Opinion
NOT TO BE PUBLISHED
Appeal from a judgment of the Superior Court of Orange County, Jamoa A. Moberly, Judge., Super. Ct. No. 05CC10670.
Law Offices of Mark B. Plummer and Mark B. Plummer for Plaintiff and Appellant.
Garcia & Phan, Robert N. Phan, Cyrus E. Seradj and Margaret A. Pitchkolan for Defendant and Respondent.
ARONSON, J.
Jeff Niblack appeals from a judgment in which the trial court confirmed an arbitrator’s decision finding Trang Diem Thi Le validly revoked an offer to sell Niblack the home he was renting. The arbitrator awarded Niblack $63,700 in unjust enrichment compensation for improvements he made to the home and for property taxes he paid, plus $10,500 in attorney fees. Niblack contends the trial court erred in denying his motion to vacate the award. He argues the award must be vacated because the arbitrator: (1) failed to “‘fully and completely resolve’” the issues submitted to arbitration as required by the parties’ stipulation to arbitration, (2) violated a statutory duty to postpone the arbitration hearing to receive additional evidence (Code Civ. Proc., § 1286.2, subd. (a)(5)), and (3) demonstrated bias by attaching an unfair condition to receiving additional evidence, namely Le’s consent. We conclude substantial evidence supports the trial court’s determination Niblack’s contentions were unfounded, and that he presented no evidence he was “substantially prejudiced” by the arbitrator’s actions, as required by statute to vacate the award. (§ 1286.2, subd. (a)(3) & (5).) We therefore affirm the judgment.
All subsequent statutory references are to this code.
I
FACTUAL AND PROCEDURAL BACKGROUND
Niblack filed a complaint on September 27, 2005, seeking specific performance of what he claimed was a real estate contract with Le. In lieu of an answer, Le stipulated to “binding arbitration” in which she and Niblack “agree[d] that the Action and all other claims against the Property shall by fully and completely resolved . . . .” Retired judge Robert H. London conducted the arbitration at Judicate West on June 12, 2006. He filed his decision in an award a month later on July 11.
The award revealed the parties entered a lease agreement in November 2002 with an option for Niblack to purchase the property for $290,000. The option expired before Niblack exercised it, but he continued living at the property, paying $2,500 in rent. In January 2004, Le presented Niblack with a standard “Residential Purchase Agreement” form with a sale price of $375,000 for the property. Both Le and Niblack executed and dated the form, but they did so on a page entitled, “Buyer’s Inspection Advisory,” rather than on the offer and acceptance page. The parties agreed Niblack would attempt to obtain financing and in the meantime he would continue to pay Le $2,500 a month. The arbitration award observes the parties later disputed whether this amount was for “rent,” as Le claimed, or for “interest” on a seller’s bridge loan Niblack claimed Le carried for him. Niblack began making substantial improvements to the property, including adding rooms to expand it.
Niblack approached a commercial lender in August 2004 for a loan but did not follow through. As noted in the arbitration award, Le claimed that — with written notice to Niblack in January 2005 — she “‘revoked’” the parties’ purchase agreement, “which she defined as an ‘offer’ to sell.” Niblack again attempted to obtain financing from a commercial lender in August 2005 but Le considered the matter closed and would not provide the lender with a payoff amount, leading to Niblack’s suit and arbitration of the matter.
The parties were represented by counsel at the arbitration, and Le and Niblack were among the witnesses who testified. The arbitrator received and reviewed documentary evidence in 15 different categories, including “Cancelled checks and receipts for monies paid to Respondent” (Le), “Receipts for real estate taxes paid,” and “Voluminous documents regarding work done and money paid in improving the subject property.”
The arbitrator denied Niblack’s request for specific performance, concluding there was no contract because Le validly revoked her offer before Niblack obtained financing. Specifically, the arbitrator held that when Le provided written notice of the revocation “she was terminat[ing] an offer, not disregarding a contract.” The arbitrator found Niblack had “paid real estate taxes,” but also determined “[t]he most recent tax was paid by [Le], although [Niblack] had attempted to make the payment.” The arbitrator observed the parties had “presented this [matter] partially in equity,” and accordingly “ordered that [Le] pay to [Niblack] in consideration of improvements made by him to the Property a sum equal to the total expenses incurred in improving the Property, but in no event less tha[n] $63,700.00 (the amount proven by claimant in the [a]rbitration hearing).” The arbitrator also held Niblack was entitled to “an amount equal to attorney fees and costs incurred in this action but in no event less than $10,500.00, the sum presented during the [a]rbitration hearing.”
