Fabian v. Renovate America, Inc. ( 2019 )

Filed 11/19/19; Certified for Publication 12/4/19 (order attached)
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
ROSA FABIAN, D075519
Plaintiff and Respondent,
v. (Super. Ct. No. 37-2018-00023808-
RENOVATE AMERICA, INC., CU-BT-NC)
Defendant and Appellant.
APPEAL from a judgment of the Superior Court of San Diego County, Earl H.
Maas III, Judge. Affirmed.
Reed Smith, Jesse L. Miller, James M. Neudecker, Matthew T. Peters and Dennis
Peter Maio for Defendant and Appellant.
Golden & Cardona-Loya, Octavio Cardona-Loya II for Plaintiff and Respondent.
Renovate America, Inc. (Renovate) appeals from an order denying its petition to
compel arbitration of Rosa Fabian's claims related to the financing and installation of a
solar energy system in her home. Renovate contends the trial court erred in ruling that
the company failed to prove by a preponderance of the evidence that Fabian
electronically signed the subject contract. We reject this contention and affirm.
FACTUAL AND PROCEDURAL BACKGROUND
A. Fabian's Complaint
Fabian filed a complaint against Renovate alleging that solar panels she purchased
for her home were improperly installed. Fabian alleged that, in early 2017, Renovate
made an unsolicited telephone call to her home about financing the solar panels and
"signed" her name on a financial agreement. All communications between Fabian and
Renovate's representative occurred telephonically and she was never presented with any
documents to sign. Fabian claims she did not sign a financial agreement with Renovate;
nevertheless, Renovate incorporated the solar panel payments set forth in the financial
agreement into her mortgage loan payments. Fabian thus alleged that Renovate violated:
(1) the Consumers Legal Remedies Act (Civ. Code § 1750 et seq.), (2) the Unfair
Competition Law (Bus. & Prof. Code § 17200 et seq.), and (3) the California Contract
Translation Act (Civ. Code § 1632).
B. Renovate's Petition to Compel Arbitration
Renovate filed a petition to compel arbitration of Fabian's claims and stay judicial
proceedings pending arbitration, supported by an Assessment Contract (Contract) that
Renovate claimed Fabian had signed electronically. The Contract states that it was
"made and entered into" on February 28, 2017, between the Western Riverside Council
of Governments (WRCOG)1 and the joint property owners, Fabian and her adult
daughter, Diana S. The Contract includes an arbitration agreement, which states:
1 Renovate is WRCOG's Program Administrator.
2
''Section 13. Arbitration Agreement. Please read this Section (''Arbitration
Agreement'') carefully. It is part of this Contract and affects the Property
Owner's rights. It contains A JURY TRIAL WAIVER and procedures for
MANDATORY BINDING ARBITRATION AND A CLASS ACTION
WAIVER.''
The arbitration agreement further states:
''All claims and disputes arising out of or relating to the [Home Energy
Renovation Opportunity] Program, the Contract and/or the Improvements
that cannot be resolved informally or in small claims court shall be resolved
by binding arbitration on an individual basis under the terms of this
Arbitration Agreement. The Arbitration Agreement applies to the Property
Owner and WRCOG.''
The last paragraph of the arbitration agreement states:
''By initialing below, the Property Owner acknowledges and agrees to the
terms set forth in Sections 4 [Existing Mortgage Disclosure], 12 [Waivers,
Acknowledgments and Contract] and 13 [Arbitration Agreement] above.''
The letters "DS" and the printed electronic initials ''RF'' appear in a box at the end of the
arbitration agreement. The last paragraph of the Contract states:
''IN WITNESS WHEREOF, the Authority and the Property Owner have
caused this Contract to be executed in their respective names by their duly
authorized representatives, all as of the Effective Date. The 'Effective Date'
is defined as the last date entered with signatures of the parties below.''
The words "DocuSigned by:" and the printed electronic signature ''Rosa Fabian''
appear in a signature box at the end of the Contract. The date "2/28/2017," a 15-digit
alphanumeric character, and the words "Identity Verification Code: ID Verification
Complete" also appear in the signature box.
In a supporting declaration, Mike Anderson, Renovate's Senior Director of
Compliance Operations, asserted that Fabian "entered into" the Contract on February 28,
2017 to finance the installation of a solar energy system.
