{"id":903794,"date":"2024-12-27T14:42:37","date_gmt":"2024-12-27T21:42:37","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=903794"},"modified":"2024-12-27T14:42:40","modified_gmt":"2024-12-27T21:42:40","slug":"arbitration-agreement-prejudice-no-longer-an-element","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/arbitration-agreement-prejudice-no-longer-an-element\/","title":{"rendered":"\u201cPrejudice\u201d No Longer an Element to Determine Waiver of Right to Compel Arbitration"},"content":{"rendered":"\n<p>Jared W. Slater | <a href=\"https:\/\/www.ecjlaw.com\/ecj-blog\/prejudice-no-longer-an-element-to-determine-waiver-of-right-to-compel-arbitration-by-jared-w-slater\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Ervin Cohen &amp; Jessup<\/a><\/p>\n\n\n\n<p>In 2003, the California Supreme Court adopted a stringent test to determine whether an employer had waived its right to <a href=\"https:\/\/www.myconstructionexpert.com\/blog\/compel-arbitration-oral-hearing\/\">compel arbitration<\/a> of an employee\u2019s claims.\u00a0 The most critical, and often determinative, factor was \u201cprejudice\u201d to the party resisting arbitration. \u00a0In other words, the courts were obligated to determine whether the party resisting arbitration had been prejudiced by the other party\u2019s behavior \u2013 typically manifested through inordinate delay or litigation gamesmanship.<\/p>\n\n\n\n<p>The facts in the recent case of&nbsp;<em>Quach v. California Commerce Club, Inc.<\/em>, in which the California Supreme Court rejected its previous precedent, illustrates the very type of prejudice that courts abhor.&nbsp; There, the employer filed a Motion to Compel Arbitration 13 months after the lawsuit was filed, propounded a \u201clarge amount\u201d of written discovery, spent \u201csignificant\u201d time meeting and conferring \u201cover many months\u201d and took the employee\u2019s deposition.&nbsp; In essence, the parties had spent substantial time and expense litigating the case and, more importantly, the employer\u2019s conduct demonstrated \u201ca position inconsistent [with the intent] to arbitrate.\u201d&nbsp; In defense, the employer claimed that it had only recently located a fully executed copy of the arbitration agreement.<\/p>\n\n\n\n<p>Initially, the trial court denied the employer\u2019s motion to compel arbitration \u2013 finding the employee to have been sufficiently prejudiced by the employer\u2019s conduct.&nbsp; The Court of Appeal reversed, finding that prejudice to the employee was \u201cnot supported by substantial evidence.\u201d<\/p>\n\n\n\n<p>In reversing the Court of Appeal\u2019s decision, the California Supreme Court rejected its prior \u201cprejudice\u201d requirement and followed a 2022 decision by the United States Supreme Court which rejected the \u201cprejudice\u201d requirement when determining waiver under the Federal Arbitration Act (\u201cFAA\u201d).&nbsp; The Court\u2019s decision brings California law in line with federal law, ensuring that courts will apply the same waiver principles regardless of whether a case is governed by the FAA or the California Arbitration Act. &nbsp;Under those principles, courts should focus \u201cexclusively \u2026 on the waiving party\u2019s words or conduct.\u201d&nbsp; Further, California\u2019s trial judges should now \u201cseparately evaluate each generally applicable state contract law defense raised by [a] party opposing arbitration,\u201d including waiver, forfeiture, estoppel, laches, and untimeliness, rather than \u201clump[ing] distinct legal defenses into a catch-all category called \u2018waiver.\u2019\u201d<\/p>\n\n\n\n<p>The takeaway for employers is loud and clear: if you have an <a href=\"https:\/\/www.myconstructionexpert.com\/blog\/arbitration-agreement-beware-of-traps\/\">arbitration agreement<\/a> with an employee, do not wait to enforce your rights or you just might lose them.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p><strong>When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes &#8211; please call Advise &amp; Consult, Inc. at 888.684.8305, or email <a href=\"mailto:experts@adviseandconsult.net\">experts@adviseandconsult.net<\/a>.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Jared W. Slater | Ervin Cohen &amp; Jessup In 2003, the California Supreme Court adopted a stringent test to determine whether an employer had waived its right to compel arbitration of an employee\u2019s claims.\u00a0 The most critical, and often determinative, factor was \u201cprejudice\u201d to the party resisting arbitration. \u00a0In other words, the courts were obligated&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/arbitration-agreement-prejudice-no-longer-an-element\/\">Continue reading <span class=\"screen-reader-text\">\u201cPrejudice\u201d No Longer an Element to Determine Waiver of Right to Compel Arbitration<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[41],"tags":[9895,42,10807],"class_list":["post-903794","post","type-post","status-publish","format-standard","hentry","category-arbitration","tag-advise-consult","tag-arbitration-2","tag-arbitration-agreement","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>\u201cPrejudice\u201d No Longer an Element to Determine Waiver of Right to Compel Arbitration - Advise &amp; 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