Filed 9/30/13 Currency Corp. v. Wertheim CA2/1
                  NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
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or ordered published for purposes of rule 8.1115.


              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                     SECOND APPELLATE DISTRICT

                                                  DIVISION ONE


CURRENCY CORPORATION,                                                B240444

         Plaintiff and Appellant,                                    (Los Angeles County
                                                                     Super. Ct. No. BC417798)
         v.

WERTHEIM, LLC, et al.,

         Defendants and Respondents.



         APPEAL from an order of the Superior Court of Los Angeles County. Michael P.
Linfield, Judge. Reversed and remanded.
         Ecoff Blut, Lawrence C. Ecoff and Philip H. R. Nevinny; Benedon & Serlin,
Douglas G. Benedon and Gerald M. Serlin for Plaintiff and Appellant.
         Law Offices of Robert S. Besser, Robert S. Besser; Lauren M. Greene for
Defendants and Respondents.
                                ___________________________________
       Appellant lender made scores of small loans to a borrower over the course of a
dozen years, each memorialized by a note and secured by the borrower‟s income. One
note, in the amount of $6,500 and dated June 2, 2006 (the June 2006 note), contained an
arbitration provision and a broad release of all claims the borrower might have against the
lender on any other note. The borrower and her assignee, respondents here, instituted
arbitration proceedings against the lender pursuant to the terms of the June 2006 note.
After determining that the arbitration provision in the June 2006 note constituted an
agreement to arbitrate any dispute relating to any of the notes, the arbitrators awarded
respondents $672,122. The superior court confirmed the award.
       We reverse. The arbitration provision in the June 2006 note pertained only to that
note. The trial court therefore erred in confirming an award encompassing all the notes.
                                    BACKGROUND
       This is the second appeal in this matter, and the facts have not changed since our
last ruling. As before, we take them from a voluminous record containing several
pleadings, the declarations of various interested persons, and the record of a three-day
arbitration hearing.
       Parviz Omidvar is the founder, owner and CEO of Currency Corporation
(Currency), a lender, and Tiffany Ventures, LLC (Tiffany), which engages in real estate
transactions. Currency loans money to persons who own rights to royalty income
payable by such entities as the American Society of Composers, Authors and Publishers
(ASCAP) and Broadcast Music Inc. (BMI). The loans are typically secured by the
borrower‟s royalty income. Omidvar‟s two adult sons, Oliver and O‟Neil Omidvar,
participate extensively in this business. (Omidvar, Currency, Tiffany, Oliver and O‟Neil
are collectively the Omidvar parties.)
       David Pullman is the owner of Wertheim, LLC and the founder and CEO of
Structured Asset Sales, LLC (collectively the Pullman parties). Pullman has negotiated
with several of Currency‟s borrowers for assignment of their claims against the Omidvar
parties.



                                             2
       Maibell Page, born in 1941, is the widow of Eugene Page, a highly successful
songwriter, arranger and producer who died in 1998. Eugene received periodic royalty
payments from ASCAP and BMI, two music rights management companies. ASCAP,
for example, generally made payments 30 times per year. Maibell‟s two adult children,
Jennifer and Christopher Page, sometimes helped with her financial matters.1 Maibell
was a preschool teacher until 2005, when she suffered a debilitating stroke. After her
stroke Maibell was severely debilitated, stopped working, and was incapable of managing
her financial affairs. She resided in some sort of assisted living community, shopped at
thrift stores, and received Social Security as her primary source of income.
The First Series of Loans: 1997 to 2006
       From 1997 to 1998, Currency entered into a financial arrangement with Eugene
pursuant to which he directed ASCAP to remit his royalty payments to Currency in return
for Currency providing him with a line of credit. The agreement obligated Currency to
make loans to Eugene on demand, collect royalty payments from ASCAP to pay off the
loans, and remit any overage to Eugene.2 The agreement also obligated Currency to
maintain and provide an ongoing accounting. To provide this royalty-advance service
Currency charged a fee, typically comprising “interest” on each loan in the amount of
                                                                                 3
2 percent every 10 days, compounded daily, plus a 20 percent administrative fee. The
loans were typically for less than $5,000, had maturity periods of 5 to 17 months, and
were memorialized by promissory notes. The promissory notes were typically two or
three single-spaced pages long and had several boxes for the borrower‟s initials and a
signature line at the end.




       1
           We sometimes use the parties‟ first names for the sake of clarity.
       2
      Pursuant to royalty assignment agreements, Eugene and later Maibell directed
ASCAP to make royalty payments directly to Currency.
       3
           This works out to an annual loan cost of approximately 107 percent.


