Ordonez v. WSA Security CA2/1 ( 2013 )

Filed 12/19/13 Ordonez v. WSA Security CA2/1
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for
publication or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION ONE
GIANNY ORDONEZ, B244075
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. BC454922)
v.
WSA SECURITY, INC.,
Defendant and Respondent.
APPEAL from an order of the Superior Court of Los Angeles County,
Malcolm H. Mackey, Judge. Affirmed.
Law Offices of Ramin R. Younessi, Ramin R. Younessi and Kaveh S. Elihu for
Plaintiff and Appellant.
Loeb & Loeb, Mark D. Campbell and Erin M. Smith for Defendant and
Respondent.
___________________________________________
An employee and her employer agreed to resolve all employment-related
disputes through binding arbitration. Notwithstanding that agreement, the employee
filed this action against her former employer, alleging statutory causes of action under
the Fair Employment and Housing Act (FEHA) (Gov. Code, §§ 12900–12996) and
related common law causes of action. The employer filed a petition to compel
arbitration. In response, plaintiff filed a statement of non-opposition. The trial court
granted the petition.
In the arbitration, the employer demurred to plaintiff’s claims on the ground they
were time-barred. The arbitrator issued an order sustaining the demurrer. The
employee filed a motion in the trial court, seeking to vacate the arbitrator’s decision.
The trial court denied the motion. The employee appealed.
Because plaintiff’s causes of action involved unwaivable statutory rights, and the
arbitrator’s order sustaining the employer’s demurrer precluded the employee from
having her causes of action heard on the merits, we review the arbitrator’s decision for
legal error. (See Pearson Dental Supplies, Inc. v. Superior Court (2010) 48 Cal.4th
665, 679–680 (Pearson Dental Supplies).) Applying that standard, we conclude the
arbitrator made the correct decision: Plaintiff’s causes of action were time-barred.
I
BACKGROUND
The allegations and facts in this appeal are taken from the complaint and the
declarations and exhibits submitted with respect to the motion to vacate the arbitrator’s
decision.
On or about May 1, 2007, plaintiff Gianny Ordonez was hired as a security guard
by defendant WSA Security, Inc. From the beginning of plaintiff’s employment
through January 8, 2009, plaintiff’s supervisor allegedly harassed her. On or about
January 9, 2009, plaintiff’s physician recommended that plaintiff take a disability leave
of absence until on or about February 12, 2009. A doctor’s note to that effect was faxed
to defendant.
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On or about February 12, 2009, plaintiff visited her physician, who
recommended that plaintiff remain on a disability leave until February 19, 2009. A
doctor’s note was allegedly faxed to defendant. Plaintiff returned to work on or about
February 19, 2009, and was informed that she had been discharged because she did not
return to work on February 12, 2009. Defendant claimed it did not receive the second
doctor’s note, which extended plaintiff’s leave of absence until February 19, 2009.
Plaintiff contends that defendant received the second doctor’s note but claimed not to
have received it as a pretext to terminate her employment because of her disability.
On February 13, 2010, plaintiff filed a charge of discrimination with the
Department of Fair Employment and Housing (DFEH). On the same day, she received
from the DFEH a “Notice of Case Closure and Right-to-Sue Letter.” On February 14,
2011, plaintiff filed this action against defendant, alleging five causes of action:
(1) disability discrimination in violation of the FEHA, (2) failure to provide reasonable
accommodation in violation of the FEHA, (3) retaliation in violation of the FEHA,
(4) wrongful termination of employment in violation of public policy, and (5) breach of
the covenant of good faith and fair dealing.
When plaintiff commenced employment with defendant, she signed a document
entitled, “Arbitration Agreement” (Agreement). The Agreement provided in part:
“WSA Group, Inc. (the ‘Company’) has an alternative dispute resolution policy that
provides for mandatory arbitration of all disputes between employees and the Company.
Therefore, the Company and Employee agree that all such disputes will be submitted to
final and binding arbitration in accordance with the National Rules for the Resolution of
Employment Disputes then in effect of the American Arbitration Association
(‘AAA’). . . . The selected arbitrator shall be a neutral, licensed arbitrator experienced in
Labor and Employment Law. . . . [¶] . . . Under this policy, the Company and Employee
waive any rights to have . . . claims and/or disputes heard or adjudicated in any other
forum, including the right to trial in a court of law. [¶] . . . [¶] A claim under this
arbitration policy must be filed within the time limit established by the applicable statute
of limitations or will be barred.” (Italics added.)
