Quach v. California Commerce Club, Inc. (2024) 16 Cal.5th 562

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IN THE SUPREME COURT OF 
CALIFORNIA 
 
PETER QUACH, 
Plaintiff and Respondent, 
v. 
CALIFORNIA COMMERCE CLUB, INC., 
Defendant and Appellant. 
 
S275121 
 
Second Appellate District, Division One 
B310458 
 
Los Angeles County Superior Court 
19STCV42445 
 
 
July 25, 2024 
 
Justice Groban authored the opinion of the Court, in which 
Chief Justice Guerrero and Justices Corrigan, Liu, Kruger, 
Jenkins, and Evans concurred. 
 


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1 
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
S275121 
 
Opinion of the Court by Groban, J. 
 
Private parties may agree to resolve their disputes in 
arbitration rather than in court.  If a party to an arbitration 
agreement files a complaint in court raising a claim covered by 
the agreement, the defendant can file a motion asking the court 
to stay the lawsuit and send the dispute to arbitration.  A 
defendant who instead litigates the case risks losing the 
contractual right to compel arbitration. 
One way a contractual right may be lost is by waiver.  
Outside the arbitration context, a California court will find 
waiver when the party seeking to enforce a known contractual 
right has intentionally relinquished or abandoned that right.  
(Lynch v. California Coastal Com. (2017) 3 Cal.5th 470, 475 
(Lynch).)  In the arbitration context, however, our cases have 
added a requirement: to find waiver, we have required that the 
party seeking to avoid arbitration show prejudice.  (See St. 
Agnes Medical Center v. PacifiCare of California (2003) 
31 Cal.4th 1187, 1203 (St. Agnes).)  To explain our adoption of 
this additional, arbitration-specific requirement, we relied on a 
policy favoring arbitration over litigation as a form of dispute 
resolution.  (Id. at p. 1204.) 
 
Until recently, most federal appellate courts similarly 
applied an arbitration-specific rule that required a showing of 
prejudice to establish waiver.  Our California rule is based upon 
these federal cases.  In Morgan v. Sundance, Inc. (2022) 596 U.S. 


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Opinion of the Court by Groban, J. 
 
2 
411 (Morgan), the United States Supreme Court rejected this 
rule.  Morgan clarified that the federal “ ‘policy favoring 
arbitration’ ” is about putting arbitration agreements on equal 
footing with other contracts, not about favoring arbitration.  (Id. 
at p. 418.)  Accordingly, the Supreme Court held that, under 
federal law, a court must apply the same rules that apply to any 
other contract when determining whether a party to an 
arbitration agreement has lost the right to enforce the 
agreement.  (Ibid.) 
 
Because our state-law arbitration-specific prejudice 
requirement is based upon the federal precedent that Morgan 
overruled, we now abrogate it.  California policy, like federal 
policy, puts arbitration agreements on equal footing with other 
types of contracts.  Accordingly, under California law, as under 
federal law, a court should apply the same principles that apply 
to other contracts to determine whether the party seeking to 
enforce an arbitration agreement has waived its right to do so.  
The Court of Appeal below applied an arbitration-specific 
prejudice requirement to overrule the trial court’s order denying 
California Commerce Club’s motion to compel arbitration.  We 
now reverse. 
I. 
FACTUAL AND PROCEDURAL BACKGROUND 
 
Peter Quach filed this suit in 2018, after California 
Commerce Club (Commerce Club), which operated the casino 
where Quach had worked for almost 30 years, terminated his 
employment.  Quach’s complaint alleges claims for wrongful 
termination, age discrimination, retaliation, and harassment 
and demands a jury trial. 
 
Before Quach filed his complaint, Commerce Club 
provided him with a copy of the signature page of a form 


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QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
3 
arbitration agreement he had signed in 2015, while he was 
working at the casino.  The agreement provided for binding 
arbitration of employment-related disputes.   
 
Rather than filing a motion to compel arbitration, 
Commerce Club answered Quach’s complaint and initiated 
discovery, 
propounding 
form 
interrogatories, 
special 
interrogatories, requests for admission, and a request for 
production of documents.  In its answer, Commerce Club 
asserted as an “affirmative defense” that Quach “should be 
compelled to arbitrate” any claims he had agreed to arbitrate.  
However, Commerce Club’s counsel did not raise the issue of 
arbitration with Quach’s counsel or with the court in any other 
way.  On the form Commerce Club submitted as its first case 
management conference statement, it requested a jury trial, did 
not check the box indicating it was willing to participate in 
“binding private arbitration,” and did not list a motion to compel 
arbitration in the space provided for listing motions it expected 
to file before trial, instead indicating that it only intended to file 
a “dispositive motion.”  (See JCC form CM-110, July 1, 2011.)   
 
At the case management conference, the court set a trial 
date.  Thereafter, both sides posted jury fees and continued to 
engage in discovery.  Commerce Club responded to Quach’s 
initial discovery requests and propounded a second set of special 
interrogatories.  In response to a discovery request, Commerce 
Club again provided Quach a copy of the signed signature page 
of his arbitration agreement.  Although trial court proceedings 
were delayed due to the COVID-19 pandemic, Commerce Club 
continued to actively participate in discovery, engaging in meet 
and confer over discovery disputes and taking Quach’s 
deposition by videoconference for a full day.  


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Opinion of the Court by Groban, J. 
 
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Then — 13 months after Quach filed his lawsuit — 
Commerce Club filed a motion to compel arbitration under the 
Federal Arbitration Act, 9 U.S.C. § 1 et seq. (FAA) “and/or” the 
California Arbitration Act, Code of Civil Procedure, sections 
1281 et seq. (CAA). 1   Attempting to explain its delay, Commerce 
Club asserted that it had just located a complete copy of Quach’s 
arbitration agreement.  It argued that Quach was not prejudiced 
by the delay because there had been only “minimal discovery” 
due to the pandemic’s impact on Commerce Club’s access to 
information and witnesses. 
 
Quach opposed the motion, arguing that Commerce Club 
had waived its contractual right to compel arbitration.  He 
pointed out that Commerce Club had provided him a copy of the 
signed signature page of his arbitration agreement before he 
even filed his lawsuit and that the first page of the two-page 
agreement contained boilerplate language that was the same in 
all the arbitration agreements Commerce Club had its 
employees sign in 2015.  Quach argued that Commerce Club’s 
delay was prejudicial because Quach had spent significant time 
and money on the litigation and had lost the advantage of 
arbitration as a way to obtain an expedited resolution of the 
dispute. 
 
The trial court denied Commerce Club’s motion.  It found 
that Commerce Club “knew of its right to compel arbitration” 
and instead of moving to compel arbitration, propounded a 
“large amount” of written discovery, spent “significant” time 
meeting and conferring “over many months,” and took Quach’s 
 
1  All subsequent statutory references are to the California Code 
of Civil Procedure unless otherwise specified. 


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deposition, demonstrating “a position inconsistent [with the 
intent] to arbitrate” and causing “prejudice.”   
 
