[00:00:12] Speaker 02: Good morning. [00:00:12] Speaker 02: Welcome to the Ninth Circuit Court of Appeals. [00:00:15] Speaker 02: My name is Morgan Christen. [00:00:16] Speaker 02: I'm one of the judges on the circuit court. [00:00:18] Speaker 02: I'm delighted to be... My chambers, I should say, are in Anchorage, Alaska, but sitting this week in Pasadena with two of my colleagues, Judge Fletcher on my right, whose chambers are in San Francisco, and Judge Van Dyke on my left, probably your right, I guess, whose chambers are in Reno, Nevada. [00:00:36] Speaker 02: We have a little housekeeping to do for the record. [00:00:40] Speaker 02: I just need to note that we've submitted on the briefs, case number 23-55192, Mellon versus Energizer Brands, and case number 23-55541, Farber versus City of Los Angeles. [00:00:56] Speaker 02: The first case on the oral argument calendar is Fong versus U.S. [00:00:59] Speaker 02: Bancorp, case number 23-16186. [00:01:05] Speaker 02: Council, we're ready for your argument whenever you're ready to present it. [00:01:19] Speaker 03: Good morning, and may it please the Court. [00:01:20] Speaker 03: My name is Toji Calabro. [00:01:22] Speaker 03: I represent the plaintiffs and appellants, and I'd like to reserve five minutes of my time for rebuttal. [00:01:27] Speaker 02: Sure. [00:01:27] Speaker 02: Just keep an eye on the clock, please. [00:01:31] Speaker 03: We're here on an order and judgment compelling arbitration. [00:01:34] Speaker 03: Under controlling law, the authority provides that the defendants have the burden of proving that plaintiffs clearly and unequivocally agreed to arbitration. [00:01:45] Speaker 03: Federal Arbitration Act provides that when there is any dispute as to whether a contract for arbitration has been formed, that a jury trial is required. [00:01:54] Speaker 03: Here, the only document my client signed is a one-pager. [00:02:00] Speaker 03: It's in the record. [00:02:01] Speaker 03: And it's nowhere does it reference or say arbitration at all. [00:02:05] Speaker 03: That's undisputed. [00:02:07] Speaker 03: Defendants are trying to bind them to a completely separate document, but there's no direct evidence that they ever saw this document. [00:02:15] Speaker 02: Could I interrupt you there because you're picking up at the story one chapter later than [00:02:21] Speaker 02: I'm interested in. [00:02:23] Speaker 02: I think that the record tells us that they've had a safety deposit box at this institution since the year 2000? [00:02:29] Speaker 03: Correct. [00:02:30] Speaker 02: Okay. [00:02:31] Speaker 02: So there was presumably a written agreement as well for that? [00:02:34] Speaker 03: There is nothing in the record to indicate that, but presumably yes that there is. [00:02:40] Speaker 02: Hence my question, but I'm assuming there was an agreement. [00:02:42] Speaker 02: Am I correct? [00:02:44] Speaker 02: They had a safety deposit box from 2000 to 2013 at the same bank? [00:02:48] Speaker 03: That is correct. [00:02:49] Speaker 02: Okay. [00:02:49] Speaker 02: Then they got a phone call? [00:02:51] Speaker 03: Correct. [00:02:52] Speaker 02: About a problem with a key? [00:02:53] Speaker 03: Well, yes. [00:02:54] Speaker 03: Well, they were, yes, they were regularly putting items into the box. [00:03:00] Speaker 03: On one of their trips to the box, there was a problem with the guard key. [00:03:03] Speaker 03: There's two separate keys, one that you keep and one that the bank keeps. [00:03:06] Speaker 03: So they were having a problem with, the bank was having a problem with the guard key. [00:03:10] Speaker 03: So after that visit, they then called them to come back and just move it to a different location. [00:03:15] Speaker 02: So you say they called them, the bank called your clients? [00:03:17] Speaker 02: The bank called them. [00:03:18] Speaker 02: To come in to move the, [00:03:20] Speaker 03: The box. [00:03:20] Speaker 02: Contents. [00:03:22] Speaker 02: Right. [00:03:22] Speaker 02: So they were present to witness that. [00:03:24] Speaker 03: Correct. [00:03:24] Speaker 02: All right, and that's when they signed the one pager you're talking about? [00:03:27] Speaker 03: Right, so the way my clients describe it is that they have a box. [00:03:31] Speaker 03: It's in a slot. [00:03:32] Speaker 03: And so they split their box out out of one place and split it back into another one. [00:03:37] Speaker 03: And because they were getting new keys, they understood that they were signing the signature card for the new keys. [00:03:43] Speaker 02: I'm going to get out of your way in just a second. [00:03:44] Speaker 02: I'll let you proceed. [00:03:45] Speaker 02: But I have one more question about this earlier period of time. [00:03:48] Speaker 02: My understanding is that another thing that happened during the first [00:03:52] Speaker 02: I guess it would be 13 years. [00:03:54] Speaker 02: Is it the bank or at some point recognize that they had the original box registered in the bank system under a different number, an incorrect number? [00:04:03] Speaker 02: The responsive brief tells me that. [00:04:05] Speaker 03: Yes, that's what the responsive brief says. [00:04:09] Speaker 02: I'm not going to spend a lot of time on this, but is there any explanation for that? [00:04:16] Speaker 02: Did that go on for 13 years? [00:04:17] Speaker 03: Well, remember, Your Honor, we've had no discovery. [00:04:19] Speaker 03: So we don't know. [00:04:21] Speaker 02: All right. [00:04:21] Speaker 02: I'll leave it at that, then. [00:04:22] Speaker 02: Thank you. [00:04:23] Speaker 03: So as I was saying, the only thing that the defendants point to that my clients actually signed was this signature card. [00:04:30] Speaker 03: And nowhere is there any evidence or any reference to arbitration in that. [00:04:35] Speaker 03: There's no evidence that they ever saw any separate document that they're trying to now bind my clients to. [00:04:42] Speaker 03: And there's no evidence that they ever knew it was in existence. [00:04:46] Speaker 03: This does not meet the standard of clear and unequivocal consent to... Let me ask you a question about the wording on the document they did sign. [00:04:57] Speaker 04: Sure. [00:04:58] Speaker 04: It says that they, quote, acknowledge receipt of two keys. [00:05:03] Speaker 04: I think