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On April 5, 2011, defendant filed a petition in the trial court, seeking an order
compelling arbitration of plaintiff’s claims. On April 22, 2011, plaintiff’s counsel filed
a declaration, stating, “Plaintiff does not presently oppose arbitration pursuant to the
[Agreement].” On May 17, 2011, the trial court, by written order, granted the petition,
dismissed the case, and “retain[ed] jurisdiction . . . .”
Under the AAA rules incorporated by reference into the Agreement, an
arbitration may be initiated in one of two ways. First, the parties may file a joint request
for arbitration. Second, in the absence of a joint request, one of the parties may make a
unilateral demand for arbitration. To make a unilateral demand, the party initiating
arbitration must “[f]ile a written notice (hereinafter ‘Demand’) of its intention to
arbitrate at any office of the AAA within the time limit established by the applicable
statute of limitations. Any dispute over the timeliness of the demand shall be referred
to the arbitrator.” (AAA, Employment Arbitration Rules and Mediation Procedures
(Nov. 1, 2009) rule 4.b.(i)(1) [as of
December 19, 2013], italics added.)
Plaintiff filed a demand for arbitration with the AAA on August 11, 2011. In the
arbitration, defendant filed a demurrer to plaintiff’s claims, contending they were barred
by the applicable statutes of limitation. By order dated March 5, 2012, the arbitrator
sustained the demurrer.
On June 18, 2012, plaintiff filed a motion in the trial court, seeking to vacate the
arbitrator’s decision on the ground that the arbitrator had exceeded his powers. (See
Code Civ. Proc., § 1286.2, subd. (a)(4).)1 On July 3, 2012, defendant filed opposition to
plaintiff’s motion. Plaintiff filed a reply. The motion was heard on July 20, 2012. By
order dated August 3, 2012, the trial court denied plaintiff’s motion. This appeal
followed.
1 Undesignated section references are to the Code of Civil Procedure.
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II
DISCUSSION
This appeal requires that we first determine the standard of review applicable to
an arbitrator’s decision when the arbitrator finds that causes of action based on
unwaivable statutory rights are time-barred. We conclude that such a decision should
be reviewed for legal error. Next, we apply that standard of review to the arbitrator’s
decision in this case and conclude the arbitrator properly found that plaintiff’s causes of
action are barred by the applicable statutes of limitations.
A. Standard of Review
“[A]n arbitrator’s decision is not generally reviewable for errors of fact or law,
whether or not such error appears on the face of the award and causes substantial
injustice to the parties.” (Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 6.) As
provided by statute, an arbitrator’s award may be vacated if the arbitrator has exceeded
his powers. (See § 1286.2, subd. (a)(4).) “[A]n arbitrator exceeds his powers by acting
without subject matter jurisdiction, deciding an issue that was not submitted to
arbitration, arbitrarily remaking the contract, upholding an illegal contract, issuing an
award that violates a well-defined public policy or a statutory right, fashioning a remedy
that is not rationally related to the contract, or selecting a remedy not authorized by
law.” (Gravillis v. Coldwell Banker Residential Brokerage Co. (2010) 182 Cal.App.4th
503, 511.)
In Pearson Dental Supplies, supra, 48 Cal.4th 665, the Supreme Court addressed
“the proper standard of judicial review of arbitration awards arising from mandatory
arbitration employment agreements that arbitrate claims asserting the employee’s
unwaivable statutory rights.” (Id. at p. 679.) The court concluded: “[W]hen . . . an
employee subject to a mandatory employment arbitration agreement is unable to obtain
a hearing on the merits of his FEHA claims, or claims based on other unwaivable
statutory rights, because of an arbitration award based on legal error, the trial court does
not err in vacating the award. Stated in other terms, construing the [California
Arbitration Act (§§ 1280–1294.2)] in light of the Legislature’s intent that employees be
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able to enforce their right to be free of unlawful discrimination under FEHA, an
arbitrator whose legal error has barred an employee subject to a mandatory arbitration
agreement from obtaining a hearing on the merits of a claim based on such right has
exceeded his or her powers within the meaning of Code of Civil Procedure
section 1286.2, subdivision (a)(4), and the arbitrator’s award may properly be vacated.”
(Pearson Dental Supplies, at p. 680.)
Under Pearson Dental Supplies, we review the arbitrator’s decision for errors of
law.2
B. Review of the Arbitrator’s Decision
Plaintiff’s three FEHA claims had to be filed within one year after her receipt of
the right-to-sue letter. (See Gov. Code, § 12965, subd. (d)(2).) Plaintiff received her
right-to-sue letter on February 13, 2010. Thus, she had until February 14, 2011, to file a
demand to arbitrate the FEHA claims. (See Code Civ. Proc., §§ 10, 12, 12a.) Instead,
she filed her superior court lawsuit on February 14, 2011, the last possible day.
