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Isaacson v. Maatuk

California Court of Appeals, Second District, Second Division
Jul 28, 2011
No. B224217 (Cal. Ct. App. Jul. 28, 2011)

Opinion

NOT TO BE PUBLISHED

APPEAL from a judgment of the Superior Court of Los Angeles County No. BC419346, Charles F. Palmer, Judge.

Lon B. Isaacson Associates, Peggy A. Farrell and Christopher C. Cianci for Plaintiffs and Appellants.

Kosnett & Durchfort and David E. Durchfort for Defendant and Appellant.


CHAVEZ, J.

Appellants and cross-respondents Lon B. Isaacson and Lon B. Isaacson Associates (collectively “Isaacson”) appeal from a judgment in favor of respondent and cross-appellant Josef Maatuk (Maatuk) in the amount of $121,374 plus costs of $1,422.66. Maatuk appeals from that portion of the trial court’s order denying him attorney fees. We affirm the judgment in all respects.

CONTENTIONS

Isaacson contends that the trial court erred in denying his petition to vacate arbitration award and request for trial de novo. Specifically, Isaacson argues that: (1) substantial evidence did not support the trial court’s finding that Isaacson willfully failed to participate in arbitration; (2) Isaacson proffered clear evidence of inadvertence, surprise or neglect as set forth in Code of Civil Procedure section 473; and (3) the trial court abused its discretion in denying his petition because less drastic measures were available. Isaacson further argues that, contrary to the trial court’s decision, he provided sufficient evidence of prejudice in support of his petition to vacate the arbitration award.

In his cross-appeal, Maatuk argues that he was entitled to attorney fees under Business and Professions Code section 6204, subdivision (d).

All further statutory references are to the Business & Professions Code, unless otherwise specified.

BACKGROUND

On June 2, 2004, Isaacson and Maatuk entered into a contingency retainer agreement under which Isaacson agreed to provide legal services to Maatuk. The matter was tried in April 2007.

In May 2008, Maatuk filed a Mandatory Fee Arbitration Act (MFAA) petition to resolve a fee dispute between the parties.

On March 19, 2009, a letter from the arbitrator, Frank Blundo (Blundo), was sent to the parties requesting (1) availability for the arbitration in the months of April, May, and June 2009, and (2) that briefs be submitted 10 days prior to the arbitration date, once it is selected. The letter, though correctly addressed to Maatuk, was incorrectly addressed to Isaacson. Delyn Spiers (Spiers), an employee of Isaacson, testified that as a result of the incorrect address, the letter was not received by Isaacson until sometime between April 27, 2009 and May 12, 2009.

On March 30, 2009, Blundo again wrote a letter to Isaacson, indicating that he had not yet received a response to his request for Isaacson’s availability, and stating that if he did not hear from Isaacson within five days, he would select an arbitration date without Isaacson’s input. This letter also was addressed incorrectly, and Isaacson did not receive it until late April or early May.

According to Spiers, upon receiving the correspondence, she immediately called the arbitrator’s office and spoke with Nancy Cantrell (Cantrell), the arbitrator’s legal assistant. Spiers informed Cantrell that the correspondence had been misdirected, and provided Isaacson’s correct mailing address. Spiers recalled asking Cantrell for an extension of time to respond to the arbitrator’s letters, since Isaacson was out of the country and Spiers could not confirm his availability.

Cantrell recalled the conversation differently. She declared that on April 1, 2009, she received a call from someone in Isaacson’s office, indicating that they had just received the letter dated March 19, 2009. Cantrell was informed of the address error and was told that Isaacson would respond some time the following week. However, Cantrell did not receive a response. Cantrell stated that after April 1, 2009, all future correspondence was directed to Isaacson’s correct address.

On April 14, 2009, a notice of hearing was served on the parties, notifying them that the arbitration hearing was set for June 5, 2009, at 1:30 p.m. Isaacson received the notice, which was properly addressed. However, according to Spiers, due to employee error, the hearing date was not calendared.

