Comia vs. Eagle Law Corp

Plaintiff notes that California Rule of Professional Conduct 1.8.8 prohibits an attorney from making "an agreement prospectively limiting the lawyer's liability to a client for malpractice" unless the client is "independently represented in making the agreement." But the arbitration agreement does not limit Defendant’s liability; rather, it designates arbitration as the forum in which to resolve the issue of Defendant’s liability. This does not render the arbitration agreement unenforceable.

Plaintiff also argues that because Defendant Barker substituted in as counsel on May 25, 2024, and was never a party to the retainer agreement between Plaintiff and Eagle, he lacks standing to enforce the arbitration clause.

Plaintiff alleges in her Complaint that Barker was an agent of Defendant Eagle Law Corp. (See Complaint, ¶¶ 3, 4.) Therefore, Defendant Barker has standing to enforce the arbitration agreement. (See Thomas v. Westlake (2012) 204 Cal.App.4th 605, 614 (“when a plaintiff alleges a defendant acted as an agent of a party to an arbitration agreement, the defendant may enforce the agreement even though the defendant is not a party thereto.”.)

Unconscionability

Unconscionability is one ground on which a court may refuse to enforce a contract, including an arbitration agreement. (Civ. Code §1670.5.) Whether a provision is unconscionable is a question of law. (Civ. Code §1670.5(a); Flores v. Transamerica (2001) 93 Cal. App. 4th 846, 851.)

To be unenforceable, a contract must be both procedurally and substantively unconscionable, but the elements need not be present in the same degree. The analysis employs a sliding scale: “...the more substantively oppressive the contract term, the less evidence of procedural unconscionability is required to come to the conclusion that the term is unenforceable, and vice versa.” (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal. 4th 83, 114; Mercuro v. Superior Court (2002) 96 Cal. App. 4th 167, 174-75.)

Plaintiff argues that the agreement is unconscionable because (1) no advisement regarding independent counsel was provided, (2) the agreement was presented as a non-negotiable intake form, and (3) the clause imposes cost-shifting burdens not present in court proceedings.

Plaintiff’s claimed failure to understand what she was agreeing to is not a defense to enforcement. (See Bolanos v. Khalatian (1991) 231 CA3d 1586, 1590 ([w]hen a person with the capacity of reading and understanding an instrument signs it, he may not, in the absence of fraud, coercion or excusable neglect, avoid its terms on the ground he failed to read it before signing it.”).)

There is no indication that Plaintiff lacks capacity to read and sign an agreement such as this. Defendants state in their reply brief that Plaintiff answered interrogatories stating that she had bachelor’s degrees in International Relations, Communications and a Master’s in Counseling Psychology.

Additionally, Plaintiff argues that because the agreement is a contract of adhesion, it is procedurally unconscionable. Contracts of adhesion are not per se unconscionable. (See Powers v. Dickson, Carlson & Campillo (1997) 54 Cal.App.4th 1102, 1110.)

Plaintiff also contends that the agreement is substantively unconscionable because it requires each party to "bear...one half of the charges of the arbitrator," and she cannot afford to bear one-half of AAA arbitration fees. (Comia Decl., ¶ 12.) She cites to Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, to support her argument that this renders the agreement substantively unconscionable and unenforceable.

Armendariz does not apply here as its holding on the payment of fees is limited to employment cases for public policy reasons: “When an employer imposes mandatory arbitration as a condition of employment, the arbitration agreement or arbitration process cannot generally require the employee to bear any type of expense that the employee would not be required to bear if he or she were free to bring the action in court. This rule will ensure that employees bringing FEHA claims will not be deterred by costs.” (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 110–111.)

In the underlying case, Plaintiff agreed to a retainer fee of $5,500.00 and an attorney rate of $400/hour. (Motion, Ex. A.) Furthermore, Defendant Barker declares in reply that throughout his conversations with Plaintiff in 2024 and 2025, he inquired about Plaintiff's financial condition and status for the purpose of evaluating the amount of any punitive damages award to which Plaintiff may have been subject to in the underlying case. Plaintiff informed him that as of 2024/2025, Plaintiff was earning approximately $50,000.00 per year via employment, she received $50,000 per year in child support, she did not pay for childcare, rent or utilities, and all insurance costs for her child was paid for by the child’s father. (Baker Decl., ¶ 1.)

As it currently stands, Plaintiff has not shown that her 1⁄2 of the arbitration fees (which are generally significantly less than the costs of litigating in court) would preclude her access to the arbitration forum. (See Armendariz, supra, 24 Cal.4th at 110–111.)

Therefore, because Plaintiff has not shown that the arbitration agreement is both procedurally and substantively unconscionable, the motion is granted.

Defendants motion includes a request for sanctions in the motion at the end of the memorandum, pursuant to Code Civ. Proc., § 127.5. There is no § 127.5. This does not exist. Defendants likely mean Code Civ. Proc., § 128.5. Sanctions under § 128.5 are not warranted here; the Court does not find that Plaintiff’s Complaint is frivolous or was filed in bad faith. Moreover, Defendants did not provide the 21-day notice as is required.

This matter is hereby stayed pursuant to Code Civ. Proc., § 1281.4. The Court further notes that Defendant Julie C. Lim was not a moving party to this motion to compel arbitration. Thus, the action against Defendant Lim is stayed as well. The Demurrer filed by Defendant Lim currently scheduled for August 3, 2026 is vacated. Additionally, the case management conference set fort July 13, 2026 is vacated.

The Court sets a hearing re: status of arbitration on July 12, 2027 at 10:00 a.m. in Dept. C27.

Moving parties are ordered to give notice.

108 2025-01462176 1. Demurrer to Amended Complaint 2. Case Management Conference