Opinion
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
Appeal from a judgment of the Superior Court of Los Angeles County, Judith C. Chirlin, Judge. Los Angeles County Super. Ct. No. BS090158
Hill, Farrer & Burrill and Scott L. Gilmore for Plaintiff and Respondent.
Zelig & Associates and Steven L. Zelig for Defendant and Appellant.
CROSKEY, J.
A party unsuccessful in an arbitration appeals from the judgment confirming the arbitration award. The vast bulk of the appellant’s arguments on appeal are simply attempts to reargue the evidence that was before the arbitrator; these arguments are simply not an appropriate basis on which to challenge an arbitrator’s award. The appellant also contends that he was prejudiced by the fact that the arbitrator mandated the presence of a court reporter for only a portion of the proceedings; the evidence demonstrates no prejudice. We therefore affirm.
FACTUAL AND PROCEDURAL BACKGROUND
Eugene H. Twarowski, III and his wholly owned corporation, Eugene H. Twarowski, III, Inc. (“EHT, Inc.”) were sued in an action brought by Zohar Ziv (“the underlying action”). Twarowski retained Hill, Farrer & Burrill LLP (“Hill”) to represent him in the underlying action. EHT, Inc. had separate counsel. The case eventually settled.
A dispute arose regarding Hill’s fees for the representation. The retainer agreement contained an arbitration clause. The parties had difficulty agreeing on an arbitrator, and Hill filed a petition, against Twarowski, to compel arbitration and appoint an arbitrator. Ultimately, an arbitration was held. The witnesses at the arbitration were: (1) Attorney Scott Gilmore of Hill; (2) Twarowski; and (3) Attorney Steven Zelig, current counsel for Twarowski, who had represented the plaintiffs in the underlying action against Twarowski.
During the course of the arbitration, Twarowski testified that Hill had represented EHT, Inc. as well as Twarowski. Hill disagreed, but, in an abundance of caution, sought to add EHT, Inc. as a party to the arbitration. Hill did so by moving, in superior court, for an ex parte order adding EHT, Inc. as an additional respondent under Code of Civil Procedure section 473. The motion was granted and EHT, Inc. was added as an additional respondent. EHT, Inc. filed an answer and a cross-petition against Hill. Thereafter, the arbitrator reviewed the evidence and arguments of counsel on the issue of EHT, Inc.’s liability. The arbitrator concluded that Twarowski had contracted individually with Hill, and that any award in favor of Hill should be against Twarowski individually.
Initially, the parties had agreed that the arbitrator could determine whether EHT, Inc. was an indispensable party. However, Hill was concerned that EHT, Inc. might argue that the statute of limitations had run during the time the parties were briefing the issue. Counsel for Twarowski stipulated that the statute would be deemed tolled, but Twarowski refused to sign a tolling agreement on behalf of EHT, Inc. As an argument could be made that the statute had run on Saturday, September 24, 2005, Hill moved ex parte to add EHT, Inc. on the following Monday.
The arbitration continued, resulting in an award in favor of Hill. The arbitrator found Attorney Gilmore’s testimony to be credible, while Twarowski and Attorney Zelig testified merely “competently.” The arbitrator concluded that Hill’s representation of Twarowski in the underlying action had been competent and professional, and Hill’s billings and rates had been proper and reasonable. The arbitrator determined Twarowski was responsible for Hill’s unpaid fees and costs, and entered an award against Twarowski individually. The arbitrator found against EHT, Inc. on its cross-petition.
Hill filed a petition to confirm the award; Twarowski filed a petition to vacate it. The bulk of Twarowski’s arguments were challenges to the arbitrator’s findings based on the evidence. Twarowski also argued that the arbitrator did not take notes during the arbitration, and had requested a reporter be provided beginning on the second day of the arbitration. Twarowski represented that, since there was no reporter on the first day of the arbitration, certain crucial testimony was not reported, including the cross-examination of Attorney Gilmore and the direct testimony of Twarowski and Attorney Zelig. Twarowski argued that he was prejudiced by the lack of a reporter for this favorable testimony. Attorney Gilmore responded with a declaration that the arbitrator did take notes. More importantly, Hill provided evidence that the only testimony not transcribed was the direct testimony of Attorney Gilmore, and a very small portion of his cross-examination, and that all of the testimony of Twarowski and Attorney Zelig was transcribed. Indeed, Hill submitted the index to the transcript of the second day of hearing, indicating over 80 pages of cross-examination of Attorney Gilmore, as well as the full testimony of Twarowski.
The trial court granted the petition to confirm and denied the petition to vacate. Judgment was entered in favor of Hill. Twarowski filed a timely notice of appeal.