On June 5, 2009, after the arbitration was scheduled to commence, Cantrell telephoned Isaacson’s offices to see if Isaacson was running late for the arbitration. Spiers, who answered the phone, informed Cantrell that Isaacson had a pre-existing obligation that day. According to Spiers’s declaration, she then requested one of two things: (1) that the arbitration be continued or postponed; or (2) that she be immediately notified that the request for continuance was denied by the arbitrator so that another attorney from Isaacson’s office could be sent to defend the firm and Isaacson on the disputed claims. Spiers stated that Cantrell informed her that, under the circumstances, a continuance “should not be a problem.” When no one called her back to inform her otherwise, Spiers assumed that the continuance had been granted. Spiers then left a voice message for Isaacson, indicating that the arbitration had been continued.

Again, Cantrell recalled the conversation differently. Cantrell confirmed that, after the 1:30 p.m. start time of the arbitration passed, she placed a phone call to Isaacson’s offices to determine if Isaacson was running late. She recalled that the person answering the phone indicated that she had no knowledge of the arbitration.

The arbitration commenced at approximately 2:20 p.m., without an appearance on behalf of Isaacson. A second phone call was received from Isaacson’s office, indicating that Isaacson was unavailable due to his previous engagement on another matter. No request for continuance was made. Cantrell attested that she would never tell opposing counsel that a “continuance should not be a problem, ” as Blundo makes those determinations.

On June 8, 2009, Spiers telephoned the arbitrator’s office to determine the new date for the arbitration. Spiers spoke directly to Blundo, who informed her that the arbitration had proceeded and that he had ruled against Isaacson.

On July 6, 2009, the arbitration panel issued a statement of decision and award, ordering Isaacson to pay Maatuk the sum of $112,155 plus interest. The statement of decision explained that Maatuk had agreed to pay Isaacson a contingency fee of 50 percent of the gross amount collected. The accounting sheet submitted to the client after the termination of services included costs which the arbitration panel felt were overreaching and were not consistent with the fee agreement. The arbitration panel noted that the case had settled for $795,000, but that Maatuk received less than 20 percent of the total settlement. The arbitration award to Maatuk consisted of the amount of the excess and unauthorized costs, plus the balance allegedly held in the client’s trust account, plus the arbitration filing fee. The arbitration panel specifically found that there had been a “willful failure on the part of [Isaacson] to participate in the proceedings.”

PROCEDURAL HISTORY

On August 13, 2009, Isaacson filed a petition to vacate the arbitration award and request for trial de novo.

On January 27, 2010, Maatuk filed an opposition to Isaacson’s petition and request for trial de novo.

A hearing on the matter took place on February 9, 2010. On February 11, 2010, the trial court issued a tentative decision denying Isaacson’s petition and request for trial de novo. The trial court noted that there is an exception to the rule permitting a party who is dissatisfied with an MFAA arbitration ruling to request a trial de novo. Under section 6204, subdivision (a), a party who willfully fails to appear at the arbitration hearing “shall not” be entitled to a post-arbitration trial de novo, and the non-appearing party has the burden of proving that his or her failure to appear was not willful.

Based on the facts before it, the trial court determined that Isaacson had failed to meet his burden of proving that his failure to appear at the arbitration was not willful. The trial court made findings of fact, which included the following:

(1) As of April 1, 2009, Isaacson’s office manager, Spiers, was aware that the arbitration panel had requested dates for the arbitration;

(2) All written communications after April 1, 2009, were properly addressed to Isaacson’s office, including the notice of the June 5, 2009 arbitration;

(3) Isaacson failed to appear at the arbitration;

(4) On behalf of the arbitration panel, on June 5, 2009, Nancy Cantrell telephoned Isaacson’s office to determine if he was running late;

(5) Later in the day on June 5, 2009, Cantrell received a telephone call indicating that Isaacson was engaged on another matter and was not available for the arbitration;

(6) Cantrell denied that a request for continuance was ever received by her, and denies ever telling anyone that a continuance would not be a problem;

(7) On June 5, 2009, Spiers spoke with Isaacson and told him that the arbitration would take place on that date;

(8) No letter or written communication of any kind confirming a continuance of the arbitration hearing was ever sent by Isaacson to Cantrell or anyone on the arbitration panel;

(9) No confirmation of a continuance was ever sent by anyone on behalf of the arbitration panel to Isaacson;

(10) On June 5, 2009, during the time of the arbitration hearing, Isaacson was at the County Law Library conducting research on an unrelated matter; and

(11) Isaacson is an experienced attorney, having been practicing for 30 years.

