Answer and Reply Filed In Judicial Reference Case

Here is the Answer to the Petition for Review and here is the reply to the answer filed in Treo@Kettner Homeowners Ass'n v. Superior Court, the judicial reference case. And here is a link to my earlier post about the petition for review.

The strength of the petition turns on whether the decision below conflicts with Villa Milano v. Il Davorge, 84 Cal. App. 4th 819 (2004). The decision below refused to apply a clause in CC&Rs authorizing judicial reference in a construction defect case between a developer and a homeowners association. Villa Milano held that an arbitration clause in CC&Rs created a written agreement to arbitrate, but held the provision procedurally and substantive unconscionable as applied to construction defect claims against the developer that devised the CC&Rs in the first instance.

The petitioner, of course, relies on the portion of Villa Milano holding that the arbitration clause in the CC&Rs constituted a written agreement to arbitrate. The respondent relies on the Villa Milano court's ultimate refusal to enforce the arbitration clause.

Although non-signatories are bound by arbitration clauses in a variety of contexts--for example, an employee signing a health insurance contract can agree to arbitrate medical malpractice disputes on hehalf of non-signatory family members--the situation here is different. Here, the CC&Rs are not the result of any sort of adversarial bargaining--instead, they are promulgated by a developer and signed by a homeowners association that the developer has created and before the association has any members. So I think the result reached by the Court of Appeal is right--though the Supreme Court may be persuaded by the importance of the issue or the conflict claim to grant review.