Opinion
B300294
06-29-2020
ERNEST FERRO, et al., Plaintiffs and Appellants, v. KAISER FOUNDATION HEALTH PLAN INC., et al., Defendants and Respondents.
Weinberg-Hoffman and Ivan Weinberg for Plaintiffs and Appellants. Cole Pedroza, Kenneth R. Pedroza, Matthew S. Levinson; LaFollette, Johnson, DeHaas, Fesler & Ames and Scott A. Blakeley for Defendants and Respondents.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Los Angeles County Super. Ct. No. 18STCP03286) APPEAL from a judgment of the Superior Court of Los Angeles County, Patricia D. Nieto, Judge. Affirmed. Weinberg-Hoffman and Ivan Weinberg for Plaintiffs and Appellants. Cole Pedroza, Kenneth R. Pedroza, Matthew S. Levinson; LaFollette, Johnson, DeHaas, Fesler & Ames and Scott A. Blakeley for Defendants and Respondents.
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This is an appeal from the trial court's denial of a petition to vacate an arbitration award and its confirmation of and entry of judgment on that award. We have jurisdiction under Code of Civil Procedure sections 904.1, subdivision (a)(1), and 1294, subdivision (d). Finding no error in the trial court's actions, we affirm.
The notice of appeal was filed on August 26, 2019, appealing the order denying the petition to vacate contractual arbitration award filed on June 3, 2019, and the order denying motion for reconsideration filed on July 23, 2019. The trial court's ruling filed on June 3, 2019 directed entry of judgment in favor of Kaiser. Judgment was entered on October 21, 2019. Though the notice of appeal was filed before entry of judgment, "[a] notice of appeal filed after judgment is rendered but before it is entered is valid and is treated as filed immediately after entry of judgment." (Cal. Rules of Court, rule 8.104(d)(1)). The judgment is appealable under Code of Civil Procedure section 1294, subdivision (d). The judgment is likewise an appealable final judgment under Code of Civil Procedure section 904.1, subdivision (a)(1).
FACTUAL BACKGROUND
Appellants Ernest Ferro, JoAnne Limanek, and Suzanne Pacheco (Appellants) initiated an arbitration claim for medical negligence against respondents Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals, and Southern California Permanente Medical Group (collectively, Kaiser). On September 18, 2018, at the conclusion of the arbitration proceedings, the arbitrator, Dana Susson, served her arbitration award finding in favor of Kaiser.
On December 19, 2018, Appellants filed a petition to vacate the award in the superior court contending that the arbitrator failed to make timely and full disclosure of potential conflicts. Appellants did not attempt to serve the petition on Kaiser until 107 days after the arbitration award was issued, when Appellants' counsel mailed a copy of the petition to Kaiser's counsel on January 3, 2019. The petition was accompanied by a cover letter inquiring whether Kaiser's counsel would accept service of the petition. Kaiser's counsel declined and did not accept service.
On January 22, 2019, Kaiser filed its response to the petition to vacate arbitration award and cross-petition to confirm the arbitration award, contending that the petition was untimely and the court was without power to grant relief. Appellants filed their reply to the opposition to the petition to vacate arbitration award on February 6, 2019, arguing that Kaiser had waived its untimeliness objection.
The trial court conducted a hearing on the petition on May 21, 2019, and took the matter under submission. On June 3, 2019, the trial court issued its ruling denying the petition on the grounds of untimeliness and granting Kaiser's request to confirm the award. On June 13, 2019, Appellants moved for reconsideration of the June 3, 2019 ruling. The trial court denied this motion on July 23, 2019. This appeal followed.
DISCUSSION
I. Standard of Review
The operative facts concerning the filing and non-service of the petition in this matter are undisputed. Accordingly, because we are analyzing statutory interpretation issues, we conduct de novo review. (Novak v. Fay (2015) 236 Cal.App.4th 329, 335; Estate of Wilson (2012) 211 Cal.App.4th 1284, 1290 ["applicability of a statutory standard to undisputed facts and questions of statutory interpretation are questions of law that are reviewed de novo"].)
II. The "100 Day Rule" for Petitions to Vacate Arbitration Awards
The California Arbitration Act (Code Civ. Proc., § 1280 et seq.), is an integrated statutory scheme designed to facilitate and enhance the availability of contractual arbitration as a means of alternative dispute resolution. Various provisions address the arbitral process "from cradle to grave," setting boundaries on judicial intervention in this process. Ideally, a court would never have to become involved in the arbitration process; however, the Legislature made provision for judicial involvement where the contractual arbitration process encounters specified problems.
Unless otherwise stated, all statutory references are to the Code of Civil Procedure.
In this appeal we address statutory provisions that apply once a final arbitral result has been reached and announced to the parties. Section 1285 provides: "Any party to an arbitration in which an award has been made may petition the court to confirm, correct or vacate the award. The petition shall name as respondents all parties to the arbitration and may name as respondents any other persons bound by the arbitration award."
Section 1286.2 in turn provides:
"(a) Subject to Section 1286.4, the court shall vacate the award if the court determines any of the following:
"(1) The award was procured by corruption, fraud or other undue means.
