Lead Opinion
Plaintiff Harriette Blanton appeals from a judgment upon an award entered for defendants in an arbitration proceeding arising out of the alleged malpractice of a medical student during an abortion performed in the clinic of defendant Womancare, Inc. Plaintiff contends the trial court erred in refusing to nullify the agreement providing for the dispute to be resolved through binding arbitration, because the stipulation to submit her claim to this procedure was made without her consent. Plaintiff’s point is well taken. Accordingly, we reverse and remand to the trial court with instructions to set aside the arbitration agreement and subsequent award, and order a trial de novo.
On February 17, 1977, plaintiff allegedly suffered a perforated uterus during an abortion performed by a fourth-year medical student at the clinic of defendant Womancare. Plaintiff brought an action for malpractice against the clinic, the student, and the supervising physician. The case was set for trial on July 29, 1980.
Wesley Harris was employed by plaintiff as her attorney in the malpractice action. He prepared the necessary complaints, then requested that the trial be continued until April 6, 1981. His request was granted. Shortly thereafter, the trial was continued until July 30, 1981, again at Harris’s behest. On July 28, 1981, two days before the case was finally to be tried, Harris requested an agreement from defendants that the case be submitted to arbitration.
An examination of Harris conducted by the trial judge reveals Harris discussed the possibility of arbitration with his client at some point before he approached defendants with his offer to arbitrate. Harris conceded, however, that his client would only consent to arbitration if her right to a trial de novo were preserved.
“1. The captioned case will be taken off the trial calendar and submitted to binding arbitration.
“2. Any award rendered to the plaintiff in arbitration shall be limited to a maximum of $15,000.
“3. Daniel S. Belsky, attorney for defendant, Womancare, shall have the right to select the arbitrator pursuant to the following conditions:
“(a) There shall be only one arbitrator.
“(b) The arbitrator shall be an individual reasonably familiar with the law pertaining to medical malpractice.
“(c) Mr. Belsky’s right to choose the arbitrator shall be exclusive in the event he chooses an arbitrator whose practice consists primarily of defending medical malpractice actions.
“(d) In the event Mr. Belsky chooses an arbitrator whose practice consists primarily of prosecuting medical malpractice actions, said individual shall also be approved by Mr. Wes Harris.”2 (Italics supplied.)
The stipulation was approved by the court, which issued an order to arbitrate “pursuant to section 1141.10 et seq. of the Code of Civil Procedure and California Rules of Court, section [sz'c] 1600 et seq.” The order declared, “The arbitration and award shall be binding.” Harris also sought, and obtained, a dismissal with prejudice of defendant’s supervising physician from the lawsuit.
Plaintiff did not learn of this stipulation, nor of the dismissal of the supervising physician, for nearly three months. When apprised that her attorney had submitted her dispute to binding arbitration, she immediately objected, and fired Harris. She then hired new counsel, and through him moved to invalidate the stipulation to binding arbitration executed by Harris, as well as the stipulation to dismiss the supervising doctor from the lawsuit, on the ground she had never given her consent to either decision.
I
The Judicial Arbitration Act (Code Civ. Proc., § 1141.10 et seq.)
The act provides, however, that “[a]ny party may elect to have a de novo trial, by court or jury, both as to law and facts,” and that an arbitration award is final if a request for a de novo trial is not “filed within 30 days after the date the arbitrator files the award with the court.” (§ 1141.20.) If there is no request for a de novo trial and the award is not vacated (§ 1141.22) the award is entered in the judgment book in the amount of the award (§ 1141.23).
