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Kurtz v. Wizbowski

California Court of Appeals, Fifth District
Jun 30, 2008
No. F053118 (Cal. Ct. App. Jun. 30, 2008)

Opinion

NOT TO BE PUBLISHED

APPEAL from a judgment of the Superior Court of Fresno County No. 05CECG00810. Alan M. Simpson, Judge.

Ruyle & Brewer, William K. Brewer and Jennifer L. Hamilton, for Defendant and Appellant.

Bacigalupi, Neufeld & Rowley, Daniel W. Rowley, for Plaintiffs and Respondents.


OPINION

Wiseman, J.

Defendant Barbara Wizbowski seeks reversal of the trial court’s orders compelling arbitration and confirming an arbitration award to plaintiffs Eric and Teresa Kurtz. The parties’ dispute concerns Wizbowski’s sale of a house to the Kurtzes and the Kurtzes’ subsequent discovery of improvements constructed without building permits, among other allegedly undisclosed problems. We reject defendant’s arguments and affirm the judgment.

FACTUAL AND PROCEDURAL HISTORIES

On April 24, 2002, plaintiffs entered into a contract to purchase a house in Fresno from Raymond and Barbara Wizbowski. Barbara Wizbowski was a licensed real estate broker. The dispute arose after the close of escrow, when plaintiffs claimed to find a number of undisclosed problems, including an outbuilding and other improvements constructed without permits and in violation of the building code. Plaintiffs claimed that the Wizbowskis and Guarantee Real Estate, which represented both parties in the sale, knew of these problems before the sale. Through counsel, plaintiffs proposed to settle the matter for $39,628.98 and, if this was not acceptable, to engage in mediation pursuant to a mediation clause in the sale contract.

Plaintiffs, the Wizbowskis, and Guarantee Real Estate participated in a mediation on November 17, 2004. At its conclusion, the parties and their attorneys signed a one-page document titled “SETTLEMENT AGREEMENT.” This document set forth the parties’ agreement in abbreviated fashion, stating: “TERMS: 1542 release payment of 30K $22,500 by Wizbowski $7500.00 by Guarantee. $22,500.00 without interest payment upon sale of home or May 17, 2005 whichever is sooner.” The number 1542 presumably is a reference to Civil Code section 1542, which pertains to general releases. The document further provided:

“The parties waive the provisions of California Evidence Code relating to mediation confidentiality; thereby rendering this Agreement enforceable. In addition, the parties agree that this dispute is now settled pursuant to the provisions of Code of Civil Procedure Section 664.6. It is understood and agreed that this is an abstract of the actual agreement and that the dispute is settled. The Mediator shall have the authority to perform binding arbitration over all disputes including the language of documents to be prepared hereafter and all disputes as to this settlement.”

After counsel for Guarantee Real Estate drafted a more detailed settlement agreement including these terms, counsel for the Wizbowskis informed the other parties that the Wizbowskis did not intend to perform.

Plaintiffs filed their complaint in superior court on March 16, 2005. It named as defendants Raymond and Barbara Wizbowski, Guarantee Real Estate, and Guarantee’s agent, Bobette Sanchez-Harvick. It alleged that the Kurtzes specifically told Guarantee they were only interested in properties that had no problems with building permits or building-code compliance. It also alleged that the Wizbowskis claimed in a disclosure statement that their house had no such problems. The complaint alleged breach of contract, failure to make required disclosures, and fraud.

Guarantee Real Estate responded to the complaint by filing a petition to compel arbitration pursuant to Code of Civil Procedure sections 1281.2 and 1292.4. The petition relied on the settlement agreement’s provision stating that “[t]he Mediator shall have the authority to perform binding arbitration over all disputes … as to this settlement.” There was no arbitration clause in the sale contract, since the parties did not initial the arbitration provisions in the printed contract form. The court granted the petition on July 12, 2005. It stated that, because the settlement agreement was signed by Barbara Wizbowski but not Raymond Wizbowski, Raymond was not bound by the order to arbitrate.

