Padilla v. Dewey Services CA2/4 ( 2020 )


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  • Filed 12/15/20 Padilla v. Dewey Services CA2/4
    NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication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 FOUR
    GUILLERMO PADILLA,                                                    B302920
    Plaintiff and Respondent,                                   (Los Angeles County
    Super. Ct. No. 19STCV15617)
    v.
    DEWEY SERVICES, INC.,
    Defendant and Appellant.
    APPEAL from an order of the Superior Court for Los Angeles
    County, Elizabeth Allen White, Judge. Affirmed.
    Hill, Farrer & Burrill, James A. Bowles and Elissa L. Gysi for
    Defendant and Appellant.
    KJT Law Group, Vache A. Thomassian, Caspar Jivalagian; Adams
    Employment Counsel and Christopher A. Adams for Plaintiff and
    Respondent.
    Defendant Dewey Services, Inc. (Dewey) appeals from the trial
    court’s order denying its motion to compel arbitration of a claim for civil
    penalties for wage-and-hour law violations brought by plaintiff
    Guillermo Padilla under the Labor Code Private Attorneys General Act
    of 2004 (Lab. Code, § 2698 et seq., hereafter, PAGA). Dewey’s primary
    contention on appeal—that it is error to find an employee cannot be
    compelled to arbitrate PAGA claims based upon the employee’s
    predispute agreement to arbitrate—is one that has been rejected by
    several courts of appeal, including this one. Dewey argues that those
    cases, all of which relied upon the reasoning of the Supreme Court in
    Iskanian v. CLS Transportation Los Angeles, LLC (2014) 
    59 Cal. 4th 348
    (Iskanian) in reaching their conclusions, were wrongly decided because
    the courts misread the holding in Iskanian, which holding Dewey
    asserts was “reaffirmed and clarified” in the subsequent case of ZB,
    N.A. v. Superior Court (2019) 
    8 Cal. 5th 175
    (ZB).
    We find the reasoning of the prior appellate court cases sound,
    and that ZB has no effect on that reasoning. We also find that neither
    of the remaining arguments Dewey raises—that the trial court’s ruling
    conflicts with and is preempted by the Federal Arbitration Act (9 U.S.C.
    § 2 et seq., hereafter, FAA), and that the trial court erred by failing to
    find that the parties’ arbitration agreement delegated the question of
    arbitrability to the arbitrator—has merit. Accordingly, we affirm the
    order denying the motion to compel arbitration.
    2
    BACKGROUND
    Padilla was employed by Dewey from June 2018 to November
    2018. At the start of his employment, Padilla (like all employees of
    Dewey) was required to sign agreements to arbitrate all disputes with
    Dewey. As a result, Padilla was subject to Dewey’s written “Mutual
    Arbitration Policy” (MAP) throughout his employment.
    The MAP, which “require[s] mandatory, binding arbitration of
    disputes,” states that it “applies to Company employees, regardless of
    length of service or status, and covers all disputes relating to or arising
    out of an employee’s employment with the Company or the termination
    of that employment.” It provides examples of the types of disputes it
    covers, and includes “claims by employees for . . . wage or overtime
    claims or other claims under the Labor Code.”
    In explaining what the obligation to arbitrate claims means, the
    MAP states: “This mutual obligation to arbitrate claims means that
    both you and the Company are bound to use the MAP as the only means
    of resolving any employment-related disputes. This mutual agreement
    to arbitrate claims also means that both you and the Company forego
    any right either may have to a judicial forum or a jury trial on claims
    relating in any way to your employment. The arbitration shall be a
    traditional bilateral arbitration with you and the Company as the
    parties unless otherwise specifically agreed to in writing.[1] Each party
    waives the right to initiate or proceed on a class action basis or
    1     The MAP subsequently explains that “[t]he parties in any . . .
    arbitration will be limited to you and the Company, unless you and the
    Company agree otherwise in writing.”
    3
    participate in a class action in arbitration. No remedies that otherwise
    would be available to you individually or to the Company in a court of
    law, however, will be forfeited by virtue of this agreement to use and be
    bound by the MAP.” Finally, the MAP provides that it is governed
    solely by the FAA, and that the National Rules for the Resolution of
    Employment Disputes of the American Arbitration Association (the
    AAA rules) would govern the procedures used in the arbitration.
