Rivera v. ShiversRivera v. Shivers
OPINION
INTRODUCTION
Arbitration is a recognized method of dispute resolution crеated by one of two means — contract or statute. The differences are important. Here we are called upon to determine whether an arbitration originally statutory in nature morphed into a contractual arbitration as the result of a vague stipulation by counsel for the parties. The stipulation failed to specify whether the parties had agreed to binding or nonbinding arbitration. Nevertheless, neither side ever seems to have entertained the notion that the completed arbitration was anything but binding, and treated it as such. The trial judge, however, had other ideas, deciding on his own that the arbitration was not what the parties intended, a conclusion he derived from their actions rather than their explicit words. As a result, he denied the appellants’ petition to confirm, vacated the award, and set a trial date in the case. We reverse and remand with instructions to confirm the award.
FACTS
Beginning in 2008, appellants Robert Shivers and Linda Shivers rented a residential property in La Habra from respondent Wilfred Rivera. Almost
The case was originally assigned to limited civil jurisdiction but was later reclassified to unlimited civil. Upon reassignment, the new trial judge ordered counsel to meet and confer regarding the appointment of a referee under
Rivera sought leave to amend the complaint to add Mr. and Mrs. Shivers’ three children, Courtney, Jacqueline, and Andrew,2 because they were also allegedly liable under the parties’ rental agreement. Mr. and Mrs. Shivers opposed this motion. At the status conference, the parties advised the court they could not agree on a referee. The court took the matter under submission, but warned that a referee would be appointed if the parties could not agree on one.
Thereafter, in a minute order dated April 19, 2018, the trial court, instead of appointing a referee, sua sponte ordered the matter to judicial arbitration. The motion for leave tо amend the complaint was heard and denied, and the parties advised the court they had stipulated to Lawrence A. Strid as their judicial arbitrator.
Undeterred by the denial of his motion for leave to amend, Rivera filed a Doe amendment to the complaint, adding the Shivers children as defendants. Mr. and Mrs. Shivers moved to strike the amendment, and a hearing was scheduled and later continued. When the hearing was finally held on September 7, 2018, the trial court took the motion to strike off calendar, pending completion of the arbitration or reference.
Another scheduled status conference took place approximately three months later, at which time counsel informed the trial court that arbitration before a retired judge, the Honorable Dennis Choate, at ADR Services, Inc., was set to proceed on January 30, 2019. The court continued the status conference to February 11, 2019. Several days later, however, one of the
The Shivers children‘s motion was heard prior to the date set for the arbitration before Judge Choate. The trial court took the motion off calendar, stating the parties had ignored its previous orders sending the matter to “non-statutory arbitration” and staying the litigation pending the outcome of the arbitration.3 As a result of what it viewed as the flouting of its previous orders, the trial court set an order to show case regarding dismissal of the underlying case for failure to prosecute the arbitration. That hearing was scheduled to take place on February 4, 2019 — a few days after the arbitration before Judge Choate was set to proceed, but prior to the February 11 status conference.
The arbitration before Judge Choate commenced as scheduled on January 30, 2019, but was not completed until February 7, 2019. In the intervening time, the order to show cause hearing was held, and the parties advised the trial court the arbitration was in progress. Consequently, the trial court set a status conference for April 8, 2019, noting in the minute order the following: “Pursuant to stipulation of parties, arbitration is proceeding as binding arbitration.”
On March 13, 2019, Judge Choate issued his arbitration findings, which were in Mr. and Mrs. Shivers’ favor. The result appeared largely to be based on Judge Choate‘s conclusion Rivera was combative, untruthful, and not credible as a witness. Judge Choate ordered that Mr. and Mrs. Shivers recover $22,500 in damages and that Rivera take nothing. Additionally, he awarded them a sizeable amount of attorney fees and costs as prevailing parties.
Judge Choate did not file the award with the court. Rather, Mr. and Mrs. Shivers filed a petition on April 3, 2019 to confirm the award, citing
The court held its planned status conference on April 8, 2019, and counsel advised that the “binding arbitration” had been “completed with an award.” Counsel also informed the court of the upcoming hearing on the petition to confirm and motion to dismiss.
On June 3, 2019, Rivera filed an opposition to the petition to confirm, arguing that Judge Choate had failed to disclose that he had a professional
In their reply brief, Mr. and Mrs. Shivers argued that Rivera‘s request to vacate the award was untimely because it was not filed within 10 days of the petition to confirm, as is required under
The trial court granted the Shivers children‘s motion to dismiss. However, it denied Mr. and Mrs. Shivers’ petition to confirm and set a trial date in the case. At the hearing, the trial court expressed concern that the stipulation for arbitration was entеred into by counsel rather than the parties and concluded the arbitration had been nonbinding. Mr. and Mrs. Shivers promptly appealed the ruling.