The arbitration hearing took place on October 5, 2006. In a written award dated October 20, 2006, the arbitrator found the settlement agreement to be enforceable and awarded the Kurtzes $22,500 plus interest. He also awarded attorneys’ fees to the Kurtzes pursuant to an attorneys’ fees provision of the sale contract.

The Wizbowskis filed a motion in the superior court to vacate or correct the award on January 31, 2007. A few days later, plaintiffs filed a petition to confirm the award. The court granted the petition to confirm the award with some of the corrections requested by the Wizbowskis: It struck the award of attorneys’ fees and all references to Raymond Wizbowski, whom it had earlier held not to be bound by the settlement agreement or its arbitration clause. The court denied the Wizbowskis’ motion to vacate the award and ordered Barbara Wizbowski to pay plaintiffs $22,500 plus interest. The order further stated that the parties could file motions in the court for attorneys’ fees. Judgment was entered on April 12, 2007.

Plaintiffs filed a motion for attorneys’ fees. They relied on a provision of the sale contract entitling the prevailing party to attorneys’ fees for “any action, proceeding, or arbitration between Buyer and Seller arising out of” that contract, so long as the party participated in or offered to participate in mediation.

The court granted the motion in part and denied it in part. It ruled that plaintiffs could recover the fees incurred in the course of the judicial proceedings but not those incurred in the arbitration proceedings. The court’s reasoning was that the settlement agreement was “a modification of the [sale contract] with respect to arbitration [which] did not include a provision for attorney fees .…” After requesting and obtaining additional documentation of the amount, the court awarded plaintiffs $11,961.25 for attorneys’ fees.

A notice of appeal for the underlying judgment was filed on June 15, 2007, and a separate notice of appeal for the award of attorneys’ fees was filed on August 31, 2007. Both notices named only Barbara Wizbowski as appellant. The appeal from the award of attorneys’ fees is addressed in our opinion in case No. F053776.

DISCUSSION

I. Order compelling arbitration

Defendant argues that the order compelling arbitration was erroneous for several reasons. To the extent the trial court’s decision to compel arbitration was based on the resolution of disputed facts, we review the court’s decision for substantial evidence. Where there are no disputed facts and the court’s decision turns on questions of law only, our review is de novo. (Hartnell Community College Dist. v. Superior Court (2004) 124 Cal.App.4th 1443, 1448-1449; Amalgamated Transit Union Local 1277 v. Los Angeles County Metropolitan Transportation Authority (2003) 107 Cal.App.4th 673, 685.)

A. Arbitration properly was ordered under the settlement agreement

Defendant argues that the court could not properly compel arbitration under the settlement agreement because plaintiffs’ lawsuit was based on the sale contract, which had no arbitration clause. The complaint did not mention the settlement agreement at all. Likewise, Guarantee Real Estate did not file a lawsuit based on the settlement agreement or assert it as a defense to plaintiffs’ lawsuit. This issue is one of law; we review it de novo.

Defendant’s argument is premised on the erroneous notion that a petition to compel arbitration must be based on an arbitration agreement contained in a contract at issue in a previously filed lawsuit. There is no such requirement. Guarantee Real Estate’s petition to compel arbitration was based on Code of Civil Procedure sections 1281.2 and 1292.4. Section 1281.2 provides for a petition to compel arbitration where a written agreement to arbitrate a controversy exists and a party has refused to arbitrate. It allows the filing of a petition even if no lawsuit is pending. Section 1292.4 provides that if the controversy is “involved in an action” pending in superior court, the petition shall be filed in that action. It does not require the agreement containing the arbitration clause to have been raised already by a party to the action. Neither section requires the petition to be based on an arbitration agreement relied on in a complaint, raised as a defense, or in any other way previously referenced in a lawsuit.

Subsequent statutory references are to the Code of Civil Procedure unless noted otherwise.

An agreement to arbitrate a controversy over the settlement agreement existed, defendant refused to arbitrate, and the controversy was over the same facts as those “involved in” the action filed by plaintiffs in the superior court. Guarantee Real Estate’s petition to compel arbitration therefore was proper under both section 1281.2 and section 1292.4.