                                               3
       Eugene passed away in 1998, owing Currency approximately $50,000. When he
died, his royalty rights transferred to Maibell, who also received a $623,000 death benefit
from the American Federation of Musicians.
       Parviz Omidvar appeared at Eugene‟s funeral and persuaded Maibell to continue
Eugene‟s financial relationship with Currency. At some point, Omidvar persuaded
Maibell to loan the $623,000 death benefit to Tiffany at an interest rate of 5 percent,
which was reduced to 2 percent from 2003 to 2005 and thereafter returned to 5 percent.
       In the ensuing years Currency made scores of loans to Maibell, ranging from
$46.06 to $44,326.09, on terms similar to those that had been extended to Eugene.
       Omidvar had similar arrangements with several other entertainers and their family
members.
Pullman’s Intervention: May to October 2006
       In early 2006, Pullman telephoned Maibell and asked if he could meet with her
regarding her financial relationship with Currency. When she refused, he appeared at her
door and advised her that the terms of the Currency loans were unfair and that Omidvar
had misappropriated her ASCAP royalty stream. He offered to investigate the financial
relationship between Maibell and Omidvar in exchange for 50 percent of whatever he
could recoup for her and an assignment of all of her rights to Eugene‟s music catalog.
Maibell requested that her children be present at the meeting but Pullman persuaded her
to exclude them because they might become too emotional.
       In two agreements drafted by Pullman, Maibell assigned to Pullman her claims
against the Omidvar parties and all her royalty rights to the Eugene Page music catalog,
and all income derived from it. (The second agreement, dated May 20, 2006, contained
an arbitration provision that will be discussed below.) The purchase price for the Page
music catalog was $100,000 less the costs of securing the income,” with $1,000 being
paid up front.
       The assignment agreement provided that Maibell would not be paid for the Page
catalog until she had “met all conditions and requirements as stated in” the agreement.
Maibell was “responsible for all costs directly related to the Closing, including, but not

                                             4
limited to, the cost to form [a corporation or vehicle to receive royalties], if necessary, the
costs to secure recognition of the transfer of the Rights to Pullman by Arista, BMG,
Sony, RCA, J Records, EMI, EMI Capitol and any EMI related company, Broadcast
Music Inc. (BMI), Warner Chappell Music Publishing and any Warner related entity,
Unichappell Music, Inc.[,] American Society of Composers, Authors and Publishers
(ASCAP), American Federation of Musicians (AFM)[,] any rights societies throughout
the world, any and all record companies throughout the world and any and all publishers
and the costs of any necessary lien searches. Such costs shall be deducted from payment
of the Purchase Price at Closing. Prior to the Closing, Pullman, at its sole discretion,
shall designate the portions, if any, of the Purchase Price that shall be consulting fees
paid to Owner pursuant to a separate Consulting Fee Agreement.”
       Thus Maibell, who Wertheim admits was “an unsuspecting elderly widow with
short term memory loss, who had been institutionalized for mental illness,” assigned her
rights to Eugene‟s music catalog, along with royalty income of approximately $50,000
per month, to Pullman for essentially $1,000.
       The June 2006 Note
       On June 2, 2006, Currency made the loan that is the subject of this action. As
evidenced by the June 2006 note, Currency loaned Maibell $6,500 for six months at an
interest rate of 2 percent compounded every 10 days, with an administrative fee of
10 percent.
       The June 2006 note contained an arbitration provision as follows: “[A]ny claim or
dispute pertaining to this Note” “shall be settled by arbitration before a panel of three
non-attorney arbitrators in accordance with the rules of the American Arbitration
Association. The arbitration hearing is to occur within 60 (sixty) days of the filing of the
demand for arbitration. The arbitrators shall decide any issue as to whether a particular
claim is subject to arbitration hereunder. Judgment upon the award rendered by the
arbitrators may be entered in any court of competent jurisdiction. The losing party shall
reimburse the prevailing party for its reasonable outside attorneys‟ fees and costs incurred
with respect to such arbitration proceeding. The Parties hereby waive any and all rights

                                              5
to the award of punitive damages in any claim submitted to arbitration. Any arbitration
proceedings or other disputes hereunder shall be kept confidential by the Parties and not
publicized in any manner whatsoever.”
       The June 2006 note also contained a global release of any claims or defenses
arising from the June 2006 note and all “prior notes.”4
       Although all notes produced in the years-long proceedings below were signed or at
least initialed by Maibell or Eugene, no signed copy of the June 2006 note has ever been
produced. Currency has always contended the note was forged by Pullman, as evidenced
by the fact that the unusual arbitration provision in the June 2006 note is an almost

       4
          The text of the release was as follows: “As additional consideration for this
Loan, Borrower acknowledges and agrees that: (a) such Borrower has no claim or cause
of action against [Lender] and all of its past, present and future sister companies, related
companies, and affiliated companies; and all of their past, present, and future
(i) directors, officers, employees, shareholders, capital sources, consultants, advisors, and
agents; and (ii) heirs, executors, administrators, successors and assigns (“Dischargees”);
(b) such Borrower has no offset right, counterclaim, or defense of any kind against any of
the Obligations [defined previously, albeit in the singular, as any obligation evidenced
by a note VERIFY], whether arising from this Note or prior notes; and (c) [Lender] has
heretofore properly performed and satisfied in a timely manner all of [its] obligations to
each Borrower. [Lender] wishes, and Borrower agrees, to eliminate any possibility that
any past conditions, acts, omissions, events, circumstances, or matters would impair or
otherwise adversely affect any of Lender‟s rights, interests, collateral security, or
remedies. Therefore, Borrower, on behalf of itself and all of its heirs, executors,
administrators, successors, assigns, and any and all other entities and persons claiming
rights through such Borrower, unconditionally releases, acquits, and forever discharges
the Dischargees from (i) any and all liabilities, obligations, duties, or indebtedness of any
of the Dischargees to said Borrower, whether known or unknown, arising prior to the date
hereof, and (ii) any and all claims, offsets, causes of action, suits, or defenses, whether
known or unknown, which said Borrower might otherwise have against any of the
Dischargees on account of any condition, act, omission, event, contract, liability,
obligation, indebtedness, claim, cause of action, defense, circumstance, or matter of any
kind which existed, arose or occurred at any time prior to the date hereof. As further
consideration for the above release, Borrower hereby agrees, represents, and warrants that
the matters released herein are not limited to matters which are known or disclosed, and
Borrower hereby waives any and all rights and benefits which it now has or in the future
may have, conferred upon it by virtue of the provisions of Section 1542 of the Civil Code
of the State of California, which provides . . . [etc.].”