Opportunity for de novo trial is what principally distinguishes court-annexed arbitration pursuant to the Judicial Arbitration Act from private arbitration conducted pursuant to the agreement of the parties and subject to
The stipulation which the attorneys entered into in this case, since it provided that the award would be binding, was something of a hybrid. From a legal standpoint it could be viewed as an agreement for private arbitration, governed by the general arbitration statute, or as an agreement for judicial arbitration with advance waiver of the right to request a de novo trial. Most likely the attorneys contemplated the latter, since the agreement specifically refers to the Judicial Arbitration Act. In either event, however, the legal effect of the agreement, if it be given effect, was to relinquish the rights of the parties to judicial trial, whether by court or jury, and to waive any right to judicial review except upon the extremely narrow grounds accorded to arbitration awards under the arbitration statute and the Judicial Arbitration Act alike. (§ 1286.2; Cal. Rules of Court, rule 1615(d).)
Of course, such an agreement may often be in the best interests of a client, Here, however, the client did not consent to the agreement; she did nothing beyond retention of the attorney to suggest that he had authority to enter into such an agreement on her behalf; and she repudiated the agreement as soon as she learned, of it. The question is whether she is nevertheless bound by her attorney’s signature, purportedly on her behalf.
In our analysis of this question we distinguish at the outset between the rights which a client may have against his attorney for breach of a duty owed the client, and the right which an opposing party or the court may have to rely upon a stipulation or agreement which an attorney has made, purportedly on his client’s behalf. The two categories are related, but not necessarily congruent, for a client may be bound by the actions of his attorney and at the same time have a legal claim against him on the ground that those actions were undertaken without or in excess of authority. Here, the question concerns the binding effect of the attorney’s agreement.
As a general proposition the attorney-client relationship, insofar as it concerns the authority of the attorney to bind his client by agreement or stipulation, is governed by the principles of agency. (Fidelity & Casualty Co. of New York v. Abraham (1945)
It is undisputed in this case that plaintiff’s attorney, in signing the arbitration agreement, acted not only without his client’s express authority but contrary to her express instructions. Consequently, though subject to the possibility of ratification which we consider later in this opinion, she is bound by the agreement only if the attorney had either implied actual authority or apparent authority to enter into the agreement on her behalf.
An attorney retained to represent a client in litigation is clothed with certain authority by reason of that relationship. “The attorney is authorized by virtue of his employment to bind the client in procedural matters arising during the course of the action .... ‘In retaining counsel for the prosecution or defense of a suit, the right to do many acts in respect to the cause is embraced as ancillary, or incidental to the general authority conferred,
The authority thus conferred upon an attorney is in part apparent authority—i.e., the authority to do that which attorneys are normally authorized to do in the course of litigation manifested by the client’s act of hiring an attorney—and in part actual authority implied in law. Considerations of procedural efficiency require, for example, that in the course of a trial there be but one captain per ship. An attorney must be able to make such tactical decisions as whether to call a particular witness, and the court and opposing counsel must be able to rely upon the decisions he makes, even when the client voices opposition in open court. (Nahhas v. Pacific Greyhound Lines, Inc. (1961)
An attorney is not authorized, however, merely by virtue of his retention in litigation, to “impair the client’s substantial rights or the cause of action itself.” (Linsk v. Linsk, supra,
In Linsk we applied this principle to hold that an attorney lacked authority to stipulate, over his client’s objection, that after a mistrial due to the disability of the trial judge the case could be decided by a different judge entirely on the basis of the previous record. (Linsk v. Linsk, supra, 70 Cal.2d at pp. 278-279.) The factual context of that case differs from this one, in that the trial judge and defense counsel in Linsk were aware of plaintiff’s objection to the stipulation when they accepted it. (Id., at p. 276.) Thus, our holding represented a limitation upon the attorney’s implied actual authority, whereas in this case, because defense counsel was unaware of plaintiff’s objection, the question is one of apparent authority. Nonetheless, we arrive at the same conclusion with respect to the agreement to arbitrate which is at issue here.