The court further noted that as to the conflicting accounts of the telephone conversation between Spiers and Cantrell, the absence of any written confirmation of a request or grant of a continuance was compelling circumstantial evidence that Cantrell’s account was more reliable. The trial court expressed its doubt that a request for continuance would not be confirmed in writing by an experienced lawyer under these circumstances.

With respect to the petition to vacate the arbitration award, the court noted that the grounds for vacation of an award are set forth in Code of Civil Procedure section 1286.2. Isaacson’s petition was based on the arbitrator’s refusal to grant a continuance despite sufficient cause therefor. To obtain this relief, Isaacson was required to show substantial prejudice. The trial court found that there was insufficient evidence that a continuance had been requested, and that Isaacson failed to show substantial prejudice resulting from the arbitrator’s failure to postpone the hearing.

On February 22, 2010, Isaacson filed a response to the trial court’s tentative statement of decision, contesting the trial court’s findings on numerous facts. On March 8, 2010, the trial court issued a final statement of decision and order denying Isaacson’s petition and request for trial de novo.

On May 5, 2010, Isaacson filed his notice of appeal. Final judgment against Isaacson was entered on May 20, 2010.

The notice of appeal indicated that Isaacson appealed only from the court’s “order... denying [Isaacson’s] Petition for a Trial de Novo.” Maatuk filed a motion to dismiss the appeal because the appeal was filed before final judgment was entered. We denied the motion. Pursuant to California Rules of Court, rule 8.104(d)(2), we treat the notice of appeal as having been filed immediately after entry of judgment.

DISCUSSION

I. Standards of review

Isaacson’s appeal first challenges the trial court’s factual findings under section 6204, subdivision (a). Specifically, Isaacson challenges the trial court’s determination that Isaacson failed to meet his burden of proving that his failure to appear at the arbitration hearing was not willful. The trial court’s determination of this factual issue will be sustained if supported by substantial evidence. (Engineers & Architects Assn. v. Community Development Dept. (1994) 30 Cal.App.4th 644, 653.) As a general matter, orders granting or denying a request for new trial are examined for abuse of discretion. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826.)

An appellate court reviews a trial court’s determination of a petition to vacate an arbitration award de novo, giving deference to the award. (SWAB Financial, LLC v. E*Trade Securities, LLC (2007) 150 Cal.App.4th 1181, 1205.) If there are disputed issues of fact before the trial court, the appellate court accepts the trial court’s resolution of those disputed facts if supported by substantial evidence. (Ibid.) “The determination of whether an erroneous denial of a postponement by the arbitrator substantially prejudiced a party should, as other issues of prejudice, generally be treated as a legal issue. [Citations.]” (Id. at p. 1204.)

II. Substantial evidence supported the trial court’s factual findings pursuant to section 6204, subdivision (a)

Unless the parties have agreed in writing to be bound to the arbitration award, “either party shall be entitled to a trial after arbitration if sought within 30 days, ... except that if either party willfully fails to appear at the arbitration hearing... that party shall not be entitled to a trial after arbitration.” (§ 6204, subd. (a).) “The party who failed to appear at the arbitration shall have the burden of proving that the failure to appear was not willful.” (Ibid.)

The trial court determined that Isaacson failed to meet his burden of proving that his failure to appear at the arbitration was not willful. Isaacson challenges this factual determination. Isaacson cites Genovia v. Cassidy (1983) 145 Cal.App.3d 452, 458 (Genovia) for the proposition that willful conduct must be “premeditated, intentional and purposeful.” Significantly, Isaacson argues, the trial court in this matter did not make a finding of a premeditated, intentional and purposeful course of action. (Merritt v. Marks (1985) 175 Cal.App.3d 825, 827 (Merritt).)