                                             6
verbatim copy of the arbitration provision in the May 20, 2006 assignment drafted two
weeks earlier by Pullman.5 However, respondents presented testimonial and
circumstantial evidence that Maibell did in fact enter into the agreement memorialized by
the June 2006 note, and various trial judges and the arbitration panel have found it to be
valid. The validity of the June 2006 note is thus not before us.
       The relationship between Maibell and Pullman soured in September 2006, when
Omidvar informed Jennifer and Chris that Maibell had given Eugene‟s music catalog to
Pullman. Maibell then sued Pullman for fraud and elder abuse and sought rescission of
the assignment, alleging Pullman had isolated her from her family and induced her to
transfer Eugene‟s entire music library to him for essentially $1,000.



       5
         The May 20, 2006 assignment agreement contained an arbitration provision that
tracked almost verbatim the arbitration provision in the June 2006 note: “The parties
agree that any controversy or claim whatsoever arising out of or relating in anyway to
this agreement and or transaction(s) by, or against Pullman, its affiliates, nominees,
assignees, principals, officers or employees and any related entities including, but not
limited to, Structured Asset Sales, LLC, Structured Asset Sales Group, LLC, Wertheim,
LLC, David Pullman or by Owner against Pullman and any related entities and
individuals including but not limited to those listed above in this paragraph, for its breach
or any of the transactions or services contemplated herein shall be settled by arbitration
before a panel of three non-attorney arbitrators in Los Angeles County, California, in
accordance with the rules of the American Arbitration Association. The arbitration
hearing is to occur within 60 (sixty) days of the filing of the demand for arbitration. The
arbitrators shall decide any issue as to whether a particular claim is subject to
arbitration hereunder. Judgment upon the award rendered by the arbitrators may be
entered in any court of competent jurisdiction. The losing party shall reimburse the
prevailing party for its reasonable outside attorneys’ fees and costs incurred with respect
to such arbitration proceeding. The Parties hereby waive any and all rights to the award
of punitive damages in any claim submitted to arbitration. Any arbitration proceedings
or other disputes hereunder shall be kept confidential by the Parties and not publicized in
any manner whatsoever.” Pullman and Maibell signed the assignment agreement on
June 2, 2006, the same date Currency loaned Maibell $6,500 pursuant to the June 2006
note. Currency argued at every stage below that the concurrence between Pullman‟s
May 20, 2006 assignment agreement and the June 2006 note was evidence that Pullman
forged the June 2006 note.


                                             7
       Jennifer Page was deposed during the pendency of this litigation. She testified
Maibell had suffered a stroke in 2005 that caused her to experience severe anxiety and
problems with writing and speaking. By May of 2006 she was disoriented, had
debilitating panic attacks, and suffered from depression. Several times when Pullman
met with Maibell in 2006 he brought a notary along and asked Maibell not to permit
Jennifer or Christopher to attend the meetings. When Jennifer came to one of the
meetings anyway, an assignment had been signed and the notary had left. Pullman told
Jennifer the document Maibell had signed “wasn‟t a big deal.” It was just “a paper
giving Pullman permission to investigate” Omidvar. Pullman did not tell Jennifer he had
negotiated with Maibell to receive: (1) Assignment of all of her claims against Currency;
(2) 50 percent of the proceeds of any unassignable claims; (3) Eugene Page‟s music
catalog (for $1,000); (4) Maibell‟s assistance in pursuing all claims and securing all
rights; and (5) Maibell‟s funding of the pursuit of all claims and securement of all rights.
       On January 27, 2009, the parties settled the litigation, with Pullman releasing all
interest in the Page music catalog and Maibell assigning to him her claims against the
Omidvar parties. Maibell also agreed to cooperate in any litigation Pullman brought
against Omidvar and Currency.
Resumption of the Currency Loans
       In the meantime, Currency resumed its financial relationship with Maibell and
over the next two years made at least 14 loans to her ranging from $1,494.17 to $17,000.
The loans bore compound interest at a rate of 2.25 percent per every 15 days, required
payment of a 10 percent administrative fee, and were secured by the Eugene Page royalty
stream. The promissory notes memorializing the loans typically comprised five single-
spaced pages, with lines designated for the borrower‟s initials and signature lines for the
borrower and Currency. None contained an arbitration provision.
       In the first note, dated October 16, 2006 (the October 2006 note), Currency
attempted to retrofit its promissory notes to comply with California finance law. That
and all following notes bore the following language: "ALL PAST FINANCING
LENDER PROVIDED BORROWER WAS PART OF A COMMERCIAL LINE

