CALIFORNIA SUPREME COURT

Employment

Kaanaana v. Barrett Business Services, Inc. (2021) _ Cal.5th _ , 2021 WL 1166963: The California Supreme Court affirmed the Court of Appeal’s decision, in a wage and hour class action, that the work performed by plaintiff contract workers working as belt sorters for a county sanitation district falls within the definition of public works in the Labor Code and they are entitled to prevailing wages. The issue was whether the belt sorter work qualified as public works as defined in Labor Code section 1720(a)(2). The California Supreme Court ruled that the most reasonable interpretation of “public works” in Labor Code section 1720(a)(2) was that it was not limited by the definition of “public works” related to construction work set out in section 1720(a)(1). The belt sorters’ labor qualified as “public works” under section 1720(a)(2). (March 29, 2021.) 

Landlord - Tenant

Stancil v. Super. Ct. (2021) _ Cal.5th _ , 2021 WL 1727612: The California Supreme Court affirmed the Court of Appeal ruling denying defendant writ relief from the trial court’s order denying defendant’s motion to quash service of summons under Code of Civil Procedure section 418.10 in an unlawful detainer case. The California Supreme Court held that no defendant may use a motion to quash service of summons as a means of disputing the merits of the unlawful detainer complaint’s allegations or to argue the plaintiff failed to comply with the pleading requirements specific to unlawful detainer actions set out in Code of Civil Procedure section 1166. (May 3, 2021.)

Penal Code

Smith v. LoanMe, Inc. (2021) _ Cal.5th _ , 2021 WL 1217873: The California Supreme Court reversed the Court of Appeal’s decision affirming the trial court’s judgment for defendant in an action alleging improper recording of a phone call in violation of Penal Code section 632.7. The California Supreme Court ruled that section 632.7 applies to both the parties to a communication, prohibiting them from recording a covered communication without the consent of all participants, and to recording by persons other than parties (“nonparties” to the communication), such as an individual who covertly intercepts a phone call and eavesdrops upon it. (April 1, 2021.)

CALIFORNIA COURTS OF APPEAL 

Arbitration

Banister v. Marinidence Opco, LLC (2021) _ Cal.App.5th _ , 2021 WL 2036529: The Court of Appeal affirmed the trial court’s order denying defendant’s petition to compel arbitration in plaintiff’s lawsuit alleging discrimination, retaliation, defamation, and other claims as a result of her termination as an employee. Defendant attached to the petition a copy of the arbitration agreement purporting to bear plaintiff’s signature. However, because plaintiff challenged the validity of the signature, defendant was required to establish by a preponderance of the evidence that the signature was authentic. The Court of Appeal ruled that substantial evidence supported the trial court’s conclusion that defendant failed to prove that plaintiff electronically signed the arbitration agreement. (C.A. 1st, filed May 30, 2021, published May 21, 2021.) 

Kuntz v. Kaiser Foundation Hospital (2021) _ Cal.App.5th _ , 2021 WL 1345313: The Court of Appeal affirmed the trial court’s order granting defendants’ motion to compel arbitration of plaintiffs’ elder abuse cause of action. The Court of Appeal ruled that, to the extent that the issue of decedent’s status as an enrollee in the Kaiser Foundation Health Plan, Inc. through the California Public Employees’ Retirement System (CalPERS) turned on factual issues, the evidence submitted by defendants constituted substantial evidence supporting the trial court’s determination. The Court of Appeal also ruled that, under the plain meaning of Government Code section 22869, information disseminated by the CalPERS Board pursuant to Government Code section 22863 was deemed to satisfy the arbitration disclosure requirements of Health and Safety Code section 1363.1. (C.A. 3rd, April 12, 2021.)