Neither of the cases cited by Isaacson involves a petition for trial de novo pursuant to section 6204, subdivision (a). (See Genovia, supra, 145 Cal.App.3d 452 [involving a dismissal of a personal injury action for deliberate circumvention of the arbitration procedures mandated by Code of Civil Procedure section 1141.11]; Merritt, supra, 175 Cal.App.3d 825 [denial of request for trial de novo pursuant to Code of Civil Procedure section 1141.20 after party and their attorneys failed to appear].) Therefore we reject Isaacson’s suggestion that the trial court was obligated to make a finding of premeditated, intentional and purposeful action. Instead, pursuant to section 6204, subdivision (a), it was Isaacson’s obligation to prove that his failure to appear was not willful.

Isaacson highlights the evidence which conflicted with the trial court’s findings. In particular, Isaacson emphasizes that the evidence he presented showed that he was entitled to relief from the arbitration award on the grounds of inadvertence, surprise, or excusable neglect as described in Code of Civil Procedure section 473, subdivision (b). Isaacson explains that there was evidence of an inadvertent calendaring error committed by a secretary in his firm. In addition, Isaacson points to the “reasonable mistaken understanding” that the request for postponement was granted.

Code of Civil Procedure section 473, subdivision (b) reads, in relevant part: “The court may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect.” Isaacson admits that no motion for relief under Code of Civil Procedure section 473, subdivision (b), was ever made. However, Isaacson argues that under California Rule of Court, rule 3.828(a), the court was required to consider the factors relevant to Code of Civil Procedure section 473, subdivision (b), even though a separate motion for relief was not filed. However, we note that Isaacson’s motion to vacate did not raise California Rule of Court, rule 3.828, nor did it specify that it was made on the basis of the grounds set forth in Code of Civil Procedure section 473, subdivision (b). Thus, we disregard Isaacson’s argument that the trial court’s failure to articulate any discussion of Isaacson’s rights under Code of Civil procedure section 473 constitutes reversible error. “[T]heories not properly raised or presented in the trial court may not be asserted on appeal, and will not be considered by an appellate tribunal.” (In re Marriage of Eben-King & King (2000) 80 Cal.App.4th 92, 117.)

We reject Isaacson’s suggestion that the trial court “ignored” this evidence which, according to Isaacson, suggested that his nonappearance was not willful. Instead, we assume that the trial court considered all of the evidence described by Isaacson. (Bennett v. Phelps (1955) 136 Cal.App.2d 645, 652 [“We must assume that the trial court has considered all the evidence before it”].) Simply put, the trial court did not believe that the evidence cited by Isaacson supported Isaacson’s position that his failure to appear was not willful. As the trial court pointed out, there was also abundant evidence that Isaacson’s failure to appear at the arbitration was deliberate. The trial court noted that Spiers knew, as early as April 1, 2009, that the arbitration panel was looking for dates on which both parties were available. In addition, the notice of hearing was properly addressed and admittedly received by Isaacson’s firm. Finally, even if there had been a calendaring error, both parties acknowledge that the arbitrator’s assistant telephoned Isaacson on the day of the hearing to alert him that it was going forward. Isaacson did not appear at the arbitration, nor did he send another attorney from his office to represent the firm. The trial court determined that the lack of written evidence of a request for postponement supports the suggestion that no such request was ever made.

Merritt is factually distinguishable. As pointed out above, it involves a different statutory scheme and is therefore inapplicable under the circumstances of this case. In addition, the facts in Merritt show less culpability on the part of the defaulting party. In Merritt, the appellants’ attorney did not have the arbitration date noted on his calendar. And, while the respondent’s attorney indicated that he telephoned appellant’s attorney’s office on the date of the arbitration, respondent’s attorney did not explain the purpose of the phone call. (Merritt, supra, 175 Cal.App.3d at p. 828.) Thus, the facts showed that appellant’s counsel had no knowledge of the arbitration. In contrast, on the day of the arbitration, Isaacson was specifically informed that the arbitration was going forward. He chose not to appear or send another attorney from his office, and he declined to provide a written request for, or confirmation of, a continuance. Under the circumstances, the evidence supports the trial court’s conclusion that Isaacson failed to carry his burden of proving that his failure to appear was not willful.

