to the enforcement of the
agreement has nothing to do with the AAA rules; her challenge concerns only matters
that were clearly delineated in the agreement she signed. [The] failure to attach the AAA
rules therefore does not affect our consideration of Baltazar’s claims of substantive
unconscionability.” (Baltazar, supra, 62 Cal.4th at p. 1246.)
       In sum, even considering the aspects of procedural unconscionability found by the
trial court and urged on appeal by Urchasko, the absence of even a modicum of

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substantive unconscionability is fatal to Urchasko’s unconscionability argument. (See
Baltazar, supra, 62 Cal.4th at p. 1244 [“‘[a] finding of procedural unconscionability does
not mean that a contract will not be enforced, but rather that courts will scrutinize the
substantive terms of the contract to ensure they are not manifestly unfair or one-sided’”];
Roman v. Superior Court, supra, 172 Cal.App.4th at p. 1471 [“whatever measure of
procedural unconscionability may be present . . . [t]here must also be some measure of
substantive unconscionability”].) The trial court erred in ruling the agreement was
unconscionable and unenforceable.
                                      DISPOSITION
       The judgment is reversed, and the matter remanded to the trial court with
directions to vacate its order denying arbitration and to issue a new order granting
Compass’s petition to compel arbitration of Urchasko’s complaint. Compass is to
recover its costs on appeal.

                                                  PERLUSS, P. J.

       We concur:

              SEGAL, J.

              BLUMENFELD, J.*

*     Judge of the Los Angeles County Superior Court, assigned by the Chief Justice
pursuant to article VI, section 6 of the California Constitution.

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