CONTENTIONS OF THE PARTIES
On appeal, Twarowski argues that the arbitrator erred in its evaluation of the evidence, particularly with respect to its conclusion that Twarowski was responsible for Hill’s fees in their entirety, rather than allocating a portion of the fees to EHT, Inc. Twarowski also argues the arbitrator committed prejudicial misconduct by not taking notes and not requiring a reporter for the entire arbitration.
Twarowski also suggests that “[t]he fact that the [a]rbitrator cho[se] to effectively force EHT, Inc. to defend – and to do so midstream – demonstrates that the arbitrator . . . was not concerned about proper substance or procedure and was obviously ‘result oriented.’” But it was the trial court, not the arbitrator, who ordered EHT, Inc. to be joined as a respondent in the arbitration. Twarowski does not argue that the trial court erred in making this ruling under Code of Civil Procedure section 473. In fact, Code of Civil Procedure section 473 is not mentioned in Twarowski’s brief at all.
DISCUSSION
1. Twarowski’s Challenge to the Merits of the Arbitration Award Is Not Proper
Code of Civil Procedure section 1286.2, subdivision (a) sets forth the sole grounds under which an arbitration award may be vacated. They are: “(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 therefore 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 [failed to timely disclose a ground for disqualification or was subject to disqualification but failed to disqualify himself or herself].”
In contrast, “ ‘[t]he merits of the controversy between the parties are not subject to judicial review.’ [Citations.] More specifically, courts will not review the validity of the arbitrator’s reasoning. [Citations.] Further, a court may not review the sufficiency of the evidence supporting an arbitrator’s award. [Citations.]” (Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 11 (“Moncharsh”).)
While Twarowski’s brief on appeal attempts to cast his challenge to the arbitrator’s award in terms of corruption, misconduct, or an act in excess of powers, in order to fit within the scope of Code of Civil Procedure section 1286.2, it is apparent that his challenge is simply an attack on the merits, which is barred by Moncharsh. A quick review of the language of Twarowski’s brief establishes the conclusion. Twarowski argues: (1) “Since when is an Arbitrator allowed to ignore compelling evidence that interferes with a result oriented arbitration? Isn’t this a form of ‘corruption’? Aren’t these acts that constitute misconduct to a party’s substantial prejudice?” (2) “The arbitrator’s refusal to objectively evaluate [the language of the retainer agreement] was misconduct resulting in substantial prejudice.” (3) “The arbitrator’s refusal to consider and weigh [certain evidence] constituted misconduct resulting in substantial prejudice.” (4) “The documentation signed by [Hill] clearly substantiates [Twarowski’s] position [regarding Hill’s representation of EHT, Inc.] But the arbitrator refused to allocate the fees ‘50/50’ between Twarowski, individually, and [EHT, Inc.] This demonstrates that [Twarowski’s] rights were substantially prejudiced by misconduct, and that the arbitrat[or] spun both the factual and legal issues in whatever way would be more favorable to Hill.” (5) “Hill’s services were of no value to Twarowski and in fact destroyed Twarowki’s bargaining position. The court’s refusal to objectively consider same was misconduct resulting in substantial prejudice to [Twarowski].” (6) “The Arbitrator approved the entire fee of Hill, and imposed [it] on both Twarowski and EHT, Inc., even though the amounts charged clearly were excessive and did not reflect fair or reasonable charges.”
We remove the emphasis from the following quotations.
In short, Twarowski believes the arbitrator did not correctly consider and weigh the evidence. Even if true, this is not corruption or misconduct, but simply a challenge to the arbitrator’s findings on the merits. Twarowski makes no argument based on any legal authority which would render his challenge to the merits cognizable in the courts in the face of Moncharsh. His arguments must be rejected.
Indeed, Moncharsh is not cited in his brief.
2. Twarowski’s Argument Regarding Transcription Fails
Twarowski also argues that he was substantially prejudiced by the ruling of the arbitrator which did not require a court reporter for the first day of proceedings. Twarowski again argues that the cross-examination of Attorney Gilmore and the direct examination of Twarowski and Attorney Zelig were not reported. Assuming, but not deciding, that the absence of a court reporter for key testimony might be prejudicial, the evidence does not support Twarowski’s argument. Hill presented clear evidence that the only testimony not transcribed was Attorney Gilmore’s direct, which would have been favorable to Hill. As Twarowski’s factual premise incorrect, his prejudice argument fails.
DISPOSITION
The judgment is affirmed. Hill is to recover its costs on appeal.
We Concur: KLEIN, P. J. KITCHING, J.