Isaacson cites to Corell v. Law Firm of Fox and Fox (2005) 129 Cal.App.4th 531, as authority for his position that cases involving judicial arbitration may properly be looked to as persuasive authority in cases involving the MFAA. In Corell, the Court of Appeal addressed the question of whether an attorney’s dismissal of a fee action—by which the attorney had sought a trial de novo following an MFAA award with which he was dissatisfied—warranted termination of the de novo proceedings and finality of the MFAA award. (Id. at p. 537.) The Court of Appeal looked to similar situations in the context of judicial arbitration, noting that such cases were “apposite here, even though the present award and request for trial de novo arose in the context of MFAA arbitration... rather than judicial arbitration.” (Ibid.) Despite this dicta in Corell, we decline to find the cases involving judicial arbitration applicable under the circumstances of this case. The language of section 6204, subdivision (a), making it Isaacson’s obligation to prove that his failure to appear was not willful, is not found in the rules governing judicial arbitration. Therefore the two statutory schemes are not analogous on the issue before us.

In reviewing the trial court’s factual determinations under the substantial evidence standard, “we do not reweigh the evidence, but rather determine whether, after resolving all conflicts favorably to the prevailing party, and according the prevailing party the benefit of all reasonable inferences, there is substantial evidence to support the judgment. [Citation.]” (Scott v. Pacific Gas & Electric Co. (1995) 11 Cal.4th 454, 465, disapproved on other grounds in Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 352, fn. 17.) “‘[W]hen a [finding] is attacked as being unsupported, the power of the appellate court begins and ends with a determination as to whether there is any substantial evidence, contradicted or uncontradicted, which will support the [finding]. When two or more inferences can be reasonably deduced from the facts, the reviewing court is without power to substitute its deductions for those of the trial court.’ [Citation.]” (Western States Petroleum Assn. v. Superior Court (1995) 9 Cal.4th 559, 571 (Western States).)

The evidence supporting the trial court’s decision was reasonable, and substantial. The court had before it the declaration of Cantrell, as well as documentary evidence in the form of the notices and letters sent from the arbitrator to Isaacson. Under the circumstances, we have no power to reweigh the facts or indulge any inferences in favor of Isaacson. The trial court’s factual determination that Isaacson failed to prove that his failure to appear at the arbitration was not willful is amply supported and is therefore affirmed.

III. The trial court did not abuse its discretion in denying the petition for trial de novo.

Isaacson argues that the denial of a trial de novo is an abuse of discretion where a less drastic sanction serves the interests of justice. The court’s authority to deny a trial de novo, Isaacson argues, is limited by the policy of deciding the case on the merits. (Lyons v. Wickhorst (1986) 42 Cal.3d 911, 916 (Lyons).)

In support of this argument, Isaacson again relies on cases regarding judicial arbitration. Isaacson cites no cases interpreting section 6204, nor any cases involving the MFAA. Under the circumstances here, the cases regarding judicial arbitration are not applicable. This case was decided on a provision of the MFAA which specifies that if either party willfully failed to appear at the arbitration, that party “shall not” be entitled to a trial after arbitration, and that the burden is on the party who failed to appear to prove that his or her absence was not willful. No such provision exists in the rules governing judicial arbitration.

In Lyons, mandatory judicial arbitration had been ordered pursuant to Code of Civil Procedure section 1141.11. At the first arbitration hearing, appellant informed the arbitrator and respondent’s counsel that he had no intention of presenting evidence at the arbitration. Appellant presented no evidence, and respondent made no attempt to refute appellant’s claims. After a second arbitration was scheduled, appellant once again declined to present evidence, and respondents did not attend the hearing after informing the arbitrator that attendance would be futile in light of appellant’s refusal to proceed. Although no evidence was presented, the arbitrator entered an award in favor of respondents. Appellant requested a trial de novo the same day. Upon the respondent’s motion, the trial court dismissed the action. (Lyons, supra, 42 Cal.3d at p. 914.) The Court of Appeal reversed the dismissal, noting that “neither the judicial arbitration statutes... nor the rules of judicial arbitration... permit the courts to dismiss an action because of a plaintiff’s failure to present evidence at a judicially mandated arbitration proceeding.” (Id. at p. 915.) The court pointed out that the Legislature had considered the problem of nonparticipation in judicial arbitration and put teeth into the mandatory nature of the process by authorizing the assessment of expenses against a nonparticipating party. Finally, the court indicated that “immediate and unconditional dismissal” was too drastic a remedy for nonparticipation in judicial arbitration because “arbitration was not intended to supplant traditional trial proceedings, but to expedite the resolution of small civil claims.” (Id. at p. 919.)

