Motion to stay
As for the issue of whether arbitration allowed for adequate discovery, the Armendariz plaintiffs argued that the denial of adequate discovery in arbitration proceedings leads to the de facto frustration of the employee’s statutory rights. The arbitration clause in that case did provide for adequate discovery by incorporating by reference all the rules set forth in the California Arbitration Act. Adequate provisions for discovery are set forth in the CAA at Code of Civil Procedure section 1283.05, subdivision (a), which determines the manner of taking depositions in arbitration proceedings. (Armendariz, supra, at pp. 104-105.)
Here, Plaintiff does not suggest that it is the arbitration agreement which limits her right to discovery. Rather, she argues that, based upon her reading of a “model Scheduling Order” from another case, that the AAA rules are insufficient. Plaintiff cites no case that has found the AAA rules to be insufficient to allow for necessary discovery.
Plaintiff argues that because CCP section 1283.05(e) requires leave from the arbitrator to take depositions, discovery will somehow be inadequate. She argues that despite the arbitration agreement stating the Federal Arbitration Act (“FAA”) is applicable to the case, section 1283.05 remains applicable because the FAA does not have this same provision. Plaintiff cites Hohenshelt v. Superior Court (2025) 18 Cal.5th 310, which addresses the issue of preemption for CCP section 1281.98. The FAA does not preempt California Code of Civil Procedure section 1281.98, a provision of the CAA that governs the payment of fees in employment and consumer arbitrations.
This is because the operation of section 1281.98 does not deviate from “generally applicable state law contract principles” and furthers rather than frustrates the objectives of the FAA (Id., at p. 323., 326.) The Supreme Court of California presumed the CAA was applicable and that CCP section 1281.98 was not preempted. (Ibid.)
Plaintiff concludes that the FAA does not address or include any procedures for prearbitration discovery. As the authority cited by Plaintiff provides that California governs procedural arbitration rules, the logical implication is that CCP section 1283.05 governs depositions in arbitration proceedings. CCP section 1283.05 allows depositions in arbitration proceedings.
IV. Request for Discovery
Plaintiff requests that, as a condition of granting this motion, this court order that Plaintiff has the right to certain discovery. Such order would be inconsistent with the CCP as it is the arbitrator who manages discovery in the case.
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V.
Conclusion
Defendant has established the existence of a valid arbitration agreement. Plaintiff has not shown that the agreement is both procedurally and substantively unconscionable. Accordingly, Defendant’s motion to compel arbitration is GRANTED. This action is stayed pending resolution of arbitration. Defendant’s counsel is directed to submit a written order to the court consistent with this ruling and in compliance with Cal. Rules of Court, Rule 3.1312.
6. SCV-271497, Villara Corporation v. Morgan Properties Inc.
(TENTATIVE ISSUED BY HON. DANA B. SIMONDS)
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Pursuant to Civil Code of Procedure sections 128 and 1048, Defendant Morgan Properties (“Defendant”) moves for an order staying all proceedings in this action, including the previously ordered contractual arbitration, until resolution of the related case, Jason Dibari, et al. v. Daniel Morgan et al., 24CV04060.
1. Objections in Reply
In reply, Defendant objects to statements made in the opposition filed by Plaintiff Villara Corporation (“Plaintiff”) and in the declaration of Stacy Moak. The objection to the first two paragraphs of Plaintiff’s opposition is overruled. This is merely Plaintiff’s argument. It is not evidence. Defendant’s objections to portions of the Moak declaration are also overruled. Paragraph 7 refers to an allegation in the complaint. Paragraphs 19 through 22, despite appearing in counsel’s declaration, are argument. This court has not considered the statements referenced in these paragraphs as evidence.
2. Instant Action
On August 25, 2022, Plaintiff filed this action against Defendant to recover $36,115.60 in alleged unpaid contract amounts for plumbing work performed at the Marlow Commons development (“Marlow Commons”). On November 23, 2022, Plaintiff filed a First Amended Complaint. Plaintiff alleges it entered into a Master Contract Agreement with Defendant on February 15, 2021, and a Work Agreement Addendum on February 19, 2021, to furnish labor, materials, services, and equipment for plumbing work at Marlow Commons. Plaintiff alleges the total contract price for the plumbing work on all phases was $375,440.00, that Defendant paid $339,324.40, but failed to pay the remaining $36,115.60. On April 19, 2024, this Court granted Defendant’s motion to compel contractual arbitration. Since that ruling, both parties state that there has been no litigation activity and no arbitration has commenced.