This was the situation in Burns v. McCain (1930)
The Court of Appeal affirmed, reasoning that “[t]he mere employment of an attorney to represent a client in litigation does not carry with it the power to compromise that litigation,” and that such a purported compromise should not be binding upon the client where it had not “actually been completed” or carried into judgment. (107 Cal.App. at pp. 294-295.) Recognizing that such a rule places a strain upon the traditional pattern of reliance among attorneys, the court observed that the “high plane upon which attorneys customarily place their agreements with each other cannot be allowed to overthrow the well-established principles of the law of agency, where the rights of the clients as between themselves are concerned.” (Id., at p. 297; see also Price v. McComish (1937)
The same language is often used in the cases to define both the attorney’s actual and apparent authority, thus suggesting that the test is the same with respect to both, We need not decide in this case whether that is true in all respects, or whether there may be some matters as to which the jus
Moreover, the agreement did not constitute a tactical maneuver in pending litigation; rather, it called for a diversion of the dispute from the judicial to the arbitral arena. It was a contract to arbitrate, such as might be entered into in the absence of any litigation at all.
“[Ajbsent express authority, it is established that an attorney does not have implied plenary authority to enter into contracts on behalf of his client. [Citation.]” (Wilson v. Eddy (1969)
Here, similarly, an attorney, merely by virtue of his employment as such, has no apparent authority to bind his client to an agreement for arbitration. We find no reason in logic, or policy, for holding his apparent authority in that respect is enlarged by reason of the fact that he has been retained to engage in litigation. When a client engages an attorney to litigate in a judicial forum, the client has a right to be consulted, and his consent
This case is distinguishable from Madden v. Kaiser Foundation Hospitals (1976)
Finally, while unauthorized acts of an attorney may be binding upon his client through ratification (Fidelity & Casualty Co. of New York v. Abraham, supra,
Under the general arbitration statute, the validity of an order to arbitrate may in some circumstances be challenged by petition for writ of mandate (Lesser Towers, Inc. v. Roscoe-Ajax Constr. Co. (1969)
The judgment is reversed.
Mosk, J., Kaus, J., Broussard, J., Reynoso, J., and Lucas, J., concurred.
Notes
Harris testified as follows:
“Q. Did she tell you when you had the discussion and recommended arbitration that she objected to any arbitration?
“A. Yes. She indicated that she wanted a trial and I thought that it would be best to go to arbitration and to see what an arbitrator would award, and if she wasn’t happy we could go to trial.
“Q. What did she say?
“A. She said, that’s fine.
“Q. She said it’s all right to go to arbitration?
“A. But not binding.
“Q. All right. Was that conversation before you signed the letter agreeing to binding arbitration on her behalf?
“A. There was no discussion about binding arbitration before I signed this letter. . . .
“Q. Did you discuss binding arbitration with her?
“A. Never, I never even knew there was binding arbitration until you mentioned it.”
Harris testified, and plaintiff argues, that the trial court gave the attorneys the limited option of going to trial or accepting binding arbitration. It was under the compulsion of this narrow choice, plaintiff contends, that Harris submitted to binding arbitration. While the record is not clear on the point, it appears that defendant’s counsel indicated it would submit to arbitration only if it were binding; under these circumstances, the judge simply stated the-choices available to the parties. Harris chose binding arbitration.
“You say that’s [the determination to submit a dispute to binding arbitration] a substantive right. He says it’s a procedural matter .... All right. We will find out .... I will deny the order to set aside the binding arbitration.”
All statutory references are to the Code of Civil Procedure unless otherwise indicated.
There are other important differences as well. Private arbitration occurs only pursuant to agreement, and it is the agreement which determines the details of the process. (§ 1282 et seq.) The parties are themselves responsible for payment of the arbitrator and associated costs. Except in personal injury cases there is no provision for discovery unless the agreement itself so provides. (§ 1283.1.) While the statute provides mechanisms for judicial enforcement of the agreement (§ 1281.2) and confirmation of the award (§ 1285 et seq.) both mechanisms are extraneous to the process and, ordinarily, to the contemplation of the parties. Typically, those who enter into arbitration agreements expect that their dispute will be resolved without necessity for any contact with the courts.
