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Law, supra, Contracts, § 451, p. Even worse and second only to Valenti is E-Harmony. We must examine the rules regarding illegal contracts before deciding if this arbitration provision was severable.
The Valenti Experience is designed for those with solo, successful lives who are now ready to invest in their personal success. Valenti Matchmaking and Irene are feeling discouraged and are almost ready to give up on finding that person with whom to share their life and many adventures. The feedback you receive about yourself is 2 to 3 elements long and nothing concrete. She pulls on your heart strings and knows exactly how to pick your bank account. However, if a contract once existed, but was fraudulently induced, arbitration in some cases can be ordered, such as where disappointed expectations are involved, in that performance did not match valenti matchmaking reviews civil result. They are the most well established. All these distinctions and terminology are important here, because we are tasked with determining whether this form of illegality provides a specific basis for revocation of the arbitration provision. We next seek to determine whether a contract that anon was created and existed for some time, but was entered into under fraudulent circumstances, can be deemed void on statutory grounds for purposes of the requested enforcement of any arbitration clause contained therein. Valenti and her team of love ambassadors wore shades of red and greeted guests at the si, in the grand tradition of Bing Crosby. Personalized Services, not so. Thank you for posting this.
The ruling on arbitrability does not further determine the merits of all issues about the agreements' legality under the dating service statutes. Anyone know how to get their money? Stay away from Chemistry.
Complaint Registration Form - About Valenti International is located at the address Po Box 2534 in Rancho Santa Fe, California 92067. I have the name of her lawyer.
Court of Appeal, Fourth District, Division 1, California. Clark, San Diego, for Defendants and Appellants. Gilliland, San Diego, for Plaintiffs and Respondents. Plaintiffs and respondents Elaine Duffens, Sandra Marnell, and Sandy Shaulis collectively respondents brought an action against Irene Valenti, Valenti International Limited, LLC and Valenti International Foundation, Inc. Section 1694 et seq. Valenti brought a motion to compel arbitration, arguing that the arbitration clause within the matchmaking consulting agreement was severable and enforceable, regardless of any potential defenses to the underlying contract liability. The superior court denied the motion, concluding the arbitration clause was unenforceable because it was contained within an agreement that lacked essential language required by the statutory scheme, and the agreement was entered into under misleading circumstances, also a violation of statute. On appeal, Valenti argues the superior court erred when it determined the agreements were illegal under California law, and that in any case, the arbitration clauses within them should have remained enforceable under state or federal law. Resolving these arguments requires us to analyze, under the standards of Rosenthal v. Great Western Financial Securities Corp. We address respondents' defenses against the enforcement of illegal contracts, and further, the public policy preferences for enforcing arbitration agreements where appropriate, such as cases in which fraudulent inducement of an agreement is alleged. Because the agreements sued upon violated express requirements of the dating service statutes that clearly apply here, they are void and unenforceable, and their arbitration provisions are likewise not enforceable. We affirm the superior court's order. Each agreement contained a clause, which respondents individually initialed, that required the parties to submit disputes to arbitration. The arbitration clauses were followed by provisions stating that California provided the governing law and the forum for resolution of any disputes arising under or relating to the agreement. Some of the agreements added that this forum would be the Superior Court in San Diego. The agreements further provide in two places that the retainer fees paid would be completely nonrefundable and were distributed directly toward time spent by staff psychologists in the evaluation process and personal consulting and coaching, among other things. On October 13, 2006, respondents filed a complaint for damages claiming Valenti made fraudulent misrepresentations about the characteristics of the other clients to whom Valenti could introduce them. Respondents alleged Valenti claimed to have a network of employees who recruited and screened high level, wealthy, single potential romantic partners throughout the United States and internationally, and Valenti promised it had such wealthy, successful persons as active clients. Respondents alleged Valenti never had any suitable matches to introduce to them and had therefore obtained their assent to the agreements through these misrepresentations. Respondents argued the agreements violated the dating service statutes because the services to be provided fell within the scope of the statutory scheme, but did not comply with statutory requirements. Respondents requested damages for lost retainer money and for emotional distress, as well as treble damages under section 1694. On December 5, 2006, Valenti filed a motion to compel arbitration. On January 9, 2007, respondents filed opposition to the motion, arguing the agreements, and arbitration clauses contained therein, were void and unenforceable because they 1 were permeated with fraud, 2 violated the dating service statutes, and 3 were unconscionable. On January 19, 2007, the superior court denied Valenti's motion to compel arbitration. The ruling stated the agreements violated the dating service statutes, by failing to contain provisions complying with section 1694. That section requires such contracts to have provisions that address the purchaser's or