An employer-defendant answered a wrongful-termination complaint, served multiple sets of discovery, and took the employee-plaintiff’s deposition during 13 months’ of litigation, before finally moving to compel arbitration. The trial court refused to compel arbitration, ruling the employer waived arbitration by its unreasonable delay. That seemed unsurprising.
So it seemed surprising that the majority in Quach v. Calif. Commerce Club, Inc. (D2d1 Apr. 14, 2022 no. B310458) 2022 WL 1113998 (nonpub. opn.) found that these facts, as a matter of law, do not waive arbitration. The court noted that the California Supreme Court in *Saint Agnes Medical Center v. PacifiCare of California* (2003) 31 Cal.4th 1187, 1203, had held that mere participation in litigation, and merely driving up court costs and expenses, are not enough to establish waiver of the right to arbitrate.
True, undue delay and waiting until the eve of trial can be grounds for waiver. But the court here found—again, as a matter of law—that “almost seven months before the trial date” is “not on the ‘eve of trial.’”
Good to know.
Writing in dissent, Judge Crandall was persuaded by the employee’s argument in his brief: “Quach's appellate brief hits the nail on the head: “[By now], all benefits of a speedy resolution [Quach] could have obtained through arbitration [have] been lost.”” Judge Crandall thought the court should not “overextend ourselves” to accommodate arbitration under these facts.
Briefing Faux Pas?: The court suggests it is unethical to copy arguments from court opinions without attributions. I don’t know why you wouldn’t give a cite. But I don’t see how this is unethical.
The Upshot: Although arbitration waivers are not supposed to be driven by any single factor, expect that the court will insist on a showing of prejudice or unfair advantage. While delay is relevant, a delay of even 13 months might not suffice. But do not rely on mere participation in litigation or driving up litigation costs.