Chestnut Square Homeowner's Association vs. Republic Services, Inc.

As to whether the court or the arbitrator determines issues of arbitrability, “[s]imply put, ‘[t]he question whether the parties have submitted a particular dispute to arbitration, i.e., the “question of arbitrability,” is “an issue for judicial determination [u]nless the parties clearly and unmistakably provide otherwise.”’” (Greenspan v. LADT, LLC (2010) 185 Cal.App.4th 1413, 1440.) There is no evidence the parties, including non-signatories, agreed the arbitrator could determine the issue of arbitrability of the City Agreement, which again does not contain an arbitration provision. The court will proceed and make the determination.

“On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party thereto refuses to arbitrate such controversy, the court shall order the petitioner and the respondent to arbitrate the controversy if it determines that an agreement to arbitrate the controversy exists . . . .” (Code Civ. Proc., § 1281.2.)

In a petition to compel arbitration, “the moving party, in essence, requests specific performance of a contractual agreement to arbitrate the controversy . . . . The trial court must determine in advance whether there is a duty to arbitrate the controversy . . . . This determination ‘necessarily requires the court to examine and, to a limited extent, construe the underlying agreement.’” (Gravillis v. Coldwell Banker Residential Brokerage Co. (2006) 143 Cal.App.4th 761, 770–71.)

“‘“‘The court should attempt to give effect to the parties’ intentions, in light of the usual and ordinary meaning of the contractual language and the circumstances under which the agreement was made.’ . . . Because California has a ‘“strong public policy in favor of arbitration”’ . . ., ‘. . . arbitration agreements should be liberally interpreted, and arbitration should be ordered unless the agreement clearly does not apply to the dispute in question’ . . . . ‘Doubts as to whether an arbitration [provision] applies to a particular dispute are to be resolved in favor of sending the parties to arbitration.’ . . .” [Citations.] [¶] “Arbitration is . . . a matter of contract, and the parties may freely delineate the area of its application. The court’s role . . . must be strictly limited to a determination of whether the party resisting arbitration agreed to arbitrate.” (Id. at p. 771.)

“The Ninth Circuit has confirmed that non-signatories may enforce arbitration agreements. [Citation.] More specifically, “[w]hen the charges against a parent company and its subsidiary are based on the same facts and are inherently inseparable, a court may refer claims against the parent to arbitration even though the parent is not formally a party to the arbitration agreement.”’” (McLeod v. Ford Motor Co., No. EDCV 04-1255VAPSGLX, 2005 WL 3763354, at *4 (C.D. Cal. Apr. 14, 2005).)

Significantly, in the McLeod case, it was the nonsignatory parent company that was compelling arbitration. The signatory plaintiff could not join the nonsignatory parent to the plaintiff’s claims against the subsidiary to avoid the arbitration agreement in the plaintiff’s agreement with the subsidiary.

“‘“[A] party may be estopped from asserting that the lack of his signature on a written contract precludes enforcement of the contract's arbitration clause when he has consistently maintained that other provisions of the same contract should be enforced to benefit him. . . . . [¶] A nonsignatory is estopped from refusing to comply with an arbitration clause ‘when it receives a “direct benefit” from a contract containing an arbitration clause.’ [Citations.] In International Paper, a defendant signatory sought to compel a plaintiff nonsignatory to arbitrate.

The court held the plaintiff, who sought a direct benefit from the contract, could not refuse to comply with the arbitration clause. [Citation.] Equitable estoppel principles are also applicable under these circumstances: a plaintiff has an arbitration agreement with a subsidiary corporation; the plaintiff sues the parent corporation; and the plaintiff's claims against the parent company are based on the same facts and are inherently inseparable. In that circumstance, the Fourth Circuit has held that the parent corporation may enforce the arbitration agreement.” (Boucher v.

All. Title Co. (2005) 127 Cal.App.4th 262, 269.)

As noted, the City Agreement does not contain an arbitration clause. The Chestnut Contract does contain an arbitration clause which states that Petitioner and RWS are to arbitrate any and all existing controversies or claims arising out of the Chestnut Contract. (Petition, Exh. F p. 2.) Nothing states the Chestnut Contract arbitration provision permits parties to force an arbitration of a separate contract.