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C. Fabian's Opposition
Opposing the petition, Fabian stated in a declaration stated that Renovate solicited
her by telephone and "placed" her into a financial agreement for an already-installed solar
energy system on her home. Fabian asserted that she only discussed financing with
Renovate telephonically, Renovate provided her with no documents to sign, she did not
sign the Contract physically or electronically, and what purports to be her electronic
signature was ''placed'' on the Contract without her consent, authorization, or knowledge.
D. Renovate's Reply
In its reply, Renovate asserted Fabian did not dispute that she negotiated the
Contract and thus acknowledged that she "entered into" the financial agreement by
declaring Renovate ''placed'' and ''signed'' her name onto the ''alleged'' financial
agreement. Renovate argued that Fabian did not address how her electronic signature
appeared on the Contract given Anderson's declaration that Fabian signed the Contract
based on records that Renovate maintained in the ordinary course of its business.
E. The Discovery
After conducting a motion hearing, the court continued the matter ''to allow the
parties to conduct discovery as to whether [Fabian] electronically [signed] the subject
contract" and "file a supplemental brief and/or declaration" on the issue.
The parties engaged in discovery, which included Anderson's deposition. Fabian's
attorney filed a supplemental declaration stating that Anderson "testified that neither he
nor any employee of [Renovate's] company was present when the alleged agreement was
electronically 'docusigned' '' and that Renovate's "belief [Fabian] electronically signed the
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subject agreement is not based on first-hand knowledge.'' Renovate's attorney filed an
opposing declaration disagreeing and stating that Anderson's "deposition confirmed that
[Fabian] and her adult daughter were both present when the electronic signatures on the
subject contract were signed." Renovate's attorney further declared that Anderson
"testified that, based on his extensive experience," "[Fabian] was present and signed the
document," and "that records confirmed the witness' location when she signed the
contract."
F. The Trial Court's Ruling
After hearing argument, the court ordered: ''[Renovate]'s motion to compel
arbitration is denied. [Renovate] has failed to establish that [Fabian] electronically
[signed] the subject contract.''
DISCUSSION
Renovate contends the trial court erred in denying its petition to compel arbitration
based on a finding that Renovate failed to prove by a preponderance of the evidence that
Fabian electronically signed the Contract.
A. Standard of Review
As a preliminary matter, the parties dispute the appropriate standard of review for
this case. Renovate argues that de novo review applies because the trial court ruled that
Renovate failed to carry its burden to prove the authenticity of Fabian's electronic
signature on the Contract, a question of law. Fabian argues that we should review the
court's ruling of arbitrability under the more deferential ''substantial evidence standard''
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because the court determined that she did not sign the Contract, which is a question of
fact.
" 'There is no uniform standard of review for evaluating an order denying a motion
to compel arbitration.' " (Carlson v. Home Team Pest Defense, Inc. (2015)
239 Cal.App.4th 619, 630.) Generally, " '[i]f the court's order is based on a decision of
fact, then we adopt a substantial evidence standard.' " (Ibid.) When, as here, the court's
order denying a motion to compel arbitration is based on the court's finding that
petitioner failed to carry its burden of proof, the question for the reviewing court is
whether that finding is erroneous as a matter of law. (Juen v. Alain Pinel Realtors, Inc.
(2019) 32 Cal.App.5th 972, 978-979; see also Sonic Manufacturing Technologies, Inc. v.
AAE Systems, Inc. (2011) 196 Cal.App.4th 456, 465 (Sonic) [where trier of fact concludes
that the party with the burden of proof fails to carry the burden, it is "misleading" to
characterize the standard of review as one of substantial evidence].) " 'Specifically, the
question becomes whether the appellant's evidence was (1) "uncontradicted and
unimpeached" and (2) "of such a character and weight as to leave no room for a judicial
determination that it was insufficient to support a finding.' " (Juen, at pp. 978-979; see
also Almanor Lakeside Villas Owners Assn. v. Carson (2016) 246 Cal.App.4th 761, 769
[same].)
For this reason, " ' [w]here, as here, the judgment is against the party who has the
burden of proof, it is almost impossible for him to prevail on appeal by arguing the
evidence compels a judgment in his favor. That is because unless the trial court makes
specific findings of fact in favor of the losing [party], we presume the trial court found
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the [party's] evidence lacks sufficient weight and credibility to carry the burden of proof.
[Citations.] We have no power on appeal to judge the credibility of witnesses or to
reweigh the evidence.' " (Patricia A. Murray Dental Corp. v. Dentsply Internat., Inc.
