Gastelum v. Remax International, Inc. , 198 Cal. Rptr. 3d 234 ( 2016 )

Filed 2/11/16
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION FIVE
AMPARO GASTELUM, B263213
Plaintiff and Respondent, (Los Angeles County
Super. Ct. No. BC515487)
v.
REMAX INTERNATIONAL, INC. et al.,
Defendants and Appellants.
APPEAL from an order of the Superior Court of Los Angeles County, Holly E.
Kendig. Dismissed.
Lytton, Williams, Messina & Hankin and John A. Messina, Jr. for Defendants and
Appellants.
Reisner & King, Adam J. Reisner and Alisa Khousadian; Benedon & Serlin,
Douglas G. Benedon and Judith E. Posner for Plaintiff and Respondent.
I. INTRODUCTION
Defendants, Remax International Inc. and Jose Garcia-Yanez, appeal from an
order lifting a litigation stay. Plaintiff, Amparo Gastelum, filed a complaint against
defendants regarding her employment. Defendants moved to compel arbitration. The
trial court granted the motion to compel arbitration of Remax International, Inc. and
stayed the litigation in the judicial forum pursuant to Code of Civil Procedure section
1281.4.1 Mr. Garcia-Yanez’s motion to compel arbitration was denied.
Plaintiff initiated the arbitration proceeding. Plaintiff requested Remax
International, Inc. pay the arbitration filing fee pursuant to Armendariz v. Foundation
Health Psychcare Services, Inc. (2000) 24 Cal. 4th 83, 113 (Armendariz). (See Cruise v.
Kroger Co. (2015) 233 Cal. App. 4th 390, 400.) Remax International, Inc., through its
counsel, refused to pay the arbitration filing fee. The arbitration provider dismissed the
arbitral proceeding after no arbitration costs were paid.
Plaintiff then moved that the trial court lift its prior order staying the litigation.
Defendants filed no contemporary motion or petition seeking an order compelling
resumption of the arbitration proceeding. The trial court granted plaintiff’s motion and
lifted the litigation stay. Defendants then appealed the order lifting the litigation stay.
We hold defendants are appealing from a nonappealable order. Thus, the appeal must be
dismissed.
II. BACKGROUND
A. Plaintiff’s Complaint
On July 17, 2013, plaintiff filed her complaint against defendants. Plaintiff alleges
the following. Remax International, Inc. is a California corporation. Plaintiff was a
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Further statutory references are to the Code of Civil Procedure.
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former employee of Remax International, Inc. and supervised by Mr. Garcia-Yanez. Mr.
Garcia-Yanez was a broker for Remax International, Incorporated. Plaintiff alleges 13
causes of action. Under the Fair Employment and Housing Act, plaintiff alleges: sex and
gender harassment; sex and gender discrimination; and sex and gender retaliation.
Plaintiff also alleges causes of action for: violation of the Unruh Civil Rights Act (Civ.
Code, § 51 et seq.); intentional and negligent interference with prospective economic
relations; contract breach; implied covenant breach; violation of Business and Professions
Code section 17200; defamation; intentional emotional distress infliction; and retaliation
and wrongful termination.
B. Defendants’ Motion to Compel Arbitration and Trial Court’s Order Granting Motion
On December 6, 2013, defendants moved to compel arbitration. Defendants relied
on an arbitration clause in an agreement entitled “INDEPENDENT CONTRACTOR
AGREEMENT” between plaintiff and Remax International, Incorporated. The
arbitration clause at subparagraph 9.B provides in part: “Contractor [plaintiff] hereby
agrees to cooperate with Broker [Remax] by supporting and fully participating in all
efforts to resolve disputes, complaints and other problems (hereafter collectively called
‘Dispute(s)’) that arise: (i) out of this Agreement; (ii) out of Contractor’s conduct,
activities or services as a real estate licensee; (iii) out of any transaction in which
Contractor is involved, or (iv) out of Contractor’s relationship with the RE/MAX
Network or any RE/MAX affiliate . . . . Contractor agrees to cooperate in the resolution
of such Disputes through mediation, and if not successfully resolved, then through
binding arbitration in accordance with the provisions of Subparagraph 9.C. below.”