3. 24CV04060, Dibari, et al. v. Morgan, et al.
On July 11, 2024, a group of homeowners at Marlow Commons filed a construction defect lawsuit, Case No. 24CV04060, assigned to Judge Pardo. The operative pleading is the Fourth Amended Complaint filed on February 17, 2026, stipulated to being the Fifth Amended Complaint. The Dibari plaintiffs are twenty homeowners who purchased homes in Marlow Commons between April 2022 and early 2023. They allege that Enclave Santa Rosa, LP (“Enclave”) was the owner and developer, and Defendant was the general contractor and general partner of Enclave.
As to Defendant, the Dibari plaintiffs allege it breached purchase agreements by defectively installing a cheap knock-off single-coat stucco system, the "Cheap One-Coat Stucco System," instead of the specified "Ultrakote WM EIFS" stucco system required by the plans and specifications. The Dibari plaintiffs allege the defective installation included: (a) failure to install drainage plans, (b) use of staples and/or nails to secure the wire lathe to the insulation board, (c) staples which were stapled through window fins resulting in damage to the windows and creating holes for water intrusion, and (d) inconsistent base and finish coat thickness.
The Dibari plaintiffs allege that, as a result of the defects, the Cheap One-Coat Stucco System is pulling away from window frames and has numerous cracks in excess of 1/8 inch. These defects, coupled with alleged inadequate exterior siding, roofing, and window flashing have resulted in water intrusion and resulting damage to property within the homes, including mold and dry rot. The Dibari complaint alleges five causes of action: (1) Breach of Written Contract; (2) Fraud (Concealment); (3) Violation of Building Standards (California Civil Code section 896); (4) Breach of Fiduciary Duty; and (5) Constructive Fraud.
On September 12, 2025, Defendant then filed a cross-complaint in the Dibari action against multiple subcontractors, including Plaintiff, asserting causes of action for express contractual indemnity, implied indemnity, breach of express warranty, breach of implied warranty, breach of written contract, negligence, contribution, strict liability, and declaratory relief.
4. CCP sections 128 and 1048
CCP section 128 gives the court various powers but does not specifically mention staying an action pending completion of a related case or consolidation of cases. The relevant portion of CCP section 1048 is subsection (a), which provides: “When actions involving a common question of law or fact are pending before the court, it may order a joint hearing or trial of any or all the matters in issue in the actions; it may order all the actions consolidated and it may make such orders concerning proceedings therein as may tend to avoid unnecessary costs or delay.”
Here, there are no common questions of law or fact overlapping in this case and the Dibari action. This action involves a simple breach of contract/common counts claim whereby Plaintiff seeks to collect the remaining amounts it alleges is due on its contract with Defendant. The Dibari action is a complex construction defect case brought by numerous homeowners primarily alleging a failed stucco system. These cases will draw upon different facts, legal theories, and remedies. In addition, this case has already been ordered to arbitration. The arbitration order is incompatible with an order consolidating this matter into the Dibari action.
In reply, Defendant argues that Plaintiff was not only responsible for plumbing but was also responsible for HVAC and sheet metal work. It argues that one of the deficiencies that has arisen is that the sheet metal caps were installed improperly, causing water intrusion. Regardless, it is far simpler to separately adjudicate the amount Defendant may owe Plaintiff on the underlying contract first rather than delay resolution of that issue in the event that Plaintiff may be responsible for some of the construction defects in the Dibari case. If Plaintiff is responsible for any construction defects, that can be determined and apportioned in the Dibari case.
5.
Conclusion
Based upon the foregoing, the motion is DENIED. Plaintiff’s counsel is directed to submit a written order to the court consistent with this ruling and in compliance with Cal. Rules of Court, Rule 3.1312.
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