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Mar v. Perkins (CA2/7 B327665 5/22/24) Arbitration | Mutual Assent

By May 22, 2024June 24th, 2024Uncategorized

SierraConstellation Partners, LLC (Sierra) and Lawrence Perkins (collectively, Sierra defendants) appeal from an order denying their motion to compel arbitration of Winston Mar’s action for buyout of his partnership interest.  The trial court found the Sierra defendants failed to meet their burden to establish the existence of an arbitration agreement because Mar clearly stated that he refused to sign the arbitration agreement and Sierra could terminate his employment if it objected.  On appeal, the Sierra defendants contend the trial court erred because Sierra notified Mar that his continued employment constituted assent to the arbitration agreement, and Mar continued his employment for 19 months before he left Sierra and filed this lawsuit. 

The Sierra defendants are correct that where an employer modifies its employment policy to require employees to arbitrate their disputes and clearly communicates to employees that continued employment will constitute assent to an arbitration agreement, the employees will generally be bound by the agreement if they continue to work for the company.  However, where, as here, the employee promptly rejects the arbitration agreement and makes clear he or she refuses to be bound by the agreement, there is no mutual assent to arbitrate.  We affirm.