{"id":2250,"date":"2026-07-26T18:30:56","date_gmt":"2026-07-26T18:30:56","guid":{"rendered":"https:\/\/gifted-chandrasekhar.174-138-183-210.plesk.page\/?page_id=2250"},"modified":"2026-09-24T20:25:26","modified_gmt":"2026-09-24T20:25:26","slug":"failure-to-pay-forum-fees","status":"publish","type":"page","link":"https:\/\/gifted-chandrasekhar.174-138-183-210.plesk.page\/?page_id=2250","title":{"rendered":"Failure to Pay Forum Fees"},"content":{"rendered":"\t\t
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FAILURE TO PAY FORUM FEES<\/strong><\/h2>\n\t\t\t\t\t

Anoke v. Twitter, Inc., 105 Cal. App.5th 153<\/u><\/em><\/strong>

Hernandez v. Sohnen Enterprises, 102 Cal. App. 5th 222<\/u><\/em><\/strong>

Hohenshelt v. Superior Court, 99 Cal. App. 5th 1319<\/u><\/em>,<\/strong>

Keeton v. Tesla, Inc., 103 Cal. App. 5th 26<\/u><\/em><\/strong>

Suarez v. Superior Court, 99 Cal. App. 5th 32<\/u><\/em><\/strong>

Trujillo v. J-M Manufacturing Co., Inc.,107 Cal. App. 5th 56<\/u><\/em><\/strong>



Anoke v. Twitter, Inc., 105 Cal. App.5th 153<\/u><\/em><\/strong>

Anoke filed a class arbitration demand with JAMS against Twitter asserting employment issues. On March 7, 2023, the arbitrator emailed an invoice for $27,200, due upon receipt, to counsel for both sides. Anoke\u2019s attorney mistakenly paid the invoice that day. On the following day, the attorney discovered his error and demanded a refund, which was paid on March 21. Twitter\u2019s counsel was not aware of the refund. On April 7, the arbitrator emailed a new invoice, which Twitter paid on May 5, within the 30-day grace period. Anoke claimed that Twitter\u2019s failure to pay the fees within 30 days after the first invoice was due triggered Code of Civil Procedure Section 1281.97, which allows an employee or consumer to withdraw from the arbitration if its adversary fails to pay the filing fees within 30 days of the invoice. She filed a motion to compel arbitration for her fees and costs. The motion was denied. Anoke appealed.

The Court of Appeal affirmed. It noted that Anoke made three arguments, none of which had merit. First, she argued that the statute requires payment of the fees, not the invoice. But it is the invoice that sets the \u201cdue date,\u201d and thus also the 30-day grace period that determines whether a payment is late. Here, there were two invoices, two due dates, and two payments\u2014and both payments were within the statutory grace period set by the relevant invoices.

Second, she contended the arbitrator, by issuing a second invoice, extended the grace period on the due date beyond 30 days. Arbitrators cannot cure a default by extending the statutory 30-day grace period. Here, however, the arbitrator did not try to cure a default or extend a 30-day grace period. There was no missed payment. Anoke failed to accept responsibility for the fact that it was her<\/em> attorney who timely paid the first invoice. The statute did not bar the arbitrator from accepting that payment. At that point, the arbitrator had nothing more to do. The arbitration could proceed without delay, which it did. The arbitrator marked the invoice \u201cpaid\u201d and \u201cclosed,\u201d which it was. When Anoke's counsel then demanded a refund, her counsel put the arbitrator back to square one. The statute does not tell the arbitrator what to do when a timely payment is refunded. The arbitrator made a rational decision to issue a new invoice \u201cdue upon receipt,\u201d which Twitter paid within the statutory grace period.

