Filed 3/11/14 LaCount v. FM San Diego CA4/1
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
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or ordered published for purposes of rule 8.1115.
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
DOYLE LACOUNT, D063324
Plaintiff and Respondent,
v. (Super. Ct. No.
37-2012-00098802-CU-WT-CTL)
FM SAN DIEGO, LLC,
Defendant and Appellant.
APPEAL from an order of the Superior Court of San Diego County, Jeffrey B.
Barton, Judge. Affirmed.
Fine, Boggs & Perkins, Cory J. King and William D. Wheelock for Defendant and
Appellant.
Stephen Danz & Associates, Melanie Porter and Stephen F. Danz for Plaintiff and
Respondent.
Doyle LaCount filed an action against his employer, FM San Diego, LLC
(FMSD), asserting a variety of claims arising from his employment with FMSD. FMSD
petitioned to compel arbitration, asserting LaCount had expressly contracted to submit
any employment-related disputes to arbitration when in 2010 he was hired by a previous
employer, FM Orange County, LLC (FMOC), and that contract remained binding on
LaCount when he left FMOC and was employed by FMSD. The trial court denied the
petition, and FMSD timely appealed.
I
FACTUAL AND PROCEDURAL BACKGROUND
A. Facts
LaCount was hired by FMOC in August 2010 and signed an arbitration agreement
as a condition to being hired. The arbitration agreement provided LaCount agreed to
arbitrate disputes between himself and "the Company (or its owners, directors, officers,
managers, employees, agents and parties affiliated with its employee benefit and health
plans)." The term "Company" was defined as FMOC, and the agreement did not mention
FMSD.
In June 2011 LaCount's employment with FMOC ended. LaCount relocated to
San Diego County and was employed by FMSD. He was required to sign a new pay plan
with FMSD but was not required to, and did not, sign an arbitration agreement with
FMSD. LaCount asked about certain employee benefits but was told by FMSD's Human
Resources manager that FMSD and FMOC were separate companies. When LaCount
worked for FMOC, his paychecks and W-2 forms were issued by FMOC, and when
LaCount worked for FMSD, his paychecks and W-2 forms were issued by FMSD.
FMOC and FMSD have different tax identification numbers, different agents for service
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of process, and their respective websites do not mention any affiliation with each other.
LaCount understood FMSD and FMOC were separate companies, and understood the
arbitration agreement he had signed with FMOC expired when he ended his employment
there. LaCount was never told the arbitration agreement he had signed with FMOC
would remain in effect with his new employer FMSD.
The only affiliation between FMOC and FMSD is that another entity (FM SO
CAL, LLC) provides management services to both FMOC and FMSD, including human
resources and accounting services, and FMOC and FMSD pay a share of FM SO CAL,
LLC's administrative costs. There was no evidence FMOC and FMSD were alter egos,
or even that FMOC and FMSD were owned by the same ownership group. To LaCount's
knowledge, FMOC and FMSD did not share any common employee benefit or health
plan, and FMSD submitted no evidence to the contrary.
B. The Order Denying Arbitration
LaCount filed his lawsuit against FMSD, and FMSD petitioned to compel
arbitration. The court found there was no enforceable arbitration agreement between
LaCount and FMSD because (1) FMSD was not a named party to the written agreement
between LaCount and FMOC, and (2) FMSD was not a party affiliated with FMOC's
employee benefit and health plans. The court also rejected FMSD's claim that LaCount
had an implied-in-fact agreement with FMSD that the FMOC arbitration agreement was
carried over and applied to his employment with FMSD.
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II
ANALYSIS
A. Legal Principles
Code of Civil Procedure sections 1281.2 and 1290.2 create a summary proceeding
for resolving a disputed petition to compel arbitration. (Rosenthal v. Great Western Fin.
Securities Corp. (1996) 14 Cal.4th 394, 413.) The petitioner bears the burden of proving
the existence of a valid arbitration agreement by a preponderance of the evidence, and a
party opposing the petition bears the burden of proving by a preponderance of the
evidence any fact necessary to its opposition. (Ibid.) In these summary proceedings, the
trial court sits as a trier of fact, weighing all the affidavits, declarations, and other
documentary evidence, as well as oral testimony received at the court's discretion, to
reach a final determination. (Id. at pp. 413-414.) An appellate court reviewing a decision
on a petition to compel arbitration will uphold the trial court's resolution of disputed facts
if supported by substantial evidence. However, when there is no disputed extrinsic
evidence considered by the trial court, an appellate court will review the trial court's
decision de novo. (Giuliano v. Inland Empire Personnel, Inc. (2007) 149 Cal.App.4th
1276, 1284.)
