Opinion
NOT TO BE PUBLISHED
Santa Clara County Super. Ct. No. CV110013
Bamattre-Manoukian, ACTING P.J.
I. INTRODUCTION
Respondent Mohsen Afrasiabi signed an independent contractor agreement with appellant Silicon Valley Innovation Company, LLC (SVIC) in September 2004. The terms of the contract stated that, in exchange for a monthly payment of $15,000, Afrasiabi would provide the consulting services that he deemed necessary to SVIC “or an affiliate thereof, in the organization and administration of its office affairs.” The independent contractor agreement also included an arbitration clause.
Four years later, in April 2008, Afrasiabi filed an action against SVIC and appellants Alexander Hern; Zone Wellness, Inc.; Medical Weight-Loss Solutions, LLC; Medi Zone; and Solidus Networks, Inc. dba Pay By Touch (hereafter, sometimes collectively defendants). Afrasiabi claimed that Hern, the SVIC officer who had signed the independent contractor agreement, had breached an oral agreement to provide Afrasiabi with a seven percent equity interest in Zone Wellness and a seven percent equity interest in Medical Weight Loss Solutions in exchange for his services to these entities. Afrasiabi also claimed that Hern had breached an agreement to convey 300,000 shares of Hern’s stock in Pay by Touch to Afrasiabi when Afrasiabi sold a portion of Hern’s remaining Pay By Touch stock to investors.
Defendants brought a motion to compel arbitration and stay judicial proceedings, arguing that Afrasiabi’s claims fell within the scope of the arbitration clause in the independent contractor agreement. The trial court denied the motion and defendants appeal. For the reasons stated below, we conclude that the trial court’s implicit ruling that Afrasiabi’s claims are not arbitrable is supported by substantial evidence, and therefore we will affirm the order.
II. FACTUAL AND PROCEDURAL BACKGROUND
A. The Complaint
The complaint filed by Afrasiabi on April 8, 2008, alleges that SVIC was “an affiliate,” “as defined by Corporations Code [section] 150,” of defendants Zone Wellness, Inc.; Medical Weight Loss Solutions, LLC; Medi Zone; and Solidus Networks, Inc. dba Pay By Touch. Afrasiabi also alleged that individual defendant Hern was “a member or officer of SVIC” and its “duly appointed agent.” The complaint includes seven causes of action, based upon the factual allegations summarized below.
Corporations Code section 150 provides, “A corporation is an ‘affiliate’ of, or a corporation is ‘affiliated’ with, another specified corporation if it directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with the other specified corporation.”
Afrasiabi was hired by SVIC in June 2004 “to assist it in developing the infrastructure” of Zone Wellness. Hern and Afrasiabi entered into an oral agreement that Afrasiabi’s compensation “would not be limited to salary or consulting fees, but that plaintiff would receive additional compensation based upon his performance for SVIC and related entities, including those named as defendants in this Complaint.”
According to Afrasiabi, the additional compensation orally promised by Hern in December 2004 was a 10 percent equity interest in Zone Wellness “in consideration of plaintiff’s services to [Zone Wellness] and SVIC....” Afrasiabi accepted these terms and continued to perform “appropriate services” for Zone Wellness, SVIC, and Hern.
In July 2005, Hern and Afrasiabi entered into an oral agreement, whereby Hern promised to provide Afrasiabi with a seven percent equity interest in Zone Wellness and a seven percent interest in Medical Weight Loss Solutions, “in lieu” of the previously promised 10 percent interest in Zone Wellness, “in consideration of plaintiff’s services to and for” Zone Wellness, Medical Weight Loss Solutions, Medi Zone, and SVIC. Afrasiabi performed “appropriate services” for Hern, Zone Wellness, Medical Weight Loss Solutions, Medi Zone, and SVIC, pursuant to this agreement.
In August 2006, Medi Zone offered Afrasiabi the position of director of business development for Medical Weight Loss Solutions. Afrasiabi rejected the offer, and, when he advised Hern that he had done so, Hern confirmed during their telephone conversation that Afrasiabi was entitled to the promised seven percent equity interest in both Zone Wellness and Medical Weight Loss Solutions, in addition to his “monthly stipend.”