Commerce Club appealed and a divided Court of Appeal 
reversed.  (Quach v. California Commerce Club, Inc. (2022) 
78 Cal.App.5th 470 (Quach).)  The majority held that Commerce 
Club did not waive its right to compel arbitration, concluding 
that the trial court’s finding that Quach had shown prejudice 
was not supported by substantial evidence.  (Quach, at p. 478; 
id. at p. 484, citing St. Agnes, supra, 31 Cal.4th at p. 1203.)  The 
dissenting justice would have deferred to the trial court’s 
prejudice finding and concluded that Commerce Club had 
waived its right to compel arbitration.  (Quach, at pp. 487–488 
(conc. & dis. opn. of Crandall, J.).) 
 
Two weeks after the Court of Appeal published its 
decision, the United States Supreme Court issued Morgan, 
supra, 596 U.S. 411, holding that federal law does not require a 
showing of prejudice to establish waiver of the right to arbitrate.  
(Id. at pp. 413–414.)  We granted review to reexamine our 
California prejudice rule in light of Morgan. 
II. 
DISCUSSION 
 
At the time the Court of Appeal issued its decision in this 
case, the framework for determining whether a party had 
“waived” its right to compel arbitration by engaging in 
litigation-related conduct was well settled in California.  
(§ 1281.2.)  As we will explain, California courts, like most 
federal 
courts, 
applied 
an 
arbitration-specific 
prejudice 
requirement and did so regardless of whether the proceedings 
were governed by the FAA or the CAA.  Morgan, supra, 596 U.S. 
411, has clarified that there is no arbitration-specific prejudice 
requirement for cases governed by the FAA’s procedural rules.  


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Opinion of the Court by Groban, J. 
 
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(Id. at pp. 413–414.)  Commerce Club contends, however, that 
the CAA’s procedural rules apply in this case. 2   It argues that 
California policy is distinct from federal policy in that it treats 
requests to enforce arbitration agreements more favorably than 
requests to enforce other types of contracts, and accordingly, 
that California courts must continue to apply an arbitration -
specific prejudice requirement in cases governed by the CAA’s 
procedural rules.  For reasons described below, we disagree — 
California’s policy with respect to the enforceability of 
arbitration agreements, like federal policy, “is about treating 
arbitration contracts like all others, not about fostering 
arbitration.”  (Morgan, supra, 596 U.S. at p. 418.)  Accordingly, 
regardless of whether the procedural requirements of the FAA 
 
2  Quach’s arbitration agreement did not specifically reference 
either the CAA or the FAA.  Although the parties disputed 
which act’s rules governed the proceedings, the courts below did 
not address this question. (See Quach, supra, 78 Cal.App.5th 
470.)  In its briefing in this court, Commerce Club argues — 
contrary to the position it took below (pre-Morgan) — that this 
dispute is governed by the CAA’s procedural rules and that 
Morgan is distinguishable on that basis.  Because we hold that 
in cases governed by the CAA’s procedural rules, as in those 
governed by the FAA’s procedural rules, California courts may 
not apply an arbitration-specific prejudice requirement, we need 
not determine which rules apply. (See Armendariz v. 
Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 
83, 99 (Armendariz) [not determining whether the FAA applied 
because “our inquiry into the enforceability of the arbitration 
agreement at issue in this case entails the same inquiry under 
the CAA”]; Tiri v. Lucky Chances, Inc. (2014) 226 Cal.App.4th 
231, 241 [court “need not resolve the parties’ dispute whether” 
the CAA or the FAA applies because the two statutes “are 
interpreted the same under controlling precedent”].) 
 


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or the CAA apply in these proceedings, our determination of 
whether Commerce Club has lost its right to compel arbitration 
as a result of its litigation-related conduct is governed by 
generally applicable state law contract principles.  As we will 
explain, these principles do not require a showing of prejudice 
to establish waiver. Applying the generally applicable law of 
waiver, we conclude that Commerce Club waived its right to 
compel arbitration. 
A.  California Courts Have Applied an Arbitration -
Specific Prejudice Requirement Grounded in a 
Policy Favoring Arbitration Over Litigation  
We described our framework for deciding waiver questions 
and our reasons for adopting that framework two decades ago in 
our decision in St. Agnes, supra, 31 Cal.4th 1187.  We began by 
observing that “[s]tate law, like the FAA, reflects a strong policy 
favoring arbitration agreements. . . .”  (Id. at p. 1195.)  While 
acknowledging that both the FAA and our state-law analogue, 
the CAA, allow a court to deny a petition to compel arbitration 
based on waiver, we emphasized that “the party seeking to 
establish a waiver bears a heavy burden of proof” and “any 
doubts regarding a waiver allegation should be resolved in favor 
of arbitration.”  (Ibid.)  Noting that California courts had found 
waiver of the right to compel arbitration in “ ‘ “a variety of 
contexts,” ’ ” we concluded there was no “single test” for 
determining whether a party had waived its right to arbitrate.  
(Id. at pp. 1195–1196.)  Nevertheless, we listed the following 
factors for courts to consider in making waiver determinations: 
“ ‘ “(1) whether the party’s actions are inconsistent with the 
right to arbitrate; (2) whether ‘the litigation machinery has been 
substantially invoked’ and the parties ‘were well into 
preparation of a lawsuit’ before the party notified the opposing 


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party of an intent to arbitrate; (3) whether a party either 
requested arbitration enforcement close to the trial date or 
delayed for a long period before seeking a stay; (4) whether a 
defendant seeking arbitration filed a counterclaim without 
asking for a stay of the proceedings; (5) ‘whether important 
intervening steps [e.g., taking advantage of judicial discovery 
procedures not available in arbitration] had taken place’; and (6) 
whether the delay ‘affected, misled, or prejudiced’ the opposing 
party.” ’ ”  (Id. at p. 1196, quoting Sobremonte v. Superior Court 
(1998) 61 Cal.App.4th 980, 992 and adopting the language of 
Peterson v. Shearson/American Exp., Inc. (10th Cir. 1988) 
849 F.2d 464, 467–468.) 
 
After listing these factors, we went on to hold that the 
party opposing arbitration must show prejudice.  (St. Agnes, 
supra, 31 Cal.4th at p. 1203.)  We characterized “ ‘[t]he presence 
or absence of prejudice’ ” resulting from the litigation of an 
arbitrable dispute as “ ‘the determinative issue under federal 
law.’ ”  (Ibid.)  We observed that, with a few exceptions, federal 
courts had long held that “ ‘the mere filing of a lawsuit does not 
waive contractual arbitration rights’ ” and that the party 
resisting arbitration must demonstrate “ ‘prejudice from the 
litigation of the dispute.’ ”  (Ibid.; see id. at fn. 6.)  In support of 
this observation, we cited our 1979 decision in Doers v. Golden 
Gate Bridge etc. Dist. (1979) 23 Cal.3d 180 (Doers), which cited 
and relied on earlier federal decisions.  (St. Agnes, at p. 1203.)   
 
