In an interesting development, the California Supreme Court dismissed review in Wisdom v. AccentCare, Inc. because the parties had reached a settlement. The Wisdom case in the Court of Appeal had declared that an arbitration agreement signed as part of an employment application was procedurally unconscionable.
The Court of Appeal opined that, “We agree with the trial court that there is abundant evidence that the arbitration agreement was procedurally unconscionable. The contract, being one of adhesion, was oppressive. It was given to plaintiffs upon their application for employment. This situation leads to inherent unconscionability because of the unequal bargaining power of the parties and the nature of the relationship. There was no evidence that the plaintiffs in this case were highly sought-after skilled employees who individually negotiated the details of their employment relationship with AccentCare.” Wisdom v. AccentCare, Inc., 202 Cal. App. 4th 591 (2012) review granted and opinion superseded, 273 P.3d 513 (Cal. 2012) and review dismissed, cause remanded, S200128, 2013 WL 3821633 (Cal. July 24, 2013)
The Court of Appeal also concluded that where the language the agreement was “The same must be said of the arbitration agreement at issue here. The phrases, ‘I hereby agree[,]' ‘I further agree,' and ‘I agree' indicate only one party is agreeing to submit all disputes to arbitration, and that party is the one whose signature appears at the bottom of the form.” As such since the agreement was not bilateral in nature the agreement was substantively unconscionable as well. The Court therefore deemed the arbitration agreement unenforceable.
As the matter is now dismissed an interesting question now arises whether or not the Court of Appeal case may be relied on as authority. The answer is no. California Rule of Court 8.528 indicates that in such a circumstance unless the California Supreme Court states otherwise the initial grant of review depublishes the case and it continues to be depublished after dismissal of review. There is only one other arbitration case that the California Supreme Court has on its docket that addresses unconscionability. In Sanchez v. Valencia Holding Co. that issue relates to AT&T v. Concepcion so the core Armendariz issue will not be tested, just its viability post-Concepcion.