    In May 2019, Padilla filed in the superior court a class action
    complaint for damages and for enforcement under PAGA, alleging
    violations of various wage-and-hour laws. At the initial status
    conference, counsel for Padilla made an oral request to pursue only the
    PAGA claims, which the trial court granted. Padilla subsequently filed
    a first amended complaint alleging only a representative claim on
    behalf of the State of California and other aggrieved employees under
    PAGA, and seeking only civil penalties.
    On September 30, 2019, Dewey filed a motion to compel
    arbitration and to stay the action pending arbitration, making
    essentially the same arguments it makes in this appeal. Padilla
    opposed the motion, relying on the Supreme Court’s reasoning in
    Iskanian that a claim for civil penalties under PAGA belongs to the
    State of California, with the plaintiff acting as a proxy for the state.
    
    (Iskanian, supra
    , 59 Cal.4th at p. 388.) As such, Padilla’s lawsuit
    involved a dispute or claim between the state and Dewey, rather than
    between Padilla and Dewey, and the state did not agree to arbitrate its
    claim. In addition, Padilla argued that the court should decide the
    4
    issue of arbitrability because the parties did not clearly and
    unmistakably delegate that question to the arbitrator.
    The trial court denied the motion, noting that several courts of
    appeal have decided the issue and uniformly have held that “‘an
    employee’s predispute agreement to arbitrate PAGA claims is not
    enforceable without the state’s consent.’” (Quoting Correia v. NB Baker
    Electric, Inc. (2019) 
    32 Cal. App. 5th 602
    , 621 (Correia), trial court’s
    bolding omitted.) The court specifically rejected Dewey’s assertion that
    Correia and the cases it relied upon no longer were applicable in light of
    the recent Supreme Court case of 
    ZB, supra
    , 
    8 Cal. 5th 175
    , concluding
    that ZB did not change the result.
    Dewey timely filed a notice of appeal from the trial court’s order
    denying its motion to compel arbitration.
    DISCUSSION
    As noted, Dewey contends on appeal that the trial court erred by
    finding that Padilla’s predispute agreement to arbitrate all disputes
    with Dewey is unenforceable as to Padilla’s PAGA claim. It also
    contends the court’s finding conflicts with and is preempted by the FAA,
    and that the issue of arbitrability must be determined by the arbitrator
    under the agreement. None of those contentions prevail.
    A.   The Reasoning of the Prior Appellate Cases Was, and Remains,
    Sound
    To understand the issues in this case we must begin our
    discussion, as we did in Julian v. Glenair, Inc. (2017) 
    17 Cal. App. 5th 5
    853 (Julian)—one of the cases criticized by Dewey—by setting forth the
    relevant elements of PAGA. We then address the Supreme Court’s
    reasoning in Iskanian and how it leads to the holdings in Julian and
    the other appellate court decisions Dewey challenges. Finally, we
    address the effect, if any, of the Supreme Court’s decision in ZB on the
    holding of those cases.
    1.    PAGA
    “Under the Labor Code, the Labor and Workforce Development
    Agency (LWDA) and its constituent departments and divisions are
    authorized to collect civil penalties for specified labor law violations by
    employers. [Citation.] To enhance the enforcement of the labor laws,
    the Legislature enacted PAGA. [Citation.] PAGA permits aggrieved
    employees to recover civil penalties that previously could be collected
    only by the LWDA, as well as newly established ‘default’ penalties.
    [Citations.]
    “Under PAGA, ‘an “aggrieved employee” may bring a civil action
    personally and on behalf of other current or former employees to recover
    civil penalties for Labor Code violations. [Citation.] Of the civil
    penalties recovered, 75 percent goes to the [LWDA], leaving the
    remaining 25 percent for the “aggrieved employees.” [Citation.]’
    [Citation.]” 
    (Julian, supra
    , 17 Cal.App.5th at p. 865.)
    Because the LWDA has “the initial right to prosecute and collect
    civil penalties” under the Labor Code (Caliber Bodyworks, Inc. v.
    Superior Court (2005) 
    134 Cal. App. 4th 365
    , 376, disapproved on
    6
    another ground by 
    ZB, supra
    , 8 Cal.5th at p. 195), an aggrieved
    employee wishing to bring a PAGA claim must first give written notice
    of the alleged violations to the LWDA (along with a filing fee) and to the
    employer. (Lab. Code, § 2699.3, subd. (a)(1)(A).) The LWDA must then
    notify the aggrieved employee and employer whether it intends to
    investigate the alleged violation; if it does not intend to investigate, or if
    the aggrieved employee does not receive any notification within 65 days,
    or if the LWDA investigates and decides not to issue a citation, the
    aggrieved employee may commence a civil action. (Lab. Code, § 2699.3,
    subd. (a)(2)(A).) Within 10 days after commencement of the action, the
    aggrieved employee must provide the LWDA with a file-stamped copy of
    the complaint. (Lab. Code, § 2699, subd. (l)(1).) Any proposed
    settlement of the action must be submitted to the LWDA and the trial
    court, and the court must approve the settlement. (Lab. Code, § 2699,
    subd. (l)(2).) The employee also must submit to the LWDA a copy of the
    judgment, as well as any order that either provides for or denies an
    award of civil penalties. (Lab. Code, § 2699, subd. (l)(3).)