The Chestnut Contract also provides that while RWS is an individual operating subsidiary of RSI, RSI does not perform waste services or contract with customers and accordingly all obligations to Petitioner rest solely with RWS and not with the parent company. (Petition, Ex. F p. 1.)

The City Agreement on the other hand, dated August 17, 2021, was between City and RWS. (Petition, Ex. A.) The City Agreement does not contain an arbitration clause. The City Agreement does state only City and RWS are the parties to the City Agreement and that the agreement does not confer any rights to any other entities that are not representatives, successors, or permitted assigns of City/RWS. (Petition, Ex. A p. 168.)

As arbitration is a matter of contract (Gravillis, supra, 143 Cal.App.4th at p. 771) and RSI did not sign either of the subject contract, nor did it agree to arbitrate any contract, RSI cannot be compelled to arbitrate claims under the City Agreement. Similarly, RWS only agreed to arbitrate the claims under the Chestnut Contract, it did not agree to arbitrate claims under the City Agreement.

Petitioner also is not a party to the City Agreement and to the extent that Petitioner seeks to compel arbitration of the City Agreement, the Chestnut Contract would appear to supersede the City Agreement. (Petition, Ex. F p. 3.) To the extent Petitioner argues the issues of the City Agreement are arbitrable as they are the same or similar to those at issue in the Chestnut Contract, the Chestnut Contract specifically states the Chestnut Contract applies to any issues related to the services under the Chestnut Contract. Thus, Petitioner appears to only be able to bring issues related to the services Respondents provide under the terms of the Chestnut Contract.

As to the equitable estoppel arguments, “[i]n any case applying equitable estoppel to compel arbitration despite the lack of an agreement to arbitrate, a nonsignatory may compel arbitration only when the claims against the nonsignatory are founded in and inextricably bound up with the obligations imposed by the agreement containing the arbitration clause. In other words, allegations of substantially interdependent and concerted misconduct by signatories and nonsignatories, standing alone, are not enough: the allegations of interdependent misconduct must be founded in or intimately connected with the obligations of the underlying agreement.’” (Goldman v. KPMG, LLP (2009) 173 Cal.App.4th 209, 219.)

Although Petitioner can compel RWS to arbitrate the terms of the Chestnut Contract because there is an arbitration clause in the Chestnut Contract and the issues are related thereto, Petitioner as a non-signatory to the City Agreement cannot compel non-signatory RSI to arbitrate under the City Agreement as is no arbitration clause contained in the City Agreement and neither Petitioner nor RSI are parties to the City Agreement.

The arbitrator may determine what issues are arbitrable under Chestnut Contract, but the terms of the Chestnut Contract do not permit the arbitrator to force non-signatory parties to arbitrate issues from a different contract that does not have an arbitration provision.

To the extent Petitioner claims to be able to enforce the terms of the City Agreement as a third-party beneficiary, the express terms of the City Agreement state the rights under the City Agreement only pertains to City and RWS and representatives, successors and permitted assigns” (Petition, Ex. A p. 168.) There is no evidence Petitioner falls under any of those categories.

In short, Petitioner seeks to turn many of the authorities it cites on their head by seeking to join a nonsignatory as a defendant and sweep that defendant into arbitration when the nonsignatory is not asserting any rights under the agreement containing the arbitration agreement.

Based on the foregoing, the petition is DENIED. Respondents’ counsel is ordered to give notice of this ruling.

5. Mann vs. Nice Sheen International, Inc. 2024-01403670 Please see the above notice regarding oral argument on June 25. 2026

Before the court is an unopposed motion to compel defendant and judgment debtor Nice Sheen International, Inc. (Debtor), to respond to requests for production, set one, and request for monetary sanctions filed by plaintiffs and judgment creditors Jeffrey Mann and Suzette Mann (collectively, Creditors). As more set forth below, the motion is GRANTED.

Creditors served requests for production, set one, on Debtor. (Rader Decl. ¶ 2, Ex. 1.) Debtor failed to serve any responses to the requests for production by the date the motion was filed. (Rader Decl. ¶¶ 3-4, Ex. 2.) The responses are late, and Debtor has waived any objections thereto. (Code Civ. Proc., § 2031.300, subd. (a).) Creditors’ motion is proper to compel Debtor’s initial objection-free responses to the requests for production. (Code Civ. Proc., § 2031.300, subd. (b).) Creditors also request monetary sanctions against Debtor and its attorneys of record, which are permissible. (Code