Court Opinion

ID: 9900903
Source: CourtListenerOpinion
Date Created: 2023-11-20 18:02:03.532859+00
Date Added: 2024-06-11T09:21:22.193743
License: Public Domain

Filed 11/20/23 Hernandez v. San Francisco Conservatory of Music CA1/5

                  NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or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

                                      FIRST APPELLATE DISTRICT

                                                  DIVISION FIVE

 SHASE LELAND HERNANDEZ,
                                                                        A166188
           Plaintiff and Respondent,
 v.                                                                     (City and County of San
                                                                        Francisco
 SAN FRANCISCO
                                                                        Super. Ct. No. CGC-22-599297)
 CONSERVATORY OF MUSIC et al.,
           Defendants and Appellants.

         In this employment dispute, the San Francisco Conservatory of Music
and its president, David Stull (collectively, the Conservatory), appeal from
the trial court’s order denying the Conservatory’s petition to compel
arbitration of plaintiff Shase Leland Hernandez’s (Plaintiff) claims. We
affirm.
                                                   BACKGROUND
         In August 2014, the Conservatory made Plaintiff “a temporary offer of
employment” from August 25, 2014 to October 31, 2014. The offer letter
conditioned the offer upon Plaintiff’s agreement to an “enclosed arbitration
agreement.” Plaintiff accepted the employment offer by signing the offer

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letter, and Plaintiff and the Conservatory executed the arbitration agreement
(hereafter, the Arbitration Agreement). Both contracts were executed on
August 25, 2014, at the same time and in the same place.1 The Arbitration
Agreement provides covered disputes include “those arising out of or relating
to Employee’s employment or ending of employment with Conservatory or
thereafter . . . .”
       On November 3, 2014, two days after the expiration of the temporary
employment contract, the Conservatory offered Plaintiff a second term of
temporary employment through February 28, 2015. The offer letter again
provided the offer was contingent upon Plaintiff’s agreement to an “enclosed
arbitration agreement.” The enclosed arbitration agreement was
substantively identical to the Arbitration Agreement. Plaintiff accepted the
second term of temporary employment but did not sign the new arbitration
agreement.
       In February 2015, the Conservatory orally offered Plaintiff a
permanent position and Plaintiff accepted. No employment contract of any
kind was executed for this position. Plaintiff was terminated in May 2019.
       In April 2022, Plaintiff sued the Conservatory for wrongful termination
and retaliation based on May 2019 events. In August, the Conservatory filed
a petition to compel arbitration. After briefing and a hearing, the trial court
denied the petition on the ground that the Arbitration Agreement “does not
include disputes occurring after the expiration of the underlying employment
contract.”

       1 Although the date by Plaintiff’s signature on the offer letter is

“4/26/14,” Plaintiff averred that he executed both contracts at the same time
and the Conservatory does not dispute this averment.

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                                  DISCUSSION
      “ ‘Although “[t]he law favors contracts for arbitration of disputes
between parties” [citation], “ ‘there is no policy compelling persons to accept
arbitration of controversies which they have not agreed to arbitrate . . . .’ ”
[Citations.] In determining the scope of an arbitration clause, “[t]he court
should attempt to give effect to the parties’ intentions, in light of the usual
and ordinary meaning of the contractual language and the circumstances
under which the agreement was made.” ’ ” (Bono v. David (2007)
147 Cal.App.4th 1055, 1063.) “ ‘ “When deciding whether the parties agreed
to arbitrate a certain matter . . . , courts generally . . . should apply ordinary
state-law principles that govern the formation of contracts.” ’ ” (Moritz v.
Universal City Studios LLC (2020) 54 Cal.App.5th 238, 246 (Moritz).)
      “To interpret a contract, we look to its language ([Civ. Code,] § 1638)
and ascertain the intent of the parties, if possible, based solely on the
contract’s written provisions ([Civ. Code,] § 1639). In doing so, we apply the
‘ “clear and explicit” meaning of these provisions, interpreted in their
“ordinary and popular sense,” unless “used by the parties in a technical sense
or a special meaning is given to them by usage” [citation] . . . . Thus, if the
meaning a layperson would ascribe to contract language is not ambiguous, we
apply that meaning.’ [Citation.] At the same time, we ‘recognize[] the
“interpretational principle that a contract must be understood with reference
to the circumstances under which it was made and the matter to which it
relates. (Civ. Code, § 1647.)” ’ ” (Hewlett-Packard Co. v. Oracle Corp. (2021)
65 Cal.App.5th 506, 530–531.)
      The heart of the parties’ dispute is whether the phrase “Employee’s
employment or ending of employment with Conservatory” in the Arbitration
Agreement means any employment of Plaintiff by the Conservatory, or