    “PAGA actions are ‘a substitute for an action brought by the
    government itself,’ in which the aggrieved employee acts as ‘the proxy
    or agent of the state’s labor law enforcement agencies.’ [Citation.] As
    explained in Iskanian, ‘[a] PAGA representative action is therefore a
    type of qui tam action. “Traditionally, the requirements for
    enforcement by a citizen in a qui tam action have been (1) that the
    statute exacts a penalty; (2) that part of the penalty be paid to the
    informer; and (3) that, in some way, the informer be authorized to bring
    suit to recover the penalty.” [Citation.] The PAGA conforms to these
    7
    traditional criteria, except that a portion of the penalty goes not only to
    the citizen bringing the suit but to all employees affected by the Labor
    Code violation.’ [Citation.]” 
    (Julian, supra
    , 17 Cal.App.5th at pp. 865-
    866.) And, “[b]ecause an employee’s PAGA action ‘functions as a
    substitute for an action brought by the government itself,’ under the
    doctrine of collateral estoppel, a judgment unfavorable to the employee
    binds the government, as well as all aggrieved nonparty employees
    potentially entitled to assert a PAGA action.” (Id. at p. 867.)
    2.   Iskanian
    In Iskanian, the plaintiff filed a complaint against his employer
    alleging claims for Labor Code violations, including a PAGA claim. The
    plaintiff had signed an agreement, subject to the FAA, providing that
    all claims arising out of his employment were to be submitted to
    arbitration, and specifically precluding representative claims. Based
    upon that agreement, the trial court granted the employer’s petition to
    compel arbitration, finding that the plaintiff was required to arbitrate
    the PAGA claim, which the court concluded he could litigate only on
    behalf of himself. 
    (Iskanian, supra
    , 59 Cal.4th at pp. 360-362.) The
    Supreme Court held that (1) “an arbitration agreement requiring an
    employee as a condition of employment to give up the right to bring
    representative PAGA actions in any forum is contrary to public policy”;
    and (2) “the FAA does not preempt a state law that prohibits waiver of
    PAGA representative actions in an employment contract.” (Id. at p.
    360.)
    8
    In reaching its first holding, the Supreme Court observed that
    “the Legislature’s purpose in enacting the PAGA was to augment the
    limited enforcement capability of the [LWDA] by empowering
    employees to enforce the Labor Code as representatives of the [LWDA].
    Thus, an agreement by employees to waive their right to bring a PAGA
    action serves to disable one of the primary mechanisms for enforcing
    the Labor Code. Because such an agreement has as its ‘object, . . .
    indirectly, to exempt [the employer] from responsibility for [its] own . . .
    violation of law,’ it is against public policy and may not be enforced.”
    
    (Iskanian, supra
    , 59 Cal.4th at p. 383.)
    In reaching its second holding, the Supreme Court pointed to the
    focus of the FAA, which is “to ensure an efficient forum for the
    resolution of private disputes.” 
    (Iskanian, supra
    , 59 Cal.4th at p. 384.)
    However, “a PAGA claim . . . is not a dispute between an employer and
    an employee arising out of their contractual relationship. It is a dispute
    between an employer and the state, which alleges directly or through its
    agents—either the [LWDA] or aggrieved employees—that the employer
    has violated the Labor Code. Through his PAGA claim, Iskanian is
    seeking to recover civil penalties, 75 percent of which will go to the
    state’s coffers. We emphasized in Arias [v. Superior Court (2009) 
    46 Cal. 4th 969
    (Arias)] that ‘an action to recover civil penalties “is
    fundamentally a law enforcement action designed to protect the public
    and not to benefit private parties”’; that ‘[i]n a lawsuit brought under
    the [PAGA], the employee plaintiff represents the same legal right and
    interest as state labor law enforcement agencies’; and that ‘an aggrieved
    employee’s action under the [PAGA] functions as a substitute for an
    9
    action brought by the government itself.’ [Citing 
    Arias, supra
    , 46
    Cal.4th at p. 986.] The fact that any judgment in a PAGA action is
    binding on the government confirms that the state is the real party in
    interest.” 