that's unquestioned. [00:05:05] Speaker 04: A copy of the present rules, now rules is bank speak for the big document that contains within it the specifications as to safe deposit box and the arbitration clause and da-da-da. [00:05:21] Speaker 04: So when Ms. [00:05:22] Speaker 04: Anderson is present there, she knows that they're signing something that is acknowledging a copy of the rules. [00:05:32] Speaker 04: She does not remember the actual transaction. [00:05:35] Speaker 04: She describes her ordinary procedures. [00:05:39] Speaker 04: And her ordinary procedures, she says, first off, her first one, she says, my ordinary procedures when they're opening a box, opening an account, X. Later, I guess she's told, well, wait a minute, no, they were just coming in to get a different box. [00:05:52] Speaker 04: She says, oh, I would have followed the same procedures. [00:05:53] Speaker 04: That's what she says in her second one. [00:05:56] Speaker 04: But she doesn't remember it. [00:05:58] Speaker 04: both of the Fong brothers very specifically state they never received anything. [00:06:04] Speaker 04: At this point, I think I have to, at this stage in the proceeding, I think I have to believe the Fongs. [00:06:11] Speaker 04: If I believe the Fongs, that means that Ms. [00:06:14] Speaker 04: Anderson saw them sign this. [00:06:19] Speaker 04: It says we acknowledge receipt of the rules, and she knew they were not getting the rules. [00:06:24] Speaker 04: What am I supposed to do with that? [00:06:26] Speaker 03: Well, you're supposed to say that there's no area of the law in which plaintiffs know that someone has the right to rely on a statement of historical fact that they know to be false. [00:06:37] Speaker 03: So that would be this case. [00:06:39] Speaker 03: There's no way that they can rely on this idea that we are bound by this idea that we've received these documents. [00:06:47] Speaker 03: It goes to trial. [00:06:48] Speaker 03: And in fact, Your Honor, I think it was the Riley case. [00:06:51] Speaker 03: where it was sort of similar. [00:06:52] Speaker 03: In the Riley case, it was a case that the defendants cite. [00:06:55] Speaker 01: It was an unpublished Ninth Circuit case from very—for a while ago, so I'm not sure that we're— What do we do with the—you know, touch Fletcher's saying that if we take all the facts in your favor that Anderson signed something that says—when I read it, it says that the renter acknowledges receipt of a copy of the rules. [00:07:19] Speaker 01: And so your clients both signed this, correct? [00:07:22] Speaker 01: They signed this, yes. [00:07:23] Speaker 01: So they signed that they had received a copy of the rules, but they're saying that they lied when they signed it? [00:07:30] Speaker 03: Well, remember that under yawments, it's not clear to the phong that the rules, this defined term rules, meant anything other than this. [00:07:39] Speaker 01: I understand. [00:07:40] Speaker 01: So that's a separate argument. [00:07:41] Speaker 01: I think there's two arguments. [00:07:42] Speaker 01: One of your arguments is that when you read this [00:07:45] Speaker 01: uh... the rules could be this and that's a separate maybe can we can talk about so but the other argument is that is clear to everybody including [00:07:54] Speaker 01: Anderson that the rules meant something else, but that Anderson was lying. [00:07:59] Speaker 01: But your clients were lying. [00:08:01] Speaker 01: Because your clients are saying they received it. [00:08:03] Speaker 01: But clients, I'm saying if we assume that they knew that there were separate rules and they signed that they had received them, then your clients would be lying. [00:08:11] Speaker 03: Your Honor, our position is that when they signed this, when they said rules, they meant the document that they were signing. [00:08:17] Speaker 01: So let's talk about that for a second, because it says, the rules are incorporated herein by reference and made a part of this agreement. [00:08:24] Speaker 01: I understand your argument, but are you aware of any circumstance where you incorporate something as part of an agreement, that when you're actually just incorporating the agreement itself? [00:08:39] Speaker 01: It seems to me it's pretty clear that that's referencing something else that's being incorporated in to the agreement. [00:08:46] Speaker 01: What is your argument, because I don't quite understand it, as to why that wouldn't be clear to anybody reading it, that the rules have to be something else that is being incorporated in and being made part of this agreement? [00:08:57] Speaker 02: As a preface to avoid backtracking, when you answer Judge Van Dyke's question, I think the record shows that one of these gentlemen is illiterate. [00:09:07] Speaker 02: Correct. [00:09:08] Speaker 02: Okay. [00:09:08] Speaker 02: But as to the other individual, can you tell me which brother are we talking about? [00:09:12] Speaker 02: The other individual? [00:09:12] Speaker 02: Peter Fong. [00:09:13] Speaker 03: Peter Fong can speak English and can read English. [00:09:15] Speaker 03: Su Fong, his brother cannot. [00:09:17] Speaker 02: Okay. [00:09:17] Speaker 02: So understanding when you answer Judge Van Dyke's question, I should be thinking that Peter could read this document. [00:09:23] Speaker 02: Is that right? [00:09:24] Speaker 02: I believe that's right. [00:09:24] Speaker 02: Okay. [00:09:25] Speaker 02: Go right ahead. [00:09:25] Speaker 03: Okay. [00:09:26] Speaker 03: So remember that rules is a defined term and it's defined to mean the safe deposit leaks agreement, right? [00:09:34] Speaker 03: Now, if you look at the very top of this document, it's called the consumer safe deposit box contract. [00:09:40] Speaker 03: Safe deposit box contract and safe deposit box lease agreement mean the same thing, especially when you look at the first line. [00:09:46] Speaker 03: The undersigned renters hereby rent the safe deposit box described in this agreement. [00:09:55] Speaker 03: So as far as the Fongs knew, all they were signing was this document, especially because they weren't getting anything else. [00:10:01] Speaker 01: So I understand your argument that you're saying, well, these are kind of similar type terms. [00:10:05] Speaker 01: And so somebody could think that they were the same thing. [00:10:09] Speaker 