Arbitration: Appellate Court Reverses Lower Court’s Denial Of Motion To Compel Arbitration Where Requesting Designer/Materialman Paid Arbitration Fees

Designer Did Not Have To Meet Payment Obligations By Contractor, So There Was No Waiver Or Forfeiture.

               Facts many times make the difference in the resolution of a dispute.  And that conclusion rang true in Mooradian v. Ingjaldsdottir, Case No. B331561 (2d Dist., Div. 7 Sept. 26, 2024) (unpublished).

               There, homeowners, designer, materialman, and contractor entered into separate contracts with arbitration clauses.  Once a dispute arose, all parties agreed to a consolidated arbitration to resolve pending disputes.  Homeowners, designer, and materialman paid their arbitration fees, but contractor did not, resulting in a termination of the arbitration.  Designer and materialman renewed a motion to compel arbitration, which was denied by the lower court because the two did not pay contractor’s arbitration expenses.  The 2/7 DCA, in an opinion authored by Justice Segal, reversed the arbitration denial.  Even though the parties agreed to a consolidated arbitration, designer and materialman did pay their fees under separate contracts with arbitration clauses such that they should not be held accountable to the separate breach by contractor, distinguishing Cintel v. Barna, 206 Cal.App.4^th 1383 (2012) in the process.

               BLOG OBSERVATION—Arbitration waiver principles have changed somewhat after the California Supreme Court’s Quach decision, with this unpublished opinion having a nice synopsis of the changes.