    (Iskanian, supra
    , 59 Cal.4th at pp. 386-387.) The court
    concluded: “In sum, the FAA aims to promote arbitration of claims
    belonging to the private parties to an arbitration agreement. It does
    not aim to promote arbitration of claims belonging to a government
    agency, and that is no less true when such a claim is brought by a
    statutorily designated proxy for the agency as when the claim is
    brought by the agency itself. . . . We conclude that California’s public
    policy prohibiting waiver of PAGA claims, whose sole purpose is to
    vindicate the [LWDA’s] interest in enforcing the Labor Code, does not
    interfere with the FAA’s goal of promoting arbitration as a forum for
    private dispute resolution.” 
    (Iskanian, supra
    , 59 Cal.4th at pp. 388-
    389.)
    3.   Prior Appellate Cases
    After Iskanian was decided, several courts of appeal relied upon
    the Supreme Court’s reasoning with regard to FAA preemption to
    conclude that a predispute agreement between an employer and
    employee to arbitrate PAGA claims is not enforceable without the
    consent of the state. For example, in Tanguilig v. Bloomingdale’s, Inc.
    (2016) 
    5 Cal. App. 5th 665
    (Tanguilig), Division Five of the First
    Appellate District relied upon the Supreme Court’s statements that
    “[t]he government entity on whose behalf the plaintiff files [a PAGA]
    10
    suit is always the real party in interest in the suit” 
    (Iskanian, supra
    , 59
    Cal.4th at p. 382), and that “‘every PAGA action, whether seeking
    penalties for Labor Code violations as to only one aggrieved employee—
    the plaintiff bringing the action—or as to other employees as well, is a
    representative action on behalf of the state’” (id. at p. 387), to conclude
    that “a PAGA plaintiff’s request for civil penalties . . . is not subject to
    arbitration under a private arbitration agreement between the plaintiff
    and his or her employer . . . because the real party in interest in a
    PAGA suit, the state, has not agreed to arbitrate the claim.”
    
    (Tanguilig, supra
    , 5 Cal.App.5th at p. 677; see also
    id. at p. 678
    [“Because a PAGA plaintiff, whether suing solely on behalf of himself or
    herself or also on behalf of other employees, acts as a proxy for the state
    only with the state’s acquiescence . . . and seeks civil penalties largely
    payable to the state via a judgment that will be binding on the state, a
    PAGA claim cannot be ordered to arbitration without the state’s
    consent”].)
    Similarly, in Betancourt v. Prudential Overall Supply (2017) 
    9 Cal. App. 5th 439
    (Betancourt), Division Two of the Fourth Appellate
    District relied upon the Supreme Court’s statement that a PAGA claim
    “is not a dispute between an employer and an employee arising out of
    their contractual relationship[, i]t is a dispute between an employer and
    the state” 
    (Iskanian, supra
    , 59 Cal.4th at p. 386) to conclude that a
    predispute agreement by an employee to arbitrate an employment
    dispute does not apply to a PAGA claim brought on behalf of the state.
    
    (Betancourt, supra
    , 9 Cal.App.5th at pp. 447-448.)
    11
    We found the conclusions of those two appellate courts persuasive
    in 
    Julian, supra
    , 
    17 Cal. App. 5th 853
    . There, our focus was on
    determining whether an agreement to arbitrate PAGA claims, entered
    into after a dispute between two employees and their employer had
    arisen but before the employees had satisfied the pre-filing
    requirements under PAGA, was enforceable under Iskanian. After
    conducting a thorough analysis of the Supreme Court’s reasoning, we
    found that “[e]nforcing a waiver executed before the employee has
    satisfied the statutory requirements would . . . impair PAGA’s
    enforcement mechanism.” 
    (Julian, supra
    , 17 Cal.App.5th at p. 870.)
    We concluded: “[U]ntil the employee meets those requirements, the
    state—through LWDA—retains control of the right underlying the
    employee’s PAGA claim. For that reason, enforcing the arbitration
    agreement would contravene the state’s control over that right.” (Id. at
    pp. 870-871.) Thus, we held that an arbitration agreement entered into
    by an employee as an individual before he or she meets the statutory
    requirements and becomes a representative of the state is a predispute
    agreement that does not subject a PAGA claim to arbitration. (Id. at p.
    872.)
