Legal Question in Real Estate Law in California
Mandatory Arbitration Clause
The property I purchased has some major problems that the seller did not tell me about or disclose in the transfer disclosure statement. Also, although I received a warranty from a licensed roofing contractor and the roof still leaks, the California contractors board just determined (after one year) that they have no jurisdiction because what WAS repaired was done satisfactorily and the contractor insists the seller and agent told him there were no roof leaks. The seller has told me to take him to court, however the arbitration clause in the purchase contract states if either party files an action in civil court, they will automatically loose. It also does not state who the arbitrator will be. How do I start this process, what forms do I need to send to the seller and at what point when they ignore me (if any), can I take this to court without losing automatically. Also, I can't force the roofing contractor into arbitration, but without a joint claim against the contractor and the seller, I'm afraid that a court will point to the seller and an arbitrator to the contractor. Do I have any options.
Thank-you
1 Answer from Attorneys
Re: Mandatory Arbitration Clause
It sounds like you will have little choice but to either give up or initiate the legal process. Your biggest decision is whether or not to proceed at all. That will depend on the size of the case, what you can really prove, and the amount of time and energy you are willing to commit. Although I would need to see the contract to be certain, even if there is an arbitration clause, you may be able to file suit in court. If no one raises the arbitration clause, then the case will proceed in court. Normally, even if someone insists on arbitration, the court will stay its proceedings and supervise the arbitration. However, without seeing your contract I cannot tell you for sure. Normally, an arbitration clause will explain how to get started. If it doesn't, then you will need a lawyer to help you get started. You and the other side will have to agree to an arbitrator and set of rules. Believe me, if a layperson and a lawyer make rules governing how a case will be determined, and the lawyer guides the selection of the arbitrator to someone he knows, who do you think will ultimately win? With regard to the contractor, a lot of contractor contracts have arbitration clauses, so you may be able to get everyone to proceed together. If not, you are experiencing firsthand why a lot of lawyers now advise against agreeing to arbitration clauses. Your situation is complicated enough that you should get a lawyer involved. Please do not take it as an insult when I tell you you will almost certainly lose if you try to proceed on your own. If you are in Northern California, please let me know if you would like me to help. If you are somewhere else, please let me know and I will see if I can get you a referral.
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