From 2004 through January 2008, Afrasiabi made repeated requests to Hern that he memorialize in writing and perform the equity agreement. In May 2007, Hern orally confirmed the equity agreement and promised to confirm it in writing, but he never did so. Afrasiabi continued to perform his obligations under the equity agreement until Medi Zone “terminated his employment by [Medical Weight Loss Solutions] on September 10, 2007.”
Afrasiabi and Hern entered into an additional oral agreement in November 2006 in which Hern agreed to convey to Afrasiabi 300,000 shares of Hern’s stock in Pay By Touch if Afrasiabi succeeded in selling a portion of Hern’s remaining stock in Pay By Touch to prospective investors for $5,000,000. Although Afrasiabi sold the shares as agreed, Hern failed to convey the 300,000 Pay By Touch shares to Afrasiabi.
Based on these allegations, Afrasiabi states causes of action against Hern, Zone Wellness, Medical Weight Loss Solutions, Medi Zone, and SVIC for breach of contract, intentional misrepresentation, negligent misrepresentation, concealment of facts, securities fraud, and specific performance. Afrasiabi also states a cause of action against individual defendant Hern for breach of contract arising from the Pay By Touch agreement. Afrasiabi seeks compensatory damages, or, in the alternative, conveyance of a seven percent interest in both Zone Wellness and Medical Weight Loss Solutions, as well as punitive damages.
B. The Motion to Compel Arbitration
On October 1, 2008, defendants filed a motion to compel arbitration and stay judicial proceedings. The motion was based upon the arbitration clause contained at paragraph 17 of the independent contractor agreement between SVIC and Afrasiabi, dated September 1, 2004, and signed by Afrasiabi as “Consultant.”
The independent contractor agreement provided, among other things, that “During the Term of this Agreement, pursuant to and subject to the terms and conditions of this Agreement, [Afrasiabi] shall provide the Company with such consulting services as he deems necessary to assist the Company, or an affiliate thereof, in the organization and administration of its office affairs. [Afrasiabi] and Company agree that Company shall have the right to control and direct the substance of the Deliverables, but [Afrasiabi] shall have the right to determine the particular means, details and methods which he believes necessary to accomplish such Deliverables.”
Regarding compensation, the independent contractor agreement provided, “As compensation for providing the Work hereunder, the Company shall pay to Contractor and Contractor shall accept as the sole and total consideration therefore the following: [¶] Consulting Fees. During the term, the Contractor shall be compensated for services rendered $15,000 monthly (the ‘Consulting Fees’). [Afrasiabi] shall submit an invoice no later than fourteen days after providing service.”
The arbitration clause in the independent contractor agreement stated, in its entirety, “The parties agree that any and all disputes between the parties arising out of the terms of this Agreement, its interpretation, any breach of this Agreement, shall be subject to binding arbitration in Santa Clara County, California before an arbitrator selected from a list provided by JAMS (Judicial Arbitration and Mediation Service/Endispute). Each party to the arbitration will select five names from the list, and beginning with the party initiating the arbitration, will alternatively strike names from the list until a single arbitrator is remaining who is available to decide the dispute. The arbitration shall be conducted under the Arbitration Rules set forth in California Code of Civil Procedure section 1280 through 1294.2, including section 1283.05 and pursuant to California law. The parties agree that the prevailing party in any arbitration shall be entitled to injunctive relief in any court of competent jurisdiction to enforce the arbitration award. The parties further agree that the prevailing party in any arbitration shall be awarded reasonable attorneys’ fees and costs.”
Defendants argued Afrasiabi was obligated to arbitrate the claims raised in his complaint pursuant to the arbitration agreement, for two main reasons. First, defendants asserted that Afrasiabi’s claims arose from the terms of the independent contractor agreement, since Afrasiabi claimed that he had not been fully compensated for his independent contractor services under the agreement as “orally amended” by Hern to provide equity in Zone Wellness and Medical Weight Loss Solutions. Second, to the extent there were any issues regarding whether Afrasiabi’s claims came within the scope of the arbitration agreement, defendants contended that the arbitration agreement provided that the JAMS arbitrator would decide issues of arbitrability.