successor's rights to relief from contractual obligations in the event of death or disability of the purchaser, and that allow for refunds and relief from contractual obligations in the event that the buyer relocates his or her primary residence more than 50 miles from the dating service office. Valenti appeals the order. DISCUSSION IINTRODUCTION AND STANDARDS OF REVIEW These actions are based upon respondents' individual agreements under which they were entitled to a three-year period of Valenti's matchmaking services. That statutory scheme contains various provisions that are raised as defenses to the enforceability of these agreements. In reviewing the superior court's order denying the petition to compel arbitration, we apply basic rules for interpreting contracts, to analyze both the agreement and the arbitration clause within it. Palm Springs Motors, Inc. Foundation Health Psychcare Services, Inc. The trial court is therefore called upon to determine whether there is a duty to arbitrate the matter; necessarily, the court must examine and construe the agreement, at least to a limited extent. Courts may be called upon to determine the legality of contracts either before or after arbitration has taken place. Regarding the first situation, in 1 Witkin, Summary of California Law 10th ed. Law, supra, § 450, pp. In our case, the request for a determination of illegality of the contract is made as a defense to arbitrability, similarly based on statutory rights. In ruling upon a petition to compel arbitration, the superior court is allowed to determine arbitrability issues, such the existence and validity of the arbitration agreement, by utilizing summary motion procedures. Rosenthal, supra, 14 Cal. These procedures are consistent with the use of private arbitration as a means of resolving disputes quickly and inexpensively. We first set forth Valenti's arguments on appeal, in which she seeks to have the arbitration clauses enforced as severable from the agreements themselves. We then outline the types of challenges respondents have pleaded in their complaints, as well as their asserted defenses to the enforcement of the arbitration clause. Those defenses allege that the agreements failed to include terms and material required by California statutes, were entered into under misleading circumstances, and were therefore void and unenforceable. We evaluate the record to determine if the order was correct as a matter of law. Rosenthal, supra, 14 Cal. II ISSUES PRESENTED On appeal, Valenti fails to address the validity of the agreements with respect to the dating service statutes, despite the fact that this issue was pleaded in respondents' complaint and opposition in the trial court, was briefed by respondents in this court, and was the express basis of the trial court's ruling. Instead, Valenti generally relies on the strong California preference for enforcing arbitration agreements, and contends arbitrators have sole authority to decide the legality of the contracts and arbitration clauses. For the first time on appeal, she also seeks a determination that the Federal Arbitration Act FAA , 9 United States Code section 1 et seq. We cannot reach the issues of whether the state and federal public policies in favor of arbitration must be applied here without first analyzing the validity of the agreements and the applicability to them of the dating service statutory scheme. This requires an understanding of the nature of the causes of action pled in the complaint. It also requires statutory interpretation and application to these undisputed facts. A party may not shield itself from this regulatory scheme by simply stating it is not a dating service when its activities are of the same nature and it functions as one. We next outline other provisions of the agreements that are integral to the arbitrability and statutory interpretation questions presented. Each party had the ability to choose one arbitrator and the third arbitrator would be chosen by the first two. Psychologist, specializing in marriage and family counseling. Thus, a contract may be implied to perform the statutory duty, or the action may be classified as in tort where the plaintiff seeks damages for violation of the statutory duty. Each of the alternative theories pled seeks compensatory damages for recovery of the fees paid for services not rendered, emotional distress damages, treble damages as provided by statute, and other declaratory relief. Each theory is grounded in the basic allegations that the plaintiff suffered financial loss and related emotional injury, due to the misrepresentations made about the nature of the services to be rendered and the concealment that there was no actual ability to deliver them. We next examine the nature of those representations, since California law recognizes there are different varieties of fraud affecting contractual relationships, but the parties' arguments do not clearly distinguish among them. Rosenthal was a complex securities fraud case in which the parties did not dispute that the FAA applied, because those transactions involved interstate commerce. As such, the court stated the questions concerning arbitrability of the parties' dispute were governed by the FAA. The court in Rosenthal further noted that a petition to compel arbitration may be denied under Code of Civil Procedure section 1281. Rosenthal, supra, at pp. The authors of Knight et al. Contracts are extinguished by rescission. Although in Rosenthal, the Supreme Court was discussing what proper procedures should be followed in California courts in cases where the FAA governs arbitrability of the controversy, the court was interpreting California law on the general subject of the distinctions between fraud in the execution of an agreement, and fraud in the inducement of an agreement, in the context of discussing the sufficiency of the evidence. Those statements and definitions of the substantive law of fraud are equally applicable in this California case, in which the arbitration clause does not mention the FAA. Therefore, the permeation doctrine is merely another