01: But if somebody was thinking that and they're reading this, which isn't a very, it's just like four or five sentences here. [00:10:16] Speaker 01: It says, the rules are incorporated herein by reference. [00:10:19] Speaker 01: Why would that not tell somebody that this must be referring [00:10:26] Speaker 01: the safe deposit box lease agreement, which is the rules, why is that not clearly referring to something else? [00:10:34] Speaker 01: Because you don't incorporate, I've never heard of something incorporating itself. [00:10:39] Speaker 03: Well, right, but the FONGs aren't required to go through this level of legal analysis, right? [00:10:44] Speaker 03: The question is, is this unambiguous? [00:10:47] Speaker 03: And unambiguous means, is there more than one reasonable interpretation? [00:10:51] Speaker 02: So hence, my question about, I think we take it as a given. [00:10:54] Speaker 02: that these folks had, these same two brothers, had an existing agreement until the bank called them and said, we have to move your box. [00:11:02] Speaker 02: There's a problem with the key. [00:11:03] Speaker 02: I'm paraphrasing, of course. [00:11:04] Speaker 03: Right. [00:11:05] Speaker 02: So my first thought was that they would think the original agreement was being incorporated, but I don't have that in the record unless you're going to tell me I missed it. [00:11:13] Speaker 02: That's what I was looking for. [00:11:14] Speaker 03: It is not in the record, Your Honor. [00:11:16] Speaker 02: OK, thank you. [00:11:17] Speaker 02: You started to answer Judge Fletcher's question, but I don't think you got a chance to, and I'm not sure you even remember it anymore. [00:11:22] Speaker 02: But I want to make sure that I get to answer to Judge Fletcher's question before we finish. [00:11:27] Speaker 04: I can't remember my question, but maybe you can. [00:11:31] Speaker 03: Well, even if everything that we talked about is true, even if we grant all of that, even if incorporation by reference necessarily has to mean something else which we don't concede, there's still two other prongs of this analysis that still has to be met by the first. [00:11:45] Speaker 03: They have to have consented to it, and under California law, that's been undisputed. [00:11:49] Speaker 03: Because the font size was so small, it's not binding as a matter of law. [00:11:54] Speaker 02: So you make that argument, forgive me for interrupting, about the 5.5. [00:11:57] Speaker 02: What font size is this document? [00:11:59] Speaker 03: This is under 8. [00:12:01] Speaker 03: right we put in the record uh... that we we we did an analysis where we copied it a lot talks about i think five or five and a half point font so when you make this argument you're running out of time so just quickly yeah no conservatorship yeah the link case conservatorship of link says that typeface should be no longer no smaller than eight [00:12:21] Speaker 03: And we show that this is at least smaller than 7.5. [00:12:24] Speaker 03: The Otto case that you're remembering was a case that was talking about a 5.5 case. [00:12:28] Speaker 02: OK. [00:12:29] Speaker 02: Again, I don't want to take up a ton of your time. [00:12:30] Speaker 02: But I couldn't figure out. [00:12:31] Speaker 02: You've made this argument what I couldn't figure out is someplace where it looks awfully tiny to me. [00:12:36] Speaker 02: But these days, everything looks tiny to me. [00:12:37] Speaker 02: That's another problem. [00:12:40] Speaker 02: Birthday related. [00:12:41] Speaker 02: So where do I find in this record? [00:12:44] Speaker 02: When you come back, you can tell me. [00:12:46] Speaker 02: where I can find the actual font of this document. [00:12:49] Speaker 02: Sure. [00:12:49] Speaker 02: You were going on to try to make another argument. [00:12:51] Speaker 03: Well, I was going to move on. [00:12:53] Speaker 03: Not only do we have to prove that the font size was there, but we also have to prove as a factual matter that it was easily available to my clients. [00:13:01] Speaker 03: All of those have to be met for there to be a clear and unequivocal incorporation by reference under the California Court of Appeal cases, assuming those are correct. [00:13:10] Speaker 03: We also have the waiver argument and the equitable estoppel arguments that I'm happy to rest on for now. [00:13:16] Speaker 02: How's the burden regarding the availability of the separate document being readily available? [00:13:23] Speaker 03: So yeah, there are three prongs that the California Court of Appeals cases say you have to meet all three of them. [00:13:29] Speaker 03: The third one is that it is easily available. [00:13:31] Speaker 02: I mean, it's clearly- I just asked you a different question. [00:13:34] Speaker 02: Oh, I'm sorry. [00:13:35] Speaker 02: That's all right. [00:13:35] Speaker 02: Maybe I wasn't very clear. [00:13:36] Speaker 02: Who has the burden to prove all of those things? [00:13:38] Speaker 03: The defendants. [00:13:39] Speaker 02: Thank you. [00:13:40] Speaker 02: Do you want to save the rest of your time? [00:13:41] Speaker 03: I do. [00:13:43] Speaker 02: Did you get your questions answered? [00:13:44] Speaker 02: OK, I think we're all set. [00:13:45] Speaker 02: When you come back, you'll have a few minutes left. [00:13:51] Speaker 00: Good morning. [00:13:52] Speaker 00: May it please the court, Karen Baumholt for the respondents. [00:13:55] Speaker 00: And Judge Fletcher, I do remember your question, and I'd like to start with it, if that's all right with the court. [00:14:01] Speaker 04: Remind me of my question. [00:14:03] Speaker 00: Yes, please. [00:14:03] Speaker 00: Sure. [00:14:03] Speaker 00: Your question related to whether or not we have to assume that the Fongs didn't receive the rules, the deposit account agreement. [00:14:13] Speaker 04: In the current posture of this case? [00:14:14] Speaker 00: In the current posture of this case, I assume they didn't receive it. [00:14:19] Speaker 00: OK. [00:14:19] Speaker 00: OK? [00:14:19] Speaker 00: I assume they didn't receive it. [00:14:21] Speaker 00: But that's not the question for this court. [00:14:23] Speaker 00: As the court just addressed in the last moments, the question is, what did, as Judge Van Dyke said, what did the document that they signed say? [00:14:33] Speaker 