    In all three of these cases, the arbitration agreements were
    construed to waive representative claims (such as PAGA claims) in any
    forum, although the agreement in Julian allowed arbitration of private
    attorney general claims, but only to resolve the claim of the individual
    employee. 
    (Tanguilig, supra
    , 5 Cal.App.5th at p. 672, fn. 2; 
    Betancourt, supra
    , 9 Cal.App.5th at p. 443; 
    Julian, supra
    , 
    17 Cal. App. 5th 861
    & fn.
    12
    2.) More recently, in 
    Correia, supra
    , 
    32 Cal. App. 5th 602
    , Division One
    of the Fourth Appellate District addressed the conclusions reached by
    the courts in Tanguilig, Betancourt, and Julian in the context of an
    arbitration agreement that is construed to require arbitration of
    representative PAGA claims, i.e., an agreement that allows PAGA
    claims in some forum. (
    Correia, supra
    , 32 Cal.App.5th at p. 621.)
    The Correia court agreed with the analysis of the prior appellate
    courts that “a PAGA arbitration requirement in a predispute
    arbitration agreement is unenforceable based on Iskanian’s view that
    the state is the real party in interest in a PAGA claim,” and held that
    the analysis applied to the circumstances before it. (
    Correia, supra
    , 32
    Cal.App.5th at p. 609.) The court examined decisions by federal courts
    that had reached a different conclusion, but it found those decisions
    “unpersuasive because the courts did not fully consider the implications
    of the qui tam nature of a PAGA claim on the enforceability of an
    employer-employee arbitration agreement.” (Ibid.; see also
    id. at pp. 623-624.) 4.
        Effect of ZB on Holdings of Prior Appellate Cases
    Based upon the analyses of Tanguilig, Betancourt, Julian, and
    Correia, the answer to Dewey’s first question on appeal—“Did the trial
    court err in holding that claims brought by an employee under [PAGA]
    cannot be compelled to arbitration based on the employee’s predispute
    agreement to arbitrate”—clearly is “No.” Dewey argues, however, that
    the courts in those cases (including this court) misapplied the holding of
    13
    Iskanian, which Dewey contends the Supreme Court “clarified” in ZB
    when it stated: “we held [in Iskanian] that a court may not enforce an
    employee’s alleged predispute waiver of the right to bring a PAGA claim
    in any forum.” (
    ZB, supra
    , 8 Cal.5th at p. 181.) Dewey asserts that
    Iskanian does not bar arbitration of PAGA claims, but rather bars only
    predispute waivers of the right to seek PAGA civil penalties in any
    forum. It also points to several federal cases that have held that
    Iskanian does not preclude arbitration of PAGA claims.
    Dewey’s argument misses the point. We (in Julian), and the
    courts in Tanguilig, Betancourt, and Correia, did not conclude that
    arbitration of PAGA claims was barred under the holding of Iskanian.
    Rather, based upon the Supreme Court’s reasoning in Iskanian as to
    why the FAA does not apply to PAGA claims—particularly the court’s
    statements that “the state is the real party in interest” in a PAGA
    action 
    (Iskanian, supra
    , 59 Cal.4th at p. 387) and that a PAGA claim “is
    not a dispute between an employer and an employee arising out of their
    contractual relationship[, but is instead] a dispute between an employer
    and the state” (id. at p. 386)—we and the other appellate courts simply
    held that a predispute agreement to arbitrate cannot be enforced with
    respect to a PAGA claim without the state’s consent, given either
    directly by the state or through its agent after that agent has been
    authorized by the state to bring such a claim. The federal court
    decisions Dewey cites do not persuade us that this holding is incorrect.
    None of those cases addresses the fact (as we explained in Julian) that,
    until an employee satisfies the statutory requirements under PAGA,
    14
    “the state—through LWDA—retains control of the right underlying the
    employee’s PAGA claim.” 
    (Julian, supra
    , 17 Cal.App.5th at pp. 870-
    871.) Thus, until the state authorizes the employee to bring a PAGA
    claim as a representative of the state, the employee has no legal
    capacity to agree to arbitrate that claim. (Id. at pp. 871-872
    [“Ordinarily, when a person who may act in two legal capacities
    executes an arbitration agreement in one of those capacities, the
    agreement does not encompass claims the person is entitled to assert in
    the other capacity. . . . [¶] . . . Prior to satisfying those requirements,
    an employee enters into the [arbitration] agreement as an individual,
    rather than as an agent or representative of the state”].)