                                              8
OF CREDITY; [SIC] AND BORROWER HAS USED ALL PAST AND WILL USE
ALL PRESENT AND FUTURE FINANCING FROM LENDER FOR
COMMERCIAL PURPOSES ONLY (THAT IS, BORROWER HAS NOT USED,
IS NOT USING, AND WILL NOT USE ANY FINANCING FROM LENDER FOR
CONSUMER USES INCLUDING WITHOUT LIMITATION PERSONAL,
FAMILY OR HOUSEHOLD USES). BORROWER UNDERSTANDS THAT
LENDER DOES NOT OFFER FINANCING FOR CONSUMER USES AND IS
RELYING ON BORROWER’S REPRESENTATIONS AND WARRANTIES IN
THIS SECTION IN DECIDING TO PROVIDE BORROWER WITH
FINANCING.” This retrofit was apparently in response to several lawsuits filed against
the Omidvar parties by Pullman in which it was alleged Currency‟s loans violated the
Finance Code.
       The October 2006 note also purported to resolve all past disputes between the
parties and set forth a dispute resolution process. Paragraph 13 of the note provided as
follows: “BORROWER WAIVES ANY RIGHT TO TRIAL BY JURY WITH
RESPECT TO ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THE LOAN DOCUMENTS, THE RELATIONSHIP BETWEEN BORROWER
AND LENDER, OR ANY PRIOR DEALINGS BETWEEN THE PARTIES. Upon a
written request of any party to this Agreement, or upon an appropriate motion by any
party, any cause of action, dispute or controversy between or among the parties (“Claim”)
shall be heard by a single referee (“Referee”), pursuant to the provisions of California
Code of Civil Procedure §§ 638 et seq., as such statutes may be amended or modified
from time to time, who shall then try all issues (including any and all questions of law
and questions of fact relating thereto), and issue findings of fact and conclusions of law
and report a statement of decision. The Referee‟s statement of decision will constitute
the conclusive determination of the Claim. The parties agree that the Referee shall have
the power to issue all legal and equitable relief appropriate under the circumstances
before him/her.” The note provided that its terms would be binding on any party‟s
successors.

                                             9
Action by Wertheim against Omidvar and Currency
       On August 5, 2008, Wertheim filed a lawsuit against the Omidvar parties, Los
Angeles Superior Court (LASC) case number BC395819, alleging they interfered with
Maibell‟s assignment of claims against Currency to Wertheim.
Arbitration Demand
       On June 8, 2009, citing the June 2006 note, Wertheim filed a form demand for
arbitration with the American Arbitration Association (the AAA). Wertheim alleged the
nature of the dispute was: “Fraud; Conversion; Breach of Contract; Violation of Finance
Lenders Act; Violation of Business and Profession[s] Code Section 17200; Breach of
Contract; Elder Abuse arising from a series of loan transactions; RICCO [sic];
Racketeering; Fraud in the inducement; Fraud in the Execution; Breach of Fiduciary
Duties; Constructive Trust; Money Had and Received; Civil Conspiracy; Conversion; An
Accounting.” He demanded $5 million, later increasing the demand to approximately
            6
$41 million. In violation of AAA rules Wertheim failed to attach a copy of the June
2006 note to the demand, providing only arbitration language that it represented was
                       7
taken from the note.
       The AAA notified Currency of Wertheim‟s arbitration demand on June 15, 2009
and gave it three days—to June 18—to select three arbitrators from a panel of fifteen.
Currency immediately objected that it had not received a copy of any agreement that
would authorize the AAA to resolve any dispute between Currency and Wertheim. The
AAA responded the next day by requesting that Wertheim submit a copy of any contract

       6
        At the arbitration hearing the panel summarily rejected Wertheim‟s attempt to
increase its demand.
       7
         AAA Rule R-4, subdivision (a)(ii), directs the party demanding arbitration to file
“two copies of the arbitration provisions of the contract.” (Italics added.) Wertheim
stated the parties were subject to “an arbitration agreement dated June 2, 2006,” but filed
only the purportedly excerpted arbitration provision, not the note itself. This filing did
not comply with the AAA rule because it failed to show the provision was part of any
contract.


