Procedural Posture 1

Procedural Posture
Plaintiff employee filed a proposed class action against defendant employer for unpaid wages and unfair business practices. The Superior Court of Los Angeles County, California, granted the employer's motion to compel arbitration under the employment agreement and dismissed the class action claims. The employee appealed.

Overview

The trial court ruled that a class action waiver did not render the arbitration agreement unconscionable because the employee did not prove that there were predictably small amounts of damages. The reviewing court assumed for the purposes of argument that the test developed in the consumer context applied and that the class action waivers would be substantively unconscionable if the dispute involved a predictably small amount of damages per class member. The court agreed with the trial court that the employee did not establish the required predictably small amounts. The complaint alleged that the employer had engaged in a scheme to defraud its employees out of overtime compensation and sought damages under Lab. Code, § 558, and Bus. & Prof. Code, § 17200. The employee presented no evidence in the trial court that the potential damages and penalties payable to class members would be predictably small. The employee could not rely for the first time on appeal on statistics from the United States Department of Labor. Moreover, there was no apparent correlation between the cited federal back wage figures and the allegations in the complaint.

Outcome: demand letter California

The court affirmed the order compelling arbitration and dismissing the class action claims.

Procedural Posture

Plaintiff contractor brought an action against defendant homeowners seeking to recover outstanding sums owed on a contract for construction of a home. The Superior Court of San Diego County (California), entered judgment in favor of the contractor. The homeowners appealed the judgment.

Overview

The homeowners contended that the evidence of completion, extras and of compliance with the arbitration award for rent allowance was insufficient for the court's finding and the judgment. They further argued that there was no adequate showing that the contractor complied with Cal. Civ. Code § 2466 requiring the publication of doing business under fictitious name, and further contended the contractor had no state contractor's license. The court affirmed the judgment in favor of the contractor. It found no merit in the homeowners' contention that the evidence was insufficient to support the findings that the construction was completed and that a balance was due for extras. The court found that while the contractor did not technically comply with the requirements of § 2466, that there was evidence that the contractor had substantially complied with the statute's requirements. The court held that because the contract did not provide for an illegal mode of performance, and because the contractor proceeded in good faith to render the service required by the contract, that the minor technical error did not damage anyone.

Outcome

The judgment in favor of the contractor was affirmed.