Swiderski v. Milberg Weiss

• Decision Date: 18 December 2001
• Docket Number: No. D036160.,D036160.
• Citation: 94 Cal.App.4th 719,114 Cal.Rptr.2d 513
• Court: California Court of Appeals Court of Appeals
• Parties: James SWIDERSKI, Plaintiff and Appellant, v. MILBERG, WEISS, BERSHAD, HYNES & LERACH, LLP, et al., Defendants and Appellants.

114 Cal.Rptr.2d 513

94 Cal.App.4th 719

James SWIDERSKI, Plaintiff and Appellant, v. MILBERG, WEISS, BERSHAD, HYNES & LERACH, LLP, et al., Defendants and Appellants.

No. D036160.

Court of Appeal, Fourth District, Division 1.

December 18, 2001.

Review Granted March 13, 2002.

Burkhardt & Larson, Philip Burkhardt and Carl A. Larson, Rnch Santa Fe, for Plaintiff and Appellant.

Littler Mendelson, Kenneth J. Rose, San Diego, and Michel J. Duquella for Defendants and Appellants.

KREMER, P.J.

Defendants Milberg, Weiss, Bershad, Hynes & Lerach, LLP, William S. Lerach, and Alan Schulman (together Milberg Weiss) appeal an order granting plaintiff James Swiderski's motion for new trial on his complaint for wrongful termination in violation of public policy. As a precaution in the event of reversal of the order granting new trial, Swiderski appeals the underlying summary judgment favoring Milberg Weiss. We reverse the order granting new trial, affirm the summary judgment, and remand the matter to the superior court to entertain proceedings to determine whether Swiderski has retained or waived his right to arbitrate his wrongful termination claim against Milberg Weiss.

I INTRODUCTION

In December 1996 Swiderski was admitted to practice law in California. In February 1997 Swiderski commenced working for Milberg Weiss as a law clerk and, as a condition of employment, signed an arbitration agreement (the Agreement) covering employment-related disputes. In January 1998, without any break in service, Swiderski began working for Milberg Weiss in a full-time position as an associate attorney.

In April 1999 Milberg Weiss terminated Swiderski's employment assertedly for performance-related reasons. To preserve his rights under the Agreement, Swiderski initiated contractually specified prearbitration procedures. However, stating the Agreement was unenforceable as unconscionable and inapplicable to the portion of his employment as an associate attorney, Swiderski also told Milberg Weiss he intended to sue.

In October 1999 Swiderski filed this lawsuit for wrongful termination in violation of public policy. Answering Swiderski's complaint, Milberg Weiss affirmatively alleged the lawsuit was barred by the Agreement. In December 1999, in response to Swiderski's discovery requests, Milberg Weiss told Swiderski that his civil suit was barred by the Agreement and that he had breached the Agreement by bringing this lawsuit/requesting discovery. Asking Swiderski to honor the Agreement by dismissing this lawsuit, Milberg Weiss also told him that failure to do so would result in a motion for summary judgment under Charles J. Rounds Co. v. Joint Council of Teamsters No. 42 (1971) 4 Cal.3d 888, 95 Cal.Rptr. 53, 484 P.2d 1397 (Rounds ).

In January 2000, not having received any response from Swiderski to its request that he dismiss this lawsuit, Milberg Weiss filed a motion for summary judgment on the ground that all matters raised in the lawsuit were subject to the valid and enforceable Agreement. In March/April 2000 the superior court granted Milberg Weiss's motion for summary judgment. In rejecting Swiderski's assertion that the Agreement applied only to disputes arising from his employment as a law clerk and not to disputes arising from his employment as an associate attorney, the court concluded as a matter of law that the Agreement applied to the parties' entire employment relationship. In rejecting Swiderski's assertion that the Agreement was unenforceable as unconscionable, the court concluded as a matter of law that Swiderski did not present evidence sufficient to raise any triable factual issue on whether the Agreement was procedurally unconscionable.

Later in April 2000, Swiderski forwarded to the American Arbitration Association (AAA) a demand for arbitration¹ and a declaration of hardship for purposes of seeking relief from arbitration expenses. The AAA deferred one-half ($250) of certain administrative fees but did not agree to waive any of the arbitrator's compensation.

In May 2000 the court entered summary judgment favoring Milberg Weiss on the ground there was no triable factual issue on whether Swiderski's single cause of action was covered by the valid and enforceable Agreement.