The arbitration award’s concluding paragraph read as follows: “As an advisory suggestion, if so stipulated, counsel for [Niblack] may present to the [a]rbitrator evidence of attorney fees and costs as well as all expenses incurred in improving the property. The [a]rbitrator will then suggest an amount found to be equitable.”
Le filed a petition in the trial court to confirm the award and Niblack opposed the petition with a motion to vacate the award. The trial court denied Niblack’s motion, entered judgment according to the provisions of the award, and Niblack now appeals.
II
DISCUSSION
Niblack contends the trial court erred by denying his motion to vacate the arbitrator’s award. Niblack argues the arbitrator: (1) failed to “fully and completely” resolve the issues submitted to arbitration as required by the parties’ stipulation to arbitration; (2) violated a statutory duty to postpone the arbitration hearing to receive additional evidence (§ 1286.2, subd. (a)(5)); and (3) demonstrated bias by attaching an unfair condition to receiving additional evidence, namely Le’s consent. Niblack’s arguments are variations on a single theme: the arbitrator failed to ascertain and include in his award all the tax payments and improvements Niblack made on the property, and therefore failed to determine the full amount Le owed him for unjust enrichment. Our focus on appeal is the trial court’s decision, not the arbitrator’s. (Malek v. Blue Cross of California (2004) 121 Cal.App.4th 44, 55.) We therefore apply the customary substantial evidence test to the trial court’s resolution of factual issues, and we review any legal issues de novo. (Id. at pp. 55-56.)
Niblack’s allegations are factual in nature, not legal. As we explain below, the trial court could reasonably conclude no evidence supported vacating the arbitrator’s award. In short, while Niblack argues on appeal the total contributions he made to the property were worth $75,000 rather than the $63,700 the arbitrator awarded, he neither made this argument to the trial court nor presented any corresponding evidence. Nor did he submit any other evidence he suffered the requisite “substantial prejudice” to vacate the award.
Niblack is correct that arbitrators must decide all the material issues before them. Section 1283.4 provides that the arbitral award “shall include a determination of all the questions submitted to the arbitrators the decision of which is necessary in order to determine the controversy.” And section 1286.2 provides that “conduct of the arbitrators contrary to the provisions of this title” is a ground to vacate the award — if and only if “[t]he rights of [a] party were substantially prejudiced . . . .” (id., subd. (a)(5).) Similarly, an award may be vacated based on “the refusal of the arbitrators to postpone the hearing upon sufficient cause being shown therefore,” but the moving party must show “substantial[] prejudice[]” to justify vacating the award. (Ibid., italics added.) Finally, “misconduct” by an arbitrator also warrants vacating the award where “[t]he rights of the party were substantially prejudiced” thereby. (§ 1286.2, subd. (a)(3).)
The fatal defect in Niblack’s motion to vacate the arbitral award is that he presented no evidence anything in the arbitrator’s actions “substantially prejudiced” him. In support of his motion to vacate, Niblack submitted the parties’ stipulation for binding arbitration and the arbitrator’s award. As the trial court observed: “It appears from the papers submitted and the arbitration award that [when] the arbitration hearing concluded [and the parties] walked out the door, they thought they were done. There’s no declaration submitted that either side wanted to call additional witnesses or to submit other evidence — [or] that their request to do so was denied — nor that the arbitrator asked that anyone do that.” The arbitrator’s award lists as evidence “received and reviewed” such items as “Receipts for real estate taxes paid” and “Voluminous documents regarding work done and money paid in improving the subject property.” The record therefore amply supports the conclusion the arbitrator decided the issue of the total value of Niblack’s contributions to the property, and properly did so based on the evidence submitted at the hearing.