In contrast to the situation in Lyons, here, the trial court applied a specific provision of the MFAA directing the court that “if either party willfully fails to appear at the arbitration hearing... that party shall not be entitled to a trial after arbitration.” (§ 6204, subd. (a).) The statutory scheme governing judicial arbitration does not contain such a specific directive. Further, proceedings under the MFAA are not conducted adjunct to litigation, and are not necessarily followed by court action, as are proceedings under the judicial arbitration scheme. (Maynard v. Brandon (2005) 36 Cal.4th 364, 381.) Thus, both the statutes and the reasoning applied in Lyons are inapplicable here.

Hebert v. Harn (1982) 133 Cal.App.3d 465 (Hebert), also cited by appellant, is inapplicable for similar reasons. In Hebert, an Orange County superior court rule required a party who failed to appear at judicial arbitration to file a noticed motion in order to obtain trial de novo. It also appeared to give discretion to the trial court to deny the request unless the moving party established good cause for failing to participate in the arbitration proceeding. (Id. at p. 467.) The Court of Appeal declared the rule invalid to the extent that it required the defaulting party to make a showing of good cause, reasoning that “Where a local rule has the effect of closing the courts to the defaulting party making the decision of the arbitrator the final determination in the case, the party is denied due process of law. [Citation.]” (Id. at pp. 469-470.) Again, the Court of Appeal focused on the role of judicial arbitration as adjunct to litigation, and the intent of the Legislature “that access to the court for a new trial following a judicially ordered arbitration... to be procedurally unfettered.” (Id. at p. 470.) Here, the intent of the Legislature is also clear: parties who fail to appear at MFAA arbitration must be denied trial de novo unless they meet their burden of showing that the failure to appear was not willful. The statutes and rationale set forth in Hebert are inapplicable.

In sum, we conclude that Lyons and its progeny are inapplicable under the circumstances of this case. Isaacson has failed to show that an abuse of discretion occurred.

IV. The trial court did not err in denying Isaacson’s petition to vacate pursuant to Code of Civil Procedure section 1286.2, subdivision (a)(5)

Isaacson’s petition to vacate the arbitration award was brought under Code of Civil Procedure section 1286.2, subdivision (a)(5), which provides:

“(a) Subject to Section 1286.4, the court shall vacate the award if the court determines any of the following: [¶]... [¶]

“(5) The rights of the party were substantially prejudiced by the refusal of the arbitrators to postpone the hearing upon sufficient cause being shown therefor or by the refusal of the arbitrators to hear evidence material to the controversy or by other conduct of the arbitrators contrary to the provisions of this title.”

Isaacson argues that the trial court ignored evidence that Isaacson requested a continuance of the arbitration hearing. Isaacson claims that the trial court not only ignored this evidence, but failed to cite any evidence in support of its findings that (1) there was insufficient evidence that a continuance was requested, and (2) substantial prejudice resulting from a failure to postpone the hearing was not shown.

Contrary to Isaacson’s position that there was insufficient evidence that a continuance of the arbitration was requested, the trial court did not “ignore” Spiers’s statement that she requested a continuance of the arbitration. Instead, the trial court made it clear that the evidence contradicting Spiers’s statement was more convincing. The court noted that Cantrell denied that a request for continuance was ever communicated to her. In addition, the court emphasized that no letter or written communication of any kind confirming a continuance of the arbitration hearing was ever sent by Isaacson to Cantrell or anyone on the arbitration panel. The court specifically noted that Isaacson is an experienced attorney, having been practicing for 30 years. Given this extensive experience, the court felt that the absence of any written confirmation of a request or grant of a continuance was compelling corroboration that Cantrell’s account was more reliable. The trial court expressed its doubt that a request for continuance would not be confirmed in writing by an experienced lawyer under these circumstances.