Judicial arbitration, by contrast, is an adjunct to litigation. It is mandatory in certain cases, and it occurs only when an action has been filed. (See Cal. Rules of Court, rule 1600.) The general costs of arbitration are borne by the public, not by the parties, except that a party who requests a trial de novo and does not succeed in obtaining a judgment more favorable than the award must pay. (§ 1141.21.) Rules adopted by the Judicial Council provide for full discovery (Cal. Rules of Court, rule 1612) as well as other aspects of the proceeding (rules 1613, 1614).
The propriety of this appeal has not been questioned by respondent. The appeal is proper whether considered as one from the entry of an award in a judicial arbitration proceeding
Section 283 provides in part: “An attorney and counselor shall have authority: 1. To bind his client in any of the steps of an action or proceeding by his agreement filed with the Clerk, or entered upon the minutes of the Court, and not otherwise . . . .” This provision represents neither a grant nor a limitation of substantive authority; rather, it is a prescription of the form of stipulations. (See Preston v. Hill (1875)
It is said in an early case, by way of dicta, that an attorney is “presumed” to have authority even with respect to substantial matters affecting the client’s cause, but that the presumption is “rebuttable,” so that “whenever it appears that an attorney entered into an agreement in direct opposition to instruction of the client, there is no ground for such presumption.” (Knowlton v. MacKenzie (1895)
In Gagnon Co., Inc. v. Nevada Desert Inn (1955)
Respondents cite Church v. Church (1940)
Respondents also cite Ghiringhelli v. Riboni (1950)
One commentator suggests that the traditional subject-matter/procedure test does not adequately explain the cases which address the power of the lawyer to bind his client, and that the cases are better explained on the basis of considerations of prejudice and judicial economy, with the timing of the client’s objection being a key consideration. (Spiegel, Lawyering and Client Decisionmaking: Informed Consent and the Legal Profession, supra, 128 U.Pa. L.Rev. 41, 54-65.) It would appear, indeed, that such equitable considerations have played a role in some of the decisions. (E.g., Burns v. McCain, supra,
Concurrence Opinion
I write separately because the majority fail to set forth any guidelines as to when an attorney may act without the express consent of his or her client. Rather than providing clarity in this troublesome area,
I.
The allocation of decision-making authority between client and attorney is a difficult problem. It involves practical, ethical and philosophical considerations. (See Burt, Conflict and Trust Between Attorney and Client (1981) 69 Georgetown L.J. 1015; Note, Balancing Competing Discovery Interests in the Context of the Attorney-Client Relationship: A Trilemma (1983) 56 So.Cal.L.Rev. 1115 [hereafter Note, Balancing Competing Discovery Interests]; Martyn, Informed Consent in the Practice of Law (1980) 48 Geo.Wash.L.Rev. 307; Spiegel, Lawyering and Client Decisionmaking: Informed Consent and the Legal Profession (1979) 128 U.Pa. L.Rev. 41; Spiegel, The New Model Rules of Professional Conduct: Lawyer-Client Decision Making and the Role of Rules in Structuring the Lawyer-Client Dialogue, 1980 Am.Bar Found. Research J. 1003; Lehman, The Pursuit of a Client’s Interest (1979) 77 Mich. L.Rev. 1078.) Clear guidance on the scope of an attorney’s implied and apparent authority and the legal consequences of the allocation of that authority would benefit both attorneys and clients. Unfortunately, the majority fail to give any guidance.