Third, Anoke contended her attorney never \u201cpaid\u201d the invoice within the meaning of the statute. Only a payment by Twitter would satisfy the statute, because it was responsible for paying the fees. The court concluded that Anoke's counsel \u201cpaid\u201d the first invoice. The reasons for a late payment are irrelevant and the reasons for a timely payment are likewise irrelevant. Section 1281.97(a)(1) uses passive voice to describe the condition (\u201cif the fees or costs \u2026 are not paid\u201d) but active voice to describe the consequences (\u201cthe drafting party is in material breach \u2026 , is in default \u2026 , and waives its right to compel arbitration\u201d). The switch in voices indicates that, if the fees are not paid\u2014regardless of how or why\u2014the drafting party bears the consequences. But for purposes of determining whether a breach has occurred, section 1281.97 turns on whether the fees were paid within 30 days of the invoice's due date\u2014not how they were paid or why.

Hernandez v. Sohnen Enterprises, 102 Cal. App. 5th 222<\/u><\/em><\/strong>

Plaintiff sued his employer for violation of the Labor Code and disability discrimination. The defendant moved to compel arbitration under an agreement that stated that it was governed by the FAA. The parties subsequently stipulated to arbitration and a stay of the litigation. The defendant failed to pay the arbitration fees within 30 days of the due date and plaintiff moved to withdraw from arbitration and lift the stay pursuant to Code of Civ. Proc. Section 1281.97. The motion was granted and the defendant appealed, arguing that Section 1281.97 was preempted.

Plaintiff argued that the ruling was not appealable. The Court of Appeal disagreed. Courts have concluded that an order under Section 1281.97 is the functional equivalent of denying a petition to compel arbitration, and therefore appealable.

The Court, in a 2-1 decision, then held that Section 1281,97 was preempted, disagreeing with the panel in Hohenshelt v. Superior Court, infra, <\/em>and reversed. It held that Section 1281.97 limits the enforceability of certain types of arbitration agreements by allowing consumers and employees to elect to avoid arbitration even in cases of minor, inadvertent, or inconsequential delay. Imposing a higher standard for enforcement of arbitration agreements in consumer and employee disputes is contrary to the FAA's policy to ensure arbitration agreements are as enforceable as other contracts. In addition, section 1281.97 frustrates the FAA's objective of cheaper, more efficient resolution of disputes by increasing the overall cost of litigation and wasting resources already invested toward arbitration. Unless the parties have expressly selected California's arbitration provisions to apply to their agreement, the FAA preempts the portion of section 1281.97 that dictates findings of material breach and waiver as a matter of law.

(Note: Another division of the Court of Appeal ruled that Section 1297. et. seq. was not preempted. See Keeton v. Tesla, Inc., infra)<\/em>

Hohenshelt v. Superior Court, 99 Cal. App. 5th 1319<\/u><\/em>,<\/strong>

Hohenshelt sued Golden State Foods, his former employer, alleging violation of the state anti-discrimination and labor laws. Golden State\u2019s motion to compel arbitration was granted and the litigation was stayed. An arbitration before JAMS commenced. JAMS sent an invoice to Golden State for $32,300 in fees on July 29, 2022, and another for $11,760 on August 29, 2022. Both payments were due upon receipt. On September 30, JAMS sent a reminder to Golden State and advised that the fees would be due on October 28. On the same day, Hohenshelt advised JAMS that he was exercising his option to withdraw from the arbitration under Code of Civ. Proc. Section 1281.97 because Golden State had not paid the fees within 30 days of the due date. Golden State paid the fees on October 5. The trial court denied Hohenshelt\u2019s motion to lift the stay, holding that JAMS had imposed a new due date and that Golden State had complied with it. Hohenshelt appealed.

In a 2-1decision, the Court of Appeal reversed. Section 1281.98 does not allow for any extension of time for the due date absent an agreement \u201cby all parties.\u201d JAMS's September 30, 2022 letter allowing payment until October 28, 2022, in no way cured Golden State's missed payment and material breach.