The parties agree that plaintiff’s two common law claims were subject to a two-
year statute of limitations. (See § 339, subd. 1.) Those claims accrued on February 19,
2009—the day plaintiff was told she had been discharged. Thus, she had until
February 19, 2011, to file a demand to arbitrate the common law claims. Instead, as
noted, she filed her superior court lawsuit on February 14, 2011—five days before the
statute of limitations had run.
Because plaintiff initially filed her civil lawsuit instead of a demand to arbitrate
with the AAA, and because the Agreement provided a deadline for the filing of claims,
section 1281.12 governs whether plaintiff’s claims were timely filed. Section 1281.12
2 Pearson Dental Supplies addressed the standard of review when an arbitrator
does not reach the merits of a claim involving an unwaivable statutory right. Here,
plaintiff alleged not only FEHA claims but also two common law claims. Even so,
neither party has treated the common law claims differently than the FEHA claims for
purposes of judicial review. We therefore make no distinction.
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provides: “If an arbitration agreement requires that arbitration of a controversy be
demanded or initiated by a party to the arbitration agreement within a period of time, the
commencement of a civil action by that party based upon that controversy, within that
period of time, shall toll the applicable time limitations contained in the arbitration
agreement with respect to that controversy, from the date the civil action is commenced
until 30 days after a final determination by the court that the party is required to
arbitrate the controversy, or 30 days after the final termination of the civil action that
was commenced and initiated the tolling, whichever date occurs first.” (Italics added.)
As explained in Pearson Dental Supplies, supra, 48 Cal.4th 665, “we begin with
the meaning of ‘tolling.’ To ‘toll’ has been defined most pertinently as ‘to stop the
running of; abate .’ . . . When it comes to the tolling of a
statute of limitations, we have stated: ‘Tolling may be analogized to a clock that is
stopped and then restarted. Whatever period of time that remained when the clock is
stopped is available when the clock is restarted, that is, when the tolling period has
ended.’” (Id. at p. 674, citation omitted.)
Under the FEHA, plaintiff’s statutory claims were filed in the trial court on the
last possible day (February 14, 2011)—one year after receipt of the right-to-sue letter,
plus one additional day because the limitations period expired on a Sunday. (See Gov.
Code, § 12965, subd. (d)(2); Code Civ. Proc., §§ 10, 12, 12a.) On May 17, 2011, the
trial court granted defendant’s petition to compel arbitration. At that time, the statute of
limitations did not begin to run again for the simple reason that it had already expired.
Nevertheless, under Code of Civil Procedure section 1281.12, plaintiff had 30 days after
May 17, 2011—up to and including June 16, 2011—to file a demand for arbitration
with the AAA. Because plaintiff did not file a demand until August 11, 2011, her
FEHA claims are time-barred.
As for plaintiff’s common law claims, she filed her complaint five days before
the statute of limitations had expired. Those five days were tolled under
section 1281.12 until the trial court granted the petition to compel arbitration on
May 17, 2011. On that date, the statute of limitations began to run again, extending the
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time to file a demand for arbitration by (1) the five days remaining on the statute of
limitation and (2) the additional 30 days under section 1281.12. (See Pearson Dental
Supplies, supra, 48 Cal.4th at p. 675.) Plaintiff had until June 21, 2011, to file a
demand to arbitrate her common law claims. Consequently, her August 11, 2011
demand was untimely.
In sum, the arbitrator did not make a legal error in sustaining defendant’s
demurrer and concluding that plaintiff’s claims were barred by the statutes of
limitations.
Plaintiff makes several arguments to the contrary. We conclude they are without
merit. First, plaintiff contends that she “effectively demanded arbitration” by way of
(1) defendant’s petition to compel arbitration, (2) her declaration of non-opposition to
the petition, or (3) the trial court’s order granting defendant’s petition. However, the
AAA rules, incorporated by reference in the Agreement, required that plaintiff file a
written demand with the AAA to initiate arbitration unilaterally. Plaintiff filed only one
demand for arbitration with the AAA—on August 11, 2011—and that demand was
untimely.
Second, plaintiff emphasizes that, under section 1281.12, the 30-day period does
not begin to run until the trial court makes a “final” determination that the parties are
required to arbitrate their disputes. According to plaintiff, the trial court’s May 17,
2011 order granting defendant’s petition to compel arbitration was not “final” until the
time for appeal—60 days—had expired. (See Cal. Rules of Court, rule 8.104(a).)