01: And did it incorporate . [00:14:36] Speaker 01: . [00:14:36] Speaker 01: . [00:14:36] Speaker 01: I'll get that in a second, but I think there's an important . [00:14:39] Speaker 01: . [00:14:39] Speaker 01: . [00:14:39] Speaker 01: I think an important point that, as I understand Judge Flush will be making, which is, it's a little bit of a subtle point about, given what was signed here and the language and what was signed, [00:14:51] Speaker 01: If we assume that they didn't receive it, which I think we're all assuming that they didn't receive it, then I think, as I understand it, he's saying that the bank employee [00:15:02] Speaker 01: signed something and had them sign something that said that they had received it, and so that the bank employee sort of is impeaching herself just by doing that. [00:15:11] Speaker 01: You see what I'm saying? [00:15:12] Speaker 01: I understand the argument. [00:15:15] Speaker 01: Well, yeah, I suppose she's signing something that says they got a copy of the rules, and I guess for assuming they didn't get it, then she signed. [00:15:24] Speaker 01: But they also signed something that said that they got a copy of the rules. [00:15:28] Speaker 01: I'm trying to figure out what to do with all that. [00:15:31] Speaker 00: First of all, let me say this. [00:15:33] Speaker 00: I don't think the bank employee impeaches herself at all. [00:15:36] Speaker 00: I don't think it's at all true that they didn't receive it, but that's not the question at this point of the proceeding. [00:15:42] Speaker 04: I'm not accusing her of impeaching herself at all because she can't remember the transaction. [00:15:46] Speaker 04: She just describes her ordinary procedure. [00:15:48] Speaker 00: Exactly. [00:15:49] Speaker 00: But that's why these cases, Wolschlager, Marcelian, Butteroff, Koffler, a legion of California and federal cases say we look to this objectively. [00:16:00] Speaker 00: We look to the document that they signed. [00:16:03] Speaker 00: And you are bound by documents that you sign, whether you read them or not, whether you got the incorporated documents or not. [00:16:11] Speaker 00: You're bound when you sign it. [00:16:12] Speaker 00: Judge Kristen, you asked, should be thinking that one of the brothers could not read this and one couldn't. [00:16:20] Speaker 00: The answer to that is no. [00:16:21] Speaker 00: You should be thinking both could read it because both signed the document. [00:16:25] Speaker 04: That's nonsense. [00:16:27] Speaker 04: We know that people who are functionally illiterate can sign their name. [00:16:31] Speaker 04: and you look at the signature, it is the signature of someone who is not ordinarily accustomed to writing. [00:16:36] Speaker 00: But Your Honor, there's nothing in the record to suggest that our clients didn't. [00:16:40] Speaker 00: There are California cases where this comes up and arguments are made. [00:16:43] Speaker 00: The argument was not made here that someone couldn't read and understand what they signed. [00:16:48] Speaker 00: In fact, both brothers admit in their declarations [00:16:52] Speaker 00: that they did receive and sign this document, which is a contract. [00:16:57] Speaker 00: So let me move to that point. [00:16:58] Speaker 02: Julie, counsel, if you could back up a minute. [00:17:00] Speaker 02: Sure. [00:17:00] Speaker 02: Because you're spending a lot of time on this. [00:17:02] Speaker 02: And I think the district court went through this analysis and then recognized there was a dispute of fact about receipt of this other document, whatever the other document is. [00:17:11] Speaker 02: And he recognized that he needed, under the posture of this case, to assume that they didn't receive it. [00:17:20] Speaker 02: Correct. [00:17:20] Speaker 02: And then he ruled in the alternative. [00:17:22] Speaker 02: Right, and he ruled in the alternative, I hope I'm using the right gender, I'm not sure I remember which district court judge we're talking about, but ruled in the alternative and said that this other document was readily available. [00:17:32] Speaker 02: Opposing counsel tells me that he thinks that's your burden, do you agree? [00:17:36] Speaker 00: I agree. [00:17:36] Speaker 00: Okay. [00:17:36] Speaker 02: The question- Can you speak to that point? [00:17:38] Speaker 00: Sure, absolutely, Your Honor. [00:17:39] Speaker 02: The question is not, so again, the question, if there's a dispute- Just tell me what the question is, and I just gave you a question. [00:17:45] Speaker 02: Could you answer that one? [00:17:46] Speaker 02: How do you meet that burden, please? [00:17:48] Speaker 00: Sure, we meet the burden by Ms. [00:17:50] Speaker 00: Anderson's declaration laying out her ordinary procedures and saying, I normally print all these things. [00:18:00] Speaker 00: So the answer to that question is, if they had asked, and there's no evidence, and of course they would say they didn't ask because they would say, I didn't know I was supposed to ask, they did not ask for these documents, and [00:18:14] Speaker 00: If they had, she would have handed it to them. [00:18:16] Speaker 00: That's the evidence. [00:18:17] Speaker 00: There's zero evidence to the contrary. [00:18:19] Speaker 00: We have met that burden. [00:18:21] Speaker 00: The preponderance of the evidence here is if they had asked for the rules. [00:18:26] Speaker 04: But that's not what the statement says. [00:18:28] Speaker 04: They signed a statement that says, I'm paraphrasing, I have received. [00:18:33] Speaker 04: But that doesn't say, I could get it if I wanted to and I didn't ask. [00:18:38] Speaker 04: It just says, I have received. [00:18:40] Speaker 04: That's not true. [00:18:41] Speaker 04: She knows it's not true. [00:18:43] Speaker 04: She knows the form. [00:18:44] Speaker 04: They may or may not have read this carefully. [00:18:47] Speaker 04: They may not, even if they read it carefully, they might not have understood it. [00:18:51] Speaker 04: I think it's plausible to think that if they'd read it carefully, they would have thought that this is the agreement, these are the rules. [00:18:59] Speaker 00: Okay, so let me answer that two ways. [00:19:01] Speaker 00: Let me take the last part. [00:19:02] Speaker 00: The last part is, is it plausible to think that someone might think that? [00:19:07] Speaker 