We noted that California courts had similarly ruled that 
the party resisting arbitration must show prejudice resulting 
from the moving party’s litigation-related conduct unless the 
merits of an arbitrable issue had been litigated.  (St. Agnes, 
supra, 31 Cal.4th at p. 1203.)  This prejudice requirement, we 
observed, was grounded in “the recognition that California’s 


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QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
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arbitration statutes reflect ‘ “a strong public policy in favor of 
arbitration” ’ ” 
over 
litigation 
because 
arbitration 
is 
“ ‘ “relatively inexpensive” ’ ” and allows parties to “ ‘ “avoid 
delays incident to a civil action” ’ ” and obtain a “ ‘ “speedy . . . 
resolution.” ’ ”  (Id. at p. 1204.)  We noted that courts generally 
did not find prejudice unless “the petitioning party’s conduct has 
substantially undermined this important public policy or 
substantially impaired the other side’s ability to take advantage 
of the benefits and efficiencies of arbitration.”  (Ibid.)  As 
examples of an adequate showing of prejudice, we cited to cases 
in which the parties had litigated the merits of arbitrable 
claims, substantial discovery related to such claims had 
occurred, the petition to compel arbitration was filed on “the eve 
of trial,” the movant had used discovery “to gain information 
about the other side’s case that could not have been gained in 
arbitration,” or evidence was lost as a result of delay “associated 
with the petitioning party’s attempts to litigate.”  (Ibid.)  We 
emphasized that “courts will not find prejudice where the party 
opposing arbitration shows only that it incurred court costs and 
legal expenses” resulting from participating in the litigation of 
an arbitrable dispute.  (Id. at p. 1203; see Iskanian v. CLS 
Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, 377 
[“substantial expense and delay” is not sufficient to show 
prejudice unless “caused by the unreasonable or unjustified 
conduct of the party seeking arbitration”].) 
We observed in St. Agnes, supra, 31 Cal.4th 1187 that 
“[s]tate law, like the FAA, reflects a strong policy favoring 
arbitration agreements and requires close judicial scrutiny of 
waiver claims” (id. at p. 1195) and that prejudice was “critical” 
to waiver determinations in California, as it was under the FAA 
(id. at p. 1203).  Based on this reasoning, Court of Appeal 


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decisions have applied St. Agnes’s framework regardless of 
whether the arbitration agreement at issue was governed by the 
procedural rules of the FAA or the CAA.  (Bower v. Inter-Con 
Security Systems, Inc. (2014) 232 Cal.App.4th 1035, 1041–1042 
(Bower).)  Thus, in ruling on waiver questions, California courts 
have, for decades, been applying a framework grounded in a 
“strong policy favoring arbitration” over litigation, under which 
they hold parties seeking to establish waiver to a “heavy burden 
of proof,” requiring a showing of prejudice beyond the loss of 
time and expenses normally associated with litigating a dispute 
and resolving any doubts “in favor of arbitration.”  (St. Agnes, at 
p. 1195; see id. at p. 1204; see also Lewis v. Fletcher Jones Motor 
Cars, Inc. (2012) 205 Cal.App.4th 436, 444.)  And they have done 
so regardless of whether the procedural rules of the FAA or the 
CAA apply to the case.  (Lewis at p. 444; Bower, at pp. 1041– 
1042.) 
B.  The United States Supreme Court Has Rejected 
Any Federal Arbitration-Specific Rule of Waiver 
The United States Supreme Court’s decision in Morgan, 
supra, 596 U.S. 411 renders the 
St. Agnes framework 
inapplicable in cases governed by the FAA’s procedural rules.  In 
Morgan, the Supreme Court addressed whether a court may 
create federal procedural rules — such as the rule conditioning 
waiver of the right to arbitrate on prejudice — “based on the 
FAA’s 
‘policy 
favoring 
arbitration.’ ” 
 
(Morgan, 
supra, 
596 U.S. at p. 419.)  The court observed that “[o]utside the 
arbitration context, a federal court assessing waiver does not 
generally ask about prejudice” to the party resisting 
enforcement of a contractual right.  (Id. at p. 417.)  Instead, it 
focuses on the actions of the person seeking enforcement, seldom 
considering “the effects of those actions on the opposing party.”  


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(Ibid.)  Until Morgan, most federal appellate courts, like 
California state courts, had addressed delayed requests to 
compel arbitration by applying “a rule of waiver specific to the 
arbitration context” derived from “the FAA’s ‘policy favoring 
arbitration.’ ”  (Id. at pp. 413–414.)  As under the California rule, 
a party could “waive its arbitration right by litigating only when 
its conduct ha[d] prejudiced the other side.”  (Id. at p. 414.)   
Morgan explained that this arbitration-specific prejudice 
rule originated with the “decades-old” decision in Carcich v. 
Rederi A/B Nordie (2d Cir. 1968) 389 F.2d 692, 696 (Carcich), 
which grounded the rule in what the Second Circuit 
characterized as “ ‘an overriding federal policy favoring 
arbitration.’ ”  (Morgan, supra, 596 U.S. at p. 417.)  The 
Supreme Court observed that Carcich’s “rule and reasoning 
spread” over the years, until most federal circuit courts had 
adopted a prejudice requirement for establishing waiver, relying 
on a policy favoring arbitration over litigation.  (Morgan, at 
p. 418.) 
Concluding that the FAA does not authorize federal courts 
to create arbitration-specific procedural rules, the Supreme 
Court rejected this additional prejudice requirement.  (Morgan, 
supra, 596 U.S. at p. 419.)  The court explained: “[T]he FAA’s 
‘policy favoring arbitration’ does not authorize federal courts to 
invent special, arbitration-preferring procedural rules.”  (Id. at 
p. 418.)  Instead, that phrase originated as an acknowledgement 
that the FAA had, in effect, “ ‘overrule[d] the judiciary’s 
longstanding refusal to enforce agreements to arbitrate,’ ” 
placing arbitration agreements on “ ‘the same footing as other 
contracts.’ ”  (Ibid.)  The Court observed that “[t]he federal policy 
is about treating arbitration contracts like all others, not about 
fostering arbitration.”  (Ibid.)   


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Turning to the statutory language, the court noted that 
FAA section 6’s “directive to a federal court to treat arbitration 
applications ‘in the manner provided by law’ for all other 
motions is simply a command to apply the usual federal 
procedural rules, including any rules relating to a motion’s 
timeliness.  Or put conversely, it is a bar on using custom-made 
rules, to tilt the playing field in favor of (or against) arbitration.” 
(Morgan, supra, 596 U.S. at p. 419, quoting 9 U.S.C. § 6.)  
Accordingly, the court held, “a court may not devise novel rules 
to favor arbitration over litigation.”  (Morgan, at p. 418.)   
 
