Can a consumer contract waive California consumer-protection rights, or the right to seek a public injunction?
No. Civil Code § 1751 makes any waiver by a consumer of the provisions of the Consumers Legal Remedies Act contrary to public policy and unenforceable and void. And a provision in any contract, even one with no arbitration provision, that purports to waive, in all fora, the statutory right to seek PUBLIC INJUNCTIVE RELIEF under the Unfair Competition Law, the CLRA, or the false advertising law is invalid and unenforceable under California law (McGill), resting on Civil Code § 3513: a law established for a public reason cannot be contravened by private agreement.
The trap
This is the California analogue of a DTPA-waiver row, and it behaves differently: § 1751's text contains no exception for a represented or sophisticated consumer. The CLRA waiver is simply void. What § 1751 voids is a waiver 'by a consumer', and the Act defines one as "an individual who seeks or acquires, by purchase or lease, any goods or services for personal, family, or household purposes" (§ 1761(d)), so the section reaches the natural-person side of a consumer transaction in goods or services bought for personal, family or household use, and not a business buyer. The subtler trap is McGill's: the provision struck there was in a predispute ARBITRATION agreement, and the court held both that a waiver of the right to seek public injunctive relief in any forum is unenforceable under California law and that the FAA does not require its enforcement, so remedy-limiting language in a consumer arbitration agreement is exactly where McGill applied it. What McGill did NOT decide is what happens to the rest of the clause: it reversed the Court of Appeal's judgment and remanded, and because the parties had not mentioned the agreement's own severability language (one version said the provision survives partial invalidity and a later version said it does not), the court expressly declined to decide whether its holding renders the remainder of the arbitration provision unenforceable, leaving that to the Court of Appeal on remand. A drafter reading McGill as a severability result is reading something the court refused to hold.
7 authorities
- statuteCal. Civ. Code § 1751enactment date not established
The words that state the rule
Any waiver by a consumer of the provisions of this title is contrary to public policy and shall be unenforceable and void.
The words that state the rule
As explained above, a provision in any contract — even a contract that has no arbitration provision — that purports to waive, in all fora, the statutory right to seek public injunctive relief under the UCL, the CLRA, or the false advertising law is invalid and unenforceable under California law. The FAA does not require enforcement of such a provision, in derogation of this generally applicable contract defense, merely because the provision has been inserted into an arbitration agreement.
- statuteCal. Civ. Code § 3513enactment date not established
The words that state the rule
Any one may waive the advantage of a law intended solely for their benefit. But a law established for a public reason cannot be contravened by a private agreement.
- statuteCal. Civ. Code § 1752enactment date not established
The words that state the rule
The provisions of this title are not exclusive. The remedies provided herein for violation of any section of this title or for conduct proscribed by any section of this title shall be in addition to any other procedures or remedies for any violation or conduct provided for in any other law. Nothing in this title shall limit any other statutory or any common law rights of the Attorney General or any other person to bring class actions. Class actions by consumers brought under the specific provisions of Chapter 3 (commencing with Section 1770) of this title shall be governed exclusively by the provisions of Chapter 4 (commencing with Section 1780); however, this shall not be construed so as to deprive a consumer of any statutory or common law right to bring a class action without resort to this title. If any act or practice proscribed under this title also constitutes a cause of action in common law or a violation of another statute, the consumer may assert such common law or statutory cause of action under the procedures and with the remedies provided for in such law.
The words that state the rule
Civil Code section 3513 provides: “Any one may waive the advantage of a law intended solely for his benefit. But a law established for a public reason cannot be contravened by a private agreement.” Consistent with this provision, we have explained that “a party may waive a statutory provision if a statute does not prohibit doing so [citation], the statute‟s „public benefit . . . is merely incidental to [its] primary purpose‟ [citation], and „waiver does not seriously compromise any public purpose that [the statute was] intended to serve‟ [citation].” (DeBerard Properties, Ltd. v. Lim (1999) 20 Cal.4th 659, 668-669.)
The words that state the rule
Because the parties have not mentioned, let alone discussed, this language, we do not decide whether, in light of our holding, it renders the remainder of the arbitration provision unenforceable. But because our holding raises this question, we need not detail each respect in which McGill‟s injunctive relief request constitutes a request for public injunctive relief. We leave these issues to the Court of Appeal on remand, should the parties raise them and should the court find it necessary to decide them. III. DISPOSITION The Court of Appeal‟s judgment is reversed and the matter is remanded for further proceedings consistent with this opinion.
- statuteCal. Civ. Code § 1761enactment date not established
The words that state the rule
As used in this title: (a) “Goods” means tangible chattels bought or leased for use primarily for personal, family, or household purposes, including certificates or coupons exchangeable for these goods, and including goods that, at the time of the sale or subsequently, are to be so affixed to real property as to become a part of real property, whether or not they are severable from the real property. (b) “Services” means work, labor, and services for other than a commercial or business use, including services furnished in connection with the sale or repair of goods. (c) “Person” means an individual, partnership, corporation, limited liability company, association, or other group, however organized. (d) “Consumer” means an individual who seeks or acquires, by purchase or lease, any goods or services for personal, family, or household purposes.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.