88 Cal.App.5th 13
Cal. Ct. App.2023Background
- Fleming filed a class complaint (Rosenthal Fair Debt Collection Practices Act) against Oliphant on February 13, 2020; Oliphant moved to compel arbitration of his individual claims.
- Oliphant’s custodian (Crossan) declared Fleming applied for a Barclays credit card on December 1, 2013; the electronic application and account statements in the record did not reference an arbitration agreement.
- Oliphant produced three Cardmember Agreement exemplars (from 2013, 2018, and 2018) that contained identical arbitration provisions, but offered no evidence those agreements were ever sent to or signed by Fleming.
- Fleming declared he never received nor agreed to any arbitration agreement; he also objected to the evidentiary showing and questioned chain-of-assignment issues.
- The trial court found Oliphant failed to meet its burden to prove a valid arbitration agreement (mutual assent/consent lacking) and denied the petition to compel; the Court of Appeal affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a valid agreement to arbitrate existed | Fleming: no agreement was ever sent, signed, or agreed to | Oliphant: exemplars show an arbitration clause and Fleming’s account use manifested assent | Held: No — Oliphant failed to prove Fleming consented; mutual assent not shown |
| Who decides arbitrability (judge vs arbitrator) | Fleming: court must decide formation when existence is disputed | Oliphant: clause delegates arbitrability to arbitrator | Held: Court decides formation here; delegation requires clear and unmistakable evidence, which Oliphant did not provide |
| Whether use of the card implies assent (implied agreement) | Fleming: use alone is insufficient when there is no proof the terms were provided | Oliphant: continued use and statements referencing Cardmember Agreement bound Fleming | Held: Use alone insufficient absent evidence the agreement/terms were delivered or otherwise brought to Fleming’s attention |
| Choice of law for contract formation (Delaware vs California) | Fleming: California law governs and supports requiring proof of mutual assent | Oliphant: agreement governed by Delaware law (per its form) | Held: Court applied California law (and noted Delaware law yields similar contract-formation analysis); no agreement under either law shown |
Key Cases Cited
- Engalla v. Permanente Med. Grp., 15 Cal.4th 951 (Cal. 1997) (trial court resolves factual issues when deciding motions to compel arbitration)
- Pinnacle Museum Tower Assn. v. Pinnacle Market Dev. (U.S.), LLC, 55 Cal.4th 223 (Cal. 2012) (party seeking arbitration bears burden to show an agreement exists)
- Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S. Ct. 524 (U.S. 2019) (parties may delegate arbitrability to arbitrator only by clear and unmistakable evidence)
- EEOC v. Waffle House, Inc., 534 U.S. 279 (U.S. 2002) (arbitration is a matter of contract; courts first ask whether parties agreed to arbitrate)
- Granite Rock Co. v. Int’l Bhd. of Teamsters, 561 U.S. 287 (U.S. 2010) (courts must resolve disputes about formation or applicability of arbitration agreements)
- First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (U.S. 1995) (state contract-formation principles govern whether parties agreed to arbitrate)
- Chambers v. Crown Asset Mgmt., LLC, 71 Cal.App.5th 583 (Cal. Ct. App. 2021) (denial of motion to compel affirmed where movant failed to show plaintiff received the account agreement containing arbitration clause)
- Toal v. Tardif, 178 Cal.App.4th 1208 (Cal. Ct. App. 2009) (arbitration agreements are contracts and governed by ordinary contract rules)
- Costa v. Road Runner Sports, Inc., 84 Cal.App.5th 224 (Cal. Ct. App. 2022) (party is not required to arbitrate absent consent)