While we understand that Isaacson’s view of the facts is different, it is not our place to reweigh the evidence. Substantial evidence, in the form of Cantrell’s declaration, supports the court’s findings. “‘When two or more inferences can be reasonably deduced from the facts, the reviewing court is without power to substitute its deductions for those of the trial court.’ [Citation.]” (Western States, supra, 9 Cal.4th at p. 571.) The trial court’s decision is supported by the evidence, and therefore must be upheld.

Isaacson next disputes the trial court’s decision that “substantial prejudice resulting from a failure to postpone the hearing has not been shown.” Isaacson takes the position that the loss of $112,155 of unreimbursed litigation costs is sufficient evidence of prejudice. We note that Isaacson has failed to articulate what specific evidence would have been presented to counter the findings of the arbitration panel. Nevertheless, because the trial court did not err in concluding that there was insufficient evidence that a postponement of the arbitration was ever requested, we need not reach this issue.

V. Maatuk’s cross-appeal

A. Proceedings regarding Maatuk’s request for attorney fees

Following the issuance of the trial court’s statement of decision, Maatuk filed a motion for entry of judgment and an award of fees and costs. Specifically, Maatuk requested attorney fees of $19,662.50 and costs of $1,422.66 under section 6204. At the April 22, 2010 hearing on the matter, the trial court announced its tentative decision that Maatuk was not entitled to fees under section 6204, subdivision (d). The court noted that the statute only allows for an award of fees “incurred in the trial after arbitration.” The court reasoned that, because there was no trial after arbitration as required by the statute, section 6204, subdivision (d) was inapplicable. The court noted that Maatuk failed to cite any other authority indicating that he was entitled to fees under the circumstances. Following argument, the trial court’s tentative decision became final.

Section 6204, subdivision (d) provides: “The party seeking a trial after arbitration shall be the prevailing party if that party obtains a judgment more favorable than that provided by the arbitration award, and in all other cases the other party shall be the prevailing party. The prevailing party may, in the discretion of the court, be entitled to an allowance for reasonable attorney’s fees and costs incurred in the trial after arbitration, which allowance shall be fixed by the court. In fixing the attorney’s fees, the court shall consider the award and determinations of the arbitrators, in addition to any other relevant evidence.”

Maatuk cross-appeals from that portion of the trial court’s decision denying him attorney fees under the MFAA. Maatuk argues that he is entitled to fees under section 6204, subdivision (d). Maatuk’s cross-appeal involves the application of these statutes to undisputed facts, therefore we review them independently. (Burden v. Snowden (1992) 2 Cal.4th 556, 562.)

Maatuk also asserts that he is entitled to attorney fees under section 6203, subdivision (c). However, Maatuk has not provided any further argument or support for this assertion. We need not consider points unsupported by legal analysis or authority. (Badie v. Bank of America (1998) 67 Cal.App.4th 779, 784-785.) We therefore treat this argument as forfeited.

B. Maatuk is not entitled to fees under section 6204, subdivision (d)

Maatuk argues that, contrary to the trial court’s decision, there was a trial on the issue of Isaacson’s willful refusal to attend arbitration. Maatuk points out that the trial court took evidence on the issue and made a factual determination. Maatuk’s argument is that the term “trial, ” as used in the statute, includes the trial court’s preliminary determination of whether such a trial will be granted.

“Our role in construing a statute is to ascertain the intent of the Legislature in order to effectuate the purpose of the law. [Citation.] Because the statutory language is generally the most reliable indicator of that intent, we look first at the words themselves, giving them their usual and ordinary meaning and construing them in context. [Citation.] If the plain language of the statute is clear and unambiguous, our inquiry ends, and we need not embark on judicial construction. [Citations.] (People v. Johnson (2002) 28 Cal.4th 240, 244.)

We disagree with Maatuk’s suggestion that the term “trial after arbitration” includes the trial court’s preliminary determination as to whether such a trial will be permitted. A plain reading of the statute suggests that the term “trial after arbitration, ” as used in the statute, does not include the trial court’s evaluation of whether a petition for new trial should be granted. Instead, that determination is a prerequisite to the moving party’s entitlement to trial after arbitration.

