Jones v. Solgen Construction, LLC, No. F085918 (D5 Feb. 26, 2024).
A shady Solar Seller claims to have sold a rooftop solar setup to an 81-year-old Lady in Fresno. Lady lives on $1,000 per month in social security, but apparently agreed to take out a $52k, 25-year loan from Lender, Solar Seller’s financing partner. Lady sued, claiming fraud and other related stuff. The loan documents included an arbitration clause. Lender and Solar Seller moved to compel arbitration.
The parties’ versions of the relevant events are, to say the least, hotly in dispute. Lady says she thought she was entering a government program that was supposed to cap her electric bills in exchange for putting some solar panels on her roof. She never would have agreed to a long term loan that would not be paid off till she was 106. Lady didn’t recall signing a contract, and certainly not a contract containing those terms. Solar Seller and Lender say that Lady DocuSigned a loan agreement and have a video where she (somewhat hesitantly and with a confused affect) acknowledges that. The details of that aren’t really super important, but it should suffice to say that there was evidence upon which the court could probably have gone either way.
One piece of that evidence is the DocuSigned contract. Solar Seller made a somewhat inscrutable hearsay objection to it. Not for the contract itself. After all, if not admitted, the lack of a contract pretty much precludes an arbitration argument. But for a stamp on the DocuSign certificate that showed Lady reviewed the 21-page contract for a whopping 38 seconds before she allegedly e-signed it.
But Lender had put in a declaration establishing business records foundation under Evidence Code § 1271. The declaration did a good job of establishing why the DocuSign process was a reliable and trustworthy way to generate business records. That being the case, there was no error in considering the time stamps.
Solar Seller also says that the trial court erroneously refused to consider a customer service recording between Lady and a customer service rep, which it submitted in connection with its reply brief. But the record doesn’t actually substantiate that is what happened. The trial judge asked why the recording was submitted on reply. Solar Seller gave an answer. Then the discussion moved on. Nowhere does the record reflect that the court refused to consider the recording. And the fact that the court didn’t expressly refer to it in its written ruling doesn’t change that fact. The appellant bears the burden of coming forward with a record of error. Silence merits a presumption that the trial court was correct.
Finally, the big issue is whether the court correctly found by a preponderance of the evidence that there was no binding agreement to arbitrate. Again, the substance of this debate is too fact-specific to be interesting. But there is an interesting debate about the standard of review.
A finding of fact is typically reviewed for substantial evidence. But specific to this context, the weight of the authority treats an appeal of a finding that a party failed to meet its burden of proof like an appeal of a denial of a plaintiff’s JNOV. That is, was the plaintiff’s evidence so overwhelming that any reasonable trier of fact would find in its favor, and thus that the court was required to find that it met its burden as a matter of law? If that’s the standard, the question here isn’t too hard, because the Solar Seller and Lender’s evidence isn’t that good.
But there are some cases that suggest that when the record before the trial court was entirely written—as it was here—an appellate court can re-weigh the evidence de novo. See Patterson v. ITT Consumer Financial Corp., 14 Cal. App. 4th 1659, 1663 (1993); Milazo v. Gulf Ins. Co., 224 Cal. App. 3d 1528, 1534 (1990). The theory is that, on a paper record, an appellate court is equally well situated to find the facts.
But the Court here does a good job of unspooling that those cases are not reasoned and authority they rely upon does not actually support the stated proposition. They instead stand for the much less sweeping point that an appellate court is equally well situated to interpret the language of a contract when no parol evidence is at play. That is the kind of mistake that appellate courts sometimes make, and I have complained about it previously. So kudos to the Court here for digging in. And in any event, the Supreme Court has repeatedly held that a deferential standard of review applies to a trial court’s fact-finding, regardless of whether it is based on oral testimony or a written record.
That being the case, the evidence was no so overpowering that the existence of an agreement was established as a matter of law.
Affirmed.