                                            10
containing an arbitration provision. It did not, however, change the deadline for selecting
arbitrators or otherwise acknowledge Currency‟s objection to jurisdiction. On the
contrary, the AAA stated any jurisdictional objections would be determined by the
arbitrator panel.
       Currency received a copy of the June 2006 note on June 19, 2009. It immediately
objected that the note was unsigned and failed to reference most of the parties against
whom Wertheim demanded arbitration. Currency also sent Maibell a written request to
resolve any dispute before a single referee, as provided by the October 2006 note.
       On June 22, 2009 the AAA informed the parties it had unilaterally appointed three
arbitrators, gave them one week to file objections to AAA jurisdiction, billed them for
$3,425 each, and gave them one week to pay that bill. On June 23, 2009, Currency
responded with a one-sentence objection, in boldface type: “The AAA is aware that the
arbitration clause that Mr. Pullman submitted is unsigned and has never been signed.”
Wertheim responded that Currency itself possessed the original, signed copy of the
June 2006 note. Wertheim also produced a deposition transcript from the earlier
litigation in which Jennifer Page had testified she once faxed to Pullman “the papers that
[her] mom signs when she wants to get money.” The AAA gave the parties four days to
respond to each others‟ contentions. Currency complained the AAA was “rushing” it “to
defend a $5,000,000.00 claim within 60 days although the AAA ha[d] no color of
authority to hear th[e] case” based on a “fraudulent document” that “was never signed,
performed, or otherwise entered into.” The AAA calendared a conference call hearing to
determine the jurisdiction dispute.
       On July 7, 2009, Currency sent a letter brief to the AAA in which it argued
arbitration is consensual in nature, and may be invoked only when the parties have
chosen to arbitrate their disputes. It reiterated that no executed June 2006 note existed
and neither Wertheim‟s allegations that such a note was in Currency‟s possession nor
Jennifer‟s testimony that she faxed “the papers” to Pullman established the fact.
Currency further argued that even pursuant to such a note, if one existed, the scope of



                                             11
arbitration would be only the $6,500 at issue on that one note, not the $5 million claimed
by Wertheim.
       The arbitrators were unimpressed. After the telephonic hearing on July 9, 2009,
they issued an order stating they “find and determine that there is sufficient basis to
proceed to a hearing on the merits, and deny Respondents‟ objections regarding
jurisdiction arbitrability, but without prejudice” to Currency revisiting the matter during
arbitration. Further, the arbitrators stated they felt constrained to abide by the 60-day
time limit set forth in the June 2006 note, and therefore gave Currency one week to
produce “the full record of all commercial notes and/or promissory notes . . . which were
signed by or otherwise related to Claimant Page,” “all documents . . . pertaining to the
relationship between Claimant Page and any named Respondent,” “a full history and
accounting of all loans and advances from any named party to Claimant Page . . .
showing each loan or advance made, how much interest was charged, how much in
processing fee was charged, when each loan or advance was funded, and when each loan
or advance was repaid,” and “a full accounting . . . of all royalty payments made to
Claimant Page, either directly or through any named party.”
       The arbitrators set the hearing for July 21, twelve days after the telephonic hearing
on jurisdiction.
       On July 14, 2009, Wertheim filed a petition stating the relief sought in arbitration,
detailing its claims for the first time, and elevating the amount sought from $5 million to
$40 million. Wertheim asserted 10 causes of action against Currency, including fraud
and elder abuse, and sought an accounting of all transactions between “approximately
1999 to 2009.” Wertheim alleged all the transactions between Maibell and Currency
were subject to the arbitration clause in the June 2006 note.
Proceedings to Enjoin Arbitration
       The Omidvar parties filed the instant lawsuit against Wertheim to enjoin
arbitration. (LASC No. BC417798.) The case was assigned to Judge Michael Stern in
Department 62. On July 16, Currency moved ex parte in Department 86 before Judge
David P. Yaffe for a temporary restraining order enjoining arbitration on the ground that

                                             12
no arbitration agreement existed. In support of the motion, Parviz Omidvar declared
Currency made no loan to Maibell in June 2006, none of the promissory notes from 1997
to 2002 contained an arbitration provision, and the June 2006 promissory note had been
forged. Currency argued that even if the arbitration provision in the June 2006 note was
valid, it was valid only as to the $6,500 at issue on that note, and only as to Currency, not
Tiffany or the Omidvars. Finally, Currency argued the court, not the arbitrators, must in
the first instance determine whether an arbitration agreement exists. In opposition to the
application for a TRO, Pullman submitted the declaration of Jennifer Page, who stated
she witnessed Maibell sign the June 2006 note.
       Judge Yaffe denied Currency‟s motion for a TRO, stating “there is a factual
dispute as to whether [the June 2, 2006] note is in existence . . . .”
Arbitration Hearing
       Maibell testified at the arbitration hearing but was unable to remember even her
own age and stated she did not understand the purpose of the proceedings. She testified
she first met Omidvar at Eugene‟s funeral in 1998, where he told her Eugene had died
owing “a lot of taxes” but he, Omidvar, “could take care of everything.” Maibell testified
she was “really really afraid of the taxes situation, and entrusted her finances to Omidvar.
She stated she had no idea how much money was being paid to Currency by ASCAP
every month, how much Currency was retaining, or what the terms of the Currency loans
were. The money she received from Currency and her own pay as a preschool teacher
were her only sources of income. When asked to explain two documents by which she
released claims against Omidvar and one by which she loaned $623,000 to Tiffany,
Maibell testified she thought the purpose of the documents was to “get some money.”
She testified, “I thought he was really a nice person who gave me money. I didn‟t know
anything about financial.”
       Christopher testified Omidvar encountered him at Eugene‟s funeral, said
Christopher “was like another son” to him, and said Eugene died owing him money and
owing his entire retirement fund to taxes, but he, Omidvar, would take the retirement
fund and shelter it and determine a course to help the Pages through their financial