The Supreme Court remanded Morgan to the Court of 
Appeals to apply the generally applicable federal law of 
waiver — which it noted “does not include a prejudice 
requirement” — or another generally applicable procedural 
framework the Court of Appeals may find appropriate.  
(Morgan, supra, 596 U.S. at p. 419.)  The court reserved the 
questions of what “role state law might play in resolving when 
a party’s litigation conduct results in the loss of a contractual 
right to arbitrate” and “whether to understand that inquiry as 
involving rules of waiver, forfeiture, estoppel, laches, or 
procedural timeliness.”  (Id. at p. 416.)   
C.  There is No Basis for an Arbitration-Specific 
Prejudice Requirement in California Law 
 
Morgan directly governs only cases in which the FAA’s 
procedural rules apply; in those cases, it requires California 
courts to apply generally applicable contract law when 
determining whether a party to an arbitration agreement has 
lost the right to compel arbitration by litigating an arbitrable 
dispute.  (Morgan, supra, 596 U.S. at p. 419.)  However, 
arbitration-related proceedings in California courts are 


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governed by the CAA’s procedural rules unless their application 
is preempted or the parties have expressly agreed that the 
FAA’s procedural rules apply.  (Rosenthal v. Great Western Fin. 
Securities Corp. (1996) 14 Cal.4th 394, 408–409 (Rosenthal); 
Cronus Investments, Inc. v. Concierge Services (2005) 35 Cal.4th 
376, 394 (Cronus).)  While Morgan made clear that when the 
proceedings are governed by the FAA’s procedural rules, it is 
inappropriate to apply a different standard of waiver than 
applies in other contractual contexts, it left open the question 
whether a court may properly apply an arbitration-specific 
standard when state procedural law governs the proceedings.  
(Id. at pp. 416, 419.)  We now consider whether courts may apply 
an arbitration-specific prejudice requirement in cases governed 
by the CAA’s procedural rules.  
 
Commerce Club argues that since Morgan does not require 
any change to our analysis of when a party has lost the right to 
compel arbitration under the CAA’s procedural rules, we should 
adhere to St. Agnes and continue to apply a prejudice 
requirement.  Our policy of adhering to precedent is rooted in 
our desire to promote certainty, predictability, and stability in 
the law — to enable people to rely on it and conform their 
conduct to it.  (People v. Mendoza (2000) 23 Cal.4th 896, 924 
(Mendoza).)  These considerations have special force when our 
precedent interprets a state statute, because in that context the 
Legislature has the power to correct our errors.  (Tansavatdi v. 
City of Rancho Palos Verdes (2023) 14 Cal.5th 639, 666.)  
However, even in the statutory interpretation context, our policy 
does not “ ‘shield court-created error from correction’ ” but 
instead allows us the flexibility “to reconsider, and ultimately to 
depart from, our own prior precedent in an appropriate case.”  


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(Moradi-Shalal v. Fireman’s Fund Ins. Companies (1988) 
46 Cal.3d 287, 296 (Moradi-Shalal).) 
 
We have found reconsideration of our precedent to be 
warranted when a development in the law indicates “an earlier 
decision was unsound, or has become ripe for reconsideration.”  
(Moradi-Shalal, 46 Cal.3d at p. 297.)  Morgan, supra, 
596 U.S. 411 is such a development.  (See People v. Anderson 
(1987) 43 Cal.3d 1104, 1139–1141 [reexamining decision 
interpreting California statute in light of intervening United 
States Supreme Court decision clarifying federal law].)  While 
Morgan is not binding when the CAA’s procedural rules apply, 
our state-law arbitration-specific prejudice rule is based on the 
federal appellate authority that Morgan disapproved.  Rather 
than approaching the question whether the CAA requires a 
showing of prejudice to establish waiver as a matter of statutory 
interpretation, we simply adopted the federal rule that the 
United States Supreme Court has now rejected.  As we will 
explain, Morgan’s reasoning about the policy underpinnings of 
the federal arbitration-specific rule of waiver applies with equal 
force in the context of the CAA.  Accordingly, a reexamination of 
our court-created arbitration-specific rule of waiver is 
warranted. 
 
When interpreting any statute, our goal is to determine 
the Legislature’s intent and give effect to the statute’s purpose.  
(Brennon B. v. Superior Court (2022) 13 Cal.5th 662, 673.)  We 
begin with the language of the relevant provision, considering it 
in its statutory context.  (Ibid.)  We usually interpret the words 
of a statute in accordance with their ordinary meaning, though 
if a word has a well-established legal meaning, we assume the 
Legislature intended to use it in that sense.  (Arnett v. Dal Cielo 
(1996) 14 Cal.4th 4, 19 (Arnett); Civ. Code, § 13.)  If the statutory 


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language is unclear, we may look to legislative history and 
public policy as aids in determining how best to give effect to 
Legislative intent.  (Brennon B. at p. 673.)   
 
The provision of the CAA at issue, section 1281.2, sets out 
an exception to the general rule that courts must enforce written 
arbitration agreements.  (Id., subd. (a).)  This exception applies 
when “the right to compel arbitration has been waived by the 
petitioner.”  (Ibid.)  Because the CAA does not say what it means 
for the right to have been “waived,” we look to generally 
applicable law to supply that meaning.  (See Arnett, supra, at 
p. 19; Civ. Code, § 13.)  The statute, therefore, is most naturally 
read as directing courts to apply generally applicable law in 
determining whether the right to compel arbitration has been 
waived. 
 
This reading finds support in section 1281, part of the 
CAA, which provides, in language similar to section 2 of the 
FAA, that an arbitration agreement is “valid, enforceable and 
irrevocable, save upon such grounds as exist for the revocation 
of any contract.”  (§ 1281; compare 9 U.S.C. § 2 [arbitration 
agreement “shall be valid, irrevocable, and enforceable, save 
upon such grounds as exist at law or in equity for the revocation 
of any contract”].)  The parallel language between section 1281 
and section 2 of the FAA suggests that both statutes contain the 
same directive and embody the same policy.  (See Armendariz, 
supra, 24 Cal.4th at p. 98 [“[U]nder California law, as under 
federal law, an arbitration agreement may only be invalidated 
for the same reasons as other contracts”].)  That policy favors 
the enforcement of arbitration agreements as it favors the 
enforcement of any other contract; it requires courts to “place 
arbitration agreements on an equal footing with other contracts, 
[citation], and enforce them according to their terms.”  (AT&T 


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Mobility LLC v. Concepcion (2011) 563 U.S. 333, 339.)  Citing 
cases interpreting section 2 of the FAA, Morgan relied on this 
equal footing principle to support its conclusion that “the FAA’s 
‘policy favoring arbitration’ does not authorize federal courts to 
invent 
special, 
arbitration-preferring 
procedural 
rules.”  
(Morgan, supra, 596 U.S. at p. 418.)  It follows that section 1281 
similarly should be interpreted to require a court to “hold a 
party to its arbitration contract just as the court would to any 
other kind,” not to authorize a court to “devise novel rules to 
favor arbitration over litigation.”  (Morgan, supra, 596 U.S. at 
p. 418.) 
 