00: Possibly. [00:19:08] Speaker 00: Do their declarations say, I've now read this, and that's how I read it? [00:19:13] Speaker 00: No. [00:19:13] Speaker 00: They do not say in their declarations, when I signed this signature card, I believed that the words [00:19:23] Speaker 00: safe deposit lease agreement meant the document I was signing. [00:19:27] Speaker 00: They do not say that. [00:19:28] Speaker 00: Sure. [00:19:29] Speaker 02: Have they had a safety deposit lease agreement? [00:19:32] Speaker 02: That's what's hanging me up. [00:19:34] Speaker 02: OK. [00:19:35] Speaker 02: I think the district court's right. [00:19:36] Speaker 02: He has to assume that she didn't hand it to him that day. [00:19:42] Speaker 02: Her initial declaration said, when I open an account, here's how I do it. [00:19:46] Speaker 02: Then she realized that was a mistake, because they weren't opening an account. [00:19:48] Speaker 02: As far as I know, they didn't have an account. [00:19:50] Speaker 02: What they had was an existing safety deposit box that presumably had an agreement. [00:19:54] Speaker 02: But it seems to me the reasonable expectation would be understanding on their part of, I've got that. [00:20:01] Speaker 02: I've got this agreement. [00:20:04] Speaker 02: Because they had it for 13 years. [00:20:06] Speaker 00: And so what? [00:20:07] Speaker 02: Go ahead. [00:20:08] Speaker 02: I'm so, no, no. [00:20:09] Speaker 00: I'm so sorry. [00:20:09] Speaker 00: I didn't mean to interrupt your question. [00:20:10] Speaker 02: I don't know why they would be prompted to ask for anything. [00:20:13] Speaker 00: The reason they'd be prompted to ask for anything is for exactly the reason Judge Van Dyke was articulating earlier. [00:20:18] Speaker 00: When we look at ER 199, [00:20:20] Speaker 00: Consumer Safe Deposit Box Contract. [00:20:25] Speaker 00: That document is clearly a new contract. [00:20:28] Speaker 00: They are signing it. [00:20:29] Speaker 00: They are agreeing to be bound by it. [00:20:31] Speaker 00: And the terms say, as Judge Van Dyke read earlier, that the rules are incorporated herein by reference and made a part of this agreement. [00:20:40] Speaker 02: The reason why- Can you say it's a new agreement and it's clear? [00:20:43] Speaker 02: Counsel, it's not clear to me. [00:20:44] Speaker 02: So if you could help me out with that. [00:20:46] Speaker 02: My understanding is the backdrop of this is that the bank [00:20:50] Speaker 02: What was the bank doing? [00:20:51] Speaker 02: The key doesn't work anymore. [00:20:53] Speaker 02: As opposed to, if you fast forward, there was this episode where the bank had drilled into their box, several apparently, right? [00:21:03] Speaker 00: I can explain that background for you, Your Honor, if it would be helpful. [00:21:06] Speaker 02: Well, it is helpful. [00:21:07] Speaker 02: I mean, it might be helpful because it's just so peculiar about how the bank is reading these. [00:21:12] Speaker 02: The first line of your brief, I think that's your first line, says that this is about a closing of a box, which is, of course, on the back end where the bank drilled these. [00:21:20] Speaker 02: And I can't figure out how you're treating these agreements. [00:21:23] Speaker 02: It seems to me very reasonable, and then I'm going to get away and let you answer it, for them to understand they had an ongoing contract. [00:21:30] Speaker 02: They'd had it for several years. [00:21:32] Speaker 00: They signed a new contract, Your Honor. [00:21:33] Speaker 02: Tell me why that looks to them. [00:21:35] Speaker 00: How do they know that's new? [00:21:36] Speaker 00: Because it says contract on the top of it, consumer safe deposit box contract. [00:21:42] Speaker 00: They signed the document. [00:21:44] Speaker 00: You are presumed under Wohlschlager. [00:21:48] Speaker 02: Maybe I could ask it this way. [00:21:50] Speaker 02: Did they get anything in the record that I've missed? [00:21:52] Speaker 02: Did they get anything to say that the old contract is kaput? [00:21:56] Speaker 00: We're starting over? [00:21:57] Speaker 00: The document that they signed says that the rules are amended from time to time. [00:22:03] Speaker 00: That's very standard practice in this industry, in the banking industry, to have those rules be amended from time to time. [00:22:09] Speaker 00: When you sign a document, look. [00:22:11] Speaker 00: The case law is very, very clear. [00:22:14] Speaker 00: Wolschlager, Marcelian, all the cases cited in Bodoroff, they all say the same thing. [00:22:20] Speaker 00: When you sign a document that looks like a contract, [00:22:24] Speaker 00: and it walks like a contract, then you're bound by what's in it. [00:22:27] Speaker 00: They wouldn't disagree that they're bound by it. [00:22:30] Speaker 02: I appreciate that point. [00:22:31] Speaker 02: I'm just not sure we're communicating. [00:22:32] Speaker 02: And I want to have an opportunity for you, give you the opportunity to answer what's hanging me up. [00:22:36] Speaker 00: Sure. [00:22:36] Speaker 02: Thank you. [00:22:36] Speaker 02: I'm not trying to ruin your day. [00:22:37] Speaker 01: No, thank you. [00:22:38] Speaker 02: Quite the contrary. [00:22:39] Speaker 02: I'm trying to make sure I don't miss anything. [00:22:41] Speaker 01: Can I ask one follow-up to that? [00:22:42] Speaker 02: Not quite yet. [00:22:42] Speaker 02: Please. [00:22:44] Speaker 02: Thank you. [00:22:47] Speaker 02: This wasn't a new account. [00:22:49] Speaker 02: It wasn't the new box. [00:22:51] Speaker 02: They've been doing this. [00:22:51] Speaker 02: And as you said, this document that they've signed is a contract. [00:22:55] Speaker 02: You're saying it's a new contract, but it says it could be amended from time to time. [00:22:58] Speaker 02: What's your best answer about why I shouldn't read this piece of paper that they signed as a continuation, that it refers back to the original ongoing agreement? [00:23:07] Speaker 00: Because of the words on the piece of paper that they signed, Your Honor, combined with all of this case law that we've cited, consumer safe deposit box contract is clearly a contract. [00:23:17] Speaker 02: Yes, it is. [00:23:18] Speaker 02: You keep making that point. [00:23:19] Speaker 02: How do we know it's a new one, a different one that the old