    Contrary to Dewey’s assertion, there is nothing in the Supreme
    Court’s recent decision in ZB that affects our, or the other appellate
    courts’, prior analyses. To be sure, the court in ZB stated, as Dewey
    asserts, that it had held in Iskanian “that a court may not enforce an
    employee’s alleged predispute waiver of the right to bring a PAGA claim
    in any forum.” (
    ZB, supra
    , 8 Cal.5th at p. 181.) But that holding from
    Iskanian was not the focus of the court’s opinion. Rather, the court
    sought to determine whether a plaintiff may seek to recover underpaid
    wages in a PAGA action. (See
    ibid. [“We granted review
    to decide
    whether Iskanian controls, and the FAA has no preemptive force, where
    an aggrieved employee seeks the ‘amount sufficient to recover
    underpaid wages’ in a PAGA action. [¶] But to resolve this case we
    must answer a more fundamental question: whether a plaintiff may
    seek that amount in a PAGA action at all”].) The court simply did not
    15
    address the reasoning in Iskanian relied upon in Tanguilig, Betancourt,
    Julian, and Correia.
    In sum, we conclude the trial court did not err in relying upon
    Correia to find that Padilla’s predispute agreement to arbitrate was not
    enforceable as to his PAGA claim, and to deny Dewey’s motion to
    compel arbitration.
    B.   Preemption by the FAA
    Dewey’s contention that the FAA preempts any state law rule that
    finds that predispute arbitration agreements are unenforceable as to
    PAGA claims has been addressed and rejected by the Supreme Court in
    Iskanian. As the court explained, “a PAGA claim lies outside the FAA’s
    coverage because it is not a dispute between an employer and an
    employee arising out of their contractual relationship. It is a dispute
    between an employer and the state, which alleges directly or through its
    agents—either the [LWDA] or aggrieved employees—that the employer
    has violated the Labor Code.” 
    (Iskanian, supra
    , 59 Cal.4th at pp. 386-
    387.) Dewey’s contention has no merit.
    C.   Determination of Arbitrability
    Dewey contends that under the arbitration agreement and the
    AAA Rules, which are incorporated by reference into the agreement, the
    determination of arbitrability of Padilla’s PAGA claim must be
    determined by the arbitrator, and not by the trial court. Padilla argues
    that the question whether a dispute is subject to arbitration is to be
    16
    determined by the court unless the parties “clearly and unmistakably”
    delegate this determination to the arbitrator; he contends the
    arbitration agreement in this case did not do so. (Citing Ajamian v.
    CantorCO2e (2012) 
    203 Cal. App. 4th 771
    , 781-782, 790.) We need not
    decide whether the arbitration agreement, with its incorporation of the
    AAA rules, delegated the arbitrability determination to the arbitrator
    because Padilla is not a party to the agreement in his capacity as agent
    or proxy for the state.
    As we explained in Julian, an employee who enters into an
    arbitration agreement before satisfying the statutory requirements to
    bring a PAGA claim “enters into the agreement as an individual, rather
    than as an agent or representative of the state.” 
    (Julian, supra
    , 17
    Cal.App.5th at p. 872.) And, “when a person who may act in two legal
    capacities executes an arbitration agreement in one of those capacities,
    the agreement does not encompass claims the person is entitled to
    assert in the other capacity.” (Id. at pp. 871-872.)
    Since Padilla entered into the arbitration agreement in this case
    before he was given the authority to act as an agent or representative of
    the state to bring a PAGA claim, he was not a party to the agreement in
    his capacity of agent of the state. As we explained in Benaroya v. Willis
    (2018) 
    23 Cal. App. 5th 462
    , even where an arbitration agreement
    unambiguously provides that the arbitrator is to determine
    arbitrability, “California case law is clear that ‘an arbitrator has no
    power to determine the rights and obligations of one who is not a party
    to the arbitration agreement. [Citation.] The question of whether a
    17
    nonsignatory is a party to an arbitration agreement is one for the trial
    court in the first instance.’” (Id. at p. 469.)
    Because Padilla was acting in his capacity as agent of the state in
    bringing the PAGA claim, and he was not a party to the arbitration
    agreement in that capacity, the trial court properly determined the
    arbitrability of the PAGA claim.
    DISPOSITION
    The order denying Dewey’s motion to compel arbitration is
    affirmed. Padilla shall recover his costs on appeal.
    NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
    WILLHITE, J.
    We concur:
    MANELLA, P. J.
    COLLINS, J.
    18
    

Document Info

Docket Number: B302920

Filed Date: 12/15/2020

Precedential Status: Non-Precedential

Modified Date: 12/15/2020