Hasty v. Am. Auto. Ass'n of N. Cal.

• Docket Number: C097674
• Decision Date: 21 December 2023
• Parties: ALJARICE HASTY, Plaintiff and Respondent, v. AMERICAN AUTOMOBILE ASSOCIATION OF NORTHERN CALIFORNIA, NEVADA & UTAH, Defendant and Appellant.
• Court: California Court of Appeals Court of Appeals

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ALJARICE HASTY, Plaintiff and Respondent, v. AMERICAN AUTOMOBILE ASSOCIATION OF NORTHERN CALIFORNIA, NEVADA & UTAH, Defendant and Appellant.

C097674

California Court of Appeals, Third District, San Joaquin

December 21, 2023

NOT TO BE PUBLISHED

Super Ct. No. STK-CV-UWT-2021-0010217

ROBIE Acting P. J.

Plaintiff Aljarice Hasty sued defendant American Automobile Association of Northern California, Nevada &Utah (Association) for claims arising out of her employment. The Association filed a petition to compel arbitration and a motion to stay the action pursuant to an arbitration agreement that was signed as part of Hasty's employment contract (petition). The trial court found the arbitration agreement was unconscionable and exercised its discretion to decline severance of the unconscionable terms. The Association appeals and argues the trial court erred in finding both procedural and substantive unconscionability and it abused its discretion by not severing any unconscionable terms.

We conclude the arbitration agreement was both procedurally and substantively unconscionable and the trial court did not abuse its discretion by declining to sever the unconscionable terms. We thus affirm.

FACTUAL AND PROCEDURAL BACKGROUND

Hasty was employed by the Association as an insurance sales agent from March 4, 2019, to approximately mid-December 2020. In 2021, Hasty sued the Association for race discrimination disability discrimination, retaliation in violation of Government Code section 12940, harassment, wrongful discharge, and retaliation in violation of Labor Code section 1102. The Association filed the petition to compel Hasty to bring her claims in arbitration. Hasty opposed the petition arguing, among other things, that the arbitration agreement was unconscionable.

Pertinent to the unconscionability question, the Association submitted the declaration of Justina Lambert.^[1] Lambert declared she is the vice president of people services at the Association and manages a team of human resources managers and directors. She authenticated various documents attached to her declaration including the written employment offer the Association provided to Hasty, the arbitration agreement between the Association and Hasty, a portion of the Association's 2018 team member handbook, a portion of the Association's 2020 team member handbook, and a summary document from an electronic database, Workday, showing the documents Hasty electronically signed for purposes of employment. Lambert explained the Association electronically disseminates certain employment documents via Workday and "Workday stores th[o]se documents in the worker documents file and tracks when employees receive, open, and electronically sign such documents." Lambert declared the Association "has required all employees and prospective employees to enter into mutual agreements to arbitrate any and all claims arising from their employment or the termination thereof," and Hasty "was required to sign an arbitration agreement in the form of [the exhibit attached to Lambert's declaration] when she began work for [the Association] in March 2019."

The Association's written employment offer to Hasty included a clause providing that, "as a condition of [her] employment, [she] must accept the terms of the [Association's] [a]rbitration [a]greement and [c]onfidentiality [a]greement," which she "w[ould] be required to sign . . . on [her] first day of employment." The Workday summary shows Hasty signed a number of documents, including an arbitration agreement, electronically.

The arbitration agreement attached to Lambert's declaration consists of two lettersize pages. The document heading is set forth in a larger font size than the text in the remainder of the agreement and is capitalized and boldfaced, "ARBITRATION AGREEMENT." The body of the agreement consists of seven single-spaced paragraphs in a smaller font size and possibly a different typeface. It is unclear what typeface or font size was used in the document. The agreement provides the Association and employee "agree that any and all disputes, claims, or causes of action, in law or equity, arising from or relating to [e]mployee's employment or the termination of [e]mployee's employment, including but not limited to statutory, contractual and other claims (including, without limitation, claims under the Age Discrimination in Employment Act; Title VII of the Civil Rights Act of 1964; [s]ection[s] 1981 through 1988 of Title 42 of the United States Code; the Americans with Disabilities Act; The Fair Labor Standard Act; The Family and Medical Leave Act; any state anti-discrimination statutes; wage and hours laws; equal pay laws; any other federal, state or local civil or human rights law or any other local, state or federal law, regulation or ordinance; or any public policy, contract, tort or common law), shall be resolved to the fullest extent permitted by law, by final, binding, and confidential arbitration conducted before a JAMS arbitrator; provided, however, that if any employee benefit plan in which the [e]mployee participates provides a process for the resolution of disputed claims under such employee benefit plan, then such process will govern such claims and this arbitration agreement ('Agreement') will not apply to such claims.