                                              13
difficulties. Christopher admitted several of the loans Omidvar ostensibly made to
Maibell were for his, Christopher‟s, and Jennifer‟s own use, as he would go to Omidvar,
receive a promissory note memorializing a loan from Omidvar to Maibell, take the note
to his mother for her signature, take the signed note back to Omidvar, receive a check
made out to Maibell, deposit the check in Maibell‟s account, and have Maibell write a
personal check to him. He admitted Maibell did not understand the transactions, and he
and Jennifer used the money to pay off his own credit cards, purchase cars and homes,
and pay for Jennifer‟s college tuition.
       Christopher testified that Currency refused to provide an accounting despite his
repeated requests for one, and although Currency knew the loans it extended to Maibell
were used to finance Christopher‟s and Jennifer‟s cars and houses, did not inform
Christopher it was holding Maibell‟s $600,000 retirement account.
       Christopher testified that when Pullman came on the scene he induced Maibell to
sign a number of documents in the presence of a notary but specifically asked that her
children not be present. There ensued a lawsuit against Pullman to regain the Page music
library, which settled with return of the library and assignment to Pullman of Maibell‟s
claims against Currency. Christopher also testified that Oliver Omidvar told him that if
he participated in the arbitration or gave any documents to Pullman, Currency would “file
a claim against” Maibell.
       Christopher authenticated a scan of a check made out to Maibell by Chantal Music
Publishing, another Omidvar entity, signed by Omidvar, for $6,500 on June 2, 2006, with
a memo line reading “Re: Royalty Advancement.”
       Oliver Omidvar testified Pullman had filed nine lawsuits against Currency in
recent years and did not deny having warned Christopher against participating with
Pullman. He testified no loans made to Maibell between February 22 and June 2, 2006
were memorialized by a promissory note. Oliver admitted that when royalty payments
from ASCAP exceeded Maibell‟s loan indebtedness the excess funds were not remitted to
Maibell but were instead retained by Currency in a “residual account” for the purpose of
indemnifying the Omidvar parties “for any liabilities that come out of the third-party

                                            14
lawsuits, such as losses with Mr. Pullman. And this was held—not spent, but held to see
what was going to happen with the litigation that Mr. Pullman had filed against Currency
Corp.” Oliver made no attempt to identify a contractual justification for the retention of
Maibell‟s “residuals,” and immediately after this testimony tendered a check to Maibell
in the amount of $20,000 as purported payment of them.
       Oliver also admitted no accounting existed for Maibell‟s account until he began
generating one—for the period of 2002 to 2006 only—the night before the arbitration
hearing began. He admitted Currency maintained no accounting of sums loaned to
Eugene or Maibell from 1997 to 2002 and had no way of creating one. Oliver testified
that although individual promissory notes entitled Currency to charge 2 percent interest
every ten days, Currency sometimes in its discretion charged less. However, he admitted
no records supported the imposition of such a lesser charge and he did not know and had
no way to find out when the charge was imposed.
Arbitration Award
       On August 27, 2009, the arbitration panel found the parties had “entered into a
broad arbitration agreement dated June 2, 2006 granting authority to the Arbitrators to
hear and decide those claims submitted in the Demand for Arbitration dated June 8,
2009.” The panel did not explain this finding. It rendered an award against Currency
only, granting Maibell and Wertheim $503,086 in damages, $110,000 in attorney fees
and costs, $11,850 in administrative fees and expenses, and $47,186.10 in arbitrators‟
fees, for a total of $672,122.10.
Petitions to Confirm and Vacate the Award
       Wertheim petitioned to confirm the award and Currency to vacate it, again arguing
the June 2006 promissory note was forged. Judge Stern declined to engage the issue
because he felt it had already been adequately litigated in arbitration, stating “The
opposition to the award is nothing more than an attempt to re-litigate what has been
presented to the arbitration . . . .” The court dismissed Currency‟s petition, confirmed the
award and entered judgment.



                                             15
       Currency appealed from the judgment and we reversed the trial court‟s orders,
holding that an arbitration award cannot be confirmed absent a judicial determination at
some stage in the proceedings that an agreement to arbitrate existed. (Currency Corp. v.
Wertheim, May 20, 2011, B222851 [nonpub. opn.].)
Proceedings on Remand
       On remand, Wertheim moved for a determination that the June 2006 note
contained a valid arbitration agreement. Currency opposed the motion, arguing again that
the June 2006 note was forged by Pullman. The superior court concluded the June 2006
note was “genuine” and contained “an agreement that required the parties to arbitrate the
dispute.”
       Currency moved for reconsideration, arguing the June 2006 note had been
superseded by the October 2006 agreement. The trial court granted the motion but upon
reconsideration affirmed its prior ruling that an arbitration agreement existed. Wertheim
then moved to confirm the arbitration award. Currency opposed the motion and moved
to vacate the award. The trial court granted Wertheim‟s motion, denied Currency‟s, and
entered judgment for Wertheim in the amount of the award plus interest, costs and
attorney fees.
                                   8
       Currency timely appealed.
                                       DISCUSSION
       We review the trial court‟s decision on arbitrability for substantial evidence
insofar as it is based upon resolution of disputed facts. (NORCAL Mutual Ins. Co. v.
Newton (2000) 84 Cal.App.4th 64, 71.) We review de novo a trial court‟s legal
conclusions. (Greenspan v. LADT, LLC (2010) 185 Cal.App.4th 1413, 1435.)
       Currency contends the arbitration award should be vacated because (1) the
October 2006 release superseded the June 2006 arbitration agreement, assignment, (2) the
scope of arbitration should have been restricted to the $6,500 allegedly put in issue by the