The court\u2019s split was over the issue of preemption. The majority held that Sections 1281.97 et. al. did not disfavor arbitration because they did not necessarily end the nascent arbitration as the employee maintained the option of continuing in arbitration or returning to a judicial forum. They both gave effect to the parties' agreement and furthered another of the FAA's main purposes\u2014namely, ensuring the quick, inexpensive, and conclusive resolution to a dispute. Although the ruling here ended the arbitration, the fault belonged with the employer. Other employers presumably would take note of this incentive to speed up the arbitration. This incentive to speed arbitration in other cases meant that the statutes were a friend of arbitration and not its foe.

Justice Wiley dissented. He stated that the California legislature disagreed \u201cstrongly and persistently\u201d with the federal courts whether arbitration was desirable. The statutes here were preempted because they made arbitration agreements unenforceable. He concluded that \u201c[a] friend of arbitration does not make the arbitration agreement unenforceable [and that] [f]ederal law does not allow a state to save arbitration by destroying it\u201d and he predicted that the United States Supreme Court, for the seventh consecutive time, would overturn a California law covering arbitration on the ground of preemption.

Keeton v. Tesla, Inc., 103 Cal. App. 5th 26<\/u><\/em><\/strong>

Keeton sued Tesla for discrimination. The trial court stayed the case after the parties agreed to arbitrate. Tesla failed to timely pay its arbitration fees in violation of Code of Civ. Proc. Section 1281.98 and Keeton moved to vacate the stay. The trial court granted the motion, and Tesla appealed, arguing, inter alia, <\/em>that Section 1281.98 was preempted by the FAA.

The Court of Appeal affirmed. The FAA does not preempt section 1281.98. Arbitrationspecific state procedural rules are not preempted where the parties agreed to arbitrate by those rules and the rules are consistent with the FAA's objectives. By imposing a strict deadline for payment of fees and specifying the consequences for untimely payment, section 1281.98 addressed the situation where an employer delays arbitration proceedings by failing to pay arbitration fees. The statute therefore furthered the purpose of the FAA for efficient and speedy resolution of claims. Thus, application of section 1281.98 in this case would not undermine the federal policy to ensure the enforceability, according to their terms, of private agreements to arbitrate.

Tesla argued that the FAA preempted section 1281.98 because it withdrew the power to enforce the arbitration agreement from the drafting party. The court responded that Section 1281.98 did not outright invalidate arbitration agreements, and it was not a provision designed to limit the rights of parties who choose to arbitrate or otherwise to discourage the use of arbitration. Rather, section 1281.98 provided the drafting party with a 30-day grace period to make late payments, defined a drafting party's failure to pay within that window as a material breach of the arbitration agreement, and provided remedies to the non-drafting party for the breach, remedies that included the option<\/em> to withdraw from arbitration. See Sections 1281.98(a)(1) and (b). Thus, it is only because of the drafting party's own actions that a court may decline to enforce an arbitration agreement, and even then, the non-drafting party could still choose to proceed with arbitration.

Tesla next asserted that section 1281.98 discriminated against arbitration agreements by imposing a strict deadline on drafting parties for payment of fees whereas the rule that applies to contracts generally for a material breach allows for a \u201creasonable time\u201d to perform an act (Civ. Code, \u00a7 1657). Tesla contended that section 1281.98 imposed a different rule than that applicable to contracts generally. The court rejected the employer's argument that the statute was preempted on that basis, emphasizing that the Legislature had a good reason for declaring untimely payment a material breach as a matter of law rather than leaving materiality a question of fact in this context.

Reynosa v. Superior Court, 101 Cal. App. 5th 967<\/u><\/em><\/strong>

Reynosa filed a suit for damages against ATS, his former employer. ATS\u2019 motion to compel arbitration was granted and Reynosa filed an arbitration demand with Judicate West. Judicate West issued a fee invoice due on December 12, 2022, which meant that the grace period ended on January 11, 2023. However, a few days later, Judicate West sent out an identical bill and informed the parties that it would be due on February 23, 2023. Reynosa did not object to the new date because he never received copies of invoices directed to ATS. ATS paid the invoice on February 22. On March 20, Reynosa returned to court and moved to lift the stay and terminate the arbitration because ATS\u2019 payment was beyond the grace period. The court denied the motion, ruling that Reynosa had agreed to an extension of the time within which to pay by not objecting to Judicate West\u2019s revised payment date.