Anticipating Afrasiabi’s arguments in opposition, defendants also argued that the lack of an SVIC signature on the independent contractor agreement was immaterial; the arbitration agreement could be enforced by those defendants who were nonsignatories; Hern could enforce the arbitration agreement because he was acting as an agent of SVIC; and third party beneficiaries Zone Wellness and Medical Weight Loss Solutions were entitled to the benefit of the arbitration agreement.
Defendants also contended that Afrasiabi should be equitably estopped from avoiding arbitration because his claims against defendants SVIC, Hern, Zone Wellness and Medical Weight Loss Solutions arose from “a single business relationship.” Defendants did not address Afrasiabi’s claim that Hern owed him 300,000 shares of Pay By Touch.
The evidentiary support for the motion to compel arbitration included the independent contractor agreement, the declaration of Hern, and Afrasiabi’s discovery responses. Defendants noted that Afrasiabi had admitted in his discovery responses that the arbitration agreement was not substantively unconscionable.
In his declaration, Hern stated that he had been the executive vice president of SVIC since 2004, that SVIC was “an incubator company that invests in emerging technologies to develop high growth, commercial businesses,” that Zone Wellness and Medical Weight Loss Solutions were affiliates of SVIC, and Medi Zone was a “ ‘dba’ ” of Medical Weight Loss Solutions. Hern also stated, “In or about September 2004, on behalf of SVIC, I negotiated an independent contractor agreement with [Afrasiabi] by which he would provide consulting services to SVIC and its affiliates.... The term ‘office affairs,’ as used in Paragraph 2 of the independent contractor agreement, broadly included consulting services appropriate to establishing and maintain operating facilities for SVIC and/or its affiliates. These services included everything from securing financing to overseeing contractors to setting up and administering an office or workplace, including any activity that one usually would perform in or from an office or workplace to implement the deliverables determined by SVIC.” Hern further stated that Afrasiabi had provided the consulting services contemplated by the independent contractor agreement in exchange for the “agreed-upon monthly consulting fee of $15,000.”
C. Opposition to the Motion to Compel Arbitration
In his opposition, Afrasiabi disputed all of defendant’s contentions. In regard to the threshold issue of who should decide arbitrability, Afrasiabi contended that it was the responsibility of the trial court, rather than the arbitrator, to decide whether his claims were subject to arbitration, because the arbitration agreement did not expressly provide that the JAMS arbitrator was to decide issues of arbitrability.
Afrasiabi also argued that his claims were not subject to arbitration because the independent contractor agreement on its face showed that the consulting services he was obligated to render under that agreement, concerning the “organization and administration” of the “office affairs” of SVIC and its affiliates, were separate and distinct from the services described in the complaint, including “marketing, development of other entities, solicitation of investment, advertising, etc.,” for which he sought the promised equity compensation.
Additionally, Afrasiabi pointed to a provision in the independent contractor agreement restricting the rights of third parties, as follows: “The execution and delivery of this Agreement shall not be deemed to confer upon, nor obligate either of the parties hereto, or impose any obligations upon, any persons or entities not a party to this Agreement.” Based on this provision, Afrasiabi argued that the arbitration agreement did not apply to the claims raised in his complaint, since the arbitration agreement was limited to the parties to the independent contractor agreement (Afrasiabi and SVIC), and none of his claims against SVIC sought relief based upon a breach of the independent contractor agreement. Afrasiabi also maintained that the third party exclusion precluded enforcement of the agreement by the other defendants as purported third party beneficiaries.
