Cooper v. Lavely & Singer Professional Corp.
178 Cal. Rptr. 3d 322
Cal. Ct. App.2014Background
- Cooper hired Lavely & Singer (L&S) for legal work; their retainer required arbitration under JAMS and included a prevailing-party attorney-fee clause.
- Cooper sued L&S for malpractice/related claims after earlier proceedings with HMI; the matter went to arbitration before Judge Terry Friedman.
- Arbitrator issued an Interim Award finding L&S prevailing and invited a fee motion; L&S moved for contractual fees claiming its malpractice insurer (Lloyd’s) had retained and would reimburse it.
- Arbitrator issued a Final Award denying L&S’s fee request, finding insufficient admissible evidence that Lloyd’s had retained L&S or that tender occurred during the policy period.
- L&S moved for correction/reconsideration, submitting additional declarations; the arbitrator granted reconsideration and issued a Revised Final Award awarding $225,677 in fees.
- Trial court confirmed the Revised Final Award; Cooper appealed, arguing the arbitrator exceeded his powers by revising a final award in violation of Cal. Code Civ. Proc. §1284 and related rules.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether arbitrator could revise a Final Award to add a new attorney-fee award after issuing a Final Award | Cooper: §1284 prohibits substantive post‑award revisions; arbitrator exceeded powers | L&S: JAMS rules and parties’ agreement allow reconsideration; JAMS permits correction and equitable relief | Reversed: arbitrator exceeded §1284; JAMS rules do not override §1284; Revised Final Award vacated and original Final Award confirmed (with fee portion struck) |
| Whether JAMS rules waived judicial review or expanded arbitrator’s correction power beyond §1284 | Cooper: no clear, express waiver; JAMS rule 4 defers to applicable law | L&S: acceptance of JAMS rules and rule 11(a) gave final interpretive power to arbitrator | Held: no clear waiver; JAMS rules must yield to applicable law (rule 4); parties didn’t validly expand §1284 remedial scope |
| Whether arbitrator’s original denial of fees exceeded powers by refusing to hear evidence | Cooper: Final Award was properly decided on merits; no excess power | L&S: arbitrator’s refusal to admit/consider evidence prejudiced rights under §1286.2(a)(5) and required correction | Held: original denial was a merits decision within arbitrator’s authority (Moshonov), not an exceedance requiring reopening |
| Appropriate remedy when arbitrator exceeds power by revising final award | Cooper: confirm original Final Award; strike fee award | L&S: confirm Revised Award or remand for reconsideration | Held: correctable portion (fees) removed; appellate court directed trial court to confirm the original Final Award dated January 16, 2013 and vacate judgment confirming the Revised Award |
Key Cases Cited
- Moncharsh v. Heily & Blase, 3 Cal.4th 1 (1992) (arbitration awards are final and judicial review is narrowly circumscribed)
- Severtson v. Williams Construction Co., 173 Cal.App.3d 86 (1985) (arbitrator cannot ‘‘correct’’ a final award to add attorney fees after finality under §1284)
- Elliot & Ten Eyck Partnership v. City of Long Beach, 57 Cal.App.4th 495 (1997) (§1284 codifies rule limiting post‑award revisions)
- A.M. Classic Construction, Inc. v. Tri‑Build Development Co., 70 Cal.App.4th 1470 (1999) (nonstatutory amendment doctrine allows correcting omitted issues before court confirmation under limited circumstances)
- DiMarco v. Chaney, 31 Cal.App.4th 1809 (1995) (trial court may correct award where arbitrator failed to apply mandatory contract terms)
- Moshonov v. Walsh, 22 Cal.4th 771 (2000) (arbitrator’s denial of contractual fees based on interpretation of fee clause is a merits decision and not per se an excess of authority)
- Advanced Micro Devices, Inc. v. Intel Corp., 9 Cal.4th 362 (1994) (arbitrator’s broad equitable remedies are valid only absent specific contractual or statutory restrictions)