Indeed, outside of the waiver context, we have interpreted 
this language in section 1281 and FAA section 2 as allowing a 
court to decline to enforce an arbitration agreement on the same 
grounds on which it could do so under generally applicable state 
contract law, without requiring any additional showing based on 
a policy “favoring” arbitration.  For example, in OTO, L.L.C. v. 
Kho (2019) 8 Cal.5th 111 (OTO), we applied the generally 
applicable standard of unconscionability to an arbitration 
agreement, observing that “the doctrine’s application to 
arbitration agreements must rely on the same principles that 
govern all contracts.”  (Id. at p. 125.)  Similarly, when 
considering an unconscionability argument in Armendariz, 
supra, 24 Cal.4th 83, we noted that “although we have spoken 
of a ‘strong public policy of this state in favor of resolving 
disputes by arbitration’ [citation], Code of Civil Procedure 
section 1281 makes clear that an arbitration agreement is to be 
rescinded on the same grounds as other contracts or contract 
terms.  In this respect, arbitration agreements are neither 
favored nor disfavored, but simply placed on an equal footing 
with other contracts.”  (Id. at pp. 126–127.)  We have likewise 


[PDF page 18]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
17 
applied generally applicable state law in the context of cases 
involving issues of fraud in the execution and fraud in the 
inducement.  (See Engalla v. Permanente Medical Group, Inc. 
(1997) 15 Cal.4th 951, 973–974; Rosenthal, supra, 14 Cal.4th at 
p. 419.)  The approach we have taken in these other contexts is 
consistent with the Supreme Court’s observation in Morgan that 
the policy “ ‘favoring’ ” arbitration is not one of promoting 
arbitration over litigation, but instead of ensuring that 
arbitration agreements are not disfavored, i.e., that they are 
treated like other contracts.  (Morgan, supra, 596 U.S. at 
p. 418.)  By contrast, the arbitration-specific prejudice 
requirement we have applied in deciding waiver issues is based 
on a policy that treats requests to enforce arbitration 
agreements more favorably than requests to enforce other types 
of contracts.  By conforming our approach in the waiver context 
to the Supreme Court’s approach in Morgan, we bring our law 
concerning waiver determinations in line with our law related 
to other questions of arbitrability. 
 
Perhaps recognizing that the CAA provides no textual 
basis for applying an arbitration-specific rule of prejudice, 
Commerce Club seeks to distinguish Morgan by arguing that 
California law, as reflected in St. Agnes, is different from federal 
law because California law embraces a policy favoring 
arbitration over litigation.  Commerce Club suggests that 
whatever the federal policy might be, California’s “policy 
favoring arbitration” supports imposition of an arbitration -
specific prejudice requirement.  But an examination of the 
legislative history reveals that California policy, like federal 
policy, is fundamentally about making arbitration agreements 
“ ‘as enforceable as other contracts, but not more so.’ ”  (Morgan, 
supra, 596 U.S. at p. 418.)   


[PDF page 19]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
18 
 
The United States Supreme Court observed in Morgan 
that, when understood in historical context, the policy favoring 
arbitration is “ ‘merely an acknowledgment of the FAA’s 
commitment to overrule the judiciary’s longstanding refusal to 
enforce agreements to arbitrate and to place such agreements 
upon the same footing as other contracts.’ ”  (Morgan, supra, 
596 U.S. at p. 418.)  We similarly have observed that the FAA 
“was intended ‘to overcome an anachronistic judicial hostility to 
agreements to arbitrate, which American courts had borrowed 
from English common law.’ ”  (Cable Connection, Inc. v. 
DIRECTV, Inc. (2008) 44 Cal.4th 1334, 1343.)   
 
The same is true of the CAA.  The Legislature’s original 
adoption — two years after the enactment of the FAA — of a 
statute “declaring arbitration agreements to be irrevocable and 
enforceable in terms identical” to the terms of the FAA was part 
of the historical shift away from hostility toward arbitration.  
(Keating v. Superior Court (1982) 31 Cal.3d 584, 601 (Keating); 
Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 20.)  That 
statutory language remains unchanged today, with the 
language of the CAA closely paralleling the language of the 
FAA.  (Compare § 1281 [an arbitration agreement is “valid, 
enforceable and irrevocable, save upon such grounds as exist for 
the revocation of any contract”] with 9 U.S.C. § 2 [arbitration 
agreement “shall be valid, irrevocable, and enforceable, save 
upon such grounds as exist at law or in equity for the revocation 
of any contract”]; see Recommendation and Study Relating to 
Arbitration (Dec. 1960) 3 Cal. Law Revision Com. Rep. (1961) 
p. G-5 (CLRC Recommendation) [noting that California was 
“among the small but growing group of states that have rejected 
the common law hostility to the enforcement of arbitration 
agreements”].)  From this shared language and history it is 


[PDF page 20]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
19 
apparent that the state policy “ ‘favoring’ ” arbitration, like the 
federal policy, “is about treating arbitration contracts like all 
others, not about fostering arbitration.”  (Morgan, supra, 
596 U.S. at p. 418.)   
 
Nothing in the legislative history of section 1281.2, which 
was enacted as part of the CAA, suggests that the Legislature 
intended courts to apply an arbitration-specific rule in the 
waiver context.  The California Law Revision Commission 
proposed the provision in its report leading to the CAA’s 
adoption. 
 
The 
Commission 
recommended 
clarifying 
amendments to the statute for purposes of codifying the 
principle that, in ruling on a request to compel arbitration, a 
court may consider “whether the party seeking to compel 
arbitration has waived [the] right to do so or whether any other 
grounds exist that render the contract unenforceable.”  (CLRC 
Recommendation, supra, at p. G-7; see id. at p. G-36 [noting that 
courts had interpreted statute authorizing a party to obtain 
court order compelling arbitration as permitting them to rule on 
defenses, including waiver].)  The Commission observed that the 
principle that a party can waive the right to compel arbitration 
“seems to be well accepted by the California courts.”  (Id. at p. G -
37.)  It recommended amending the statute to clearly express 
the general idea that a court can deny a petition to compel 
arbitration based on a waiver defense, while leaving it to the 
courts to apply the defense “to specific factual situations.”  
(Ibid.)  The report did not suggest that the Commission 
understood the waiver defense as requiring a showing of 
prejudice.  Indeed, one of the cases cited in the report found 
waiver without discussing prejudice, explaining:  “Appellants 
did none of the things required by law to enforce their right to 
arbitrate and on the contrary filed their answer and amended 


[PDF page 21]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
20 
answers in this action.  It seems clear to us that if they ever had 
such right, the facts in the case at bar indicate clearly that it 
was waived.”  (Pneucrete Corp. v. U.S. Fidelity & Guaranty Co. 
(1935) 7 Cal.App.2d 733, 741; see CLRC Recommendation, 
supra, at p. G-36, fn. 65.)   
 
Our decision in St. Agnes did not examine the language of 
the CAA or its legislative history; instead, after observing that 
prejudice “ ‘is the determinative issue under federal law’ ” we 
declared that “[i]n California, whether or not litigation results 
in prejudice also is critical in waiver determinations.”  (St. 
Agnes, supra, 31 Cal.4th at p. 1203.)  The cases we cited to 
support that declaration, such as Doers, supra, 23 Cal.3d 180, 
link back to Carcich, supra, 389 F.2d 692, the “decades-old 
Second Circuit decision” that Morgan, supra, 596 U.S. at p. 417, 
identified as the origin of the arbitration-specific prejudice 
requirement applied by federal Courts of Appeals. 3   
 
In Doers, we granted review to resolve a conflict between 
Court of Appeal decisions over whether the mere filing of a 
lawsuit by a party who had agreed to arbitrate a claim 
constituted a waiver of the right to arbitrate.  (Doers, supra, 23 
Cal.3d at pp. 182–183.)  We held that a party does not waive the 
right to arbitrate when it engages in litigation that does not 
reach the merits of a dispute, but in a footnote said: “We do not 
preclude the possibility that a waiver could occur prior to a 
judgment on the merits if prejudice could be demonstrated.”  (Id. 
 