Afrasiabi further argued that the arbitration agreement was unenforceable because SVIC had never signed the independent contractor agreement and had never delivered a copy to him or communicated its acceptance of the agreement. He also asserted that the arbitration agreement was unenforceable because Hern had fraudulently induced Afrasiabi to sign the independent contractor agreement by telling him that the agreement “was only designed to shelter HERN and his entities from having to pay employment taxes and that the true arrangement would include providing [Afrasiabi] with equity positions in [Zone Wellness] and, later, [Medical Weight Loss Solutions].”
Alternatively, Afrasiabi contended that even if the arbitration agreement was enforceable, Hern should be estopped from refusing to provide Afrasiabi with the promised equity compensation because Afrasiabi had performed the agreed-upon services. Afrasiabi also claimed, in the alternative, that the independent contractor agreement had been modified by the “subsequently executed oral agreement” regarding Afrasiabi’s equity compensation.
Finally, Afrasiabi stated that SVIC was not a necessary party and that Hern was the “central and primary defendant” who could provide Afrasiabi with the promised equity interests in Zone Wellness and Medical Weight Loss Solutions.
The evidentiary support for the opposition to the motion to compel arbitration included the declaration of Afrasiabi and copies of his email correspondence seeking confirmation of his equity interest in Zone Wellness and Medical Weight Loss Solutions. In his declaration, Afrasiabi stated, among other things, that “[i]n late 2004, defendant HERN asked me to sign the alleged Independent Contractor Agreement.... Defendant HERN stated that our true agreement included a 10% equity interest in defendant [Zone Wellness] and said that the proposed Independent Contractor Agreement had only been drafted and submitted to me for tax purposes, i.e., it would enable him and his entities to avoid paying employment taxes on my income.”
Afrasiabi also stated in his declaration that he had rejected an offer of employment from Medical Weight Loss Solutions in August 2006 because the offer did not confirm the promised equity interests in Zone Wellness and Medical Weight Loss Solutions, which he had relied upon “in rendering services to and on behalf of [Zone Wellness] and [Medical Weight Loss Solutions].... [H]ern orally confirmed to me that, in addition to a monthly stipend, I was entitled to and would receive the promised 7% equity interests in [Zone Wellness] and [Medical Weight Loss Solutions].” Additionally, Afrasiabi stated, “Since late 2004, I have diligently and competently performed all of my obligations under my oral agreements with defendant HERN until defendant MEDI ZONE terminated[d] my employment by [Medical Weight Loss Solutions] on September 10, 2007....”
D. The Trial Court’s Order
On November 17, 2008, the trial court issued its order denying defendant’s motion to compel arbitration and stay judicial proceedings. The trial court did not explain the basis for its ruling in the written order. However, at the hearing on the motion, the trial court stated that, while the court was aware of the policy favoring arbitration and the rule that ambiguities were to be resolved in favor of arbitration, the court had denied the motion “for the reasons set forth by [Afrasiabi’s] Counsel, both in his writings and his oral comments. I agreed with his positions.”
III. DISCUSSION
Defendants appeal from the order denying their motion to compel arbitration and stay judicial proceedings. An order denying a motion to compel arbitration is appealable under Code of Civil Procedure section 1294, subdivision (a).
All statutory references hereafter are to the Code of Civil Procedure unless otherwise indicated.
On appeal, defendants argue that for several reasons the trial court erred in denying their motion: a valid arbitration agreement exists; Afrasiabi agreed to arbitrate his claims when he signed the independent contractor agreement; all defendants may enforce the arbitration agreement, either as a signatory or a nonsignatory, because they were all engaged in a single enterprise and/or were agents and affiliates of SVIC; all defendants except Pay By Touch are third party beneficiaries of the independent contractor agreement; Afrasiabi is equitably estopped from objecting to the joinder of Hern, Zone Wellness, Medi Zone, and Medical Weight Loss Solutions since his claims against them are inherently inseparable from his claims against SVIC; the arbitration agreement applies to Afrasiabi’s claims in this action; Afrasiabi’s defense of fraud in the inducement of the independent contractor agreement lacks merit; and the issue of arbitrability must be decided by the arbitrator, not the trial court.
Before addressing the dispositive issue of arbitrability, we will briefly review the statutory scheme that governs private arbitration in California and the standard of review that applies to an order denying a motion to compel arbitration.
