A party that wishes to pursue arbitration must take “ ‘active and decided steps to secure that right’ . . ."
Why? Because an arbitration agreement is not self-executing.
In Fleming Distribution Company v. Alfons Younan, A157038 (3/1 5/15/20) (Petrou, Fujisaki, Jackson), Defendant/Appellant Fleming appealed from a trial court order denying its petition to compel arbitration, stay proceedings, and vacate a Labor Commissioner award. Fleming's employee Younan had successfully pursued a labor claim before the Labor Commissioner, and all the while, Fleming had asserted that it wanted to arbitrate. However, Fleming did not affirmatively move to stay and to compel arbitration until after it lost the Labor Commissioner proceeding. Only after seeking a trial de novo in the Superior Court did Fleming move to compel arbitration, vacate proceedings, and vacate a Labor Commissioner Award.
The Court of Appeal affirmed the trial court's order denying Fleming's request, on the basis that Fleming had waived its right to arbitrate, based on substantial delay and pursuing litigation before the Labor Commissioner, without taking affirmative steps to compel arbitration and stay proceedings.
Delaying the motion to compel arbitration denied Younan the benefits of early arbitration, while burdening Younan with Labor Commission proceedings that were wiped clean by a trial de novo.
California courts readily find prejudice when there is delay moving to stay and compel arbitration while the defendant engages in substantial litigation practice. Perhaps this demonstrates the wisdom behind such cliches as "you don't get two bites of the apple", "you don't get to have your cake and eat it too", and "you snooze, you lose."
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