(2018) 19 Cal.App.5th 258, 270.) "The appellate court cannot substitute its factual
determinations for those of the trial court; it must view all factual matters most favorably
to the prevailing party and in support of the judgment. [Citation.] ' "All conflicts,
therefore, must be resolved in favor of the respondent." [Citation.]' [Citation.]" (Dreyer's
Grand Ice Cream, Inc., v. County of Kern (2013) 218 Cal.App.4th 828, 838.)
B. The Trial Court Did Not Err in Denying Renovate's Petition
Renovate met its initial burden to show an agreement to arbitrate by attaching a
copy of the Contract to its petition, which purportedly bears Fabian's electronic initials
and signature. (Espejo v. Southern California Permanente Medical Group (2016)
246 Cal.App.4th 1047, 1057.) Because Fabian declared that she did not sign the
Contract, however, Renovate then had "the burden of proving by a preponderance of the
evidence that the electronic signature was authentic." (Ruiz v. Moss Bros. Auto Group,
Inc. (2014) 232 Cal.App.4th 836, 846 (Ruiz); see also Espejo, at pp. 1059-1060.)
"[T]he burden of authenticating an electronic signature is not great." (Ruiz, supra,
232 Cal.App.4th at p. 844; Civ. Code § 1633.9, subd. (a) [an electronic signature is
attributable to a person if it is the act of the person]; Evid. Code, § 1400, subd. (a);
People v. Skiles (2011) 51 Cal.4th 1178, 1187 [the means of authenticating a writing are
not limited to those specified in the Evid. Code].) The party seeking authentication may
carry its burden ''in any manner,'' including by presenting evidence of the contents of the
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contract in question and the circumstances surrounding the contract's execution. (Ruiz, at
p. 844.) Here, the trial court found that Renovate did not carry its burden to establish the
authenticity of Fabian's electronic signature on the Contract. As we explain, Renovate's
evidence was not " ' "of such a character and weight as to leave no room for a judicial
determination" ' " that Renovate failed to establish that Fabian electronically signed the
Contract. (Sonic, supra, 196 Cal.App.4th at p. 466.)
Renovate offers two items to show that the trial court erred in denying its petition
to compel arbitration: (1) the Contract bearing Fabian's printed electronic initials and
signature, which is purportedly authenticated by DocuSign; and (2) a declaration from
Anderson.2 We consider each in turn.
1. The Contract
Renovate first contends the Contract bearing Fabian's printed electronic initials
and signature is authenticated by DocuSign. Standing alone, that fact is not sufficient to
compel a result in Renovate's favor as a matter of law.
Citing to Newton v. Am. Debt Servs (N.D. Cal. 2012) 854 F.Supp.2d 712(Newton), Renovate argues that DocuSign renders Fabian's electronic initials and
signature "legally binding." Newton explained DocuSign is a company used to
electronically sign documents in compliance with the U.S. Electronic Signatures in
Global and National Commerce Act (ESIGN), 15 U.S.C. § 7001 et seq. (Newton, at p.
2 Renovate also offered the printed electronic initials and signature of Diana S. that
appear on the Contract and are purportedly authenticated by DocuSign as evidence that
the trial court erred. However, Diana S. is not a party to the underlying complaint or this
appeal.
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731.) Under ESIGN, electronic records and signatures in compliance with ESIGN are
legally binding. (Ibid.) DocuSign permits a company to send documents to a customer
for their signature. (Ibid.) The customer opens the document for review containing areas
marked for the signatory to execute. (Ibid.) The signer creates a signature and must click
a button confirming their signature once they have completed all form fields and signed
in all required places. (Ibid.)
Renovate's reliance on Newton is misplaced because, unlike here, the declarant in
that case proved that the "docusigned" electronic signature was the plaintiff's by
explaining the process used to verify the signature. (Newton, supra, 854 F.Supp.2d at
p. 731.) There, the defendant submitted a declaration stating that it sent a contract to the
plaintiff using DocuSign, and that the plaintiff signed the Client Signature portion of the
contract. (Ibid.) Once signed, the signature was assigned an identifying code, such as the
one that appeared above the plaintiff's signature on the subject contract. (Ibid.)
Here, Renovate did not provide any evidence from or about DocuSign in its
petition, reply, or supplemental declaration. Indeed, the word "DocuSign" does not
appear in any of Renovate's moving papers. Renovate offered no evidence about the
process used to verify Fabian's electronic signature via DocuSign, including who sent
Fabian the Contract, how the Contract was sent to her, how Fabian's electronic signature
was placed on the Contract, who received the signed the Contract, how the signed
Contract was returned to Renovate, and how Fabian's identification was verified as the
person who actually signed the Contract. We thus find Renovate's DocuSign
authentication argument unsupported and unpersuasive.