A. The Statutory Scheme and the Standard of Review
“Title 9 of the Code of Civil Procedure... represents a comprehensive statutory scheme regulating private arbitration in this state. (§ 1280 et seq.)” (Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 9.) “The fundamental premise of the scheme is that ‘[a] written agreement to submit [either a present or future controversy] to arbitration... is valid, enforceable and irrevocable, save upon any such grounds as exist for the revocation of any contract.’ ([§] 1281.)” (Vanderberg v. Superior Court (1999) 21 Cal.4th 815, 830.)
“Through this detailed statutory scheme, the Legislature has expressed a ‘strong public policy in favor of arbitration as a speedy and relatively inexpensive means of dispute resolution.’ [Citations.] Consequently, courts will ‘ “indulge in every intendment to give effect to such proceedings.” ’ [Citations.]” (Moncharsh v. Heily & Blase, supra, 3 Cal.4th at p. 9.) Nevertheless, the public policy is not absolute. “ ‘[T]he policy favoring arbitration cannot displace the necessity for a voluntary agreement to arbitrate.’ [Citations.] In addition, ‘[however] broad may be the terms of a contract, it extends only to those things concerning which it appears that the parties intended to contract. [Citation.]” (Victoria v. Superior Court (1985) 40 Cal.3d 734, 739.)
Section 1281.2 provides for trial court enforcement of private arbitration agreements: “On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party thereto refuses to arbitrate such controversy, the court shall order the petitioner and the respondent to arbitrate the controversy if it determines that an agreement to arbitrate the controversy exists, unless it determines that [¶] (a) The right to compel arbitration has been waived by the petitioner; or [¶] (b) Grounds exist for the revocation of the agreement.”
Section 1292.4, provides, “If a controversy referable to arbitration under an alleged agreement is involved in an action or proceeding pending in a superior court, a petition for an order to arbitrate shall be filed in such action or proceeding.”
Both parties have a burden of proof. “The petitioner bears the burden of proving the existence of a valid arbitration agreement by the preponderance of the evidence, and a party opposing a petition bears the burden of proving by a preponderance of the evidence any fact necessary to its defense. [Citation.] In these summary proceedings [under section 1281.2], the trial court sits as a trier of fact, weighing all the affidavits, declarations, and other documentary evidence, as well as oral testimony received at the court’s discretion, to reach a final determination.” (Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 972.)
The standard of review where the trial court resolved disputed facts in ruling on a motion to compel arbitration is substantial evidence. (Brown v. Wells Fargo Bank, NA (2008) 168 Cal.App.4th 938, 953.) Where the facts were undisputed, the standard of review is de novo. (Ibid.) If only a question of law is involved, the standard of review is also de novo. (Robertson v. Health Net of California, Inc. (2005) 132 Cal.App.4th 1419, 1425.)
B. Arbitrability
In the present case, it is undisputed that an arbitration agreement exists, as set forth at paragraph 17 of the independent contractor agreement. The primary issue is whether the parties agreed to arbitrate the claims raised in Afrasiabi’s complaint, or, in other words, whether the claims are arbitrable. Before addressing the issue of arbitrability, we will consider the threshold issue of whether the trial court or the arbitrator was required to decide the issue of arbitrability in this case.
1. Who Decides the Issue of Arbitrability
California courts have adopted the federal standard that “[u]nless the parties clearly and unmistakably provide otherwise, the question of whether the parties agreed to arbitrate is to be decided by the court, not by the arbitrator. [Citations.]” (AT&T Technologies, Inc. v. Communications Workers (1986) 475 U.S. 643, 649; Gilbert Street Developers, LLC v. La Quinta Homes, LLC (2009) 174 Cal.App.4th 1185, 1190-1191.) Thus, where the agreement is either silent or ambiguous regarding who is to decide arbitrability, doubts should be resolved in favor of the court making the decision. (First Options of Chicago, Inc. v. Kaplan (1995) 514 U.S. 938, 944-945; Parker v. Twentieth Century-Fox Film Corp. (1981) 118 Cal.App.3d 895, 904.)