name for fraud in the execution of a contract and is unnecessary. Rather, as explained in Rosenthal, the correct analysis in determining an arbitrability question that is based on a claim of an invalid agreement will use the following definitions. First, an arbitration clause will not be enforced if it is found within an agreement that may properly be judicially determined to be void for fraud in the execution or fraud in the inception, such that there was never any existing agreement in the first place, and this determination includes any arbitration clause within the basic agreement; fraud in the execution voids the entire agreement. Rosenthal, supra, 14 Cal. Nevertheless, an arbitration clause may be subject to enforcement even where a challenge exists to the validity of the overall agreement, if the challenge is based upon fraud in the inducement, and if the FAA applies. The reason for this is that under Prima Paint v. Rosenthal, supra, 14 Cal. There, the Supreme Court states that section 1281. Rosenthal, supra, at p. In such a case it may be disregarded without the necessity of rescission. This type of analysis requires courts to deem that claims of fraud in the execution of the entire agreement are not arbitrable under either state or federal law. Likewise, claims that a party has employed fraud in inducing consent specifically to the arbitration agreement e. Rosenthal, supra, 14 Cal. Here, it is undisputed that respondents knew the nature of their acts when they entered into the contracts, and they are not claiming fraud in the execution or inception. In Moncharsh, supra, 3 Cal. In making that distinction, the Supreme Court in Moncharsh took care to distinguish the authority of Ericksen, supra, 35 Cal. According to the Supreme Court in Moncharsh, such a case should be distinguished from those in which a party claimed illegality of the underlying agreement. Ericksen, supra, 35 Cal. Apparently, this means that where the underlying agreement is illegal under other accepted standards, its arbitration clause can be avoided. See Moncharsh, supra, 3 Cal. We now apply these rules to our case. Both in their fraud and statutory duty causes of action, respondents essentially plead that fraud in the inducement occurred, because they knew what they were signing, i. However, they claim their consent was induced by fraud, so that even though there was mutual assent and a contract, the contract, by reason of the fraud, is voidable. This could mean that fraud claims such as these, based on fraudulent inducement of an underlying contractual arrangement, normally might be arbitrable, as in a case of disappointed expectations in the performance of the contract. However, respondents' references to breaches of statutory duty invoke other governing rules of contract interpretation that must be considered here in determining the arbitrability question. We must examine the rules regarding illegal contracts before deciding if this arbitration provision was severable. Here, respondents' argument is that certain statutorily required language in the contracts was omitted, and the statutory scheme expressly provides that contracts that omit this language are void and unenforceable. Before we reach that question, we return to the FAA claims newly raised on appeal. Question of Any FAA Applicability Valenti relies on several references in the record that suggest interstate commerce is involved here. The agreements show that all three respondents have non-California drivers' license numbers. Respondents allege that Valenti advertised widely, including in airline magazines. However, those facts are not dispositive, as will be explained, and were not timely presented and developed in the trial court to establish the dominant presence of interstate commerce in this case. To support the claim this is merely a legal issue that can be resolved on this appellate record, Valenti relies extensively on Buckeye Check Cashing, Inc. Cardegna 2006 546 U. Buckeye involved a contract governed by the FAA. After Buckeye, federal case law should make no distinction between void and voidable contracts for arbitration enforcement purposes, where the FAA applies. Ferrer 2008 --- U. Boren 1999 74 Cal. Where different factual bases may exist to support a particular legal theory, it is the duty of the party asserting those facts to bring them to the attention of the trial court. North Coast Business Park v. Failure to do so may be deemed a waiver of the point on appeal. It is not disputed that these agreements were entered into in California, that the arbitration clauses and related provisions provide for a forum in California, and enforceability of any arbitration award is to be determined under California law. The agreement as a whole is stated to be governed by California law, and in some cases, a choice of forum is stated as the Superior Court for the County of San Diego, California. Where an arbitration provision contains California choice-of-law language, the parties' intent is inferred that state law will apply for resolving motions to compel arbitration. Coldwell Banker Residential Brokerage Co. Given the lack of factual development of this record and the numerous references to California law in the agreements, we have no basis to rule this is properly an FAA case. Valenti's failure to raise the FAA argument below deprived the court of the opportunity to develop the record as to facts related to interstate commerce-a critical requirement in determining FAA applicability, on which we decline to speculate. Although the court in Buckeye generally states that its analysis for FAA cases must be applied in both state and federal courts, this should not now be treated as an FAA case. Buckeye, supra, 546 U. Accordingly, we adhere to the analysis in Rosenthal, supra, 14 Cal. § 1694 et seq. Green, supra, 207 Cal. That is not the only type of allegation here. The Supreme Court in Moncharsh, supra, 3 Cal. Ericksen, supra, at pp. To understand whether these agreements are illegal, such that their arbitration clauses can nevertheless be avoided, we next turn to an analysis