A trial court lacked authority to rule on the enforceability of an arbitration agreement when the parties had contracted to delegate questions about the agreement’s enforceability to the arbitrator, the California Court of Appeal has ruled, reversing the denial of arbitration in a wrongful discharge action. Tiri v. Lucky Chances, Inc., No. A136675 (Cal. Ct. App. May 15, 2014).
Although the agreement’s delegation provision was in an adhesive contract, drafted by the employer and presented to the employee on a take-it-or-leave-it basis, and despite the fact the employee stated she was worried she would lose her job if she refused to sign it, the Court found the agreement was enforceable because it was not overly harsh or one-sided, and therefore, not substantively unconscionable.
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