Defendants contend that the arbitration agreement provides that the arbitrator must decide the issue of arbitrability, because it states, as quoted by defendants, that “ ‘any and all disputes between the parties arising out of the terms of this Agreement [or] its interpretation... shall be subject to binding arbitration.’ ” Defendants explain that the issue of whether Afrasiabi’s claims are arbitrable arises from the terms of the independent contractor agreement, and therefore that issue is delegated to the arbitrator.
Additionally, defendants assert that because the arbitration agreement provides that disputes arising from the independent contractor agreement will be decided by “an arbitrator selected from a list provided by JAMS,” the arbitration agreement thereby incorporates the JAMS Comprehensive Arbitration Rules and Procedures, including the JAMS rule requiring the arbitrator to decide “arbitrability disputes.”
JAMS Comprehensive Arbitration Rules and Procedures, revised March 26, 2007, rule 1 and 11(c).
Having independently reviewed the arbitration agreement (Dream Theater, Inc. v. Dream Theater (2004) 124 Cal.App.4th 547, 551), we determine that it does not “clearly and unmistakably provide” that the arbitrator is to decide the issue of arbitrability (AT&T Technologies, Inc. v. Communication Workers of America, supra, 475 U.S. at p. 649). While the arbitration agreement does provide for the arbitration of disputes arising from the terms of the independent contractor agreement or its interpretation, the arbitration agreement does not expressly provide that the arbitrator shall decide whether a particular dispute is arbitrable. Therefore, we find that the arbitration agreement is ambiguous in that regard, and following the direction of the United States Supreme Court, we may not “assume that the parties agreed to arbitrate arbitrability unless there is ‘clea[r] and unmistakabl[e] evidence that they did so. [Citation.]” (First Options of Chicago, Inc. v. Kaplan, supra, 514 U.S. at p. 944.)
The purported incorporation of JAMS rules does not convince us otherwise, because the arbitration agreement expressly provides to the contrary that “[t]he arbitration shall be conducted under the Arbitration Rules set forth in California Code of Civil Procedure section 1280 through 1294.2, including section 1283.05 and pursuant to California law.” Accordingly, we believe that it was proper for the trial court to decide the threshold issue of arbitrability in this case.
2. The Arbitrability Issue
Defendants contend that Afrasiabi’s claims fall within the scope of the arbitration agreement because, pursuant to the independent contractor agreement, he agreed to provide consulting services to SVIC and its affiliates in the “organization and administration” of their “office affairs” in exchange for compensation of $15,000 per month. Based on Hern’s declaration, they assert that the independent contractor agreement thereby “broadly referred to those services associated with developing and maintaining an office or workplace, including all aspects of infrastructure development and operations, securing financing, overseeing contractors, and all other tasks necessary or appropriate to the operation of an office.” In defendants’ view, therefore, the independent contractor agreement necessarily encompassed the services that Afrasiabi alleges in his complaint that he performed for Hern, Zone Wellness, Medical Weight Loss Solutions, Medi Zone, and SVIC in exchange for the promised equity interests, and his claims that defendants failed to fully compensate him for those services must be arbitrated.
In response, Afrasiabi argues that substantial evidence supports the trial court’s “implied conclusion that the parties had not agreed or intended to arbitrate their present disputes.” Afrasiabi points to language in the independent contractor agreement, as quoted in his brief, providing that he would provide SVIC “ ‘with such consulting services as hedeems necessary to assist the Company, or an affiliate thereof, in the organization and administration of its office affairs.’ ” According to Afrasiabi, “[t]hose services are distinct from and far more limited than those alleged in the Complaint, which involve marketing, development of other entities, solicitation of investment, advertising, etc. Moreover, the complete clause gave [Afrasiabi] the discretion to determine which services were necessary to his fulfill[ing] his obligations to SVIC under the [independent contractor agreement].