3  The other decisions we cited in St. Agnes — Keating, supra, 
31 Cal.3d 584, Christensen v. Dewor Developments (1983) 
33 Cal.3d 778, and Davis v. Continental Airlines, Inc. (1997) 
59 Cal.App.4th 205 — similarly did not engage in statutory 
analysis, instead citing Doers or decisions citing Doers in 
support of the prejudice requirement. 


[PDF page 22]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
21 
at p. 188, fn. 3.)  As support for our holding, we relied on federal 
cases, observing that “[u]nder federal law, it is clear that the 
mere filing of a lawsuit does not waive contractual arbitration 
rights.  The presence or absence of prejudice from the litigation 
of the dispute is the determinative issue under federal law.”  (Id. 
at p. 188.)  Citing Carcich — the Second Circuit decision that 
Morgan, supra, 596 U.S. at page 417, identified as the origin of 
the federal arbitration-specific prejudice requirement — we 
observed that the analogy between California law and federal 
law was “significant inasmuch as the basis for the federal rule 
is the important national policy favoring arbitration.”  (Doers at 
p. 189.)  We reasoned that in resolving the conflict over whether 
the filing of a lawsuit constituted a waiver of the right to compel 
arbitration, we should pick the result that “comport[ed] with the 
‘strong public policy’ favoring arbitration.”  (Ibid.)   
 
It thus appears that the stringent standards to which we 
have held a party seeking to establish waiver — and, in 
particular, the prejudice requirement — are based on a now -
abrogated federal rule that we had adopted in order to conform 
state procedure to federal procedure.  (St. Agnes, supra, 
31 Cal.4th at p. 1195; id. at p. 1204.)  As we have observed, 
California courts have, for decades, been applying the 
arbitration-specific prejudice requirement regardless of whether 
the case was governed by the CAA or the FAA.  (Bower, supra, 
232 Cal.App.4th at pp. 1041–1042.)  California’s arbitration -
specific prejudice requirement shares a history with the federal 
prejudice requirement at issue in Morgan; both originated in 
federal 
circuit 
court 
precedent 
reflecting 
the 
faulty 
understanding of the federal policy favoring arbitration that 
Morgan corrected.  After Morgan, the desire for procedural 
uniformity 
weighs 
in 
favor 
of 
abrogating 
California’s 


[PDF page 23]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
22 
arbitration-specific prejudice requirement and applying the 
same principles in determining whether a party has lost the 
right to compel arbitration as would apply under generally 
applicable contract law.  (See Morgan, supra, 596 U.S. at 
p. 419.)  Because the state law arbitration-specific prejudice 
requirement finds no support in statutory language or 
legislative history, we now abrogate it. 4 
 
While practical concerns do not dictate our answer to what 
is, at core, a question of statutory interpretation, it seems worth 
noting that preserving the arbitration-specific prejudice 
requirement for cases governed by the CAA’s procedural rules 
would risk creating uncertainty and confusion and undermining 
the purpose of arbitration.  (See Mendoza, supra, 23 Cal.4th at 
p. 924.)  Although the CAA’s procedural rules apply by default 
to cases brought in California courts, including those in which 
the FAA governs the arbitrability of the controversy, the FAA’s 
procedural rules may apply if the parties expressly agree they 
do or if the CAA’s procedural rules are preempted. (Rosenthal, 
supra, 14 Cal.4th at pp. 408–410; Cronus, supra, 35 Cal.4th at 
p. 394.)  Because in the past we have applied the same principles 
when determining whether a party has lost the right to compel 
arbitration under the CAA as under the FAA, California courts 
have been able to avoid the sometimes tricky choice of law and 
preemption questions involved in determining which statute 
governs proceedings to enforce an arbitration agreement.  (See 
Valencia v. Smyth (2010) 185 Cal.App.4th 153, 162–180 
 
4  To the extent they are inconsistent with our analysis, we 
overrule St. Agnes Medical Center v. PacifiCare of California, 
supra, 31 Cal.4th 1187 and overrule or disapprove opinions cited 
in St. Agnes or relying upon our decision in that case. 


[PDF page 24]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
23 
[describing choice of law and preemption questions].)  Applying 
a different rule for determining when a party has lost the right 
to arbitrate a dispute in cases governed by the CAA’s procedural 
rules from the rule that applies in cases governed by the FAA’s 
procedural rules would introduce uncertainty into the law that 
would lead to additional litigation.  Such uncertainty would be 
contrary to arbitration’s purpose of providing an expedient and 
inexpensive means of dispute resolution. (OTO, supra, 8 Cal.5th 
at p. 125.) 
In sum, we conclude that the procedural rules of the CAA, 
like those of the FAA, are grounded in a policy of “treating 
arbitration [agreements] like all others,” not one preferring 
arbitration to litigation.  (Morgan, supra, 596 U.S. at p. 418.)  
Accordingly, in determining whether a party to an arbitration 
agreement has lost the right to arbitrate by litigating the 
dispute, a court should treat the arbitration agreement as it 
would any other contract, without applying any special rules 
based on a policy favoring arbitration. That is, courts should 
apply the same procedural rules that they would apply to any 
other contract.  (Ibid.)  
D. Under Generally Applicable Law, No Showing of 
Prejudice is Required to Establish Waiver of a 
Contractual Right 
In reversing the trial court’s order denying Commerce 
Club’s motion to compel arbitration, the Court of Appeal applied 
St. Agnes’s arbitration-specific prejudice rule, which we have 
now abrogated.  Relying on St. Agnes, supra, 31 Cal.4th 1187 at 
page 1195, the court emphasized that “ ‘[i]n light of the policy in 
favor of arbitration, “waivers are not to be lightly inferred and 
the party seeking to establish a waiver bears a heavy burden of 


[PDF page 25]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
24 
proof.” ’ ” 
 
(Quach, 
supra, 
78 Cal.App.5th 
at 
p. 477.)  
Accordingly, the court observed that “ ‘merely participating in 
litigation, by itself, does not result in a waiver,’ ” and “ ‘courts 
will not find prejudice where the party opposing arbitration 
shows only that it incurred court costs and legal expenses.’ ”  (Id. 
at p. 479.)  Based on this language from St. Agnes, the Court of 
Appeal concluded that Quach had not met his burden of proof.  
(See Quach at p. 479 [“Quach has not met St. Agnes’s test.”].)  It 
reasoned that Quach had shown only that “the parties 
participated in litigation,” and had “not shown any prejudice 
apart from the expenditure of time and money on litigation.”  
(Ibid.) 
 