Subparagraph 9.C provides: “Disputes shall be submitted to a mediation and arbitration
system mutually acceptable to the parties to the Dispute. If the parties cannot agree on a
mediation and arbitration system, then the Dispute shall be submitted to the American
Arbitration Association . . . for mediation and, if unsuccessful, for binding arbitration, in
accordance with [the American Arbitration Association’s] Commercial Mediation Rules
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or Commercial Arbitration Rules, as applicable.” In their motion to compel arbitration,
the following appears, “‘Defendants recognize that the Arbitration Agreements are
employer-promulgated and therefore do, in fact, intend to pay the costs of arbitration.’”
On September 24, 2014, defendants’ motion to compel arbitration was granted in
part. The trial court found Remax International, Inc. and plaintiff had agreed to arbitrate
the claims raised in her complaint. However, the trial court denied the motion to compel
arbitration as to plaintiff’s claims against Mr. Garcia-Yanez. The trial court found Mr.
Garcia-Yanez was not a party to the arbitration agreement. Mr. Garcia-Yanez never
appealed the September 24, 2014 denial of his motion to compel arbitration. The trial
court stayed litigation pending the arbitration between plaintiff and Remax International,
Inc. pursuant to section 1281.4 which provides in part, “If a court of competent
jurisdiction . . . has ordered arbitration of a controversy which is an issue involved in an
action or proceeding pending before a court of this State, the court in which such action
or proceeding is pending shall, upon motion of a party to such action or proceeding, stay
the action or proceeding until an arbitration is had in accordance with the order to
arbitrate or until such earlier time as the court specifies.”
C. Arbitration Procedural History
On December 2, 2014, plaintiff submitted the matter for arbitration before the
American Arbitration Association. An American Arbitration Association staffer, Adam
Schoneck, sent a notice to the parties on December 17, 2014. Mr. Schoneck stated: the
American Arbitration Association could not yet determine whether plaintiff was an
employee or an independent contractor; therefore, Mr. Schoneck indicated the matter
would proceed under the Commercial Arbitration Rules; and the issue of whether
plaintiff was an employee or an independent contractor was preserved for review by the
arbitrator after payment of the arbitration fees. Pursuant to the Commercial Arbitration
Rules, Mr. Schoneck, on behalf of the American Arbitration Association, assessed a
$7,000 filing fee because plaintiff’s alleged damages are between $1 and $10 million.
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Plaintiff had already paid $200. Mr. Schoneck indicated that if the remaining $6,800
filing fee was not paid, the American Arbitration Association would administratively
close the arbitration proceeding.
Plaintiff was represented by Justin Silverman. On December 17, 2014, Mr.
Silverman sent an e-mail to counsel for Remax International, Inc. requesting it pay the
filing fee. Mr. Silverman noted the trial court’s September 24, 2014 order partially
granting the motion to compel arbitration expressly relied on Armendariz which held in
part, “[A] mandatory employment arbitration agreement that contains within its scope the
arbitration of [Fair Employment and Housing Act] claims impliedly obliges the employer
to pay all types of costs that are unique to arbitration.” (Armendariz, supra, 24 Cal.4th at
p. 113; see Cruise v. Kroger Co., supra, 233 Cal.App.4th at p. 400.) Mr. Silverman
informed defense counsel that Remax International, Inc. was required to pay the
arbitration filing fee here. Remax International, Inc. did not pay the filing fee. The
American Arbitration Association eventually closed the arbitration on January 15, 2015.
Mr. Schoneck explained the arbitral proceedings were terminated because the arbitration
fees remained unpaid.
D. Plaintiff’s Motion to Lift Stay on Litigation and Trial Court’s Order Granting Motion
On February 3, 2015, plaintiff moved to lift the stay on litigation. Plaintiff argued
defendants’ conduct by failing to pay arbitration filing fees terminated the arbitration
proceeding. On March 3, 2015, the trial court granted plaintiff’s motion and ordered the
litigation stay lifted. This appeal by defendants followed.