Reynosa filed a writ, which was granted. To preempt undisclosed payment extensions that exploited a loophole in section 1281.98(a), the statute was amended by adding section (a)(2), which prohibited an arbitration provider from implementing a due date extension without first affording the consumer or employee claimant the opportunity to give input thereon and then obtaining the consent of all parties including the claimant. The construction of 1281.98(a)(2) advanced by ATS and adopted by the superior court undermined the legislative intent by letting a claimant's silence, failure to object, or other seemingly acquiescent conduct (not amounting to direct expression) constitute a sufficient manifestation of his or her agreement to an extension. Thus, the need for the arbitration provider or the business\/employer to actively procure such consent\u2014e.g., by having the claimant sign an acknowledgement form\u2014was obviated.

The trial court also held that Reynosa in effect waived his right to elect to return to court by not objecting to the extension of time and instead choosing to take part in extensive prehearing procedures. The Court of Appeal disagreed. The record did not demonstrate Reynosa received either the invoices or the confirmation of late payment. Reynosa's involvement in the arbitration proceeding prior to his election to return to court did not evince he deliberately chose to continue the arbitration proceeding notwithstanding ATS's failure to timely pay fees or costs because he had not yet become cognizant of the untimely payments. It is evident one cannot elect a remedy to redress a wrong inflicted upon him or her when\u2014at the time of the purported election\u2014he or she was unaware of said wrong. To deem otherwise, put the proverbial cart before the horse.

Suarez v. Superior Court, 99 Cal. App. 5th 32<\/u><\/em><\/strong>

Defendant Rudolph & Sletten (R&S) successfully moved to compel arbitration of and stay Suarez\u2019 suit alleging wage and hour violations. After the arbitration demand was filed, JAMS sent an invoice to the parties, requesting $400 from Suarez and $1350 from R&S. Pursuant to Code of Civ. Proc. Section 1281.97 et. seq., R&S needed to pay its share by January 2, 2023, to avoid being subject to a lifting of the stay. R&S paid the bill on January 4. R&S claimed that its payment was timely because Civ. Code Section 12, which pertains to holiday extensions, would have extended the due date to January 3 and R&S then tacked on two more days, based on Civ. Code 1010.6, which pertains to electronic service of documents. R&S also contended that the arbitration was never properly initiated because Suarez did not pay his share of the fee. The trial court denied the motion to lift the stay. Suarez filed a writ before the Court of Appeal and the court granted it.

Even if section 12 could potentially apply to extend the time for R&S's payment of arbitration fees if the deadline for payment fell on a holiday, the major problem with R&S's argument is that section 1010.6<\/a> does not apply to the e-mail transmission of a fee invoice. The statute governs the service of documents in an action filed with <\/em>the court. An arbitration proceeding is not \u201can action filed with the court,\u201d and the invoice required by section 1281.97<\/a> is \u201cprovided\u201d to the parties but is not \u201cserved.\u201d Moreover, section 1010.6 governs the electronic service of documents. \u201cService\u201d is a legal term of art. Typically, it involves sending service copies of documents filed with the court to opposing parties in the litigation. Even if the service procedures of section 1010.6 somehow extended to arbitrations in general, the document that R&S sought to apply it to was not something that is \u201cserved.\u201d It was an invoice. It was not a document filed with the court or, by analogy, the arbitrator. Nothing in section 1281.97 (or elsewhere in the CAA) says anything about the arbitration provider \u201cserving\u201d the invoice on the parties. The statute merely requires the provider to \u201cimmediately provide<\/em> an invoice for any fees and costs \u2026 to all of the parties to the arbitration.\u201d Section 1281.97(a)(2).