"(2) There was corruption in any of the arbitrators.
"(3) The rights of the party were substantially prejudiced by misconduct of a neutral arbitrator.
"(4) The arbitrators exceeded their powers and the award cannot be corrected without affecting the merits of the decision upon the controversy submitted.
"(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.
"(6) An arbitrator making the award either: (A) failed to 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 Section 1281.91 but failed upon receipt of timely demand to disqualify himself or herself as required by that provision. However, this subdivision does not apply to arbitration proceedings conducted under a collective bargaining agreement between employers and employees or between their respective representatives."
Next, section 1286.4, subdivision (a), provides in pertinent part: "The court may not vacate an award unless: (a) A petition . . . requesting that the award be vacated has been duly served and filed . . . ." (Italics added.)
This statutory remedy allows an arbitration participant to seek court intervention to vacate an award (§ 1285) on specified grounds (§ 1286.2). But, in order for the court to intervene, the petitioner bringing the matter before the court must establish that the petition "has been duly served and filed" (§ 1286.4).
The Legislature's concern that a petition to vacate must be duly served as well as filed makes sense in light of the reality that, up to this point, no court action may have been pending at all. Addressing this precise situation, section 1290.4, subdivision (b)(1), provides: "If the arbitration agreement does not provide the manner in which such service shall be made and the person upon whom service is to be made has not previously appeared in the proceeding and has not previously been served in accordance with this subdivision: [¶] (1) Service within this State shall be made in the manner provided by law for the service of summons in an action." (Italics added.)
The trial court found that there is no applicable written arbitration agreement; perforce there is no provision concerning service of a petition to confirm, correct, or vacate an award.
This is exactly the circumstance that applies in this case. Until Appellants filed their petition to vacate the arbitration award, there was no court proceeding. The Legislature could rationally determine that the formalities involved with initiating other civil proceedings should be observed in this situation.
Crucial to the instant case, the Legislature has explicitly specified when service and filing of a petition to vacate an arbitration award must be made. Section 1288 provides, in pertinent part: "A petition to vacate an award or to correct an award shall be served and filed not later than 100 days after the date of the service of a signed copy of the award on the petitioner." (Italics added.) It is this 100-day rule, which Appellants concededly did not satisfy, that is at the heart of this appeal.
By contrast, under section 1288 a petition to confirm need only be served and filed within four years of service of the arbitration award. This is consistent with the characterization in section 1287.6 that "[a]n award that has not been confirmed or vacated has the same force and effect as a contract in writing between the parties to the arbitration," because it adopts the four-year statute of limitations for actions to enforce a written contract (§ 337, subd. (a)).
III. The Effect of Appellants' Failure to Serve the Petition Within 100 Days
Appellants freely admit that they did not serve the petition on Kaiser within 100 days of service on them of the signed arbitration award, as specified in section 1288. Notwithstanding, Appellants offer the novel argument that Kaiser forfeited its objection to the lack of timely service by making a "general appearance" in opposition to the petition. Appellants contend that Kaiser was required to make a special appearance by filing a motion to quash service under section 418.10 in order to contest the timeliness of the petition.
The trial court aptly characterized this as a "novel theory."
This argument is misconceived. Appellants conflate the due process concept of personal jurisdiction with the principle of a jurisdictional deadline. It is this latter form of "jurisdiction"—that is, situations in which the power of a court to act has specifically been limited by rule or statute—that is at issue here.
Examples of such limits on jurisdiction are not difficult to find. Perhaps the best-known time limit deemed "jurisdictional" is the deadline for taking an appeal from a trial court judgment or appealable order. (Stuart Whitman, Inc. v. Cataldo (1986) 180 Cal.App.3d 1109, 1113 ["The requirement as to the time for taking an appeal is mandatory, and the court is without jurisdiction to consider one which has been taken subsequent to the expiration of the statutory period"].) Similar treatment is given to the 30-day time limit to request trial de novo after mandatory attorney's fees arbitration under Business and Professions Code section 6203, subdivision (b). (Maynard v. Brandon (2005) 36 Cal.4th 364, 376 [30-day limit cannot be extended under § 473, subd. (b)].) Likewise, the 10-day time limit for appealing a decision of the Labor Commissioner under Labor Code section 98.2, subdivision (a), has been held to be jurisdictional. (Pressler v. Donald L. Bren Co. (1982) 32 Cal.3d 831, 837 ["The time for filing a notice of appeal from a decision of the Labor Commissioner is mandatory and jurisdictional"].) And the California Supreme Court has recently reaffirmed that "[s]ections 657, 659, and 660, which govern on what ground and in what time period a litigant may seek a new trial, fall into the jurisdictional category." (Kabran v. Sharp Memorial Hospital (2017) 2 Cal.5th 330, 342 ["Not only is a party's attempt to file a notice of intent after the relevant deadline invalid, but the court has no power to issue a ruling on the basis of an untimely filed notice or on a ground not set forth in the statute"].)
