Liu v. Barrelet

CourtDistrict Court, S.D. California
DecidedJuly 28, 2025
Docket3:23-cv-02186
StatusUnknown

This text of Liu v. Barrelet (Liu v. Barrelet) is published on Counsel Stack Legal Research, covering District Court, S.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Liu v. Barrelet, (S.D. Cal. 2025).

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 WEI LIU, an individual, Case No.: 3:23-cv-02186-RBM-SBC

12 ORDER: Petitioner, 13 v. (1) DENYING MOTION FOR 14 RECONSIDERATION BLAISE BARRELET as Trustee of the 15 BARRELET FAMILY TRUST, (2) DIRECTING THE CLERK OF 16 THE COURT TO CLOSE THE CASE 17 Respondent. [Doc. 14] 18 19

20 On April 10, 2024, Petitioner Wei Liu (“Liu”) filed a Motion to Compel Arbitration 21 (Doc. 4), which the Court granted on November 22, 2024 (Doc. 13). Now pending before 22 the Court is Respondent Blaise Barrelet’s, as Trustee of the Barrelet Family Trust, 23 (“Barrelet”) Motion for Reconsideration and Clarification of Order Granting Motion to 24 Compel Arbitration (“Motion for Reconsideration”), which was filed on December 20, 25 2024. (Doc. 14.) Liu filed an Opposition to Barrelet’s Motion for Reconsideration 26 (“Opposition”) on January 27, 2025 (Doc. 15), and Barrelet filed a Reply in support of his 27 Motion for Reconsideration (“Reply”) on February 3, 2025 (Doc. 16.) 28 The Court finds this matter suitable for determination without oral argument 1 pursuant to Civil Local Rule 7.1(d)(1). For the reasons discussed below, the Court 2 DENIES Barrelet’s Motion for Reconsideration and ORDERS the Clerk of the Court to 3 close the case. 4 I. BACKGROUND 5 A. Barrelet’s State Court Action and Appeal 6 On October 31, 2022, Barrelet filed a Complaint for (1) Breach of Written Lease, 7 (2) Breach of Implied Covenant of Good Faith and Fair Dealing, (3) Conversion, and (4) 8 Violation of California Civil Code § 1950.5 against Liu in the Superior Court of California, 9 County of San Diego, Case No. 37-2022-00043748-CU-BC-CTL (the “State Court 10 Action”). (Doc. 9-1 at 23–291 [“State Court Complaint”].) Barrelet alleged that, on or 11 about March 9, 2022, Liu leased Barrelet the residential property located at 16627 Los 12 Morros, Rancho Santa Fe, California 92067 (the “Property”) pursuant to the terms of the 13 California Association of Realtors’ (“CAR”) form Residential Lease After Sale (the 14 “Lease”). (Id. ¶¶ 5, 7.) Pursuant to the terms and conditions of the Lease, Barrelet 15 delivered to Liu $40,000 to be held as a security deposit. (Id. ¶ 6.) 16 Barrelet alleged that the Lease expired on May 18, 2022 and that he vacated and 17 surrendered possession of the Property in clean and good condition and repair. (Id. ¶¶ 8– 18 9.) Barrelet then alleged that Liu “wrongfully and intentional[ly] withheld the Security 19 Deposit in bad faith and refused Plaintiff’s repeated requests for return of the deposit.” (Id. 20 ¶ 11.) 21 After Barrelet filed the State Court Complaint, Liu sought an order compelling the 22 case to arbitration based on the arbitration provision in the CAR’s form California 23 Residential Purchase Agreement and Joint Escrow Instructions (the “Purchase 24 Agreement”) that preceded the Lease. (Doc. 9-1 at 67 [Tentative Ruling].) The arbitration 25 provision states: 26 The Parties agree that any dispute or claim in Law or equity arising between 27 28 1 1 them out of this Agreement or any resulting transaction, which is not settled through mediation, shall be decided by neutral, binding arbitration. ... 2 Enforcement of, and any motion to compel arbitration pursuant to, this 3 agreement to arbitrate shall be governed by the procedural rules of the Federal Arbitration Act [“FAA”], and not the California Arbitration Act, 4 notwithstanding any language seemingly to the contrary in this Agreement. 5 6 (Id. (emphasis added).) 