Realizing, perhaps, that the relevant statutes refute her argument, defendant ignores those statutes and instead cites section 664.6. She says Guarantee Real Estate “did little more than file [a] motion to enforce the settlement under the procedures prescribed by C.C.P. § 664.6,” but “the provisions of C.C.P. § 664.6 did not apply” because the settlement agreement was entered into before the lawsuit was filed, so the only way plaintiffs could obtain an order compelling arbitration was to file a lawsuit based on the settlement agreement. This argument has no merit. Guarantee Real Estate’s petition to compel arbitration relied on sections 1281.2 and 1292.4, not section 664.6. Section 664.6 allows a trial court to enter judgment upon a settlement agreement reached by the parties while a case is pending in the court. It has nothing to do with the issues in this appeal.

B. Defendant waived any defect in the notice of the motion to compel

Defendant argues that the petition to compel arbitration was not properly granted because she did not receive adequate notice of the petition. Specifically, she points out that Guarantee Real Estate’s notice of motion and memorandum of points and authorities begin by stating that the purpose of the petition is to ask the court to compel Eric and Teresa Kurtz to submit their claims to arbitration. Further, so far as the proofs of service included in the appellate record disclose, the motion was served only on counsel for the Kurtzes. On the other hand, at its conclusion the motion prayed for an order compelling plaintiffs “and all interested parties” to arbitrate. Here, too, the facts are undisputed and we review the issue de novo.

We agree with plaintiffs’ contention that defendant waived any defect in the notice Guarantee Real Estate gave of its petition. Defendant filed a brief opposing the petition; her brief contained no objection to the notice. Defendant’s counsel requested and participated in oral argument, which took place after the court issued its tentative ruling. Counsel never made any objection to the notice during oral argument. It has long been settled that where a party appears in the trial court to contest a motion and makes no objection based on lack of notice or defective notice, the issue of notice is waived. (Acock v. Halsey (1891) 90 Cal. 215, 220; Padilla v. Department of Alcoholic Beverage Control (1996) 43 Cal.App.4th 1151, 1157; Hammond Lumber Co. v. Bloodgood (1929) 101 Cal.App. 561, 563-564.) Defendant filed no reply brief to explain why there would be no waiver here.

C. The court ruled correctly on the claim of duress

In her brief opposing the petition to compel arbitration, defendant alleged that her signature on the settlement agreement was obtained by means of duress:

“During the mediation, WILLIAM BREWER [defendant’s counsel] stepped outside to telephone RAYMOND WIZBOWSKI [who was absent from the mediation because of recent heart surgery]. In Mr. Brewer’s absence, BARBARA WIZBOWSKI was pressured to [agree] to pay KURTZ $22,500.00 or face a lawsuit based on a variety of claims, including fraud. BARBARA was told that she made a ‘terrible witness’ and the settlement was a ‘favor’ to her. When Mr. Brewer returned to the room he asked BARBARA what she wanted to do. She said to pay them what they had requested. The pressure placed on BARBARA was not communicated to Mr. Brewer until after the mediation, and after execution of the Settlement Agreement. BARBARA WIZBOWSKI entered into the Settlement Agreement believing that her husband could not survive the pressure of a lawsuit due to his failing health.”

The trial court rejected the claim of duress on the ground that defendant had made no attempt to support the claim with evidence. Its ruling stated:

“A petition to compel arbitration is heard in the same manner as a motion. Factual issues, including the validity of the agreement, are decided upon declarations and affidavits. (Code Civ. Proc., §§ 1290.2 & 2009; Brookwood v. Bank of America (1996) 45 Cal.App.4th 1667, 1670.) The opposition papers of the Wizbowskis contain no such affidavits or declarations to support the contentions raised by their opposition.”

Confronted with this conclusion (which the court had stated in its tentative ruling) at oral argument, defendant’s counsel said he mistakenly thought the Kurtzes were going to oppose the motion and win and that in any case his argument based on section 664.6 was more important, so he decided not to provide any factual support for the duress claim. As it turned out, they filed a statement of nonopposition instead.

