Fourth District Upholds Trial Court's Refusal to Enforce Arbitration Provision, Post-Concepcion: Roberts v. El Cajon Motors, Inc.

On November 8, 2011, the Fourth District (Division 1) upheld a trial court order denying a motion to compel individual arbitration of a class action case, post Concepcion, in Roberts v. El Cajon Motors, Inc., __ Cal.App.4th __ (2011). The Court upheld the trial court’s denial based on the finding that the defendant had waived any right to arbitration by actively engaging in litigation rather than promptly moving to compel:

Assuming, without deciding, the waiver of classwide claims in the arbitration provision at issue here is valid and enforceable in light of Concepcion, as El Cajon argues, we nonetheless conclude El Cajon waived arbitration when it waited five months to invoke arbitration.

Indeed, if El Cajon either had promptly moved to compel arbitration at or near the time it answered the complaint or informed Roberts at that time of its intention to compel arbitration (such as in its answer to the complaint), Roberts likely would not have propounded extensive written discovery involving the class action allegations in her complaint. Of course, if Roberts had been given timely notice by El Cajon of its intent to arbitrate and propounded the discovery in any event, it would have been at her peril.

However, because the record shows El Cajon waited months after Roberts propounded extensive written discovery (undoubtedly at great expense) to notify Roberts of its intent to arbitrate and because most, if not all, of this discovery would—under El Cajon's own analysis of Concepcion—be useless in arbitration, we conclude there is ample evidence in the record showing El Cajon's conduct (including in responding to this discovery) was inconsistent with the intent to arbitrate and that Roberts was prejudiced by that conduct. (See St. Agnes Medical Center v. PacifiCare of California, supra, 31 Cal.4th at p. 1196.)

See Slip Opinion, at 18-19.

The Court’s decision joins the ever growing list of potential exceptions to the U.S. Supreme Court’s ruling in Concepcion. (See previous posts here, here and here).