Further, because defendants did not request a statement of decision under section 632, Afrasiabi contends that the appellate court must assume that the trial court made factual findings to support its implied conclusion that his claims were not arbitrable. Defendants object to Afrasiabi’s contention, asserting that this court must perform a de novo review and arguing that, in any event, defendants effectively requested a statement of decision at the hearing on their motion to compel arbitration. We agree with Afrasiabi.
Section 1291 provides that “A statement of decision shall be made by the court, if requested pursuant to Section 632, whenever an order or judgment, except a special order after final judgment, is made that is appealable under this title.” Section 632 provides in pertinent part, “The request for a statement of decision shall specify those controverted issues as to which the party is requesting a statement of decision.” Thus, “[a] party is not entitled to a statement of decision based on a ‘general inquisition’.... [Citations.]” (Conservatorship of Hume (2006) 140 Cal.App.4th 1385, 1394.) Where a statement of decision was not effectively requested, we must assume the trial court made findings necessary to sustain the judgment. (Michael U. v. Jamie B. (1985) 39 Cal.3d 787, 792-793.)
Defendants rely on the following colloquy at the hearing on the motion to support their contention that they effectively requested a statement of decision:
“[DEFENSE COUNSEL]: We have a [case management conference] at 10 o’clock. Could we perhaps briefly address that?
“THE COURT: I will be happy to address that now, so you don’t have to remain.
“[DEFENSE COUNSEL]: Your Honor, before we do, if I may respectfully ask for the basis of your ruling?
“THE COURT: I think I articulated that. But I will say for the reasons set forth by Counsel, both in his writings and his oral comments. I agreed with his positions.”
We find that nothing in the above colloquy, in which defense counsel merely made a nonspecific request to the trial court to elaborate on its ruling, constitutes a request by defendants for a statement of decision within the meaning of section 632. Therefore, we will incorporate the doctrine of implied findings, as discussed below, in applying the appropriate standard of review to the trial court’s implicit decision regarding arbitrability.
It is well established that the trial court’s factual rulings on arbitrability are reviewed under the substantial evidence standard of review. (Engineers & Architects Assn. v. Community Development Dept. (1994) 30 Cal.App.4th 644, 653.) “[T]he power of an appellate court begins and ends with a determination as to whether there is any substantial evidence, contradicted or uncontradicted,” to support the court’s findings. (Crawford v. Southern Pacific Co. (1935) 3 Cal.2d 427, 429.) Under this standard of review, we view the evidence in the light most favorable to the prevailing party, giving that party the benefit of every reasonable inference and resolving all conflicts in that party’s favor. (Jessup Farms v. Baldwin (1983) 33 Cal.3d 639, 660.)
Thus, “ ‘we must presume the court found every fact and drew every permissible inference necessary to support its judgment, and defer to its determination of credibility of the witnesses and the weight of the evidence. [Citation.]’ [Citation.].” (Engineers & Architects Assn. v. Community Development Dept., supra, 30 Cal.App.4th at p. 653.) With regard to implied findings, “ ‘[a]n appellate court will not disturb the implied findings of fact made by a trial court in support of an order, any more than it will interfere with express findings upon which a final judgment is predicated.... So far as it has passed on the weight of the evidence or the credibility of witnesses, its implied findings are conclusive.” (Griffith Co. v. San Diego College for Women (1955) 45 Cal.2d 501, 507-508.)
In the present case, we presume that the trial court found that Afrasiabi’s claims were not arbitrable under the arbitration agreement contained in the independent contractor agreement, based on the trial court’s statement at the time of the hearing on the motion to compel arbitration that the court agreed with Afrasiabi’s “positions,” as set forth in his “his writings and his oral comments.”
Afrasiabi’s writings included his opposition to the motion, in which his primary argument was that the independent contractor agreement, including the arbitration clause, did not apply to the claims raised in his complaint regarding the equity compensation owed for his services because those services were distinct from the services covered by the independent contractor agreement. Afrasiabi stated in his opposition that his claims were not subject to arbitration because the independent contractor agreement on its face showed that the consulting services he was obligated to render under that agreement, concerning the “organization and administration” of the “office affairs” of SVIC and its affiliates, were separate and “distinct from and far more limited than those alleged in the Complaint, which involve marketing, development of other entities, solicitation of investment, advertising, etc.”