one stopped? [00:23:23] Speaker 02: well it didn't necessarily but that's not really the point right the point is right we're trying to figure out what is being incorporated in the document it changes right it changes the terms at one point it has to a different place has to tell you the rules or the lease agreement means rules it doesn't they don't quite match up so i'm trying to figure out what these folks would have reasonably understood was getting incorporated sure they agreed [00:23:48] Speaker 00: Renters agree to the terms of the quote capital safe capital deposit capital box Capital lease capital agreement close quote as amended from time to time parentheses the rules Including payment of fees etc rental fees I'm sorry the rules are incorporated here in by reference and made part of this agreement whether or not it's a continuation of a prior 2000 contract that they did not put in the record and [00:24:17] Speaker 00: Whether it's a continuation of that or not, this document clearly says you are bound by these incorporated documents. [00:24:24] Speaker 02: Right. [00:24:25] Speaker 02: I think that's exactly it. [00:24:26] Speaker 02: Maybe we're just going to talk past each other all morning and I'm going to let Judge Van Dyke ask. [00:24:29] Speaker 00: I'm so sorry. [00:24:30] Speaker 02: Not at all. [00:24:31] Speaker 02: You don't owe me an apology. [00:24:32] Speaker 02: I'm not sure how else to ask it. [00:24:36] Speaker 02: I don't know what the first contract from 2000 said about rules. [00:24:40] Speaker 02: And so I don't know what they would have thought is getting incorporated. [00:24:43] Speaker 02: That is my point, and you had a different question. [00:24:48] Speaker 00: May I try to tie that up, though? [00:24:50] Speaker 00: Nothing in their declarations, the Fong's declarations, tells you that they were relying on some prior version of the rules. [00:24:58] Speaker 00: Nothing. [00:24:58] Speaker 01: That's my question. [00:25:00] Speaker 01: I'm kind of confused by this whole conversation. [00:25:05] Speaker 01: I didn't understand that they, my understanding was that their argument, at least now, I'm not sure their declarations say this, but their argument now is wholly that we thought that what it was referring to as the rules was this thing itself. [00:25:16] Speaker 01: I don't, there's nothing in the record about that, about the prior agreement. [00:25:21] Speaker 01: I think we kind of are all assuming that there was some written agreement because that's just how banks work. [00:25:25] Speaker 01: But I don't I didn't understand them or you anybody to be thinking that that this was even a possibility that this referred to a program I understand I guess in the abstract how that could be but is that an argument that's being made by anybody in this case it has not been made by anybody what they have said was we thought we were signing a new signature card that's what they've said we thought we were signing a new signature card but the document they signed does not say signature card [00:25:50] Speaker 00: It says we're bound by these rules. [00:25:52] Speaker 00: And whether or not... Let me ask you this. [00:25:56] Speaker 04: California law, there are three requirements. [00:25:58] Speaker 04: One is that the reference must be clear and unequivocal. [00:26:01] Speaker 04: Second, the reference must be called to the attention of the other party. [00:26:04] Speaker 04: How was it called to the attention of the fawns? [00:26:07] Speaker 00: So the cases, Your Honor, don't actually require that you... Well, just tell me how it was called to their attention. [00:26:13] Speaker 00: Because it's written there. [00:26:14] Speaker 04: It doesn't have to be... So nothing beyond the fact that it was written. [00:26:17] Speaker 04: Correct. [00:26:19] Speaker 04: And is the context irrelevant? [00:26:21] Speaker 04: That is to say, they're not opening up a new box. [00:26:24] Speaker 04: They're coming in because the bank's key doesn't work and they're told, listen, come in and sign some new documents. [00:26:30] Speaker 04: We'll get a new slot for you and then the keys will work. [00:26:34] Speaker 04: Is that irrelevant? [00:26:35] Speaker 00: I think largely it is because of the terms of the documents that they signed, yes. [00:26:40] Speaker 04: That strikes me as the bank plan gotcha, meaning if I'm a relatively unsophisticated consumer, and it's very clear that one of the brothers is very unsophisticated, it's not quite clear as to Peter, but I'm not a lawyer. [00:26:55] Speaker 04: Peter is occupied full-time taking care of his mother. [00:27:00] Speaker 04: They come in. [00:27:02] Speaker 04: here sign this so you can get your new keys, you know, to insist upon a literal reading that says they got documents. [00:27:12] Speaker 04: The Miss Anderson knew darn well that she wasn't giving them to them. [00:27:16] Speaker 04: She knew that they were signing a document that they either didn't understand or were disregarding. [00:27:22] Speaker 04: They were saying they received it when she knew darn well that they had not. [00:27:26] Speaker 04: It strikes me as the context is actually quite relevant. [00:27:31] Speaker 00: Let me just accept that premise for a moment, even if that context is relevant. [00:27:37] Speaker 00: We've all still assumed, and you must, that this document does say things are incorporated. [00:27:42] Speaker 00: And the cases have been uniform on this point. [00:27:45] Speaker 04: That's lawyer talk. [00:27:47] Speaker 04: You understand it. [00:27:48] Speaker 04: I understand it. [00:27:49] Speaker 04: I do. [00:27:49] Speaker 04: These are ordinary people. [00:27:51] Speaker 04: These are not particularly sophisticated people. [00:27:54] Speaker 04: And for them to hang the entire outcome of this case, for them to have a lawyer's understanding of incorporated, that's pretty tough going. [00:28:02] Speaker 00: I think we would have a different case, Your Honor, if they had said, [00:28:07] Speaker 00: You know, I asked for them, and they didn't provide them. [00:28:10] Speaker 00: But we all conduct this kind of business all the time. [00:28:13] Speaker 00: And banks and retailers conduct this business all the time. [00:28:16] Speaker 00: And they have to be able to rely on people. [00:28:18] Speaker 04: There's time