A California Court of Appeal shot down Applied Underwriters renewed attempt to compel arbitration in a dispute with an insured in its workers’ comp and payroll processing programs. The Second District Court of Appeal held the lower court’s order denying a petition to compel arbitration is not appealable.
Applied also sought to dismiss the case to change venues but was rebuffed. The Court of Appeal notes that Applied failed to appeal that issue in a timely fashion. Applied Underwriters’ has sued multiple California employers in Nebraska.
The Berkshire Hathaway (NYSE: BRK. A) subsidiary is fighting a three-year-old lawsuit filed by Chango Coffee, Inc. that alleges breach of contract, conversion, and fraud. Chango is a former client in Applied’s SolutionOne program that packages the EquityComp workers’ comp program with payroll processing services.
As with other disputes involving Applied’s programs, Chango says it was not provided the side agreement to the program, which contained the arbitration provision, until after it signed up for the program. The trial court held that Chango was only bound by the terms of the original service agreement it signed. The court denied Applied’s motion to compel arbitration, and Applied did not appeal.
Seven months later, however, Applied filed a renewed motion to compel arbitration under Section 1008(b) claiming it had new information. The new information was the deposed testimony of Chango’s corporate secretary Tad Yenawine. The court again rejected the motion noting that the deposed testimony covering Yenawine’s perception of the program documents did not change its analysis finding that the original agreement – not the side agreement that contained the arbitration provision – controlled.
On appeal, the court noted that prior case law holds that motions under section 1008(b) are not appealable as allowing so could give parties unwarranted extensions of time to appeal.
The Appellate Court also cited a Senate Judiciary analysis of the section noting that its purpose is “to conserve judicial resources by constraining litigants who would endlessly bring the same motions over and over, or move for reconsideration of every adverse order and then appeal the denial of the motion to reconsider.”
“That observation is consistent with the rationale the Tate court relied upon in concluding an order denying a renewed motion under section 1008, subdivision (b) is not appealable.”