Defendant now argues that the court ruled wrongly on the claim of duress and that its ruling had the effect of erroneously referring that claim to the arbitrator. We consider this claim under the substantial-evidence standard of review to the extent that it challenges the court’s finding that the claim was unsupported. We review it under the de novo standard to the extent it asserts a conclusion of law about a referral of the claim to the arbitrator.

At oral argument, defendant’s counsel stated that he could not present evidence of duress because of the mediation privilege set forth in Evidence Code section 1119. Defendant did not, however, make this claim in her briefs. We will not consider the claim for that reason.

The court found correctly that the claim lacked factual support. If a court finds that an agreement to arbitrate exists, it is required to compel arbitration unless the petitioner has waived the right to compel arbitration, grounds exist for the revocation of the agreement, or a party to the agreement is also a party to pending litigation from which conflicting rulings on a common issue could arise. (§ 1281.2.) Except in rare cases of physical compulsion, duress renders a contract not void but voidable and subject to rescission. (Civ. Code, §§ 1566, 1567; 1 Witkin, Summary of Cal. Law (10th ed. 2005) Contracts, § 310, p. 336.) As a result, a showing of duress could establish either that the arbitration agreement did not exist (i.e., because it was void from its inception) or that grounds to revoke it existed (i.e., because the duress made it voidable). Either way, the court in this case could not find duress on the basis of counsel’s unsubstantiated say-so in a brief.

In an attempt to provide factual support for the duress claim, defendant’s appellate brief cites and quotes a declaration that her counsel, William Brewer, submitted in support of defendant’s motion to vacate the arbitrator’s award. In this declaration, counsel makes the following assertions: Ryan Brewer, a person present at the mediation as a witness, talked to William Brewer as the two drove home to San Diego after the mediation, which took place in Fresno. Ryan Brewer told William Brewer that the mediator made statements to Barbara Wizbowski while William Brewer was out of the room. The declaration never explains what Ryan Brewer (or anyone else) told William Brewer about these statements allegedly occurring at the mediation. Instead, it makes claims about evidence that was not presented at the arbitration:

“25. The testimony offered [at the arbitration] did not dispute that Mediator Broadman made statements to Barbara Wizbowski outside the presence of her counsel, including comments that she was a poor witness, that he was doing her a favor and she needed to settle, and while discussing the current value of the Property, Mrs. Wizbowski told Judge Broadman that the Property had almost doubled in value and was worth over one million dollars. Mediator Broadman informed Mrs. Wizbowski that the value of the home would not be admitted into evidence, after which Mrs. Wizbowski [said] that it would because she would tell the jury, to which Mediator Broadman replied ‘then you will go to jail.’

“26. There was no evidence that Mrs. Wizbowski communicated that she was in the process of, or agreed to more than $10,000, much less $22,500 before I returned to the conference room following Mediator Broadman’s comments to her.

“27. Rather, when I returned to the conference room, Mrs. Wizbowski abruptly instructed me to settle it for ‘whatever they want.’ I asked Ms. Wizbowski if she wanted to talk privately, or to call her husband to which she again abruptly replied, ‘no.’”

The declaration also includes a hearsay claim that Barbara Wizbowski said comments by the mediator had a detrimental effect on her:

“Barbara Wizbowski was awaiting surgery to replace three heart valves. The leakage in the heart valves cause[d] memory loss as well. Mrs. Wizbowski testified that the comments from Mediator Broadman while her counsel was not present, placed her under such stress she thought she was going to die and could not wait to leave.”

This declaration fails to support defendant’s case for at least two reasons. First, the declaration contains no evidence at all of the content of the statements by the mediator that allegedly resulted in duress. It says that Ryan Brewer told William Brewer that the mediator made statements to defendant. It also says defendant asserted that the statements caused her great stress. As for the content of the statements, however, the declaration only says there was no evidence of what these statements were not. There was no declaration by Ryan Brewer, who allegedly heard the mediator’s statements, or by defendant, who allegedly was coerced by the statements. There was not even a declaration by William Brewer stating that Ryan Brewer or defendant told him about these statements. William Brewer’s declaration merely stated that no evidence was presented at the arbitration to refute his claim that coercive statements were made. The amount of evidence of the content of these alleged statements before the court after the filing of this declaration was exactly the same as the amount previously: none.