We must also presume that the trial court made the findings of fact necessary to support its implicit ruling regarding arbitrability. In particular, we presume that the court found credible Afrasiabi’s claim that the services he agreed to perform in exchange for equity interests in both Zone Wellness and Medical Weight Loss Solutions under his oral agreement with Hern were distinct from the services he agreed to perform under the independent contractor agreement for a consulting fee of $15,000 per month. We reiterate that, as the reviewing court, we are limited to making “a determination as to whether there is any substantial evidence, contradicted or uncontradicted,” to support the court’s implied factual findings. (Crawford v. Southern Pacific Co., supra, 3 Cal.2d at p. 429.)
The evidence in support of the trial court’s implied factual findings included Afrasiabi’s responses to defendants’ requests for admission. Defendants asked Afrasiabi to admit that the services he provided for Zone Wellness, SVIC, Medical Weight Loss Solutions, and Medi Zone, “arose out of the consulting work you performed for SVIC.” In his responses, Afrasiabi stated in pertinent part, “As stated in the Complaint the services which Mr. Hern asked [Afrasiabi] to provide were separate and distinct from his services to [defendants] and were expressly solicited in consideration of the promised equity position in Zone Wellness and Medical Weight Loss Solutions.... Mr. Hern many months later substantially enlarged [Afrasiabi’s] services to Mr. Hern and his other entities in exchange for Mr. Hern’s promises of the separate and additional compensation described in the Complaint. Mr. Hern, despite innumerable opportunities to do so, as reflected in the e-mail chains which [Afrasiabi’s] counsel produced several months ago, never repudiated these promises until well after [Afrasiabi] had rendered these additional services....”
Additional evidence included Afrasiabi’s declaration, in which he stated that he had rejected an offer of employment from Medical Weight Loss Solutions in August 2006 because the offer did not confirm the promised equity interests in Zone Wellness and Medical Weight Loss Solutions, which he had relied upon “in rendering services to and on behalf of [Zone Wellness] and [Medical Weight Loss Solutions].... [H]ern orally confirmed to me that, in addition to a monthly stipend, I was entitled to and would receive his promised 7% equity interests in [Zone Wellness] and [Medical Weight Loss Solutions].” Afrasiabi also stated, “Since late 2004, I have diligently and competently performed all of my obligations under my oral agreements with defendant HERN until defendant MEDI ZONE terminated[d] my employment by [Medical Weight Loss Solutions] on September 10, 2007....”
Our review of the evidence therefore shows that substantial evidence supports the trial court’s implied factual findings that (1) an oral agreement existed in addition to the independent contractor agreement; and (2) the terms of the oral agreement were that Afrasiabi would receive equity interests in Zone Wellness and Medical Weight Loss Solutions for services that were distinct from the services he was to provide under the independent contractor agreement. Since the trial court also impliedly found that Afrasiabi’s claim for equity compensation, as set forth in his complaint, arose from the oral agreement rather than the independent contractor agreement, the trial court properly determined that the claims were not subject to arbitration under the arbitration agreement contained in the independent contractor agreement.
Finally, we observe that defendants have not specifically argued, in either their opening brief or their reply brief, that Afrasiabi must arbitrate his additional claim that he is owed 300,000 shares of Pay By Touch stock pursuant to his agreement with Hern. We will construe their silence on this point as an implied concession that the Pay By Touch claim is not arbitrable under the arbitration agreement contained in the independent contractor agreement.
For these reasons, we conclude that the trial court did not err in denying defendants’ motion to compel arbitration and we will affirm the order. Having reached this conclusion, we need not address the other issues raised by defendants.
IV. DISPOSITION
The order of November 17, 2008, denying the motion to compel arbitration and stay judicial proceedings is affirmed. Costs on appeal are awarded to respondent.
WE CONCUR: Mcadams, J., Duffy, J.