running, so I've got another question. [00:28:21] Speaker 04: And I'm not sure my decision in this case will depend on it. [00:28:26] Speaker 04: I did notice that the so-called rules are contained in a 25-page document. [00:28:32] Speaker 04: in tiny, tiny print, tinier than the contract we have here in front of us. [00:28:36] Speaker 04: I don't know whether it's five point or whatever point. [00:28:38] Speaker 04: I just know that it's tiny. [00:28:40] Speaker 04: And the part of the agreement relevant to them is on pages 20 and 21. [00:28:46] Speaker 04: Even if they had been given it, oh my god, do you expect any reasonable person to turn to page 20 and 21 and find the arbitration agreement at the end of the provision? [00:28:56] Speaker 00: I expect any reasonable person to do at least this, to read the one page, very clear English document that was given to them, plain English document. [00:29:06] Speaker 00: and to ask questions if they're uncertain. [00:29:10] Speaker 00: There is no evidence. [00:29:12] Speaker 00: And in fact, they would deny that they asked questions. [00:29:15] Speaker 00: There is no evidence. [00:29:16] Speaker 00: And business has to be able to be done that way, Your Honor. [00:29:19] Speaker 00: Is this tiny print? [00:29:20] Speaker 00: I mean, I can read it. [00:29:21] Speaker 00: It's small. [00:29:22] Speaker 04: There is no California law that... One of the reasons I say tiny print is not necessarily that it's illegible, but it's going to take you a very long time to get to page 20. [00:29:33] Speaker 00: Sure, but if you take a look your honor at the table of contents, it's very very clear on page two Safe deposit box lease agreement has a heading safe deposit box lease agreement is the thing that is referred to in the one-page document Banks have to do a lot of terms for a lot of different kinds of accounts and that's why banks do it this way and [00:29:57] Speaker 04: This would be, to me, a totally different case if they were opening a new account. [00:30:02] Speaker 02: I agree. [00:30:03] Speaker 02: That was my point. [00:30:05] Speaker 00: I see I'm out of time if I may answer that. [00:30:10] Speaker 00: The answer to that question is, and to help you with the history of this, they had to come in and open a new safe deposit box. [00:30:17] Speaker 00: They were told you have to come in and open a new safe deposit box. [00:30:20] Speaker 04: Where is that in the record that says they had to open a new account? [00:30:22] Speaker 04: Well, in a way, that's not right. [00:30:24] Speaker 04: If you may be talking bank talk, they kept the same box. [00:30:29] Speaker 04: They put it in a different slot. [00:30:31] Speaker 00: Okay, but they had to open a new safe deposit box account to do that, and they had to sign documents. [00:30:38] Speaker 04: That's not clear to me. [00:30:39] Speaker 04: They had an account. [00:30:40] Speaker 04: They've been doing it for 15 years. [00:30:42] Speaker 04: And the bank may say, in terms of bank talk, you just opened a new account. [00:30:46] Speaker 04: But as far as they're concerned, this is just a continuation of the relationship they've had with respect to this box for the last 15 years. [00:30:52] Speaker 04: They're not opening a new box. [00:30:54] Speaker 00: They're not opening a new account They are signing something so the bank can use different keys that now work because the old bank key didn't work I understand your honor But they don't testify that anybody told them that and this document has to mean something When you sign a contract with a financial institution, it has to mean something when you say that [00:31:13] Speaker 02: Again just trying to have clear communication when you say they don't testify anyone told them that yes I thought it was uncontested that the bank contacted them the bank contacted them and said Please come in we have to you know move your box Right, but I what I was no no no I think that's correct your honor, but what I was saying no one told them that [00:31:33] Speaker 00: You're not opening a new account. [00:31:35] Speaker 00: We just need you to have these new keys. [00:31:37] Speaker 00: What was told to them is what's in writing, and we can't disregard that. [00:31:42] Speaker 02: Can you give me the record site? [00:31:45] Speaker 02: Where in the record do you point to exactly what they were told when they were asked to come in? [00:31:54] Speaker 00: That would be helpful to me. [00:31:59] Speaker 00: Peter Fong's declaration at page approximately 155 says, the bank called to tell us that because the guard key for the box's location was damaged, the bank would like to move the box to a different slot. [00:32:15] Speaker 00: He says we did not open a new account. [00:32:17] Speaker 00: What he says about that is wrong. [00:32:19] Speaker 00: It's just immaterial. [00:32:21] Speaker 02: Is there anything, I want to make sure you're way over time, but that's our fault. [00:32:24] Speaker 02: We're asking lots of questions. [00:32:26] Speaker 02: Are there other indications in the record from the bank's perspective of what they told the Fongs when they asked them to come in too? [00:32:32] Speaker 00: So the supplemental declaration of Miss Anderson explains that the plaintiff's then opened box 2038 is set forth in her declaration and her declaration, which is at 165 and following and. [00:32:48] Speaker 00: I mean, you can't fault Miss Anderson. [00:32:50] Speaker 00: She does a lot of transactions every day. [00:32:52] Speaker 00: She gave us a declaration that followed the basic procedures of what she would have normally. [00:32:56] Speaker 02: Did they get anything in writing telling them to come in, to sign a new contract? [00:33:00] Speaker 02: Did they? [00:33:00] Speaker 02: I want to give you every opportunity to tell me, what am I missing? [00:33:02] Speaker 02: I know that Mr. Fong said we got a phone call, but is there anything in writing? [00:33:06] Speaker 00: There's nothing in this record. [00:33:07] Speaker 00: I don't believe that they did. [00:33:09] Speaker 02: All right. [00:33:09] Speaker 02: Fair enough. [00:33:10] Speaker 01: I'm trying to figure out why it matters whether or not a new account was opened or not. [00:33:17] Speaker 01: All the time we have to click on things to say there's been an updated agreement and they might be