III. DISCUSSION
The right to appeal is statutory. (Dana Point Safe Harbor Collective v. Superior
Court (2010) 51 Cal. 4th 1, 5; Mt. San Jacinto Community College Dist. v. Superior Court
(2007) 40 Cal. 4th 648, 665; Wells Fargo Bank, N.A. v. The Best Service Co., Inc. (2014)
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232 Cal. App. 4th 650, 652 (Wells Fargo).) The general list of appealable civil judgments
and orders is codified in section 904.1.2 (See Walton v. Mueller (2009) 180 Cal. App. 4th
161, 172, fn. 9; Nimmagadda v. Krishnamurthy (1992) 3 Cal. App. 4th 1505, 1507.)
Nothing in section 904.1 expressly identifies an order setting aside a litigation stay as
appealable. And there is a general prohibition against nonfinal interlocutory orders in
section 904.1, subdivision (a)(1) which applies in the arbitration context. (See Judge v.
Nijjar Realty, Inc. (2014) 232Cal.App.4th 619, 634; Vivid Video, Inc. v. Playboy
Entertainment Group, Inc. (2007) 147 Cal. App. 4th 434, 442.) Defendants rely upon
section 1294, subdivision (a) which defines appealable orders relating to arbitration and
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Section 904.1 states: “(a) An appeal, other than in a limited civil case, is to the
court of appeal. An appeal, other than in a limited civil case, may be taken from any of
the following: [¶] (1) From a judgment, except (A) an interlocutory judgment, other than
as provided in paragraphs (8), (9), and (11), or (B) a judgment of contempt that is made
final and conclusive by Section 1222. [¶] (2) From an order made after a judgment
made appealable by paragraph (1). [¶] (3) From an order granting a motion to quash
service of summons or granting a motion to stay the action on the ground of inconvenient
forum, or from a written order of dismissal under Section 581d following an order
granting a motion to dismiss the action on the ground of inconvenient forum. [¶] (4)
From an order granting a new trial or denying a motion for judgment notwithstanding the
verdict. [¶] (5) From an order discharging or refusing to discharge an attachment or
granting a right to attach order. [¶] (6) From an order granting or dissolving an
injunction, or refusing to grant or dissolve an injunction. [¶] (7) From an order
appointing a receiver. [¶] (8) From an interlocutory judgment, order, or decree,
hereafter made or entered in an action to redeem real or personal property from a
mortgage thereof, or a lien thereon, determining the right to redeem and directing an
accounting. [¶] (9) From an interlocutory judgment in an action for partition
determining the rights and interests of the respective parties and directing partition to be
made. [¶] (10) From an order made appealable by the provisions of the Probate Code or
the Family Code. [¶] (11) From an interlocutory judgment directing payment of
monetary sanctions by a party or an attorney for a party if the amount exceeds five
thousand dollars ($5,000). [¶] (12) From an order directing payment of monetary
sanctions by a party or an attorney for a party if the amount exceeds five thousand dollars
($5,000). [¶] (13) From an order granting or denying a special motion to strike under
Section 425.16. (b) Sanction orders or judgments of five thousand dollars ($5,000) or
less against a party or an attorney for a party may be reviewed on an appeal by that party
after entry of final judgment in the main action, or, at the discretion of the court of
appeal, may be reviewed upon petition for an extraordinary writ.”
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provides in part: “An aggrieved party may appeal from: [¶] (a) An order dismissing or
denying a petition to compel arbitration.” Defendants assert the order lifting the stay of
litigation was the functional equivalent of an order dismissing or denying a petition to
compel arbitration.
Defendants rely upon Henry v. Alcove Investment, Inc. (1991) 233 Cal. App. 3d 94,
96-100 (Henry) to support their argument the order at issue is appealable. At the outset,
we emphasize there is no pending arbitration. Nor has either defendant filed a petition or
motion to compel the American Arbitration Association to reopen arbitral proceedings.
That being said, we turn to Henry. In Henry, while an action was pending, the defendant
initiated an arbitration before the American Arbitration Association. (Id. at p. 98.) The
plaintiff then filed a motion to stay the arbitration. (Ibid.) The trial court granted the
plaintiff’s motion to stay the arbitration which was pending before the American
Arbitration Association. (Ibid.) The defendant appealed from the order staying the
American Arbitration Association arbitration of the plaintiff’s claims during the
pendency of the litigation. (Id. at p. 96.) The plaintiff argued the appeal must be
dismissed as it was from a nonappealable order. (Id. at p. 98.) The Court of Appeal
rejected the plaintiff’s argument. (Id. at p. 97.) The Court of Appeal held, “[A]n order
staying arbitration is the functional equivalent of an order refusing to compel arbitration.”