In interpreting deadlines of this kind as jurisdictional, courts have pointed to the policy benefits of finality once the statutory time has elapsed after a decision. (Estate of Hanley (1943) 23 Cal.2d 120, 123-124 ["of particular importance is the fact that the security of rights of contract, titles to property, and the status of persons rest upon certainty in the finality of judgments occasioned by the lapse of the statutory time for the taking of an appeal"].) The Maynard court sounded a similar theme concerning the Mandatory Fee Arbitration Act (MFAA): "The MFAA thus envisions the deadline for seeking a trial following fee arbitration as injecting a measure of finality into a dispute. A party who fails to timely request a trial de novo normally may be presumed to have acquiesced in the result reached through arbitration." (Maynard v. Brandon, supra, 36 Cal.4th at p. 376.) This is the kind of policy decision that the Legislature is empowered to make.
Courts that have examined the 100-day time limit for filing and service of petitions or counter-petitions to vacate an arbitration award under section 1288 have consistently put that statute in the same category discussed above, treating the time limit as mandatory and jurisdictional. (See, e.g., Santa Monica College Faculty Assn. v. Santa Monica Community College Dist. (2015) 243 Cal.App.4th 538; Abers v. Rohrs (2013) 217 Cal.App.4th 1199; Knass v. Blue Cross of California (1991) 228 Cal.App.3d 390; Klubnikin v. California Fair Plan Assn. (1978) 84 Cal.App.3d 393; Archuleta v. Grand Lodge of Intern. Ass'n of Machinists (1968) 262 Cal.App.2d 202.) This interpretation appears sound, especially in light of the express language of section of 1286.4, subdivision (a), providing that a court "may not vacate an award" unless "[a] petition . . . requesting that the award be vacated has been duly served and filed." (Italics added.) We believe that the word "duly" in the quoted language incorporates, among other things, the 100-day deadline set forth in section 1288.
Appellants urge us to reexamine the question of whether section 1288's 100-day time limit for filing and service of a petition to vacate is truly "jurisdictional" under the extensive criteria set forth by the California Supreme Court in Kabran v. Sharp Memorial Hospital, supra, 2 Cal.5th 330. But we do not believe a journey into this realm of analysis is necessary or appropriate under the statutes and undisputed facts presented here. This is because Appellants' entire theory rests on the fallacious notion that Kaiser forfeited its objection to the petition's untimeliness when it made a "general appearance" in the action without filing a motion to quash. The trial court rejected this proposition, and we do so as well.
Appellants make much of the fact that the party challenging the petition to vacate the arbitration award in Abers v. Rohrs, supra, 217 Cal.App.4th 1199 did so by way of a motion to quash. (Id. at p. 1205.) However, this decision does not in any way suggest that a motion to quash is the only appropriate way to challenge timeliness of a petition to vacate.
Notably, Appellants have not directed us to any authority that actually supports their forfeiture argument. While a party's general appearance in a matter may waive defects in service, or questions of in personam jurisdiction over that party, we are aware of no authority for the proposition that such party thereby waives the ability to contest the compliance of the adverse party with a statutory deadline such as the one set forth in section 1288.
Section 418.10, subdivision (e)(3), provides: "Failure to make a motion under this section at the time of filing a demurrer or motion to strike constitutes a waiver of the issues of lack of personal jurisdiction, inadequacy of process, inadequacy of service of process, inconvenient forum, and delay in prosecution."
Appellants contend that their lack of proper service on Kaiser was cured by section 410.50, subdivision (a), which states in pertinent part: "A general appearance by a party is equivalent to personal service of summons on such party." Appellants argue that this statute became applicable when Kaiser filed its opposition to the petition on January 22, 2019. But the application of this statute does not help Appellants because the "deemed service" would have occurred only as of the appearance date of January 22, 2019—126 days after service of the arbitrator's decision. (Moore v. Superior Court (1970) 8 Cal.App.3d 804, 808, fn. 1 [voluntary appearance the equivalent of service of summons]; Anglo-Californian Bank, Ltd. v. Griswold (1908) 153 Cal. 692, 696 [jurisdiction acquired upon filing of appearance].) The service would still have been untimely under section 1288.
Without their forfeiture argument, Appellants' entire position collapses. The fact is that Kaiser was not served with the petition within the time limit required by section 1288. When Kaiser did appear, it immediately objected to the petition on timeliness grounds. Appellants never claimed to have complied with the statutory time limit for service of the petition, and indeed admitted their noncompliance. Whether the time limit in section 1288 is classified as jurisdictional or not—and we believe the argument for treating it as jurisdictional is well-founded—Kaiser did nothing to waive the protection of this time limit. It was entitled to assert the time limit, and it did.
In sum, Kaiser's timeliness objection was valid and promptly raised before the trial court. The trial court properly ruled that the petition was time-barred.
DISPOSITION
The trial court orders denying vacation of the arbitration award and the judgment confirming the arbitration award are affirmed. Respondents shall recover their costs on appeal.
NOT TO BE PUBLISHED
Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.
ROTHSCHILD, P. J.
CHANEY, J.