A reading of the cases and authorities reveals that when courts refer to “substantial rights,” they mean important or “essential” rights (City of Fresno v. Baboian, supra,
When no substantial right is implicated, an attorney must be free to act independently. It is essential to the efficient conduct of the client’s case and the accomplishment of the client’s ultimate goals that an attorney have the authority to make independent decisions in the day-to-day management of civil litigation. This authority “allow[s] the lawyer-professional to apply his technical expertise!.]” (Spiegel, The New Model Rules of Professional Conduct: Lawyer-Client Decision Making and the Role of Rules in Structuring the Lawyer-Client Dialogue, supra, Am.Bar Found. Research J. at p. 1004.) It also protects the lawyer’s professional reputation and preserves the lawyer’s role as an officer of the court. (See 1 Witkin, supra, § 114, at p. 125.)
The effective management of litigation requires independent decisions by the attorney regarding not only procedural matters but also certain substantive matters—for example, it may include the legal theories or arguments to be advanced. Routine and technical matters, including those ordinary matters which arise in the course of litigation, may be handled independently by the attorney as a necessary aspect of the professional management of the case. On the other hand, decisions which affect “substantial rights,” whether they be denominated “procedural” or “substantive,” must involve the client.
Rather than define the standard as “substantial rights” versus “procedural matters,” the inquiry should seek to differentiate between decisions affecting important, substantial rights and decisions on routine matters. This approach would provide the practitioner with more useful guidance.
II.
Whatever formulation is used to determine when an attorney has the authority to make decisions on the client’s behalf, the decision to waive the
The right to trial by jury, in both civil and criminal matters, is “a basic and fundamental part of our system of jurisprudence. ” (Byram v. Superior Court (1977)
Under the California Constitution, the right to a jury in a civil cause “may be waived by the consent of the parties expressed as prescribed by statute.” (Art. I, § 16, italics added.) The right to a trial by jury is fundamental and “should be zealously guarded by the courts.” (Byram, supra,
Section 631 of the Code of Civil Procedure describes the ways in which a party may waive the right to trial by jury. These include the filing of written consent with the clerk or judge and the offering of oral consent in open court. (Code Civ. Proc., § 631, subds. 2, 3.)
Nothing in the statute gives an attorney the authority to waive the client’s right to a jury trial without the client’s knowledge and consent. As a Washington appellate court has held in interpreting similar constitutional and statutory provisions, “no client should be at the mercy of his attorney, who, without the authority or knowledge of his client stipulates away such a right
An attorney should explain to the client the strategic considerations that determine whether a jury trial or some other form of dispute resolution should be utilized. The attorney’s professional expertise is vital to any decision. However, the ultimate determination to waive a right as fundamental and “substantial” as the right to a jury trial should rest with the client.
See, e.g., City of Fresno v. Baboian (1975)
Commentators who advocate an “informed consent” doctrine for the attorney-client relationship favor “complete communication” between an attorney and client so that decisions regarding litigation can be made through their “combined effort and knowledge.” (Note, Balancing Competing Discovery Interest, supra, 56 So.Cal. L.Rev. at p. 1124; see also Martyn, Informed Consent in the Practice of Law, supra, 48 Geo. Wash. L.Rev. 307; Spiegel, Lawyering and Client Decisionmaking: Informed Consent and the Legal Profession, supra, 128 U.Pa. L.Rev. 41.) One commentator cites evidence that “plaintiffs who actively participated in their cases obtained significantly better results than those who delegated responsibility to an attorney.” (Note, Balancing Competing Discovery Interests, supra, at p. 1124.)
Article I, section 16 of the California Constitution provides that “[t]rial by jury is an inviolate right and shall be secured to all . . .
Waiver may also result from the failure to appear at trial, to announce at the prescribed time that a jury is required, or to deposit jury fees and transportation costs. (Code Civ. Proc., § 631, subds. 1, 4-7.) Because of the importance of the right to a jury trial, section 631 gives the trial court discretion to allow a jury trial even if the party has previously waived that right. (Code Civ. Proc., § 631; Hernandez v. Wilson (1961)
In Graves, defense counsel in a civil trial withdrew the demand for a jury without the client’s authorization. The appellate court vacated the judgment entered after a nonjury trial and remanded the case. (Graves v. P. J. Taggares Co., supra,