We reject Maatuk’s suggestion that the term “trial” is ambiguous under the circumstances of this case. Maatuk points out that under the MFAA, a party may demurrer, move for summary judgment, or file other procedural devices. (Schatz v. Allen Matkins Leck Gamble & Mallory LLP (2009) 45 Cal.4th 557, 572-573 (Schatz).) To the extent that such devices are dispositive, Maatuk argues, there is no good reason to deny the prevailing party attorney fees merely because victory was obtained before trial. We decline to address this argument as these circumstances are not present in this case. Isaacson was not granted a new trial, therefore none of the procedural devices listed above could possibly have been utilized by either party. Contrary to Isaacson’s suggestion, Schatz does not suggest that the term “trial, ” as used in section 6204, is ambiguous. Instead, the ambiguity discussed in Schatz involved the question of whether the MFAA impliedly repealed the California Arbitration Act. (Schatz, at p. 573.) As to the term “trial, ” the Schatz court confirmed that “the right granted is simply to a trial in accordance with applicable law.” (Id. at p. 572.) Here, the trial court determined that Isaacson did not have the right to a trial. Therefore Maatuk has no right to fees under section 6204, subdivision (d).

A trial de novo is “‘“‘“a trial anew in the fullest sense, ”’”’” in which the previous decision “is entitled to no weight whatsoever, and the parties may present entirely new evidence to the trial court.” (Eicher v. Advanced Business Integrators, Inc. (2007) 151 Cal.App.4th 1363, 1381 [discussing appeal to the superior court of a decision of the Labor Commissioner under Labor Code section 98.2].) The language of Business & Professions Code section 6204, subdivision (d), suggesting that a prevailing party may be entitled to a reasonable award of attorney fees “incurred in the trial after arbitration, ” requires a trial of the issues decided at the arbitration to have taken place. Here, there was no trial on the arbitration panel’s decisions regarding Isaacson’s “overreaching” and charging of items that were not consistent with the fee agreement between the parties. Thus, there was no “trial after arbitration” as that term is used in the statute.

Maatuk next argues that fees are triggered when a party files a request for fees after arbitration, regardless of whether a trial is ultimately held. Again, the language of the statute undermines this argument. The prevailing party is only entitled to attorney fees and costs “incurred in the trial after arbitration.” (§ 6204, subd. (d).) Where such a trial is not granted, there is no authority for an award of fees.

Finally, Maatuk presents policy arguments in support of his request for attorney fees. First, he argues, a narrow construction of the term “trial” rewards parties who fail to attend arbitration. Next, he argues that a policy of denying fees to a party who successfully defeats his opponent’s request for trial after arbitration discourages early resolution and promotes judicial waste. Maatuk also asserts that Isaacson’s behavior throughout the MFAA proceedings was egregious. During the one year that the fee petition was pending, Isaacson refused to submit a single letter, document, or brief, and frustrated the process at every turn. This cavalier and hostile attitude, Maatuk argues, justifies an award of attorney fees.

Section 6204, subdivision (d) provides for attorney fees to a prevailing party “incurred in the trial after arbitration.” In light of this clear directive, we decline to consider Maatuk’s policy arguments for the purpose of expanding the statute to include attorney fees incurred where a request for trial after arbitration was defeated in the first instance. “In construing the statutory provisions a court... may not rewrite the statute to conform to an assumed intention which does not appear from its language. The court is limited to the intention expressed. [Citation.]” (People v. One 1940 Ford V-8 Coupe (1950) 36 Cal.2d 471, 475.) We decline to expand the scope of the statute as Maatuk requests.

DISPOSITION

The judgment of the trial court is affirmed in its entirety. Each party shall bear its own costs of appeal.

We concur: BOREN, P. J., DOI TODD, J.


Summaries of

Isaacson v. Maatuk

California Court of Appeals, Second District, Second Division
Jul 28, 2011
No. B224217 (Cal. Ct. App. Jul. 28, 2011)
Case details for

Isaacson v. Maatuk

Case Details

Full title:LON B. ISAACSON et al., Plaintiffs and Appellants, v. JOSEF MAATUK…

Court:California Court of Appeals, Second District, Second Division

Date published: Jul 28, 2011

Citations

No. B224217 (Cal. Ct. App. Jul. 28, 2011)