R&S also argued that because Suarez did not pay his portion of the initial arbitration fees, he never properly initiated an arbitration within the meaning of subdivision (a)(2)<\/a> and section 1281.97<\/a> therefore did not apply. But by its express terms, the statute contemplates the employer complying with certain \u201cfiling requirements\u201d to initiate the arbitration before the provider is obligated to send an invoice. Necessarily, then, the arbitration is \u201cinitiated\u201d before any fees are paid. Moreover, the focus of section 1281.97 is on employers and not employees. The plain language of the statute does not say anything about Suarez's payment and does not create penalties for employees who do not pay their share of the arbitration fees. Instead, it focuses exclusively on the obligations of the draftperson of the arbitration agreement.

Trujillo v. J-M Manufacturing Co., Inc.,107 Cal. App. 5th 56<\/u><\/em><\/strong>

After Trujillo filed a lawsuit against J-M, her former employer, the parties negotiated an agreement largely written by Trujillo\u2019s counsel that contained a stipulation to arbitrate. The arbitration commenced and J-M timely paid the first three bills submitted by the arbitrator. J-M inadvertently failed to pay the fourth bill but did so immediately after being reminded by the provider. Trujillo then filed a motion to withdraw from the arbitration based on CCP Section 1281.98 and the court granted it. J-M appealed, asserting that the statute\u2019s penalties only applied to the drafting party, that it was not the drafting party and that they did not apply to post-dispute agreements.

The Court of Appeal reversed. The Legislature intended to limit section 1281.98's applicability to arbitration arising from a pre-dispute agreement. Section 1281.98(a)(1) refers to the failure to timely pay arbitration fees by \u201cthe drafting party,\u201d a term defined by section 1280(e) as \u201cthe company or business that included a pre-dispute arbitration provision in a contract with a consumer or employee.\u201d

After having filed a civil complaint in court, Trujillo\u2014by way of her counsel\u2014drafted and circulated to JMM a post-dispute stipulation for arbitration. The parties submitted to arbitration based on that post-dispute stipulation. The fact that the Legislature specifically elected to define the term \u201cdrafting party\u201d indicates that the Legislature intended the statute to apply only to an employer or company that drafted a pre-dispute arbitration agreement binding the employee.<\/p>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

FAILURE TO PAY FORUM FEES Anoke v. Twitter, Inc., 105 Cal. App.5th 153 Hernandez v. Sohnen Enterprises, 102 Cal. App. 5th 222 Hohenshelt v. Superior Court, 99 Cal. App. 5th 1319, Keeton v. Tesla, Inc., 103 Cal. App. 5th 26 Suarez v. Superior Court, 99 Cal. App. 5th 32 Trujillo v. J-M Manufacturing Co., Inc.,107 […]<\/p>\n","protected":false},"author":1,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"footnotes":""},"class_list":["post-2250","page","type-page","status-publish","hentry"],"_links":{"self":[{"href":"https:\/\/gifted-chandrasekhar.174-138-183-210.plesk.page\/index.php?rest_route=\/wp\/v2\/pages\/2250","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/gifted-chandrasekhar.174-138-183-210.plesk.page\/index.php?rest_route=\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/gifted-chandrasekhar.174-138-183-210.plesk.page\/index.php?rest_route=\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/gifted-chandrasekhar.174-138-183-210.plesk.page\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/gifted-chandrasekhar.174-138-183-210.plesk.page\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2250"}],"version-history":[{"count":5,"href":"https:\/\/gifted-chandrasekhar.174-138-183-210.plesk.page\/index.php?rest_route=\/wp\/v2\/pages\/2250\/revisions"}],"predecessor-version":[{"id":3325,"href":"https:\/\/gifted-chandrasekhar.174-138-183-210.plesk.page\/index.php?rest_route=\/wp\/v2\/pages\/2250\/revisions\/3325"}],"wp:attachment":[{"href":"https:\/\/gifted-chandrasekhar.174-138-183-210.plesk.page\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2250"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}