Second, the submission of this declaration in support of the motion to vacate cannot affect the correctness of the earlier ruling on the motion to compel. Defendant does not argue that the motion to vacate was an opportunity to correct her failure to present evidence she could have, but did not, present in opposing the motion to compel.

We conclude that defendant’s reliance in her appellate brief on William Brewer’s declaration to support her alleged duress argument is misleading and falls below the standards established by the California Rules of Court. Rule 8.204(a)(1)(C) requires every appellate brief to “[s]upport any reference to a matter in the record by a citation to the volume and page number of the record where the matter appears.” Defendant’s brief asserts, as facts, that “Mediator Broadman stated to Mrs. Wizbowski” that she was a poor witness, that he was doing her a favor, that she needed to settle, and that she would go to jail if she tried to communicate inadmissible evidence to a jury. The only record citation for these claims is page 333 of the clerk’s transcript. This reference is to a page of William Brewer’s declaration, which, as we have said, contains no evidence of the content of any coercive statements by the mediator. It merely states that no evidence was presented at the arbitration to refute the contention that the mediator made these statements. Further, the declaration had not even been filed yet when the court decided the motion to compel arbitration, the decision defendant is claiming to be erroneous in the portion of her brief in which the declaration is cited. The declaration was filed later, in support of the motion to vacate.

Finally, there is no merit in defendant’s argument that the court erroneously caused her challenge to the validity of the settlement agreement to be submitted to the arbitrator. Instead, it is clear from the court’s ruling that it decided her challenge to the validity of the settlement agreement, rejecting it on the ground that defendant failed to support it with evidence. True, the arbitrator considered and rejected this challenge as well. The fact that defendant attempted (and again failed) to persuade the arbitrator of the same claim, however, does not show that the court referred the issue to the arbitrator instead of ruling on it.

II. Order confirming award

Defendant contends that the trial court erred when it denied her motion to vacate the award, ordered corrections to the award, and confirmed the award as corrected. A trial court’s power to correct or vacate an arbitration award is circumscribed. Beyond statutorily specified grounds for vacating or correcting an award, “an arbitrator’s decision is not generally reviewable for errors of fact or law, whether or not such error appears on the face of the award and causes substantial injustice to the parties.” (Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 6.) We review de novo a ruling confirming an arbitration award, except that we review for substantial evidence issues in the ruling that rest on the trial court’s resolution of factual disputes. (Lindenstadt v. Staff Builders, Inc. (1997) 55 Cal.App.4th 882, 892, fn. 7.)

A. Substantial evidence supported the court’s ruling on the disclosure issue

Defendant first argues that the court should have vacated the award because the arbitrator failed to make mandated disclosures. Section 1281.9 requires an arbitrator to disclose “all matters that could cause a person aware of the facts to reasonably entertain a doubt that the … arbitrator would be able to be impartial .…” (§ 1281.9, subd. (a).) The disclosure must be made within 10 days of service of the notice of proposed nomination or appointment of the arbitrator. (§ 1281.9, subd. (b).) Section 1281.91, subdivision (a), states that failure to make this disclosure is grounds for disqualification. Section 1286.2, subdivision (a)(6), commands the court to vacate an arbitration award if it finds that the arbitrator failed to disclose, within the required time, grounds for disqualification “of which the arbitrator was then aware.” The moving party has the burden of establishing the claimed grounds for vacating the award. (Guseinov v. Burns (2006) 145 Cal.App.4th 944, 957.) Since the question of whether the arbitrator was required to disclose information that might indicate bias is a question of fact, we review the trial court’s decision under the deferential substantial-evidence standard. (Ibid.)

William Brewer described the alleged grounds for doubting the arbitrator’s impartiality in the declaration he submitted in support of defendant’s motion to vacate:

“34. I am defense counsel for Central Valley RV in the Sossoman matter, which has been stayed since in or about 2003.