       8
        We grant respondents‟ request for judicial notice and deny their motion to strike
appellant‟s reply brief or alternatively to permit further briefing.


                                            16
June 2, 2006 promissory note, the only agreement with an arbitration clause, and (3) the
arbitrators violated AAA rules. We agree with Currency‟s second contention, and do not
reach the others.
A. The Scope of the Arbitration Agreement
       “Private arbitration (also called contractual or nonjudicial arbitration) „is a
procedure for resolving disputes which arises from contract; it only comes into play when
the parties to the dispute have agreed to submit to it.‟ [Citation.]” (Toal v. Tardif (2009)
178 Cal.App.4th 1208, 1218.) “By agreeing to arbitration, parties anticipate a relatively
speedy, inexpensive and final resolution, one that may be based on „“broad principles of
justice,”‟ rather than strictly the rule of law. [Citation.] Consequently, „as a general rule
courts will indulge every reasonable intendment to give effect to arbitration proceedings.‟
[Citation.]” (Ibid.) But the powers of an arbitrator are limited by the agreement.
(Advanced Micro Devices, Inc. v. Intel Corp. (1994) 9 Cal.4th 362, 375.) “„[A] party
cannot be required to submit to arbitration any dispute which he has not agreed so to
submit.‟” (Atkinson v. Sinclair Refining Co. (1962) 370 U.S. 238, 241.) “Unless the
parties clearly and unmistakably provide otherwise, the question of whether the parties
agreed to arbitrate is to be decided by the court, not the arbitrator.” (AT&T Technologies,
Inc. v. Communications Workers of America (1986) 475 U.S. 643, 649.)
       An arbitration award “has the same force and effect as a contract in writing
between the parties to the arbitration.” (Code Civ. Proc., § 1287.6.) A party may seek
judicial enforcement of the award by petitioning the court to confirm it. (Code Civ.
Proc., § 1285.) A petition to confirm an award is akin to a suit in equity seeking specific
performance of the arbitration contract. (See Engineers & Architects Assn. v. Community
Development Dept. (1994) 30 Cal.App.4th 644, 653 [a petition to compel arbitration is a
suit in equity seeking specific performance of an arbitration agreement].)
       A petition to confirm an arbitration award must “[s]et forth the substance of or
have attached a copy of the agreement to arbitrate . . . .” (Code Civ. Proc., § 1285.4,
subd. (a).) “[T]he existence of the agreement is a statutory prerequisite to granting the
petition . . . .” (Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394,

                                              17
413.) Before a court may confirm an arbitration award it must find, or there must have
been a prior judicial finding, that a valid arbitration agreement exists. (Toal v. Tardif,
supra, 178 Cal.App.4th at p. 1221.) “[W]hen a petition to compel arbitration is filed and
accompanied by prima facie evidence of a written agreement to arbitrate the controversy,
the court itself must determine whether the agreement exists and, if any defense to its
enforcement is raised, whether it is enforceable. . . . If the party opposing the petition
raises a defense to enforcement—either fraud in the execution voiding the agreement, or
a statutory defense of waiver or revocation [citation]—that party bears the burden of
producing evidence of, and proving by a preponderance of the evidence, any fact
necessary to the defense.” (Rosenthal, supra, 14 Cal.4th at p. 413.)
       Here, the June 2006 note set forth an agreement to arbitrate “Any claim or dispute
pertaining to” the note. The note itself “pertained” to a $6,500 loan made by Currency to
Maibell on June 2, 2006 and a global release of any claim against Currency arising on or
before June 2, 2006. At most, therefore, Currency agreed to arbitrate Maibell‟s dispute
over the June 2, 2006 loan and the scope of the release. It never agreed to arbitrate the
merits of any other disputes. Yet Wertheim‟s arbitration demand referenced transactions
from 1999 to 2009, alleging they were all subject to the arbitration clause in the
June 2006 note, and the arbitrators apparently agreed, as they awarded Wertheim more
than 100 times the value of the June 2, 2006 loan. This agreement, and thus the award,
was “wholly groundless.” (Greenspan v. LADT, supra, 185 Cal.App.4th at p. 1443.)
       Neither the arbitrators nor the trial court explained why an arbitration provision
applicable to (1) a loan and (2) a retrospective release should apply to scores of loans
made over the course of more than a decade, both before and after the effective date of
the provision. Wertheim offers no explanation now.
       Wertheim first argues this court has no jurisdiction to determine the scope of the
arbitration agreement, an argument we have repeatedly rejected in prior disputes between
these parties and reject again now for reasons stated above. Wertheim then states without
explanation that the June 2006 note provides it “fully supercedes any and all prior or
contemporaneous understandings.” The point is irrelevant. Even if the note

