Court Holds Arbitration Agreement Unconscionable and Unenforceable
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In Carmona v. Lincoln Millennium Car Wash, Inc. (5/9/14) — Cal.App.4th —, the plaintiffs filed a putative wage and hour class action against their employers. The trial court denied the employers’ motion to compel arbitration under a pre-dispute arbitration agreement, and the Court of Appeal affirmed, holding as follows:
The arbitration agreement was procedurally unconscionable: (1) it was a contract of adhesion that was presented on a take-it-or-leave-it basis; and (2) although the plaintiffs primarily spoke Spanish, the employers translated only part of the agreement into Spanish, leaving important sections in English only.
The agreement was substantively unconscionable: (1) it lacked mutuality in that it required the employees to arbitrate, but allowed the employers to choose whether to arbitrate or go to court; and (2) the employers did not “justify the lack of mutuality with reference to business realities.”
Read original articleTags: arbitration agreement, Court Holds Arbitration Agreement Unconscionable, Court of Appeal, employers
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