DISCUSSION
Where a party files a petition to confirm an arbitration award pursuant to
I. Judicial or Contractual Arbitration
One major point of confusion was whether the arbitration before Judge Choate was judicial or contractual in nature. The distinction is critical. Contractual arbitration is regulated by
By
There is one attribute shared by judicial and contractual arbitration - the parties can voluntarily submit to either. (
Initially, the trial court indicated its intention to send the case to a referee under
We nevertheless have some clues as to the proper categorization of the arbitration. The stipulation referenced Judge Choate of ADR Services, Inc., rather than Mr. Strid. Additionally, the parties informed the court at the February 2019 order to show cause hearing that the arbitration, then in progress, was proceeding as a binding arbitration pursuant to their stipulation. The point was memorialized in the court‘s minute order. Upon completion of the arbitration, Judge Choate framed his findings as an order and served the document on both parties, without filing it with the court. Such filing would have been necessary to trigger Rivera‘s window to request trial de novo under
The trial court disagreed, stating “there‘s no basis for regarding this as a binding arbitration” because the arbitration “was ordered by me, the judge. Not by the parties. And that didn‘t change when the parties stipulated to move from Strid to Choate.”
This was incorrect. Essentially, the trial court believed that the arbitration before Judge Choate was a mandatory, nonbinding judicial arbitration. But it could not have been. The court was without authority to order mandatory judicial arbitration since, as noted above, unlawful detainer cases are exempt from the procedure. In any event, litigants are always free to voluntarily submit thеir dispute to arbitration on their own terms. They may turn to contractual arbitration after a dispute has arisen. (See Douglass v. Serenivision, Inc. (2018) 20 Cal.App.5th 376, 387; see also Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 112 [speaking approvingly of “postdispute arbitration agreements” in the employment context].) Or they might stipulate to waive trial de novo and pursue a binding arbitration under the judicial arbitration framework. (See, e.g., Porreco v. Red Top RV Center (1989) 216 Cal.App.3d 113, 130-131.) Either way, we are satisfied the stipulation made in this case was for binding arbitration.
II. Client Consent to Arbitrate
The trial court noted that the parties had not themselves signed the stipulation and concluded that a stipulation signed by counsel was insufficient to show an arbitration agreement. We believe this, too, was incorrect. “A stipulation is an agreement between counsel respecting business before the court . . , and like any other agreement or contract, it is essential that the parties or their counsel agree to its terms.” (Palmer v. City of Long Beach (1948) 33 Cal.2d 134, 142, italics added.) And “a stipulation of the attorneys will be presumed to have been authorized by the client” unless the opposing side and the court are aware that the client has not consented to the stipulation. (See Clemens v. Gregg (1917) 34 Cal.App. 245, 253, citing Knowlton v. Mackenzie (1895) 110 Cal. 183, 188.)4
This
In Blanton, there was no act of ratification. The plaintiff‘s attorney entered into a stipulation for binding arbitration without her knowledge and consent, and when plaintiff discovered this, she immediately objected and fired the attorney. (Blanton, supra, 38 Cal.3d at p. 400.) She then substituted new counsеl and sought to invalidate the stipulation, arguing she had never given her consent to it. (Ibid.) Here, in stark contrast, the record shows no evidence either side ever objected to the stipulation or to the arbitration itself. Perhaps most tellingly, neither side argued, in the trial court or on appeal, that the stipulation to binding arbitration lacked consent. It was the trial court‘s decision to throw out the stipulation.5 But “[a] court is free to disregard a stipulation only if it is ‘illegal’ or ‘contrary to public policy.’ [Citations.]” (Estate of Burson (1975) 51 Cal.App.3d 300, 306.) This stipulation was neither.
We recognize the observation made in Sanker v. Brown (1985) 167 Cal.App.3d 1144 (Sanker) that “[a]n attorney‘s mere assertion of authority to waive a trial de novo on behalf of his client cannot be relied upon[,]” and that arbitration stipulations should include signature lines for the clients themselves. (Id. at p. 1147.) We have no quibble with this advice. Indeed, had counsel in this case included signature lines in the stipulation for their clients, the present appeal may not have been necessary. Even so, context matters. Sanker involved a party who had requested trial de novо and disavowed the stipulation signed by his counsel. (Id. at p. 1146.) He thought
III. Arbitrator Bias
Given our determination the parties did indeed stipulate to binding arbitration, the only issue remaining is the one raised by Rivera: should the arbitration award have been vacated based on evidence of bias on Judge Choate‘s part? Mr. and Mrs. Shivers contend the issue should not even be considered, given that Rivera‘s request to vacate was untimely pursuant to
“Under a well delineated statutory scheme the parties to an arbitration may seek correction of the award first by filing an application to the arbitrator within 10 days after the service of award (
§ 1284 ). [Fn. omitted.] As a second steр, the parties may petition the court to confirm, correct or vacate the award (§ 1285 ). Vacation or correction of an award may also be requested from the court by way of a response filed to a petition to confirm the award. However, while a petition to confirm an award may be served and filed within four years, the petition to vacate or correct an award must be served and filed within 100 days after the service of the award on the petitionеr (§ 1288 ; Archuleta v. Grand Lodge etc. of Machinists (1968) 262 Cal.App.2d 202 . . .). The same 100-day limitation applies when vacation or correction of the award is sought by response. . . . To this latter rule there is only one exception. When the party petitions the court to confirm the award before the expiration of the 100-day period, respondent may seek vacation or correction of the award by way of response only if he serves and files his response within 10 days after the service of the petition (§ 1290.6 ). Unless the response is duly served and filed, undersection 1290 the allegations of the petition are deemed to be admitted by respondent [citation].” (De Mello v. Souza, supra, 36 Cal.App.3d at p. 83; accord, Oaktree Capital Management, L.P. v. Bernard (2010) 182 Cal.App.4th 60, 66.) In this case, Rivera filed his response containing the request to vacate within the 100-day period undersection 1288.2 , but beyond the 10-day period undersection 1290.6 .