However, an order compelling arbitration is not appealable. (See Code Civ. Proc.,
§ 1294; Abramson v. Juniper Networks, Inc. (2004) 115 Cal.App.4th 638, 648.) Thus,
the order was final when issued.
Third, plaintiff’s counsel states that he “diligently” attempted to initiate
arbitration by having his secretary call defendant’s attorney five times from May 2011
through July 2011. Each time, the secretary left a voicemail message. Plaintiff did not
provide any record references to support those statements. As a result, plaintiff has
forfeited the point. (See Grant-Burton v. Covenant Care, Inc. (2002) 99 Cal.App.4th
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1361, 1379; Warren-Guthrie v. Health Net (2000) 84 Cal.App.4th 804, 808, fn. 4,
disapproved on another ground in Cronus Investments, Inc. v. Concierge Services
(2005) 35 Cal.4th 376, 393, fn. 8; Guthrey v. State of California (1998) 63 Cal.App.4th
1108, 1115.)
Fourth, plaintiff contends that defendant was equitably estopped from invoking
the statutes of limitations. “[T]he doctrine of equitable estoppel may be invoked only
when the party to be estopped is apprised of the facts and intends that his or her conduct
will be acted upon, and the other party is ignorant of the true facts and relies upon the
conduct to his or her detriment.” (Hughes v. Board of Architectural Examiners (1998)
17 Cal.4th 763, 794.) “‘To give rise to equitable estoppel, the promisee’s reliance must
be reasonable.’” (Barnes, Crosby, Fitzgerald & Zeman, LLP v. Ringler (2012)
212 Cal.App.4th 172, 182.) Plaintiff argues that equitable estoppel applies because
defendant’s attorney did not respond to the voicemail messages left by plaintiff’s
counsel’s secretary. Essentially, plaintiff faults defendant for not agreeing to a joint
request for arbitration.
Plaintiff’s estoppel argument fails for three reasons. First, it relies on telephone
calls for which—as previously mentioned—there are no record references. (See Grant-
Burton v. Covenant Care, Inc., supra, 99 Cal.App.4th at p. 1379; Warren-Guthrie v.
Health Net, supra, 84 Cal.App.4th at p. 808, fn. 4; Guthrey v. State of California, supra,
63 Cal.App.4th at p. 1115.) Second, the pertinent alleged facts—the failure of
defendant’s attorney to return five telephone calls—were known by both parties;
plaintiff was not ignorant of the facts. Last, plaintiff could not have reasonably relied
on defendant’s silence as an indication that defendant was willing to make a joint
request for arbitration. If anything, the lack of a response should have put plaintiff on
notice that a joint request was unlikely and that plaintiff should have filed a timely
demand for arbitration.
Fifth, plaintiff asserts that defendant could not demur to plaintiff’s claims in the
arbitration because the Code of Civil Procedure does not authorize an arbitrator to rule
on a demurrer. This assertion overlooks AAA rule 27, incorporated by reference in the
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Agreement, which states: “The arbitrator may allow the filing of a dispositive motion if
the arbitrator determines that the moving party has shown substantial cause that the
motion is likely to succeed and dispose of or narrow the issues in the case.” (AAA,
Employment Arbitration Rules and Mediation Procedures (Nov. 1, 2009) rule 27
[as of December 19, 2013].) In short,
rule 27 authorized the arbitrator to rule on defendant’s demurrer.
Finally, plaintiff relies on the principle that state and federal law reflect a strong
policy favoring arbitration. (See, e.g., St. Agnes Medical Center v. PacifiCare of
California (2003) 31 Cal.4th 1187, 1195.) However, there is no policy that favors the
arbitration of stale claims. The statutes of limitations are not restricted to civil actions.
They also apply in arbitration proceedings. (See Pearson Dental Supplies, supra,48 Cal.4th at pp. 673–675.) Were it otherwise, there would be no need for
section 1281.12, which tolls the running of the statutes of limitations on an arbitration
claim while a civil action is pending.
Accordingly, the trial court properly denied plaintiff’s motion to vacate the
arbitration decision.
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III
DISPOSITION
The order is affirmed.
NOT TO BE PUBLISHED.
MILLER, J.*
We concur:
CHANEY, Acting P. J.
JOHNSON, J.
* Judge of the Los Angeles Superior Court, assigned by the Chief Justice
pursuant to article VI, section 6 of the California Constitution.
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