MOTION TO COMPEL ARBITRATION
1. CASE # CASE NAME HEARING NAME HERNANDEZ VS WESTERN CVME2503311 MOTION FOR LEAVE TO AMEND DENTAL SERVICES INC Tentative Ruling: Grant the motion, with 5 court days leave to file the amended complaint in the Clerk’s Office.
C.C.P. §473 authorizes the court to grant leave to amend any pleading “in furtherance of justice, and on such terms as may be proper.” A motion for relief under CCP § 473 is addressed to the sound discretion of the trial court, and the exercise of that discretion will not be disturbed on appeal unless there is a clear showing that it was abused. (Carroll v. Abbott Laboratories, Inc. (1982) 32 Cal.3d 892, 897-898; Record v. Reason (1999) 73 Cal.App.4th 472, 486.)3.1324(b).
California courts have developed “a policy of great liberality in allowing amendments at any stage of the proceeding so as to dispose of cases upon their substantial merits where the authorization does not prejudice the substantial rights of others.” (Dunzweiler v. Superior Court (1968) 267 Cal.App.2d 569, 576.) Thus, if a motion is timely and the amended pleading will not prejudice the opposing party, it is error not to allow leave to amend. (Kittredge Sports Co. v. Superior Court (1989) 213 Cal.App.3d 1045, 1048; Morgan v.
Superior Court (1959) 172 Cal.App.2d 527, 530 [“If the motion to amend is timely made and the granting of the motion will not prejudice the opposing party, it is error to refuse permission to amend and where the refusal also results in a party being deprived of the right to assert a meritorious cause of action or a meritorious defense, it is not only error but an abuse of discretion”].) Here, the motion is timely and no prejudice is alleged.
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2. CASE # CASE NAME HEARING NAME DARRAH VS MERCEDES- CVME2600198 MOTION TO COMPEL ARBITRATION BENZ USA, LLC Tentative Ruling: Grant—the Defendant is an expressly named third party beneficiary of the arbitration agreement. Deny the request for judicial notice. The matter is stayed pending arbitration.
The Arbitration Agreement contained in the Lease Agreement provides, “This lease evidences a transaction involving interstate commerce. Any arbitration under this lease shall be governed by the Federal Arbitration Act.” (Decl. of Newman, Ex. B., pg. 4.) This provision is enforceable. Plaintiff does not dispute that the FAA applies.
Defendant produced a copy of the California Motor Vehicle Lease Agreement for the Subject Vehicle. The Arbitration Agreement therein states:
Any claim or dispute, whether in contract, tort or otherwise (including any dispute over the interpretation, scope, or validity of this lease, arbitration section or the arbitrability of any issue), between you and us or any of our employees, agents, successors, assigns, or the vehicle distributor, including Mercedes Benz USA LLC (each a “Third Party Beneficiary”), which arises out of or relates to a credit application, this lease, or any resulting transaction or relationship arising out of this lease (including any such relationship with third parties who do not sign this contract), shall at the election of either
you, us, or a Third Party Beneficiary, be resolved by a neutral, binding arbitration and not by a court action.
(Decl. of Newman, Ex. B pg. 4, emphasis added.) Plaintiff does not deny that she executed the Lease Agreement.
Plaintiff argues that Defendant cannot claim third party beneficiary status because the warranty dispute does not result from the Lease Agreement. Plaintiff relies Ford Motor Warranty Cases, wherein the California Supreme Court held that the plaintiffs and Ford had not agreed to arbitrate any disputes between them, and nothing in the agreement between the plaintiffs and the seller of the vehicle expressed an intent to empower third parties to invoke the arbitration clause, citing express language limited the arbitrable disputes to “any disputes between us” meaning plaintiffs and the dealership. (Ford Motor Warranty Cases, 17 Cal. 5th at 1129.)
The Court indicated that the “third party” language in the arbitration agreement meant that if the buyer sued the dealer based on the condition of the vehicle, the dealer could enforce the arbitration claim, but did not bind the purchaser to arbitrate with “the universe of unnamed third parties.” (Id at 1130.)
However, in this case, Mercedes is not an unnamed third party. The Arbitration Agreement expressly states that Mercedes is a third-party beneficiary and that third party beneficiaries may elect to resolve any disputes against them in arbitration. (See Decl. of Newman, Ex. B, p. 4.) As such, Mercedes is an intended third-party beneficiary of the Arbitration Agreement. (Soltero v. Precise Distribution, Inc. (2024) 102 Cal.App.5th 887, 898 [“[T]he question is not whether the party seeking to compel arbitration is a third party beneficiary of the contract containing the arbitration clause, but whether it is a third party beneficiary of the arbitration clause itself.”) The Arbitration Agreement language indicates that the arbitration clause was made expressly for Mercedes’ benefit. (Ibid.)