Does an arbitration clause in an independent contractor's contract allow for recovery of actual monetary damages only?

California, United States of America


The following excerpt is from Subcontracting Concepts (CT), LLC v. De Melo, 245 Cal.Rptr.3d 838, 34 Cal.App.5th 201 (Cal. App. 2019):

11 In light of our conclusion that the provision permitting recovery of actual monetary damages only is substantively unconscionable, we need not address respondents related assertion "that rights that arise based on the application and interpretation of an alleged independent contractor agreement are distinct from statutory rights arising out of the California Labor Code," and therefore respondents Labor Code claims are not encompassed by the arbitration clause. (Citing Elijahjuan v. Superior Court (2012) 210 Cal.App.4th 15, 17, 21, 147 Cal.Rptr.3d 857 [finding that workers claims seeking to enforce rights arising under Labor Code were outside scope of arbitration provision where provision applied "only to disputes regarding the application or interpretation of the parties contracts"].)

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