Habash v. L.A Pacific Center, Inc.
136 Cal. Rptr. 3d 832
Cal. Ct. App.2012Background
- Hotels Nevada and appellant are related through alter-ego ownership and arbitration against L.A. Pacific Center arising from a 2004 property sale and 60‑month holdback dispute.
- Arbitration was compelled after litigation in California and Nevada; the panel included three arbitrators and later accommodated Justice Wallin’s surgery.
- Interim and final arbitration awards found alter ego liability and awarded substantial damages to L.A. Pacific, plus fees and quiet title relief; holdback was offset by a $5 million bond issue.
- Appellant challenged arbitrability, alter ego liability, and the panel’s conduct; the trial court and appellate court upheld arbitration and powers under Nevada law and AAA rules.
- Confirmation of the arbitration award occurred in California federal/bankruptcy proceedings, with related stay/abstention orders and subsequent motions to vacate denied.
- This appeal challenges the arbitrability, panel procedure due to Justice Wallin’s absence, and whether the alter ego liability could bind appellant personally.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether there was a valid agreement to arbitrate | Habash contends no meeting of minds on material term | L.A. Pacific had shown a valid arbitration agreement governing disputes | Arbitration properly compelled; meeting of minds assumed for threshold arbitration |
| Whether the arbitrators exceeded their powers with Wallin’s absence | Procedure violated arbitration provision | AAA rules and Nevada law permit the panel to proceed with alternatives | Arbitrators did not exceed powers; procedure permissible and within governing rules |
| Whether the law of the case barred claims against L.A. Pacific | Earlier Hotels Nevada II ruled protections; bar subsequent Nevada claims | Law of the case did not preclude Nevada counterclaims decided by arbitration | Law of the case did not bar arbitration of Nevada claims; arbitrators could decide them |
| Whether appellant could be bound personally under alter ego theory | Alter ego liability could bind appellant despite lack of direct agreement | Nevada and California law support piercing the veil and binding nonsignatories | Appellant bound as alter ego; damages awarded against Hotels Nevada and appellant jointly and severally |
| Whether the final confirmation of the award was proper | Judgment supports enforcement and fee/cost awards; no VAC grounds | Errors alleged on procedural grounds were unreviewable or waived | Award properly confirmed; defenses to vacatur rejected |
Key Cases Cited
- Moncharsh v. Heily & Blase, 3 Cal.4th 1 (Cal. 1992) (arbitration review limits; arbitral merits generally not reviewed)
- Advanced Micro Devices, Inc. v. Intel Corp., 9 Cal.4th 362 (Cal. 1994) (arbitration powers limited by agreement; deference to arbitrator authority)
- Graham v. Scissor-Tail, Inc., 28 Cal.3d 808 (Cal. 1981) (meeting of the minds required on material terms for enforceable contract)
- Parker v. McCaw, 125 Cal.App.4th 1494 (Cal. App. 2005) (three-arbitrator panel rights; conflicts with single arbitrator rules)
- Truck Ins. Exchange v. Palmer J. Swanson, Inc., 189 P.3d 656 (Nev. 2008) (binding nonsignatories under alter ego framework in Nevada)
- Lorenz v. Beltio, Ltd., 114 Nev. 795, 963 P.2d 488 (Nev. 1998) (alter ego factors for veil piercing under Nevada law)