7 Interpreting the plain language of the arbitration provision, the state trial court found 8 that “the arbitration agreement is governed by the ‘procedural rules of the [FAA]’ but not 9 the substantive rules [of the FAA] as the agreement expressly states only the FAA’s 10 ‘procedural rules.’” (Id. at 68.) The trial court then held that California “Civil Code [§] 11 1953(a)(4) invalidates any provision in a lease that agrees to waive or modify procedural 12 rights in litigation, including the right to a jury trial” and that “[Barrelet’s] complaint asserts 13 breaches and violations of the [Lease] and tenancy related claims[,]” precluding arbitration. 14 (Id.) 15 The California state appellate court affirmed the trial court’s decision. (Doc. 12-1 16 [Appellate Court Decision] at 2.) The appellate court held that “the plain language of the 17 agreement indicates the parties intended for substantive California law to govern in general 18 and for federal procedural law as set forth in the FAA to govern in the context of the 19 agreement to arbitrate.” (Id. at 6.) Therefore, the appellate court agreed “with the trial 20 court’s conclusion that the arbitration agreement at issue here is governed by the procedural 21 rules of the FAA, and by substantive California state law.” (Id. at 9.) The appellate court 22 then found that California Civil Code § 1953(a)(4), a substantive law that voids the waiver 23 of litigation rights in a dwelling lease or rental agreement as contrary to public policy, 24 voided the arbitration provision as it pertains to disputes concerning the Lease. (Id. at 9– 25 12.) 26 B. Liu’s Petition and Motion to Compel Arbitration 27 On November 20, 2023, Liu filed a Petition to Compel Arbitration (“Petition”) 28 before this Court pursuant to FAA, 9 U.S.C. § 4. (Doc. 1 [“Petition”].) In contrast to 1 Barrelet’s State Court Complaint, which alleged breaches of the Lease by Liu, in her 2 Petition, Liu alleged breaches of the Purchase Agreement by Barrelet. 3 Liu asserted that she purchased a single-family residence on a large lot with a 4 vineyard from Barrelet. (Id. ¶ 1.) Liu asserted that, while Barrelet represented that the 5 vineyard was in perfect condition, Barrelet did not allow Liu to conduct a second 6 inspection. (Id.) After the close of escrow, Liu discovered that the vineyard contained 7 many grape vines that were dead or dying. (Id.) Similarly, despite representations that 8 there were no easements on the Property, Liu learned that an open space easement 9 encumbered large portions of the Property. (Id. ¶ 2.) The open space easement prevented 10 Liu and her husband from undertaking future improvement plans that they had for the 11 Property, thereby reducing the fair market value of the Property. (Id.) Liu asserted that 12 her claims include “breach of contract, fraud in the inducement and deceit by intentional 13 and/or negligent misrepresentation, and fraud and deceit by concealment of material facts.” 14 (Id. ¶ 3.) Liu stated that she “selected the Judicial Arbitration and Mediation Service 15 (‘JAMS’)[,] filed its complaint-in-arbitration with JAMS, and [] paid the JAMS filing fee” 16 but that “Barrelet refuses to arbitrate.” (Id. ¶ 9.) Barrelet did not respond to Liu’s Petition. 17 On April 10, 2024, Liu filed a Motion to Compel Arbitration (“Motion”). (Doc. 4.) 18 In her Motion, Liu re-asserted the allegations from her Petition. (Id. at 2–4.) Liu then 19 argued that an order for arbitration is proper here because (1) diversity jurisdiction exists 20 and (2) the disputes between the parties fall within the scope of the arbitration agreement. 21 (Id. at 4–5.) 22 C. Barrelet’s Opposition to Liu’s Motion to Compel Arbitration 23 In his Opposition to Liu’s Motion to Compel Arbitration, Barrelet responded that he 24 did not refuse to arbitrate. (Doc. 9 at 19.) Barrelet argued that Liu “unilaterally demanded 25 arbitration before a tribunal not provided for by the agreement, using JAMS rules not 26 provided for by the agreement, and in a forum not provided for by the agreement.” (Id. at 27 20.) Barrelet also argued that “the additional evidence provided has shown, respondent did 28 not simply refuse arbitration.” (Id.) Rather, “[h]is counsel submitted argument to JAMS 1 ….” (Id.; see also id.

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Liu v. Barrelet, Counsel Stack Legal Research, https://law.counselstack.com/opinion/liu-v-barrelet-casd-2025.