Court Opinion

ID: 4714947
Source: CourtListenerOpinion
Date Created: 2021-08-12 00:42:48.268707+00
Date Added: 2024-06-11T08:07:25.009863
License: Public Domain

González, J.
¶39 (concurring) — I agree with the majority’s well-reasoned conclusions that the arbitrator selection, statute of limitations, and fee shifting provisions of the arbitration agreement are unconscionable. But the punitive damages provision is unconscionable as well. Washington law provides that employers who intentionally and willfully violate employees’ rights under chapter 49.52 RCW are liable for exemplary damages. The provision of the arbitration agreement that removes that penalty is unfairly one-sided and unconscionable.
¶40 RCW 49.52.070 specifically provides (with some exceptions not relevant here) that an employer who wrongfully withholds wages “shall be liable in a civil action ... for twice the amount of the wages unlawfully rebated or withheld by way of exemplary damages.” Under Washington law, “exemplary damages” is another term for “punitive damages.” As we have explained in the past, “[e]xemplary damages are punitive in nature.” Kadoranian by Peach v. Bellingham Police Dep’t, 119 Wn.2d 178, 188, 829 P.2d 1061 *277(1992) (citing Barr v. Interbay Citizens Bank of Tampa, 96 Wn.2d 692, 698-99, 635 P.2d 441, 649 P.2d 827 (1981)). A competent arbitrator would no doubt so find. Indeed, even the standard legal dictionary defines punitive and exemplary damages as synonymous terms. Black’s Law Dictionary 448 (9th ed. 2009) (listing “exemplary damages” as an alternate term for “punitive damages”).
¶41 Washington appellate courts have used the terms “exemplary” and “punitive” damages interchangeably, even when discussing the statute at issue here. In Schilling v. Radio Holdings, Inc., 136 Wn.2d 152, 157, 161, 961 P.2d 371 (1998), we affirmed a trial court judgment that included double damages under RCW 49.52.070, which we referred to as a “punitive award.” The Court of Appeals similarly explained that “[a]s exemplary damages, [RCW 49.52.070’s double damages] are intended to punish and deter blameworthy conduct.” Morgan v. Kingen, 141 Wn. App. 143, 161-62, 169 P.3d 487 (2007); see also McKee v. AT&T Corp., 164 Wn.2d 372, 401, 191 P.3d 845 (2008) (noting Washington’s “limited examples of exemplary damages” while analyzing a service agreement’s limitation on punitive damages); Dailey v. N. Coast Life Ins. Co., 129 Wn.2d 572, 577, 919 P.2d 589 (1996) (noting that the legislature has explicitly authorized punitive damages in RCW 9.73.230(11), which literally provides for “exemplary damages”).
¶42 We have also characterized statutes providing for double or treble damage awards as punitive damages, even when those statutes do not use the terms “punitive” or “exemplary.” See, e.g., Barr, 96 Wn.2d at 699-700 (the Consumer Protection Act, chapter 19.86 RCW, and laws prohibiting usury and trespass to trees, shrubs, and timber provide narrow exceptions to the rule that “punitive damages are contrary to public policy”).7
*278¶43 Because RCW 49.52.070 offers specifically exemplary (or punitive) damages, the court should not rely on PacifiCare Health Systems, Inc. v. Book, 538 U.S. 401, 123 S. Ct. 1531, 155 L. Ed. 2d 578 (2003). In PacifiCare, the Supreme Court found that it was at least doubtful whether an arbitration agreement’s exclusion of punitive damages would prevent an arbitrator from awarding treble damages under the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. § 1961. Id. at 405-06. However, RICO provides treble damages without identifying them as remedial or punitive. 18 U.S.C. § 1964(c). The Court explained that its prior cases had placed “treble-damages provisions on different points along the spectrum between purely compensatory and strictly punitive awards.” PacifiCare, 538 U.S. at 405. In contrast to RICO’s treble damages, Washington’s legislature specified that an employer “shall be liable in a civil action ... for twice the amount of the wages unlawfully rebated or withheld by way of exemplary damages” RCW 49.52.070 (emphasis added).
¶44 The conflict between RCW 49.52.070 and the arbitration agreement is quite plain. The law allows employees to seek punitive damages from an employer who willingly and intentionally pays them less than required, and the agreement takes away the arbitrator’s authority to award those damages. I would hold the punitive damages provision of the arbitration agreement unconscionable. I respect*279fully concur with the court’s judgment that this arbitration clause is unconscionable and unenforceable.
Fairhurst, Stephens, and Gordon McCloud, JJ., concur with González, J.

 I recognize that an early decision of this court concluded that exemplary damages were not a form of punishment but rather provided actual damages for “undetermined loss and damage . . . such as damage to reputation, damage to pride and to feeling, and damages of that character, some of which, it is true, are *278more or less sentimental.” Levy v. Fleischner, 12 Wash. 15, 17-18, 40 P. 384 (1895). However, later cases reason that “compensatory damages fully compensate the plaintiff for all injuries to person or property, tangible or intangible,” Barr, 96 Wn.2d at 699-700, such that punitive or exemplary damages are separate from compensatory damages. Moreover, the statute in Levy authorized a potentially unlimited amount of exemplary damages, and the court was inclined to think “the legislature, in granting the jury the right to assess this peculiar, and not very well-defined, character of damages, to grant them only the right to assess actual damages, which could not be assessed, in the absence of this provision, under the general laws governing attachments.” 12 Wash, at 17. In contrast, RCW 49.52.070 provides a specific measure of exemplary damages, most likely for the punitive purpose normally associated with that term.