Quach

Quach v. Cal. Commerce Club, Inc.

Good Law
Supreme Court of CaliforniaJuly 25, 2024S275121California8,631 words

Opinion

Opinion

Groban, J.

Opinion of the Court by Groban, J.

Private parties may agree to resolve their disputes in arbitration rather than in court. If a party to an arbitration agreement files a complaint in court raising a claim covered by the agreement, the defendant can file a motion asking the court to stay the lawsuit and send the dispute to arbitration. A defendant who instead litigates the case risks losing the contractual right to compel arbitration. One way a contractual right may be lost is by waiver. Outside the arbitration context, a California court will find waiver when the party seeking to enforce a known contractual right has intentionally relinquished or abandoned that right. (Lynch v. California Coastal Com. (2017) 3 Cal.5th 470, 475 (Lynch).) In the arbitration context, however, our cases have added a requirement: to find waiver, we have required that the party seeking to avoid arbitration show prejudice. (See St. Agnes Medical Center v. PacifiCare of California (2003) 31 Cal.4th 1187, 1203 (St. Agnes).) To explain our adoption of this additional, arbitration-specific requirement, we relied on a policy favoring arbitration over litigation as a form of dispute resolution. (Id. at p.…

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