Law Finance Group, LLC v. Key, 531 P.3d 326

Background

Sarah Plott Key borrowed $2.4 million from Law Finance Group to fund probate litigation; the loan charged compounded interest and fees and included an arbitration clause.
After Key prevailed in probate and repaid principal, she refused to pay interest/fees as unlawful under the California Financing Law; Lender sought about $3.5 million in arbitration.
The arbitrators found some charges unlawful, reformed the contract to simple interest, and awarded Lender roughly $800,000 plus fees; award was served September 19, 2019.
Lender filed a petition to confirm (Oct. 1, 2019); Key’s counsel and Lender’s counsel agreed to a joint briefing/hearing schedule and to extend response timing; Key filed a petition to vacate on Jan. 27, 2020 (130 days after service) and a response to the confirmation petition on Feb. 5, 2020 (139 days after service).
The trial court vacated the award on the merits; the Court of Appeal reversed, holding Code Civ. Proc. §1288.2’s 100‑day deadline jurisdictional and thus not subject to extension; Supreme Court granted review.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether §1288.2’s 100‑day vacatur deadline is jurisdictional	§1288.2 is not jurisdictional; parties can rely on §1290.6 or equitable doctrines	§1288.2 is jurisdictional; courts lack power to hear late vacatur requests	§1288.2 is nonjurisdictional; presumption against statutes limiting fundamental jurisdiction applies
Whether §1288.2 is subject to equitable tolling or estoppel	Equitable tolling/estoppel should excuse Key’s late filings given counsels’ agreement and conduct	Equitable doctrines cannot override the statutory deadline (if jurisdictional) or were not appropriate here	§1288.2 is subject to equitable tolling and equitable estoppel; remand to determine if relief warranted
Whether §1290.6’s 10‑day response rule can extend or displace §1288.2’s 100‑day limit when responding to a confirmation petition	A response filed within §1290.6’s time is timely even if beyond 100 days from award	Both deadlines apply: a response seeking vacatur must meet §1290.6 and §1288.2	Both deadlines apply; §1290.6 does not extend §1288.2’s 100‑day outer limit
Whether a claim that the underlying contract is illegal can be raised at any time regardless of procedural deadlines	Illegality forecloses enforcement and may be raised even if vacatur request is late	Illegality defenses can be forfeited if not timely raised under the Act	Illegality claims are not categorically immune from forfeiture; timely raising or equitable relief is required

Key Cases Cited

Quigley v. Garden Valley Fire Protection Dist., 7 Cal.5th 798 (Cal. 2019) (presumption that statutes do not limit fundamental jurisdiction absent clear intent)
Kabran v. Sharp Memorial Hospital, 2 Cal.5th 330 (Cal. 2017) (mandatory procedural rules not necessarily jurisdictional)
Saint Francis Memorial Hospital v. State Dept. of Public Health, 9 Cal.5th 710 (Cal. 2020) (presumption that statutory deadlines permit equitable tolling absent clear contrary intent)
Lantzy v. Centex Homes, 31 Cal.4th 363 (Cal. 2003) (statutory text and purpose can preclude equitable tolling)
Moncharsh v. Heily & Blase, 3 Cal.4th 1 (Cal. 1992) (claims of illegality can be forfeited if not timely raised)
Loving & Evans v. Blick, 33 Cal.2d 603 (Cal. 1949) (judicial review may be warranted when arbitrators enforce an illegal contract)
McDonald v. Antelope Valley Community College Dist., 45 Cal.4th 88 (Cal. 2008) (equitable tolling principles and background presumption)
Richey v. AutoNation, Inc., 60 Cal.4th 909 (Cal. 2015) (limits on judicial review of arbitration awards)