of the dating service statutory scheme. See Moncharsh, supra, p. From this placement of the dating service statutes within the long-standing rules for extinction or release from contractual obligations, we may infer that the Legislature was concerned with regulating the manner in which such dating service contracts were entered into, for the express purpose of providing the consumer with a means of release from them when exploitative contractual practices were followed. In the arbitration statutes, Code of Civil Procedure section 1281. All these distinctions and terminology are important here, because we are tasked with determining whether this form of illegality provides a specific basis for revocation of the arbitration provision. If a contract never existed, due to fraud in the execution or inception, no arbitration can be ordered under it. However, if a contract once existed, but was fraudulently induced, arbitration in some cases can be ordered, such as where disappointed expectations are involved, in that performance did not match the promised result. Ericksen, supra, 35 Cal. We next seek to determine whether a contract that clearly was created and existed for some time, but was entered into under fraudulent circumstances, can be deemed void on statutory grounds for purposes of the requested enforcement of any arbitration clause contained therein. We first focus upon the mandatory language of section 1694. Next, under section 1694. Statutory reasonable attorney fees are allowed to a prevailing party. Where an alleged illegality goes to only a portion of the contract, not including an arbitration agreement, a court will be justified in ruling that the entire controversy, including the issue of illegality, remains arbitrable. Moncharsh, supra, 3 Cal. In the case before us, not only does the basic agreement fail to contain the mandatory provisions of section 1694. Such illegality voids the entire contract, including the arbitration clause. This particular omission cannot be deemed to be only a peripheral or minor illegality of the contract, because it goes to a major policy promoted by the statutory scheme. How does this affect any right to arbitration under a different clause of the agreement? Illegality of the Contracts; No Severability of Arbitration Clause in this Context This legislation provides that a dating service contract that fails to meet these standards is void and unenforceable, but without clarifying the rules that apply to an arbitration clause within that contract or agreement. We may find guidance in a comparable situation described in 14 Cal. Where the statute prescribes the only mode by which the power to contract is to be exercised, that mode is the measure of the power. The adoption of the prescribed mode is a jurisdictional prerequisite to the exercise of the power to contract at all, and that power can be exercised in no other manner. That parallel authority suggests that if a statute prescribes the only method in which a valid contract can be made, a contract that fails to follow that method is void. Omitting required provisions, as here, does not follow the requirements of statute. Blick 1949 33 Cal. We emphasize that this matter is before us solely upon a petition to compel arbitration. The ruling on arbitrability does not further determine the merits of all issues about the agreements' legality under the dating service statutes. Rosenthal, supra, 14 Cal. Nevertheless, when we read the agreements together with the statutes, and consider these parallel authorities, we conclude that because of the particular manner in which fraud in the inducement is alleged within the context of these statutorily insufficient and illegal agreements, the agreements do not belong within the general category allowing severable arbitration clauses, because of the importance of the omitted provisions. We are aware that even voidable contracts may contain enforceable arbitration clauses. There, the authors cite as authority for this proposition Abramson v. We cannot find the arbitration provisions in this case to be severable from these contracts under these authorities. The dating service statutes represent the Legislature's intent to regulate in a particular manner such contracts for dating services, and the statutes operate to exclude such contracts for dating services from the scope of the general rule that a court will refrain from determining the legality of voidable contracts that contain an arbitration clause, and will instead allow an arbitrator to do so. The defects in these agreements are central to the policy of the statutes, and the express language of the statutes regarding unenforceability applies to the arbitration clauses as well. Thus, these agreements fail to meet the requirements of the dating service statutes and were appropriately deemed by the superior court, in its preliminary determination made for purposes of resolving the motion to compel arbitration, to be void and unenforceable. The court also properly made a preliminary factual determination that misleading circumstances existed and led to the entry into the agreements, supporting a conclusion the agreements are void. These conclusions apply to void the arbitration clauses contained within the agreements. We accordingly need not reach the arguments concerning unconscionability of the arbitration clauses. We affirm the trial court's order denying Valenti's motion to compel arbitration. Costs are awarded to respondents. All further statutory references are to the Civil Code unless otherwise noted. The arbitration clauses required a panel of three arbitrators. Each party had the ability to choose one arbitrator and the third arbitrator would be chosen by the first two. Psychologist, specializing in marriage and family counseling. Although the parties continue to discuss this permeation theory, the better approach utilized in Rosenthal, supra, 14 Cal. Law, supra, Contracts, § 451, p. According to Green, supra, 207 Cal. Blick, supra, 33 Cal. Green, supra, at pp. Law, supra, Contracts, § 451, p. WE CONCUR: McINTYRE and O'ROURKE, JJ.
