A California appeals court has found that an auto dealer鈥檚 used car sales agreement that had been translated into Spanish but omitted translation for the arbitration clause renders the clause unenforceable.
In , Alfred Ramos bought a used car from Pena鈥檚 Motors, an agent for Westlake Services, LLC. The negotiation between Ramos and Pena鈥檚 Motors was conducted primarily in Spanish, which is Ramos鈥� native language. Although the sales contract was written in English, Pena鈥檚 Motors provided Ramos with what they said was a Spanish translation of the complete agreement. Ramos then signed the English version of the contract, which stated that he fully read and understood the arbitration clause within the agreement.
Later, Ramos sued Westlake over an optional insurance policy he had purchased with the vehicle, alleging that the policy violated California鈥檚 unfair competition laws. Based on the arbitration clause in the sales agreement, Westlake moved to compel arbitration. However, it was discovered that the arbitration clause had been omitted from the Spanish translated document furnished to Ramos during negotiations. Based on that fact, an Alameda Superior Court judge denied Westlake鈥檚 motion to compel arbitration.
In its opinion, the Court of Appeal for the First District upheld the trial court鈥檚 ruling, finding that there was no mutual agreement to arbitrate 鈥渂ecause the arbitration agreement was hidden in the English Contract and not included鈥� in the Spanish translation. Since Westlake could not produce the translation of the arbitration clause, it had no proof that Ramos had agreed to arbitrate any disputes with Westlake.
While Ramos鈥� action of acknowledging and understanding the arbitration clause by signing the English version of the contract might normally bind him to the terms of the clause, the court found that the 鈥渃ircumstances of this case are not typical.鈥� The court found the fact that Ramos was supplied with a Spanish translation to be significant in supporting Ramos鈥� contention that he spoke little English and that the arbitration clause was 鈥渉idden鈥� in the English contract. Based on this, the court found that there was fraud in the execution of the arbitration clause and no mutual agreement to arbitrate.
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