The foundational question in a petition to compel arbitration is the existence of an
agreement to arbitrate. (Banner Entertainment, Inc. v. Superior Court (1998) 62
Cal.App.4th 348, 356; Frederick v. First Union Securities, Inc. (2002) 100 Cal.App.4th
694, 697.) "General principles of contract law determine whether the parties have
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entered a binding agreement to arbitrate. [Citation.] This means that a party's acceptance
of an agreement to arbitrate may be express [citations] or implied-in-fact . . . ." (Craig v.
Brown & Root, Inc. (2000) 84 Cal.App.4th 416, 420 (Craig).)
B. Analysis
On appeal, FMSD does not contend there was an express agreement between
FMSD and LaCount to submit disputes to arbitration.1 Instead, FMSD relies on Craig to
argue there was an implied-in-fact agreement to adhere to the arbitration agreement
between LaCount and FMOC because LaCount accepted employment with FMSD
knowing FMSD conditioned his employment on LaCount's consent that the arbitration
agreement he signed with FMOC applied to his employment with FMSD. FMSD also
relies on Civil Code section 1589, and cases decided under that section, which provides
that "[a] voluntary acceptance of the benefit of a transaction is equivalent to a consent to
all the obligations arising from it, so far as the facts are known, or ought to be known, to
the person accepting." FMSD argues that because LaCount accepted the benefits of
employment with it, he consented to the attendant obligations, which included an
agreement to arbitrate. However, section 1589's "principal application is to the parties to
the original transaction, and to cases of assignment where the assignee's assumption of
liability may be implied from his acceptance of rights and privileges under the contract."
1 On appeal, FMSD concedes it was "not a signatory or listed as the 'Company' in
the agreement" with FMOC that LaCount signed. Moreover, FMSD makes no claim that
it was entitled to interpose FMOC's written arbitration agreement as a "part[y] affiliated
with [FMOC's] employee benefit and health plans." We examine only whether LaCount
and FMSD had an implied-in-fact agreement that LaCount would be bound by the terms
of the written arbitration agreement with FMOC to arbitrate disputes with FMSD.
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(Matthau v. Superior Court (2007) 151 Cal.App.4th 593, 603.) FMSD does not explain
how this section has any application here because there is no claim LaCount was an
assignee of a contract containing an arbitration clause, and the only contract that involved
an agreed arbitration clause to which LaCount was an original party was his contract with
a former employer. The cases applying section 1589 appear to require the person who
accepted the benefits of a contract to have had actual knowledge of its burdens (see, e.g.,
Unterberger v. Red Bull North America, Inc. (2008) 162 Cal.App.4th 414, 421), and none
of the cases cited by FMSD support the argument that a person who accepts the benefits
of a contract in ignorance of its burdens is nevertheless charged, as a matter of law, with
those burdens. Accordingly, unless there is no substantial evidence to support the trial
court's key factual determination--that LaCount did not know his employment with
FMSD was conditioned on having the FMOC arbitration agreement carry over into and
apply to his employment with FMSD--section 1589 has no application here.
FMSD's argument on appeal is that "LaCount understood that his move . . . from
FMOC to FMSD was a 'transfer' of employment," and "understood . . . the Binding
Arbitration Agreement . . . was intended to survive LaCount's transfer from FMOC and
apply to his employment with FMSD"; because there was "no doubt [LaCount] was
aware of the arbitration agreement requirement . . . when he subsequently transferred his
employment to FMSD [and] since all indications were that [LaCount] had received notice
and was aware of the transfer of the Binding Arbitration Agreement from his
employment at FMOC to FMSD, [LaCount] is bound by his conduct to submit disputes
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to arbitration." However, the trial court made a contrary and key factual determination
because it found LaCount "perceived FMOC and FMSD as two separate companies with
different policies, thereby showing he did not have notice, or implicitly accept, FMOC's
arbitration agreement carrying over into his employment with FMSD."
