California Supreme Court Kicks 'Unconscionable' Arbitration Case Back to Court of Appeal
Determining whether an employment arbitration's provisions are fatally flawed requires more than just tallying the number of unconscionable provisions, the unanimous court held.
July 15, 2024 at 06:53 PM
4 minute read
Courts have no "bright line rule" that signals when they should sever unconscionable terms from an employment arbitration agreement and let the remaining contract survive or simply toss the pact altogether, the California Supreme Court unanimously held Monday.
Instead, a judge must use a "qualitative" process that relies on more than just tallying the number of unenforceable provisions to reach an answer, Justice Carol Corrigan wrote for thecourt. That process of deciding if a contract's "central purpose" is "tainted with illegality," Corrigan continued, is spelled out in the court's 2000 ruling in Armendariz v. Foundation Health Psychcare Services, Inc.
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