adding arbitration terms. [00:33:22] Speaker 01: Is it your position that they have to have been opening a new account? [00:33:27] Speaker 01: You could have somebody come in and say you've got to sign a new agreement or we're going to close your box. [00:33:32] Speaker 00: It is not my position. [00:33:34] Speaker 00: That is the point I was trying to make earlier poorly. [00:33:38] Speaker 00: But your honors made it much better than I have. [00:33:40] Speaker 00: Whether or not this is the opening of a new account, we still have to look at what they signed entitled contract. [00:33:49] Speaker 00: It is entitled contract. [00:33:50] Speaker 00: They are bound by the amended rules. [00:33:53] Speaker 00: And there's no case, no case that says consumers can simply get away with, I'm not bound by anything because I didn't get it. [00:34:02] Speaker 01: I'm actually curious to hear the other side's response to that. [00:34:05] Speaker 00: Yes, I understand, Your Honor. [00:34:07] Speaker 02: I appreciate your patience with our questions. [00:34:08] Speaker 00: And I appreciate the questions. [00:34:10] Speaker 00: Would the court like me to address any of the other issues such as waiver or the— I think we're good. [00:34:15] Speaker 00: Okay. [00:34:16] Speaker 00: Thank you, Your Honor. [00:34:16] Speaker 02: Thank you. [00:34:19] Speaker 01: Counsel, you just have— Can I ask him to respond to that question that I asked right at the end? [00:34:25] Speaker 02: Sure. [00:34:26] Speaker 01: So is it your position that it matters if they're opening a new account or not? [00:34:31] Speaker 01: I mean, do you agree that you could have somebody come in and say, listen, we're wanting to change the terms of our contract if you want to continue to have a safe deposit box you have to? [00:34:41] Speaker 01: You have to sign a new agreement. [00:34:42] Speaker 01: Is that impermissible under California law? [00:34:45] Speaker 03: It's not impermissible. [00:34:46] Speaker 03: And this is key, because this was a point I wanted to raise, is that defense counsel conceded that it was a plausible, that the Fong's construction was plausible, but that we just didn't put it in the declaration. [00:34:59] Speaker 03: But remember, when it comes to contract interpretation, we don't care about subjective understanding. [00:35:04] Speaker 03: We care about the objective understating. [00:35:06] Speaker 03: And so your question is, well, what about this context? [00:35:08] Speaker 03: Does it matter? [00:35:09] Speaker 03: Absolutely the context matters because that informs the objective understating. [00:35:13] Speaker 01: My question is, it doesn't, my question more precise is, does it matter whether or not they're actually signing a new, like opening a new safe deposit box or not as to whether, like are they not allowed to have them sign a contract with new terms if they're not opening a new safe deposit box? [00:35:32] Speaker 03: I think the point is they would not have been on notice that there are new terms. [00:35:37] Speaker 01: Other than what it says in the five sentences on this that they signed? [00:35:42] Speaker 03: But there's nothing in here that says these are new terms. [00:35:45] Speaker 03: It says you're agreeing to the rules, as may be amended from time to time. [00:35:50] Speaker 02: Is it correct that we don't have the first contract in the record? [00:35:53] Speaker 03: It is correct. [00:35:55] Speaker 03: I mean, that's one of the things that could have happened in discovery, if we had discovery. [00:35:59] Speaker 03: But to answer your questions from the first thing, font size, record size, ER, 27 to 28. [00:36:06] Speaker 02: It tells me what? [00:36:08] Speaker 03: That tells you that it's not 7.5 font. [00:36:11] Speaker 03: It's below 7.5 font size. [00:36:13] Speaker 02: OK. [00:36:14] Speaker 03: And then also while we're on the record, ER 155 paragraph 18, this is Peter Fong's declaration. [00:36:21] Speaker 03: He says, but because we received two new keys, we were asked to sign a document indicating that we had received the new keys for the new location. [00:36:32] Speaker 03: I also wanted to touch briefly on this easily available point. [00:36:39] Speaker 03: And this ties in with defense counsel's argument that there are a legion of cases such as Wolfshogler. [00:36:46] Speaker 03: and Marcelinians that all say that we're bound by this contract, but those cases say no such thing. [00:36:51] Speaker 03: We distinguish them all in the case. [00:36:53] Speaker 03: Those cases are actually really important because they specifically say, those cases deal with situations in which the incorporated terms were specifically guided to in the document. [00:37:03] Speaker 03: They said, for example, in the Wolfshoggery case, they said you can ask for the copy of it in the office. [00:37:10] Speaker 03: None of that happened here. [00:37:11] Speaker 03: There's absolutely no indication, unless you're some lawyer [00:37:14] Speaker 03: tons of experience with your reading contracts that this is anything different than the contract that they actually signed. [00:37:22] Speaker 03: So my time is running out. [00:37:24] Speaker 03: Your time is out, actually. [00:37:26] Speaker 02: It's going back up. [00:37:27] Speaker 02: The clock is going back up. [00:37:28] Speaker 02: Oh, great. [00:37:28] Speaker 02: So go ahead and wrap up, please. [00:37:30] Speaker 03: OK. [00:37:33] Speaker 03: I do want to get back to the easily available, because this is a pure- You're going to have to do it very quickly, because you're out of time. [00:37:38] Speaker 03: Oh, I thought I was. [00:37:38] Speaker 03: I'm sorry. [00:37:40] Speaker 02: You're out of time. [00:37:40] Speaker 02: Do it quickly, please. [00:37:41] Speaker 03: All right. [00:37:41] Speaker 03: We'll rest on the briefs. [00:37:42] Speaker 03: Easily available is a fact question. [00:37:44] Speaker 03: They don't have to ask, because there is no reason for them to ask. [00:37:47] Speaker 03: That is a jury question as to whether it is easily available. [00:37:49] Speaker 03: For those reasons, we still have a brief. [00:37:51] Speaker 03: We ask the court to brief. [00:37:52] Speaker 02: Thank you both all for your patience with our questions and for your advocacy. [00:37:57] Speaker 02: We'll take that case under advisement.