disclose within the time required for disclosure a ground for disqualification of which the arbitrator was then aware; or (B) was subject to disqualification upon grounds specified in [s]ection 1281.91 but failed upon receipt of timely demand to disqualify himself or herself as required by that provision.” (
Because Rivera‘s response to the petition to confirm was not filed and served within 10 days of the petition, it was not “duly served and filed,” and thus the trial court had no authority to hear it. But even if the trial court had such authority, Rivera‘s request to vacate lacked merit.
“Every reasonable intendment is indulged to give effect to arbitration proceedings; the burden is on the party attacking the award to affirmatively establish the existence of errоr by a proper record.” (Lopes v. Millsap (1992) 6 Cal.App.4th 1679, 1685.) The words “by a proper record” are particularly apropos here. Rivera failed to create one.7
“[S]ection 1286.2, subdivision (a)(6)(A), provides for vacatur only where the arbitrator fails to disclose a ground for disqualification ‘of which the arbitrator was then aware.‘” (ECC Capital Corp. v. Manatt, Phelps & Phillips, LLP (2017) 9 Cal.App.5th 885, 902, italics added.) The only evidence of bias Rivera submitted was a declaration from his attorney, in which she averred that Judge Choate told counsel after a brief break during the arbitration that thе Shivers’ counsel‘s father had been a mentor to him as a young prosecutor in Los Angeles. Rivera introduced no evidence that Judge Choate was aware counsel was the late judge‘s son at the time he made his required
disclosures prior to the arbitration. Thus
Rivera cites Commonwealth Coat. Corp. v. Continental Cas. Co. (1968) 393 U.S. 145, 149, for the notion that an arbitrator‘s failure to notify the parties of any information tending to create an impressiоn of bias is grounds for vacatur. But there is no evidence Judge Choate failed to notify the parties of relevant information. To the contrary, the only reason that Rivera knew about the information was because Judge Choate disclosed it to the parties, albeit after the arbitration proceedings had commenced. Rivera apparently did nothing in response to this information.
Rivera argues he could not have raised any substantial objection to the bias issue without incurring the wrath of the trial court, given that there was a pending order to show cause hearing at which his case might have been dismissed if the arbitration was not complete. We disagree that the pending order to show cause hearing required him to keep mum on his concerns about arbitrator bias. The trial court set the order to show cause because it felt the parties had “fail[ed] to pursue the underlying arbitraton.” But the parties very clearly had been pursuing the underlying arbitration, and both parties reported as much to the trial court at the order to show cause hearing. There could not have been any harm, therefore, if Rivera had made the objections necessary to ensure impartiality. Indeed, upon learning of the potential basis for disqualification, Rivera could have immediately moved to disqualify Judge Choate in the arbitration proceeding, then sought relief in the trial court prior to the order to show cause hearing. He did not do this, but instead proceeded quietly with arbitration to its unfavorable outcome. Not having acted to protect his rights before that unfavorable outcome, he cannot seek to undo the arbitration after the fact.
Finally, Mr. and Mrs. Shivers request that we include Rivera‘s alias in the judgment to be entered. While they made this request in the trial court, it was mooted by the trial court‘s denial of their petition to confirm, and never addressed. We decline to review an issue the trial court did not decide. (See Association for Los Angеles Deputy Sheriffs v. County of Los Angeles (2015) 234 Cal.App.4th 459, 467, fn. 2.) The trial court is to resolve this issue on remand.
The order denying the petition to confirm arbitration award is reversed and remanded to the trial court with the instruction that the arbitration award be confirmed. Appellants will recover their costs on appeal.
BEDSWORTH, ACTING P. J.
WE CONCUR:
THOMPSON, J.
GOETHALS, J.