Civil Code

Smart Corner Owners Assn. v. CJUF Smart Corner LLC (2021) _ Cal.App.5th _ , 2021 WL 2010152: The Court of Appeal reversed the trial court’s order granting defendant’s motion for summary judgment in a construction defect case on the basis that plaintiff association failed to obtain the consent of more than 50 percent of its condominium owner members before filing the action as required by the governing declaration of covenants, conditions, and restrictions. After plaintiff filed its notice of appeal, the Legislature enacted Civil Code section 5986, effective January 1, 2020, rendering prelitigation member vote requirements null and void. The newly enacted statute abrogated the defense that noncompliance with such conditions defeats a construction defect claim. The Legislature also expressly provided the statute would apply retroactively “to claims initiated before the effective date of this section, except if those claims have been resolved through an executed settlement, a final arbitration decision, or a final judicial decision on the merits.” (Section 5986(d), italics added.) The Court of Appeal concluded that a “final judicial decision on the merits” within the meaning of section 5986 (d) does not encompass a judgment that was not final on appeal as of the statute’s effective date. Section 5986 therefore applied retroactively to plaintiff’s claims requiring reversal of the judgment entered against plaintiff. The Court of Appeal also held, as an independent ground for reversal, that the prelitigation vote requirement at issue in this case violated fundamental state public policy by making it more difficult for the plaintiff to hold defendant developers accountable for construction defects. The Court of Appeal also found the requirement to be unreasonable, unconscionable and violative of the fundamental state policy against unreasonable servitudes insofar as it required strict compliance as a precondition to suit and prohibited members from providing their consent later through a vote ratifying a board decision to file suit. The trial court was directed to enter a new order denying defendant’s motion for summary judgment. (C.A. 4th, May 20, 2021.)

Civil Procedure

Cal. Medical Assn. v. Aetna Health of Cal. Inc. (2021) _ Cal.App.5th _ , 2021 WL 1660614: The Court of Appeal affirmed the trial court’s order granting defendant’s motion for summary judgment in plaintiff’s complaint alleging several causes of action, including a claim seeking an injunction for alleged violations of the Unfair Competition Law (UCL; Business & Professions Code, § 17200), filed by plaintiff after defendant implemented a policy to restrict or eliminate patient referrals by its in-network physicians to out-of-network physicians. The Court of Appeal held that an association must sustain direct economic injury to itself and not just its members to bring a UCL claim, and evidence that an association diverted resources to investigate its members’ claims of injury and advocate for their interests was not enough to establish standing under the UCL. (C.A. 2nd, April 28, 2021.) 

Employment

General Atomics v. Super. Ct. (2021) _ Cal.App.5th _ , 2021 WL 2176921: The Court of Appeal granted a writ petition by petitioner (defendant in the underlying action) ordering the trial court to vacate its order denying defendant’s motion for summary adjudication and enter an order granting the motion. Plaintiff filed a putative class action and a representative action under the Private Attorneys General Act (PAGA; Labor Code section 2698 et seq.). Plaintiff alleged that defendant violated Labor Code section 226(a) by providing wage statements that did not identify the correct rate of pay for overtime wages. Plaintiff maintained that the correct overtime rate was 1.5 times (1.5x) the regular rate of pay, and the wage statements provided by defendant showed only 0.5 times (0.5x) the regular rate. Plaintiff did not contend that defendant had incorrectly calculated overtime pay (or failed to pay the correct amounts), only that it did not provide compliant wage statements showing the correct hourly rate of pay. The Court of Appeal concluded that the trial court erred in determining that defendant’s wage statements violated section 226. The wage statements showed the applicable hourly rates in effect and the corresponding number of hours worked at each rate. In the wage statements provided by defendant, the applicable hourly rates are (1) the standard hourly rate determined by contract or other agreement between the employee and the employer and (2) the overtime premium hourly rate, determined by statute, that must be added to the employee’s standard wages to compensate the employee for working overtime. These rates were plainly shown, along with the hours worked at each rate. While other formats might also be acceptable, given the complexities of determining overtime compensation in various contexts, the format adopted by defendant adequately conveyed the information required by statute. (C.A. 4th, May 28, 2021.)

Torts

Issakhani v. Shadow Glen Homeowners Assn., Inc. (2021) _ Cal.App.5th _ , 2021 WL 1711584: In an action for personal injury action where a pedestrian, who decided to jaywalk across a five-lane highway at night and was struck by a car, sued the owner of the condominium complex she was trying to visit for negligence and premises liability for having too few onsite parking spaces for guests, the Court of Appeal affirmed the trial court’s order granting defendant’s motion for summary judgment. The Court of Appeal held that a landowner does not owe a duty of care to invitees to provide adequate onsite parking, either (1) under common law principles, or (2) by virtue of a 1978 city ordinance that rezoned the complex’s specific parcel for multifamily dwellings and conditioned that rezoning on providing a specific number of guest parking spaces. (C.A. 2nd, April 30, 2021.)