Notwithstanding its contrary assertions on appeal, FMSD's argument necessarily
devolves into a claim the evidence was insufficient to support the key factual
determination: that LaCount did not have actual knowledge his acceptance of his new
employment with FMSD carried with it an acceptance that his agreement with his former
employer would apply to his new employment. We are not persuaded by FMSD's
argument. FMSD's opening brief recites only the evidence supporting its arguments and
ignores evidence supporting the order, which permits us to deem waived a claim no
substantial evidence supports the order. When an appellant challenges a finding for
insufficiency of the evidence to support it, he or she is required to set forth in the
appellant's opening brief all the material evidence on that issue or finding and not merely
evidence favorable to his or her position. (Foreman & Clark Corp. v. Fallon (1971) 3
Cal.3d 875, 881.) "In furtherance of its burden, the appellant has the duty to fairly
summarize all of the facts in the light most favorable to the judgment." (Boeken v. Philip
Morris, Inc. (2005) 127 Cal.App.4th 1640, 1658.) Unless this is done, the asserted error
is deemed waived. (Foreman & Clark, at p. 881.) "An appellate court will consider the
sufficiency of the evidence to support a given finding only after a party tenders such an
issue together with a fair summary of the evidence bearing on the challenged finding,
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particularly including evidence that arguably supports it." (Huong Que, Inc. v. Luu
(2007) 150 Cal.App.4th 400, 409-410.)
Furthermore, "[a] party who challenges the sufficiency of the evidence to support
a finding must set forth, discuss, and analyze all the evidence on that point, both
favorable and unfavorable" (Doe v. Roman Catholic Archbishop of Cashel & Emly
(2009) 177 Cal.App.4th 209, 218), and not doing so permits a reviewing court to deem
waived any substantial evidence contention. (Ibid.) Our review of the record on appeal
and FMSD's opening brief confirms FMSD has not set forth a sufficient statement of
facts stating all of the material evidence, both favorable and unfavorable, on the key
factual determination, and instead cites only the evidence FMSD submitted while citing
none of the evidence submitted by LaCount. We therefore deem this issue forfeited.
Even assuming we were to reach this issue, substantial evidence supports the key
factual determination. LaCount's declaration averred he was not told the agreement he
signed with FMOC would remain in effect with his new employer, and instead
understood it expired after he left FMOC's employment. This testimony is alone
sufficient to support the trial court's factual finding. (State Farm Fire & Casualty Co. v.
Jioras (1994) 24 Cal.App.4th 1619, 1626 [testimony of a single witness is sufficient to
provide substantial evidentiary support for a factual finding].) Moreover, LaCount was
told the two entities were separate companies, and he was required by FMSD to sign a
different pay plan when he starting working there, which provides additional evidentiary
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support that LaCount reasonably believed the agreements he formerly had with FMOC
did not apply to his new employer.
Because the court's factual determinations were adverse to its claims, the court's
decision in Craig, supra, 84 Cal.App.4th 416, does not aid FMSD's argument. In Craig,
an employee was notified that future legal disputes between the employee and employer
would be handled by a new dispute resolution program, including arbitration, and the
employee continued working for the employer for several years after she received this
notification. (Id. at pp. 419-420.) Craig held that continuing to work for the employer
after receiving actual notice this new term would apply to her employment could
constitute an implied-in-fact acceptance of the arbitration agreement (id. at pp. 420-421),
and further held that because the trial court resolved the only disputed issue (i.e., whether
she was actually notified of this new proviso) in the employer's favor, substantial
evidence supported the trial court's finding that the employee did agree to the arbitration
provision. (Id. at pp. 420-422.) As the trial court below noted, Craig has no application
because the trial court in Craig found the employee had notice the arbitration agreement
was a condition of the employee's continued employment, but the trial court here reached
the opposite conclusion. To the extent Craig has any application, it undermines FMSD's
argument by recognizing the key factual determination--whether the employee knew
arbitration was a condition to his employment--must be upheld if supported by substantial
evidence. (Id. at p. 422.) Because we have concluded there is substantial evidence to
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support the trial court's finding on this disputed issue, Craig teaches we must affirm the
order denying FMSD's petition to compel arbitration.
DISPOSITION
The order is affirmed. LaCount is entitled to costs on appeal.
McDONALD, J.
WE CONCUR:
McCONNELL, P. J.
NARES, J.
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