Having abrogated the arbitration-specific rule of waiver 
that the Court of Appeal applied, we now must determine what 
generally applicable state contract law principle to apply in its 
place.  In Morgan, the Supreme Court indicated that various 
defenses may be implicated when a party opposes arbitration 
based on the other party’s litigation conduct, including “waiver, 
forfeiture, estoppel, laches, or procedural timeliness.”  (Morgan, 
supra, 596 U.S. at p. 416; see id. at p. 419.)  Similarly, under 
California law, a party may, as a result of its litigation conduct, 
lose its right to compel arbitration on various grounds.  (See, 
e.g., Ross v. Blanchard (1967) 251 Cal.App.2d 739, 742 
[estoppel]; 
Chase 
v. 
Blue 
Cross 
of 
California 
(1996) 
42 Cal.App.4th 1142, 1151 [forfeiture]; Wagner Construction Co. 
v. Pacific Mechanical Corp. (2007) 41 Cal.4th 19, 30 
[timeliness]; 30 Cal.Jur. 3d (2024) Estoppel and Waiver, § 30 
[distinguishing waiver from other defenses].)  In ruling on a 
motion to compel arbitration, a court should separately evaluate 
each generally applicable state contract law defense raised by 
the party opposing arbitration.  It should not lump distinct legal 


[PDF page 26]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
25 
defenses into a catch-all category called “waiver.”  (See Platt 
Pacific, Inc. v. Andelson (1993) 6 Cal.4th 307, 315 [noting the 
longstanding “confusion engendered by the multiple meanings 
of ‘waiver’ ”].)   
 
Among the factors we identified as relevant to a “waiver” 
determination in St. Agnes are some that are relevant to other 
defenses, such as forfeiture, estoppel, laches or timeliness, but 
not to waiver.  (See St. Agnes, supra, 31 Cal.4th at p. 1196 
[listing factors relevant to “waiver” analysis].)  Courts should 
not apply the St. Agnes factors as a single multifactor test for 
determining whether the right to compel arbitration has been 
lost through litigation.  (See, e.g., Wagner, at p. 31 
[characterizing St. Agnes factors as a multifactor test]; Burton 
v. Cruise (2010) 190 Cal.App.4th 939, 944 [same]; Davis v. 
Shiekh Shoes, LLC (2022) 84 Cal.App.5th 956, 962 [describing 
trial court’s application of St. Agnes factors as multifactor test].)  
Instead, a court should be careful to consider only those factors 
that are relevant to the specific state-law defense the party 
resisting arbitration has raised.  
 
Quach raised the defense of “waiver” to Commerce Club’s 
motion to compel arbitration.  Because we conclude the trial 
court’s ruling that Commerce Club waived its right to compel 
arbitration was correct under the generally applicable law of 
waiver, we need not consider whether any other generally 
applicable state contract law defense applies. 
 
To establish waiver under generally applicable contract 
law, the party opposing enforcement of a contractual agreement 
must prove by clear and convincing evidence that the waiving 
party knew of the contractual right and intentionally 
relinquished or abandoned it.  (Lynch, supra, 3 Cal.5th at p. 475; 


[PDF page 27]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
26 
see Waller v. Truck Ins. Exchange, Inc. (1995) 11 Cal.4th 1, 31 
(Waller) [burden is on party claiming waiver “ ‘to prove it by 
clear and convincing evidence’ ”]; 30 Cal.Jur. 3d, supra, Estoppel 
and Waiver, § 38.)  Under the clear and convincing evidence 
standard, the proponent of a fact must show that it is “highly 
probable” the fact is true.  (Conservatorship of O.B. (2020) 
9 Cal.5th 989, 995 (O.B.).)  The waiving party’s knowledge of the 
right may be “actual or constructive.”  (Outboard Marine Corp. 
v. Superior Court (1975) 52 Cal.App.3d 30, 41.)  Its intentional 
relinquishment or abandonment of the right may be proved by 
evidence of words expressing an intent to relinquish the right or 
of conduct that is so inconsistent with an intent to enforce the 
contractual right as to lead a reasonable factfinder to conclude 
that the party had abandoned it.  (Lynch, supra, 3 Cal.5th at 
p. 475.)   
 
The waiver inquiry is exclusively focused on the waiving 
party’s words or conduct; neither the effect of that conduct on 
the party seeking to avoid enforcement of the contractual right 
nor that party’s subjective evaluation of the waiving party’s 
intent is relevant.  (See McCormick v. Orient Insurance Co. 
(1890) 86 Cal. 260, 262 [“the term ‘waiver’ is used to designate 
the act, or the consequences of the act, of one side only”]; Altman 
v. McCollum (1951) 107 Cal.App.2d Supp. 847, 862 [waiver 
“depends upon the intention of one party only,” i.e., the party 
alleged to have waived the right].)  This distinguishes waiver 
from the related defense of estoppel, “which generally requires 
a showing that a party’s words or acts have induced detrimental 
reliance by the opposing party.”  (Lynch, supra, 3 Cal.5th at 
pp. 475–476; see DRG/Beverly Hills, Ltd. v. Chopstix Dim Sum 
Cafe & Takeout III, Ltd. (1994) 30 Cal.App.4th 54, 59 [by 
contrast to estoppel, waiver “does not require any act or conduct 


[PDF page 28]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
27 
by the other party”].) 5   To establish waiver, there is no 
requirement that the party opposing enforcement of the 
contractual right demonstrate prejudice or otherwise show 
harm resulting from the waiving party’s conduct.  (Lynch, at 
p. 475; see City of Hollister v. Monterey Ins. Co. (2008) 
165 Cal.App.4th 455, 487 [Waiver does not require “any 
demonstration that the other party was caused by the waiver to 
expose himself to any harm”].) 
E. Applying the Generally Applicable Law of 
Waiver, We Conclude Commerce Club Has Lost 
Its Right to Compel Arbitration 
 
In ruling on Commerce Club’s motion to compel 
arbitration, the trial court did not have the benefit of Morgan or 
of our decision today, so in considering Quach’s waiver defense, 
it did not apply the generally applicable law of waiver.  We do so 
now, reviewing de novo the undisputed record of the trial court 
proceedings and asking whether Quach has established by clear 
and convincing evidence that Commerce Club knew of its 
contractual right to compel arbitration and intentionally 
 
5  Commerce Club observes that some California courts have 
considered prejudice in ruling on waiver questions outside the 
arbitration context.  This is unsurprising, given the tendency of 
courts and litigants to conflate waiver with other defenses.  (See 
Lynch, supra, 3 Cal.5th at p. 476 [“Although the distinctions 
between waiver, estoppel, and forfeiture can be significant, the 
terms are not always used with care.”].)  To the extent that some 
Court of Appeal decisions have suggested a showing of prejudice 
is required to establish waiver, those decisions are inconsistent 
with 
our 
precedent, 
which 
makes 
clear 
that 
waiver 
determinations are to be made based on the words and conduct 
of the waiving party.  (See id.; Waller, supra, 11 Cal.4th at 
p. 31.) 


