Laswell v. Ag Seal Beach, LLC
189 Cal. App. 4th 1399
| Cal. Ct. App. | 2010Background
- Laswell, a 92–93-year-old resident, sued AG Seal Beach, LLC (doing business as Country Villa Seal Beach Healthcare Center), AG Facilities Operations, LLC, and Country Villa Service Corporation for elder abuse and related claims based on care at Country Villa Seal Beach Healthcare Center (Oct 21–Dec 10, 2008).
- Defendants moved to compel arbitration, asserting a valid arbitration agreement covering disputes arising from facility services and Elder Abuse Act claims per Health and Safety Code §1599.81.
- Laswell opposed, arguing lack of capacity to sign, presence of nonarbitrable third parties, and that elder abuse and Health and Safety Code §1430(b) claims are not arbitrable.
- The trial court found a prima facie case for arbitration but denied the petition, citing nonparticipating entities, nonarbitrable claims, imminent trial date, Laswell’s age, and timing of the arbitration issue.
- Defendants appealed; the court reverses, holding all defendants are bound by the arbitration agreement and the §1281.2(c) third-party exception does not apply; the elder abuse claim is arbitrable, while §1430(b) remains nonarbitrable and may be litigated after arbitration.
- Remand directed for entry of an order granting arbitration for all arbitrable claims except the §1430(b) claim against AG Seal Beach, LLC.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether CCP §1281.2(c) applies to stay or deny arbitration. | Laswell contends third parties not bound by the agreement warrant denial. | Defendants argue no third parties exist; all defendants bound. | No; §1281.2(c) not applicable; arbitration must be compelled. |
| Whether all defendants are bound by the arbitration agreement. | Laswell argues some defendants are nonarbitrable third parties. | AG Facilities Operations, LLC and Country Villa Service Corp. are bound as related entities. | All defendants bound; nonarbitrable third-party status is absent. |
| Whether elder abuse and Health and Safety Code §1430(b) claims are arbitrable. | Laswell asserts elder abuse claims are nonarbitrable. | Elder abuse claims are arbitrable; §1430(b) is nonarbitrable but can be litigated post-arbitration. | Elder abuse is arbitrable; §1430(b) nonarbitrable but may be litigated after arbitration; remand for arbitration of remaining claims. |
Key Cases Cited
- Garrison v. Superior Court, 132 Cal.App.4th 253 (Cal. Ct. App. 2005) (strong public policy favoring arbitration; needs existence of valid agreement)
- Madden v. Kais er Foundation Hospitals, 17 Cal.3d 699 (Cal. 1976) (strong public policy in favor of arbitration)
- Rowe v. Exline, 153 Cal.App.4th 1276 (Cal. Ct. App. 2007) (nonarbitrable third-party status and alter-ego/estoppel concepts)
- Cronus Investments, Inc. v. Concierge Services, 35 Cal.4th 376 (Cal. 2005) (third-party exception to arbitration; discretionary denial if third parties risk conflicting rulings)
- Molecular Analytical Systems v. Ciphergen Biosystems, Inc., 186 Cal.App.4th 696 (Cal. Ct. App. 2010) (defines when third-party status triggers §1281.2(c) and abuse of discretion standard)
- RN Solution, Inc. v. Catholic Healthcare West, 165 Cal.App.4th 1511 (Cal. Ct. App. 2008) (nonarbitrable claims and agency relationships; enforceability against nonsignatories)