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2. Anderson's Declaration
Renovate also contends Anderson's declaration supports a finding as a matter of
law that Fabian's electronic signature is authentic. We disagree.
The facts in this case mirror those of Ruiz, supra, 232 Cal.App.4th 836. There, the
appellate court affirmed the denial of a petition to compel arbitration after the defendant-
employer proffered an electronically signed arbitration agreement. (Id. at pp. 838, 840.)
In support of its petition, the defendant submitted the declaration of its business manager
who ''summarily asserted'' that the plaintiff-employee electronically signed the
agreement. (Id. at pp. 839, 843.) In his opposing declaration, the plaintiff-employee
claimed he did not recall signing the agreement. (Id. at p. 840.) The defendant-employer
then filed a reply declaration from the same manager attempting to authenticate the
plaintiff's signature; however, the court held that the manager's declarations were
insufficient to support such a finding. (Id. at pp. 838, 840-842, 846.) Specifically, the
court stated that the manager did not explain: how, or on what basis, the manager inferred
that the electronic signature was "the act of" the plaintiff-employee; that the date and time
printed on the agreement were accurate; that the electronic signature could only have
been placed on the agreement by a person using the plaintiff-employee's unique
identification number and password; and that the agreement was therefore signed by the
plaintiff. (Id. at p. 844.)
Here, as in Ruiz, Anderson only ''summarily asserted'' that Fabian "entered into"
the Contract on February 28, 2017. Anderson did not state anywhere in his declaration
that Fabian actually signed the contract, electronically or otherwise. Anderson did not
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explain, for instance, who presented Fabian with a physical or electronic copy of the
Contract, the specific location where the Contract was signed, the time when the Contract
was signed, or how Anderson ascertained that Fabian was present when the Contract was
signed. Nor did Anderson make any reference to DocuSign or the process used to obtain
and verify Fabian's "docusigned" electronic initials and signature.
Even after Fabian disputed signing the Contract, Anderson did not suggest how
the electronic signature could have only been placed on the Contract by Fabian. For
example, Anderson did not make clear the meaning of the letters "DS" or the significance
of the words "DocuSigned By:" that appear above Fabian's electronic initials and
signature. Most importantly, Anderson did not explain how Fabian's electronic initials
and signature were the "act of Fabian" by offering evidence that DocuSign assigned
Fabian a unique "identity verification code" to initial and sign the Contract. Anderson
did not explain the significance of the 15-digit alphanumeric characters or the words
"Identity Verification Code: ID Verification Complete" that appear below Fabian's
electronic signature. By not providing any specific details about the circumstances
surrounding the Contract's execution, Anderson offered little more than a bare statement
that Fabian "entered into" the Contract without offering any facts to support that
assertion. This left a critical gap in the evidence supporting Renovate's petition.
3. Conclusion
To prevail on appeal, Renovate was required to establish that its evidence
compelled a finding in its favor as a matter of law. The Contract and Anderson's
declaration do not compel this finding. We thus conclude that the trial court did not err in
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denying Renovate's petition to compel arbitration based on Renovate's failure to prove,
by a preponderance of the evidence, that Fabian electronically signed the Contract.
Accordingly, we affirm.
DISPOSITION
The order denying the petition to compel arbitration is affirmed. Fabian shall
recover her costs on appeal.
IRION, J.
WE CONCUR:
HALLER, Acting P. J.
O'ROURKE, J.
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Filed 12/4/19
CERTIFIED FOR PUBLICATION
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
ROSA FABIAN, D075519
Plaintiff and Respondent,
v. (Super. Ct. No. 37-2018-00023808-
RENOVATE AMERICA, INC., CU-BT-NC)
Defendant and Appellant. ORDER CERTIFYING OPINION
FOR PUBLICATION
THE COURT:
The opinion in this case filed November 19, 2019, was not certified for
publication. It appearing the opinion meets the standards for publication specified in
California Rules of Court, rule 8.1105(c), the request pursuant to rule 8.1120(a) for
publication is GRANTED.
IT IS HEREBY CERTIFIED that the opinion meets the standards for publication
specified in California Rules of Court, rule 8.1105(c); and
ORDERED that the words "Not to Be Published in the Official Reports" appearing
on page 1 of said opinion be deleted and the opinion herein be published in the Official
Reports.
HALLER, Acting P. J.
cc: All parties
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