“35. On or about January 11, 2007, I was reviewing the file in the matter of Sossoman v. Central Valley RV Outlet in preparation for argument in the case and noticed correspondence suggesting that Mr. Betts [i.e., the arbitrator in the present case] was defense counsel for Heritage TPA, a defendant in the Sossoman matter. On January 16, 2007, my office contacted the clerk of the Fresno Superior Court to confirm his current status as counsel for Heritage.

“36. I am opposing counsel with Mr. Betts in that case since Central Valley RV demanded indemnification from Heritage and intends to cross-complain in the Sossoman matter against Heritage following conclusion of its arbitration with the Sossomans, including a claim for costs and attorney fees.

“37. On January 17, 2007, counsel for Wizbowski [i.e., Brewer himself] notified Mr. Betts of his failure to disclose his relationship as opposing counsel for Heritage in the Sossoman matter. Wizbowski’s counsel objected to this failure to disclose and asked Mr. Betts to withdraw his arbitration award and disqualify himself as the arbitrator for failing to disclose his conflict.…

“38. On January 25, 2007, Mr. Betts denied the request.

“39. I believe my client was prejudiced by this non-disclosed conflict of interest.

“40. I just learned for the first time last week that Mr. Betts is also the attorney for Dan Gamel. I do not know how long he has served in that capacity, however John Brewer is my brother and is a former manager of Dan Gamel RV. My brother is now in fierce competition with Dan Gamel RV, and there have been numerous threats of lawsuits between the two companies. Mr. Betts and the counsel and parties in this case are aware that Barbara Wizbowski is the mother of myself and my brother. Had Mr. Betts disclosed that he was counsel for Dan Gamel RV, I would have immediately undertaken to seek his disqualification on that ground alone.”

Addressing this issue at the hearing on the motion to vacate, the court said:

“[T]he grounds that have been cited for vacating the award are not compelling or persuasive to me. I do not believe that Mr. Betts had an undisclosed conflict or a situation that would require—would have required him to recuse him or now that would require that I vacate the award. I understand the nature of what has been cited by the moving parties to that motion, and I don’t find it persuasive or compelling.”

It denied the motion to vacate.

In her appellate brief, defendant complains of the trial court’s “lack of analysis” of this issue. So far as the appellate record discloses, however, defendant did not request a statement of decision. Under these circumstances, all intendments favor the trial court’s ruling, and we assume the trial court made whatever findings are necessary to sustain the judgment. (Code Civ. Proc., § 632; Walling v. Kimball (1941) 17 Cal.2d 364, 373; Homestead Supplies, Inc. v. Executive Life Ins. Co. (1978) 81 Cal.App.3d 978, 984.)

The question for the trial court on the motion to vacate was whether the arbitrator failed to disclose, within the required time, grounds for disqualification of which he was then aware. The record supports the ruling. As the moving party, defendant had the burden of showing that grounds to vacate existed. This included showing that the arbitrator was aware of the alleged grounds for disqualification at the time disclosure was required, i.e., before the arbitration. Defendant presented no evidence that the arbitrator was aware of William Brewer’s representation of Central Valley RV, or that William Brewer’s brother was a business competitor of the arbitrator’s client, until he, William Brewer, wrote to the arbitrator about it after the arbitration. William Brewer himself indicated in his letter to the arbitrator and in his declaration that he had no knowledge of the facts until January 2007, months after the issuance of the arbitration award. Nothing in the record shows that the arbitrator was aware of them earlier. A person could not reasonably entertain a doubt about the arbitrator’s impartiality on the basis of facts of which the arbitrator was not aware until after he issued the award.