(Id. at p. 99.) Thus, the Court of Appeal concluded the order staying the pending
American Arbitration Association arbitration was appealable under section 1294,
subdivision (a). (Ibid.) The Court of Appeal reasoned in part, “[A]n order staying
arbitration is merely the flip side of an order refusing to compel arbitration and should be
treated the same for purposes of appellate review.” (Id. at p. 100; see Wells Fargo,
supra, 232 Cal.App.4th at p. 653; MKJA, Inc. v. 123 Fit Franchising, LLC (2011) 191
Cal. App. 4th 643, 653-654.)
The order appealed from here is materially different from the one in Henry. In
Henry, an order was issued which stayed a pending arbitration. The order here lifted a
stay on litigation under section 1281.4. An order lifting a stay of litigation under section
1281.4 is reviewable on appeal, but only when there is another appealable order or
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judgment. (MKJA, Inc. v. 123 Fit Franchising, LLC, supra, 191 Cal.App.4th at p. 655;
see § 1294.2 [“Upon an appeal from any order or judgment under this title [arbitration],
the court may review the decision and any intermediate ruling, proceeding, order or
decision which involves the merits or necessarily affects the order or judgment appealed
from, or which substantially affects the rights of a party.”].) Here, the motion of Remax
International, Inc. to compel arbitration was granted. An order granting a motion to
compel arbitration is not appealable under California law. (Reyes v. Macy’s Inc. (2011)
202 Cal. App. 4th 1119, 1122; Muao v. Grosvenor Properties, Ltd. (2002) 99 Cal. App. 4th
1085, 1088-189.) As noted, Mr. Garcia-Yanez never appealed the denial of his motion to
compel arbitration. Defendants have identified no other appealable order or judgment.
We have previously held that an appeal from a litigation stay order which is
unaccompanied by a motion or petition to compel arbitration is not appealable. We
explained, “[N]othing in sections 1294, subdivision (a) or 1294.2 allow for an appeal
from a stay order which is unaccompanied by a motion or petition to compel arbitration.”
(Wells Fargo, supra, 232 Cal.App.4th at p. 653; see Berman v. Renart Sportswear Corp.
(1963) 222 Cal. App. 2d 385, 388 [“the order denying a stay is not appealable itself, since
it is interlocutory in nature and not expressly made appealable by any language in section
1294 . . . .”].) Our holding in Wells Fargo, which involved the construction of section
1294, subdivision (a), applies to the order lifting the litigation stay here. In Wells Fargo,
we analyzed an order staying litigation which was unaccompanied by an effort to compel
arbitration. Here, we are confronted with an order lifting a litigation stay which was
unaccompanied by a motion or petition to compel arbitration.
Finally, an order lifting a litigation stay is not controlled by the analysis in Henry.
As noted, Henry held an order staying arbitration is merely the “flip side” of one refusing
to compel arbitration. (Henry v. Alcove Investment, Inc., supra, 233 Cal.App.3d at p.
100.) The order lifting the litigation stay is not, to use the metaphor in Henry, the “flip
side” of an order denying a petition to compel arbitration under our circumstances.
Because the order lifting the litigation stay is not appealable, we are required to dismiss
the appeal. (Baker v. Castaldi (2015) 235 Cal. App. 4th 218, 222; Marsh v. Mountain
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Zephyr, Inc. (1996) 43 Cal. App. 4th 289, 297.) As the present case does not involve an
appealable order and must be dismissed, we need not address the parties’ other
contentions.
IV. DISPOSITION
The appeal is dismissed. Plaintiff, Amparo Gastelum, may recover her appellate
costs from defendants, Remax International, Incorporated, and Jose Garcia-Yanez.
CERTIFIED FOR PUBLICATION
TURNER, P. J.
We concur:
KRIEGLER, J.
KUMAR, 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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