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whether it is limited to Plaintiff’s temporary employment between August 25,
2014 to October 31, 2014. “An ambiguity arises when language is reasonably
susceptible of more than one application to material facts.” (Dore v. Arnold
Worldwide, Inc. (2006) 39 Cal.4th 384, 391.) Because the phrase is
reasonably susceptible of both interpretations, the language is ambiguous.
      We thus consider whether the circumstances under which the
Arbitration Agreement was executed clarifies the ambiguity. The Arbitration
Agreement was executed at the same time as the 2014 temporary
employment contract, and the latter expressly references the former.
“ ‘ “Under Civil Code section 1642, it is the general rule that several papers
relating to the same subject matter and executed as parts of substantially one
transaction, are to be construed together as one contract.” ’ ” (Alberto v.
Cambrian Homecare (2023) 91 Cal.App.5th 482, 490 (Alberto).) Courts have
applied this rule to construe separate arbitration agreements together with
other contemporaneously executed documents. (See id. at pp. 490–491
[construing arbitration agreement and confidentiality agreement together
where “[t]hey were executed on the same day” and “were both separate
aspects of a single primary transaction—[the employee’s] hiring”];
Reigelsperger v. Siller (2007) 40 Cal.4th 574, 580 [construing arbitration
agreement and informed consent agreement together where the forms
appeared on the reverse side of a single page and were “signed . . . at the
same time”].)
      We therefore construe the Arbitration Agreement together with the
2014 temporary employment contract. “An arbitration agreement is tied to
the underlying contract containing it, and applies ‘only where a dispute has
its real source in the contract. The object of an arbitration clause is to
implement a contract, not to transcend it.’ ” (Moritz, supra, 54 Cal.App.5th at

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p. 246.) “When an arbitration provision is ‘read as standing free from any
[underlying] agreement,’ ‘absurd results ensue.’ ” (Id. at p. 247.)
Accordingly, construing the two contracts together clarifies that the phrase
“Employee’s employment or ending of employment with Conservatory” refers
to the term of temporary employment that was the subject of the 2014
temporary employment contract. Similarly, the Arbitration Agreement’s
inclusion of the phrase “or thereafter,” construed together with the 2014
temporary employment contract, refers to subsequent disputes arising from
the 2014 temporary employment term. The Conservatory’s authority is not to
the contrary. (See Caviani v. Mentor Graphics Corp. (N.D. Cal. 2019, No. 19-
cv-01645-EMC) 2019 U.S. Dist. LEXIS 160105, at *1, 7–8 [arbitration
agreement signed upon plaintiff’s initial hire to permanent position applied
after plaintiff was promoted to different position]; Reigelsperger v. Siller,
supra, 40 Cal.4th at pp. 577, 580 [arbitration agreement providing it was
“ ‘intended to bind the patient and the health care provider . . . who now or in
the future treat[s] the patient’ ” applied to separate treatment provided two
years after agreement signed].)2

      2 At oral argument, counsel for the Conservatory argued a

determination that the plain language of the Arbitration Agreement was
ambiguous required a conclusion in favor of arbitration, relying on
authorities providing “ ‘arbitration agreements should be liberally
interpreted, and arbitration should be ordered unless the agreement clearly
does not apply to the dispute in question’ [citation]. ‘Doubts as to whether an
arbitration clause applies to a particular dispute are to be resolved in favor of
sending the parties to arbitration.’ ” (Vianna v. Doctors’ Management Co.
(1994) 27 Cal.App.4th 1186, 1189.) Assuming this proposition applies to the
determination of the term of an arbitration agreement, it does not assist the
Conservatory. While we find the Arbitration Agreement’s plain language
ambiguous, the ambiguity is resolved when we construe it in conjunction with
the 2014 temporary employment contract, as we must under Civil Code
section 1642. So construed, the term of the Arbitration Agreement is
unambiguous, leaving no doubts to be resolved in favor of arbitration.

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      This conclusion is also supported by the 2015 temporary employment
contract, which by its terms required Plaintiff to sign a new arbitration
agreement as a condition of the new term of employment (although Plaintiff
did not do so). This provision indicates the Conservatory’s understanding
that the Arbitration Agreement expired with the expiration of the original
term of temporary employment.3 “Acts of the parties, subsequent to the
execution of the contract and before any controversy has arisen as to its
effect, may be looked to in determining the meaning.” (1 Witkin, Summary of
Law (11th ed. 2023) Contracts, § 772.)
      The Conservatory does not contend Plaintiff’s claims arise from the
2014 temporary employment term. Accordingly, the Arbitration Agreement
does not cover the Plaintiff’s claims and the trial court properly denied the
petition to compel arbitration.4
                                   DISPOSITION
      The order is affirmed. Plaintiff is awarded his costs on appeal.

      3 At oral argument, counsel for the Conservatory suggested the

declaration of a Conservatory employee states the Conservatory
contemporaneously determined it was not necessary for Plaintiff to sign the
new arbitration agreement because the Arbitration Agreement was still in
effect. In fact, the declaration asserts only that “[i]t was not necessary to
require Plaintiff to complete” a new arbitration agreement—a legal
conclusion of the declarant rather than a factual explanation of the
Conservatory’s past conduct.
      4 We need not and do not resolve Plaintiff’s contentions that the

Conservatory forfeited various arguments and that we should disregard the
Conservatory’s opening brief.

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                                                                    SIMONS, J.
WE CONCUR:
JACKSON, P. J.
BURNS, J.

Hernandez v. San Francisco Conservatory of Music et al. (A166188)

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