"This Agreement waives the parties' rights to obtain any legal or equitable relief (e.g., monetary, injunctive or reinstatement) through any court. The parties also waive their right to commence any court action to the extent that is permissible under law provided that either party may seek equitable relief to preserve the status quo pending final disposition of the arbitration. Both[e]mployee and [the Association] hereby waive the right to resolve any claim through a trial by jury or judge or by administrative proceeding. The parties may seek and be awarded any remedy in arbitration that they could receive in a court of law. Nothing in this Agreement precludes either party from filing a charge or complaint with appropriate governmental administrative agencies and to assist or cooperate with agencies in their investigation or prosecution of charges or complaints, although, to the extent that is permissible by law, the parties waive their right to any remedy or relief as a result of such charges or complaints brought by such governmental administrative agencies.

"The arbitration shall take place in San Francisco, California for [e]mployee if he/she performs work for [the Association] in California, otherwise the arbitration shall take place in the state where the [e]mployee performs the majority of his/her work for [the Association], as determined by the arbitrator provided, however, that if the arbitrator determines there will be an undue hardship to [e]mployee to have the arbitration in such location, the arbitrator will choose an alternative appropriate location. The arbitration shall be conducted in accordance with the applicable employment rules of JAMS then in effect (except to the extent such rules conflict with this Agreement, in which case the terms of this Agreement will control) and the requirements of California law and the Federal Arbitration Act (9 U.S.C., [s]ections 1-14) regarding the terms and enforcement of arbitration agreements. (The JAMS [e]mployment [a]rbitration [r]ules and [p]rocedures are available for review on JAMS's web site at http://www.jamsadr.com/rules- employment-arbitration.) All claims, disputes or causes of action under this Agreement, whether by [the Association] or [e]mployee, must be brought in an individual capacity, and shall not be brought as a plaintiff (or claimant) or class member in any purported class or representative proceeding, nor brought in a private attorney general capacity or proceeding, nor joined or consolidated with any claims of any other person or entity. Employee will have the right to be represented by legal counsel at any arbitration proceeding. The arbitrator shall: (1) have the authority to compel adequate discovery for the resolution of the dispute and to award such relief as would otherwise be permitted by law; and (2) issue a written arbitration decision including the arbitrator's essential findings and conclusions and a statement of the award. The arbitrator may not consolidate more than one person's claims, and may not otherwise preside over any form of a representative or class proceeding. [The Association] shall pay all of the arbitrator's fees and administrative fees in excess of the amount of filing and other court-related fees [e]mployee would have been required to pay if the claims were asserted in a court of law. Employee and [the Association] acknowledge that, by agreeing to this arbitration procedure, both[e]mployee and [the Association] waive the right to resolve any such dispute through a trial by jury or judge or by administrative proceeding. Nothing in this Agreement is intended to prevent [e]mployee or [the Association] from obtaining injunctive relief in court if the award [that] such party might obtain in arbitration may be rendered ineffectual without provisional relief.

"This Agreement is made under the provisions of the Federal Arbitration Act (9 U.S.C., [s]ection 1-14) and will be construed and governed accordingly. Questions of arbitrability (i.e. whether an issue is subject to arbitration) shall be decided by the arbitrator. Likewise, procedural questions which grow out of the dispute and bear on its final disposition are also matters for the arbitrator.

"If any term or provision of this Agreement is declared illegal or unenforceable and cannot be modified to be enforceable such term or provision shall immediately become null and void, leaving the remainder of this Agreement in full force...