Niblack relies on the arbitrator’s “advisory suggestion” that he be allowed, “if so stipulated,” to present evidence of “all expenses incurred in improving the property. He sees this suggestion as a tacit recognition by the arbitrator that Niblack had or might have other evidence of improvement expenses. Another inference, however, is that this language recognizes Niblack — having had ample notice of the date of the hearing — enjoyed a full and fair opportunity to present evidence concerning his contributions to the value of the property and, therefore, allowing him another bite at the apple should only come with Le’s consent. The standard of review requires the latter interpretation. (Denham v. Superior Court (1970) 2 Cal.3d 557, 564.) Accordingly, the record supports the conclusion the arbitrator committed no misconduct by imposing the consent requirement. Moreover, no evidence showed Niblack requested that the arbitrator postpone or extend the hearing, let alone that he demonstrated “sufficient cause . . . therefore” as required by section 1286.2, subvidivision (a)(5).
In any event, even assuming the arbitrator somehow erred, we review the trial court’s decision, not the arbitrator’s. On this score, Niblack presented the trial court with no evidence he was “substantially prejudiced” by the arbitrator’s award, a necessary precondition for vacating the award. (§ 1286.2, subd. (a)(3) & (5); accord, Cal. Const., art. II, § 13.) Niblack now argues on appeal that his contributions to the property amounted to $75,000 rather than the $63,700 determined by the arbitrator on the evidence at the hearing, but he neither made this argument to the trial court nor presented any supporting evidence. Absent the requisite evidence of prejudice, we cannot say the trial court erred in declining to vacate the award.
Niblack contends the face of the award demonstrates prejudice because the award acknowledges he presented receipts for property taxes he paid but fails to itemize corresponding damages owed by Le for this unjust enrichment. Thus, he insists the arbitrator left unresolved whether he “gets the [p]roperty [t]axes that he paid back.” According to Niblack, the award must be vacated because the arbitrator also failed to determine whether he was “still expected to pay the property taxes, which he had been doing because he thought he owned the property[.]” And he further argues the arbitrator should have continued the hearing because it was “unforeseen” both he and Le would present evidence they paid property taxes in the past.
We perceive no merit in Niblack’s arguments concerning property taxes. The record amply supports the trial court’s conclusion the arbitrator resolved these issues. As to future taxes, the arbitrator’s determination Niblack did not own the property necessarily absolves him of any duty to pay taxes on the record presented. As to back taxes, the arbitrator’s award identifies this as an issue specifically addressed at the hearing. The award notes the parties presented “[r]eceipts for real estate taxes paid,” and the award expressly states the arbitrator’s findings that Niblack “paid real estate taxes” and that “[t]he most recent tax was paid by [Le], although [Niblack] had attempted to make the payment.”
Like the trial court, we presume the arbitrator has resolved all issues submitted for decision. (Rodrigues v. Keller (1980) 113 Cal.App.3d 838, 842.) Because the award specifies the $63,700 figure is “the amount proven by claimant in the [a]rbitration hearing,” the trial court could reasonably conclude the back taxes Niblack paid were included in this sum. Niblack points to no authority that the arbitrator must itemize damage awards, and we decline to impose such a requirement. Nor can we agree it is unforeseeable the parties would present conflicting evidence on who paid property taxes — that is the nature of a contested hearing. Niblack presented no evidence to the trial court that either party sought the arbitrator’s permission to continue the hearing to secure and present additional evidence, as required by section 1286.2, subdivision (a)(5). Consequently, the trial court did not err in declining Niblack’s motion to vacate the award.
Niblack also contends the arbitrator failed to determine whether he was entitled to remain in possession of the property as a tenant. The trial court could reasonably conclude this line of attack was no more than another attempt to manufacture an omission by the arbitrator. In petitioning to confirm the arbitration award, Le sought to have the trial court read the decision as requiring Niblack’s eviction. But the parties presented no evidence they asked the arbitrator to decide Niblack’s possessory interest in the property, only his ownership, and the trial court could reasonably conclude Le was left to pursue an unlawful detainer action if she wished. Because the issue was never presented to the arbitrator, raising it later is not a basis to vacate the award. Moreover, because Niblack cannot show he was prejudiced by avoiding eviction, the trial court’s ruling confirming the award must stand.
III
DISPOSITION
The judgment is affirmed. Respondent is entitled to her costs on appeal.
WE CONCUR: BEDSWORTH, ACTING P. J., MOORE, J.