[PDF page 29]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
28 
relinquished or abandoned that right.  (See D’Amico v. Board of 
Medical Examiners (1974) 11 Cal.3d 1, 18–19 [we may uphold 
the trial court’s ruling if correct under the law].) 6    
 
The record shows by clear and convincing evidence that 
Commerce Club was aware of its right to compel arbitration, 
despite the asserted failure of Commerce Club’s counsel to find 
a complete copy of Quach’s arbitration agreement sooner.  In a 
declaration Commerce Club submitted in support of its motion 
 
6  When a trial court has applied the clear and convincing 
evidence burden of proof required by the generally applicable 
law of waiver and made factual findings in support of a waiver 
determination, the question on review is “whether the record as 
a whole contains substantial evidence from which a reasonable 
fact finder could have found it highly probable that the fact was 
true.”  (O.B., supra, 9 Cal.5th at pp. 995–996; see also People v. 
Ramirez (2022) 14 Cal.5th 176, 190; Waller, supra, 11 Cal.4th at 
p. 31.)  The trial court’s order below cited to Hoover v. American 
Income Life Ins. Co. (2012) 206 Cal.App.4th 1193, in which the 
Court of Appeal, quoting St. Agnes, supra, 31 Cal. 4th at p. 1195, 
observed that waiver is not “ ‘ “ ‘lightly inferred’ ” ’ ” and “the 
party claiming the other waived the right to arbitrate ‘bears a 
heavy burden of proof.’ ”  (Hoover at p. 1203.)  We need not 
decide whether the trial court applied a burden of proof 
equivalent to the clear and convincing evidence burden of proof 
required by the generally applicable law of waiver since even 
under a more stringent de novo standard of review, we conclude 
that Quach has established by clear and convincing evidence 
that Commerce Club waived its right to compel arbitration.  
Going forward, trial courts should apply a clear and convincing 
evidence burden of proof and reviewing courts should uphold 
findings of waiver when “the record as a whole contains 
substantial evidence from which a reasonable fact finder could 
have found it highly probable” that the party knew of its 
contractual right to compel arbitration and intentionally 
relinquished or abandoned that right.  (O.B., supra, 9 Cal.5th at 
pp. 995–996.) 


[PDF page 30]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
29 
to compel arbitration, its director of human resources attested 
that in 2015 — during Quach’s employment — Commerce Club 
required all employees to sign form agreements providing for 
binding arbitration of employment-related disputes.  Before 
Quach filed suit, Commerce Club provided him the signature 
page of his arbitration agreement, signed in 2015.  And in its 
answer to Quach’s complaint, Commerce Club asserted that 
Quach’s arbitration agreement barred his suit and that he 
should be compelled to arbitrate.  Based on these undisputed 
facts, we conclude it is “highly probable” that Commerce Club 
knew of its right to compel arbitration.  (O.B., supra, 9 Cal.5th 
at p. 995; see Lynch, supra, 3 Cal.5th at p. 475.)   
 
The record of Commerce Club’s words and conduct also 
demonstrates by clear and convincing evidence its intentional 
abandonment of the right to arbitrate.  Indeed, on this record, 
Commerce Club’s position, if accepted, would surely create 
undue delay and gamesmanship going forward.  Rather than 
moving to compel arbitration at the outset of the case, 
Commerce Club answered the complaint and propounded 
discovery requests, suggesting it did not intend to seek 
arbitration.  Although Commerce Club asserted in its answer 
that Quach should be compelled to arbitrate, its counsel did not 
otherwise raise the issue with Quach’s counsel or with the court.  
Instead, it affirmatively indicated its preference for a jury trial 
and actively pursued discovery.  On Commerce Club’s initial 
case management conference statement, filed about three 
months after Quach filed his complaint, Commerce Club 
requested a jury trial, left the check box for indicating it was 
“willing to participate” in arbitration blank, and represented 
that the only motion it intended to file was a “dispositive 
motion.”  After the case management conference, Commerce 


[PDF page 31]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
30 
Club posted jury fees.  In the following months, despite the 
disruptions caused by the COVID-19 pandemic, Commerce Club 
actively engaged in discovery, taking Quach’s deposition for a 
full day and corresponding with Quach’s counsel about discovery 
disputes.  It was not until 13 months after Quach filed his 
complaint that Commerce Club first sought to enforce its right 
to compel arbitration.  This evidence of Commerce Club’s words 
and conduct shows that Commerce Club chose not to exercise its 
right to compel arbitration and to instead defend itself against 
Quach’s claims in court.  (See Lynch, supra, 3 Cal.5th at p. 475.)   
 
This conclusion is not undermined by Commerce Club’s 
assertions that it did not move to compel arbitration on the “eve 
of trial,” that the discovery it conducted was “minimal,” that it 
did not gain information about his case that it could not have 
gotten in arbitration, and that Quach has not litigated the 
merits of his claims.  (See St. Agnes, supra, 31 Cal.4th at 
p. 1204.)  The record in this case shows that, being fully aware 
of its right to compel arbitration, Commerce Club chose not to 
do so for 13 months, affirmatively indicated its intent to pursue 
a jury trial rather than arbitration, and actively engaged in 
discovery — words and conduct markedly inconsistent with an 
intent to arbitrate.  Accordingly, we conclude Commerce Club 
waived its right to arbitrate the dispute.  (Lynch, supra, 
3 Cal.5th at p. 475.)   
CONCLUSION 
 
We reverse the judgment of the Court of Appeal and 
remand for further proceedings consistent with our decision.  
 
 


[PDF page 32]
QUACH v. CALIFORNIA COMMERCE CLUB, INC. 
Opinion of the Court by Groban, J. 
 
31 
 
GROBAN, J. 
We Concur: 
GUERRERO, C. J. 
CORRIGAN, J. 
LIU, J. 
KRUGER, J. 
JENKINS, J. 
EVANS, J. 


[PDF page 33]
 
 
See next page for addresses and telephone numbers for counsel who 
argued in Supreme Court. 
 
Name of Opinion  Quach v. California Commerce Club, Inc. 
__________________________________________________________  
 
Procedural Posture (see XX below) 
Original Appeal  
Original Proceeding 
Review Granted (published) XX 78 Cal.App.5th 470 
Review Granted (unpublished)  
Rehearing Granted 
__________________________________________________________  
 
Opinion No. S275121 
Date Filed:  July 25, 2024 
__________________________________________________________  
 
Court:  Superior  
County:  Los Angeles  
Judge:  Michael L. Stern 
__________________________________________________________   
 
Counsel: 
 
Sanders Roberts, Reginald Roberts, Jr., Eric S. Mintz, Ayan K. Jacobs; 
Benedon & Serlin, Wendy S. Albers, Gerald M. Serlin and Kelly 
Riordan Horwitz for Defendant and Appellant. 
 
Law Offices of Dilip Vithlani, Dilip Vithlani; The Law Office of 
Jonathan J. Moon, Jonathan J. Moon; The Vora Law Firm, Nilay U. 
Vora, Jeffrey A. Atteberry, William M. Odom and Amy (Lou) Egerton -
Wiley for Plaintiff and Respondent.  
 
Bosko and David Bosko for Asian Americans Advancing Justice 
Southern California, Thai Community Development Center and 
Council on American-Islamic Relations, California, as Amici Curiae on 
behalf of Plaintiff and Respondent. 
 
McGuinn, Hillsman & Palefsky, Cliff Palefsky, Keith Ehrman; Pine 
Tillett Pine and Norman Pine for California Employment Lawyers 
Association and Consumer Attorneys of California as Amici Curiae.


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Counsel who argued in Supreme Court (not intended for 
publication with opinion):  
 
Kelly Riordan Horwitz 
Benedon & Serlin, LLP 
22708 Mariano Street 
Woodland Hills, CA 91367 
(818) 340-1950 
 
Nilay U. Vora 
The Vora Law Firm, P.C. 
201 Santa Monica Boulevard, Suite 300 
Santa Monica, CA 90401 
(424) 258-5190