Hyundai Amco America, Inc. v. S3H, Inc.

Filed 12/17/14

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION THREE

HYUNDAI AMCO AMERICA, INC.,

Plaintiff and Respondent, G049204

v. (Super. Ct. No. 30-2013-00660039)

S3H, INC., OPINION

Defendant and Appellant.

Appeal from an order of the Superior Court of Orange County, James Di Cesare, Judge. Reversed. Petition for a writ of supersedeas. Discharged. Order staying proceedings. Vacated. Friedman Stroffe & Gerard, James D. Stroffe, Eoin L. Kreditor and Andrew R. Nelson for Defendant and Appellant. Gordon & Rees, William M. Rathbone, David J. Aveni and Michael P. Campbell for Plaintiff and Respondent.

INTRODUCTION Hyundai Amco America, Inc. (Hyundai Amco), and S3H, Inc. (S3H), entered into a subcontractor services agreement. Their agreement provided that disputes would be subject to arbitration. Hyundai Amco sued S3H for breaching the agreement, as well as for other related causes of action. S3H filed a motion to compel arbitration; the trial court denied the motion on the ground that S3H had failed to allege (1) it demanded arbitration and (2) Hyundai Amco refused. We reverse. Under Code of Civil Procedure section 1281.2, a party requesting a court order for arbitration must prove the existence of a written agreement to arbitrate, and that the other party refuses to arbitrate their controversy. (All further statutory references are to the Code of Civil Procedure.) S3H unquestionably established the existence of the parties’ written agreement containing an arbitration provision; Hyundai Amco does not dispute this fact. We hold that S3H was not required to make a formal demand for arbitration because Hyundai Amco’s filing of a complaint invoked the protections and procedures of the court system, and thus was an effective refusal of arbitration. S3H met its burden under section 1281.2. We publish our opinion to clarify that the opinion of the Court of Appeal, Third Appellate District, in Mansouri v. Superior Court (2010) 181 Cal.App.4th 633 (Mansouri) does not apply under the facts and circumstances of this case.