64 Cal.App.5th 67
Cal. Ct. App.2021Background:
- Joanna Grabowski (pro per) sued Kaiser for medical malpractice; dispute was resolved in a five-day contractual arbitration that resulted in an award for Kaiser.
- Grabowski’s mother inadvertently left a phone recording on during a break; the audio captured an ex parte conversation between the neutral arbitrator and Kaiser’s counsel.
- The recording shows the arbitrator mocking Grabowski’s decision to appear pro se, sharing laughs with Kaiser’s counsel, and expressing doubts about her ability to advocate for herself.
- Grabowski petitioned the trial court to vacate the award on grounds of arbitrator misconduct/failure to disclose the ex parte communication, failure to disclose two prior Kaiser-related appointments, and denial of a continuance.
- The trial court found the ex parte communication improper but concluded Grabowski failed to show substantial prejudice or a nexus to the award and dismissed the petition.
- The Court of Appeal held the arbitrator’s ex parte communication was a disclosure event that the arbitrator failed to report; because nondisclosure of a ground for disqualification requires vacatur without a showing of prejudice, the appellate court reversed and directed vacatur of the arbitration award.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Ex parte communication / disclosure | Arbitrator privately mocked Grabowski and did not disclose the ex parte talk; revealed bias and required vacatur | Communication was non‑merits, not derogatory, did not prejudice award | Ex parte revealed doubts about impartiality; arbitrator had continuing duty to disclose; failure to disclose requires vacatur under §1286.2(a)(6)(A) |
| Failure to disclose prior Kaiser matters | Arbitrator omitted two prior Kaiser appointments; Grabowski would have moved to disqualify | Arbitrator provided notice to Grabowski’s prior counsel; no harmful nondisclosure | Appellate court did not resolve this issue because vacatur was required on the ex parte nondisclosure ground |
| Denial of continuance | Denial prevented needed preparation (spine treatment evidence), prejudicing Grabowski’s case | No good cause shown tying treatment to Kaiser negligence; no prejudice | Not reached on appeal; trial court had denied continuance and found no abuse of discretion, but appellate vacatur rendered further consideration unnecessary |
| Whether vacatur requires proof of prejudice or nexus | Failure to disclose is statutorily sufficient; no additional prejudice showing required | Kaiser argued petitioner must show substantial prejudice or nexus to the award | Court held failure to disclose a ground for disqualification requires vacatur without proof of prejudice (following Haworth and §1286.2(a)(6)(A)) |
Key Cases Cited
- Haworth v. Superior Court, 50 Cal.4th 372 (2010) (interprets arbitrator disclosure duties and holds nondisclosure of a disqualifying ground requires vacatur without prejudice showing)
- Honeycutt v. JPMorgan Chase Bank, N.A., 25 Cal.App.5th 909 (2018) (emphasizes strict, continuing disclosure duties for arbitrators)
- Dornbirer v. Kaiser Foundation Health Plan, Inc., 166 Cal.App.4th 831 (2008) (distinguishes minor nondisclosures when parties were aware of relationships and had opportunity to inquire)
- Benjamin, Weill & Mazer v. Kors, 195 Cal.App.4th 40 (2011) (supports mandatory vacatur for undisclosed disqualifying matters)
- Ovitz v. Schulman, 133 Cal.App.4th 830 (2005) (explains statutory disclosure regime leaves no discretion once nondisclosure of a disqualifying ground is established)
- Pour Le Bebe, Inc. v. Guess? Inc., 112 Cal.App.4th 810 (2003) (discusses nexus requirement in undue‑means cases but distinguishes situations not involving arbitrator nondisclosure)
- Cox v. Bonni, 30 Cal.App.5th 287 (2018) (distinguishes minor administrative ex parte contacts that did not require vacatur when no prejudice shown)
- Johnson v. Gruma Corp., 614 F.3d 1062 (9th Cir. 2010) (discusses initial and continuing duties of arbitrator disclosure)