Even if defendant had shown that the arbitrator was aware of the facts on which defendant relies, there is no authority for the proposition that disqualification would have been required. The nonexclusive list of facts set forth in section 1281.9 that would justify a reasonable doubt about an arbitrator’s impartiality includes an attorney-client relationship, a professional relationship, and a significant personal relationship between the arbitrator and a party or a party’s lawyer. (§ 1281.9, subd. (a)(5), (6).) James Betts did not have any of these relationships with any party to the arbitration. Other kinds of relationships might give rise to a reasonable doubt about an arbitrator’s impartiality, but defendant has not shown how the relationships at issue here would do so. In another case, the arbitrator was counsel to a codefendant of another client of defendant’s counsel, against whom that client contemplated an indemnity claim. The arbitrator was also counsel to defendant’s son’s business competitor, who was defendant’s counsel’s brother. The court could properly find that these facts did not justify a reasonable doubt about the arbitrator’s impartiality.

Ceriale v. AMCO Ins. Co. (1996) 48 Cal.App.4th 500, which defendant cites, does not support her position. There, Justice Gilbert wrote:

“Arbitration No. 1 is a binding arbitration. While it is pending, one of the attorneys involved in arbitration No. 1 becomes an arbitrator in arbitration No. 2, a judicial arbitration. Must the arbitrator in arbitration No. 1 disclose that she represents a party in arbitration No. 2? Yes.” (Ceriale v. AMCO Ins. Co., supra, 48 Cal.App.4th at p. 502.)

The reason why a reasonable person might entertain a doubt about the impartiality of the arbitrator in arbitration No. 1 is obvious: She might favor the party represented by the attorney who is the arbitrator in No. 2 in the hope of influencing that attorney to rule in favor of the client she represents in No. 2. In other words, a reasonable person could fear that the two arbitrators would scratch one another’s backs. There is nothing similar in this case.

B. The court properly corrected the award instead of vacating it

Defendant contends that when the trial court found errors in the arbitration award but decided merely to correct the award instead of vacating it, it “erred as a matter of law by failing to analyze the errors in terms of bias, prejudice and/or corruption and not vacating the award on those grounds.” She also says the court was, for these reasons, required to find that the arbitrator exceeded his powers. We understand this argument to mean that when the court found grounds to delete the award’s references to Raymond Wizbowski and to eliminate the attorneys’ fees award granted by the arbitrator, it was compelled to find also that the arbitrator’s errors on these points were caused by bias or corruption and to vacate the award on those grounds. Defendant adds that the arbitrator also must have been biased and corrupt because he required any deposition of Ryan Brewer to be taken in Fresno, not San Diego, and did not disclose that he was counsel to Heritage TPA, to which William Brewer was adverse in another case. These are claims about factual findings the arbitrator should have made, so we consider them under the substantial-evidence standard of review.

Substantial evidence in the record supports the trial court’s decision not to vacate the award for the reasons defendant asserts but instead to correct it and confirm it as corrected. The arbitrator’s references to Raymond Wizbowski were erroneous because the trial court granted the petition to compel arbitration with respect to Barbara Wizbowski only. The arbitrator’s references to Raymond Wizbowski in the award are most plausibly understood as the result of a simple oversight. There is not the slightest basis in the record for defendant’s imputation of sinister motives. The arbitrator’s award of attorneys’ fees was based on the attorneys’ fees clause in the sale contract. When it found this award erroneous on the ground that the fees clause was not applicable to the arbitration proceedings, the trial court was not compelled by the evidence to attribute the arbitrator’s mistake to bias or corruption. The ruling that depositions must be local also reveals no bias or corruption; rather, it is consistent with the policy that arbitration should be cost-effective. We have already said that the evidence did not compel the court to find that a reasonable person could infer bias from the arbitrator’s representation of Heritage TPA.

DISPOSITION

The judgment is affirmed. Plaintiffs shall recover their costs on appeal.

WE CONCUR: Vartabedian, Acting P.J. Hill, J.


Summaries of

Kurtz v. Wizbowski

California Court of Appeals, Fifth District
Jun 30, 2008
No. F053118 (Cal. Ct. App. Jun. 30, 2008)
Case details for

Kurtz v. Wizbowski

Case Details

Full title:ERIC KURTZ et al., Plaintiffs and Respondents, v. BARBARA WIZBOWSKI…

Court:California Court of Appeals, Fifth District

Date published: Jun 30, 2008

Citations

No. F053118 (Cal. Ct. App. Jun. 30, 2008)