In June 2000 Swiderski filed notice of intention to move for new trial on the ground of newly discovered evidence.² (Code Civ. Proc., § 657, subd. 4.)³ Swiderski's points and authorities supporting his new trial motion identified such assertedly newly discovered evidence as the AAA's refusal to provide him with an economically viable forum. Swiderski's notice of intention also stated a new trial would be sought on the grounds that the decision was against law (§ 657, subd. 6) and that at the summary judgment proceedings an error in law had occurred that was excepted to by Swiderski (id., subd. 7). With respect to those latter two grounds, Swiderski's points and authorities asserted that triable factual issues existed on whether the Agreement applied to the parties' entire employment relationship and on whether the Agreement was effectively unilateral and thus substantively unconscionable.⁴

In July 2000 the court granted Swiderski's motion for new trial. As Swiderski expressly acknowledges, the court's new trial order was based upon a reason never asserted by Swiderski. Specifically, characterizing Milberg Weiss's summary judgment motion as based on the ground that its employment agreement with Swiderski contained an arbitration provision, the court concluded there was evidence sufficient to establish that Swiderski "pursued or attempted to pursue his arbitration remedy" before filing this lawsuit.

Milberg Weiss appeals the order granting Swiderski's motion for new trial. In reversing the new trial order, we conclude such order was based upon the court's erroneous concept of applicable legal principles. We also conclude the order was not otherwise sustainable upon any ground stated in Swiderski's motion for new trial.

Swiderski appeals the underlying summary judgment. In affirming the summary judgment, we conclude as a matter of law that the Agreement encompassed the entirety of the parties' employment relationship and was not unconscionable.

Finally, we remand the matter to the superior court to entertain proceedings to determine the issue whether Swiderski has retained or waived his arbitration rights.

II DISCUSSION

A Standard of Review

Like any order granting a new trial, an order granting new trial following an order granting summary judgment is appealable. (Aguilar v. Atlantic Richfield Co., supra, 25 Cal.4th at pp. 858-859, 107 Cal.Rptr.2d 841, 24 P.3d 493; see Waschek v. Department of Motor Vehicles (1997) 59 Cal.App.4th 640, 643-644, fn. 4, 69 Cal. Rptr.2d 296; Malo v. Willis (1981) 126 Cal.App.3d 543, 546, fn. 2, 178 Cal.Rptr. 774.) To the extent Swiderski's motion for new trial was granted because the superior court believed it had misapplied the law in granting Milberg Weiss's motion for summary judgment, the independent appellate review standard applies and the issue on appeal with respect to the new trial order is whether the summary judgment was properly granted or should have been denied. (Aguilar, at pp. 859-860, 107 Cal. Rptr.2d 841, 24 P.3d 493; Green v. Del-Camp Investments, Inc., supra, 193 Cal. App.2d at pp. 482-483, 14 Cal.Rptr. 420 [since defendant had adequately shown there was no triable factual issue, "the motion for summary judgment was properly granted and the motion for new trial should have been denied"]; Malo, at pp. 546, 549, 178 Cal.Rptr. 774.) With respect to whether a new trial should have been granted on the ground of assertedly newly discovered evidence, the standard of review on appeal is abuse of discretion. (Aguilar, at p. 859, 107 Cal.Rptr.2d 841, 24 P.3d 493; Scott v. Farrar, supra, 139 Cal. App.3d at pp. 468-69, 188 Cal.Rptr. 823.)

B The Superior Court's Legally Erroneous Rationale for Ordering New Trial

The court's order granting Swiderski's motion for new trial did not specify the statutory "ground" upon which it was granted. (§ 657.) Instead, the order was based simply on the "reason," never asserted by Swiderski, that the record on the summary judgment motion purportedly contained evidence sufficient to establish that Swiderski "pursued or attempted to pursue his arbitration remedy" before filing this lawsuit. Milberg Weiss contends the court erred in granting a new trial on a "ground" assertedly not specified by Swiderski. (Wagner v. Singleton (1982) 133 Cal.App.3d 69, 72, 183 Cal.Rptr. 631 ["the motion for new trial can only be granted on a ground specified in the notice of intention to move for a new trial"].) However, where, as here, "`a trial court in granting a new trial based its order exclusively upon an erroneous concept of legal principles applicable to the cause, its order will be reversed [citation].'" (Neal v. Montgomery Elevator Co. (1992) 7 Cal. App.4th 1194, 1199-1200, 9 Cal.Rptr.2d 497.) Thus, regardless whether the court could properly order a new trial based on a "reason" never asserted by Swiderski, we conclude the order must be reversed as based upon the court's erroneous interpretation of the controlling legal principles set forth in Rounds, supra, 4 Cal.3d 888, 95 Cal.Rptr. 53, 484 P.2d 1397.⁵ Specifically, in Rounds the Supreme Court held that summary judgment for defendants may properly be granted where, as here, the plaintiff has failed to exhaust or attempt to exhaust his arbitration remedy before filing his lawsuit on a claim covered by an arbitration agreement. In granting Swiderski's motion for new trial, the superior court erroneously concluded that Swiderski's mere initiation of the contractually imposed prearbitration procedures, without more, satisfied the requirements of Rounds.

In Rounds, supra, 4 Cal.3d 888, 95 Cal. Rptr. 53, 484 P.2d 1397, an employer sued a union for allegedly breaching a collective bargaining agreement. The Supreme Court affirmed...