Carmona v. Lincoln Millennium Car Wash: Court Holds Arbitration Agreement Unconscionable and Unenforceable

In Carmona v. Lincoln Millennium Car Wash, Inc. (5/9/14) --- Cal.App.4th ---, the plaintiffs filed a putative wage and hour class action against their employers. The trial court denied the employers' motion to compel arbitration under a pre-dispute arbitration agreement, and the Court of Appeal affirmed, holding as follows: 

The arbitration agreement was procedurally unconscionable: (1) it was a contract of adhesion that was presented on a take-it-or-leave-it basis; and (2) although the plaintiffs primarily spoke Spanish, the employers translated only part of the agreement into Spanish, leaving important sections in English only. 

The agreement was substantively unconscionable: (1) it lacked mutuality in that it required the employees to arbitrate, but allowed the employers to choose whether to arbitrate or go to court; and (2) the employers did not "justify the lack of mutuality with reference to business realities." 

The trial court did not abuse its discretion in determining that the agreement was "permeated by unconscionability" and refusing to sever the unconscionable provisions. 

The opinion is available here.