                                             18
“superceded” all prior agreements, whatever that means, the arbitration provision itself
provided that it applies only to the note itself. Nothing indicates the parties intended that
it also apply to disputes arising from the superseded agreements. Finally, Wertheim
states—again with no reasoning connecting the statement to its contention that the
arbitration clause encompassed all of its claims—that the June 2006 note contained a
release of all claims arising from earlier loans. This point too is irrelevant, as it means
only that the parties agreed to arbitrate, at most, the validity of the release itself, not the
underlying merits of released claims. (We note the arbitrators impliedly resolved the
merits of the release by refusing to honor it.) In sum, Wertheim fails to explain how an
agreement can both release claims and require that they arbitrated.
       The only permissible scope of arbitration was the dispute over one loan made on
June 2, 2006 loan for $6,500. In awarding more than 100 times this amount with no
explanation, the arbitrators apparently accepted Wertheim‟s argument that all transactions
between Currency and Maibell were before them. In doing so, they exceeded the scope
of their mandate. Because they made no effort to particularize the award, it cannot be
determined what amount they would have awarded on the June 2006 note alone. The
entire award must therefore be vacated.
B. The Enforceability of Agreements
       Although we need not and do not reach the parties‟ other contentions, we feel
constrained to make an observation about this litigation that may save time for all parties
and the court below. Both sides urge us to accept and enforce provisions from various
agreements between them and Maibell. Currency argues an October 2006 release
superseded all prior promissory notes and should be enforced to preclude arbitration in
the instant matter. Wertheim argues a June 2006 assignment transferred Maibell‟s rights
to Wertheim, which renders the October 2006 release ineffective. Yet both sides have




                                               19
                                                                                           9
admitted to conduct that amounts to breach of fiduciary duty and financial elder abuse.
Indeed, this entire litigation surrounds a three-sided effort to separate Maibell Page, an ill,
incompetent senior, from her main source of income. Currency admitted during the
arbitration hearing that it extended loans to Maibell after she suffered a stroke and
became unable to understand the loan terms, failed and was unable to account for the
money it took from her, and retained her money without just cause. (It offered to return
the money at the hearing.) Christopher Page admitted he took Maibell‟s money for his
own and his sister‟s uses, knowing Maibell was unable to understand the transactions.
And Wertheim admitted it extracted financial agreements from “an unsuspecting elderly
widow with short term memory loss, who had been institutionalized for mental illness.”
And all of the agreements were unconscionable. All were written in visually dense,
incomprehensible language, heavily favored their authors, and were obtained under
conditions of undue influence. Currency made purportedly commercial “loans” to
Maibell—some for under $100—at 107 percent annual interest—charged at its own
undisclosed discretion—while keeping no records. Wertheim bought a royalty stream
from her, worth approximately $50,000 per year, for $1,000.
       Courts may refuse to enforce a contract or clause on the ground that it was
unconscionable when formed. (Civ. Code, § 1670.5, subd. (a); see Armendariz v.


       9
         Welfare and Institutions Code section 15610.30 provides in part: “(a) „Financial
abuse‟ of an elder or dependent adult occurs when a person or entity does any of the
following: [¶] (1) Takes, secretes, appropriates, obtains, or retains real or personal
property of an elder or dependent adult for a wrongful use or with intent to defraud, or
both. [¶] (2) Assists in taking, secreting, appropriating, obtaining, or retaining real or
personal property of an elder or dependent adult for a wrongful use or with intent to
defraud, or both. [¶] (3) Takes, secretes, appropriates, obtains, or retains, or assists in
taking, secreting, appropriating, obtaining, or retaining, real or personal property of an
elder or dependent adult by undue influence, as defined in Section 1575 of the Civil
Code. [¶] (b) A person or entity shall be deemed to have taken, secreted, appropriated,
obtained, or retained property for a wrongful use if, among other things, the person or
entity takes, secretes, appropriates, obtains, or retains the property and the person or
entity knew or should have known that this conduct is likely to be harmful to the elder or
dependent adult.”

                                              20
Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83 [describing
unconscionability].) However, nothing before us now requires that we enforce any
unconscionable agreement. For example, the arbitration provision at issue is not itself
unconscionable in this context because any party here who might complain of
unconscionability, Wertheim or Maibell, is seeking instead to invoke the provision. And
the release contained in the October 2006 agreement is moot in light of our conclusion
that the arbitration award must be vacated on other grounds.
                                     DISPOSITION
       The trial court order granting Wertheim‟s petition to confirm the arbitration award
is reversed. The case is remanded to the superior court with directions to vacate the
arbitration award. Each side is to bear its own costs.
       NOT TO BE PUBLISHED.




                                                               CHANEY, J.
We concur:


       MALLANO, P. J.




       JOHNSON, J.




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