One of the frustrations for parties forced to arbitrate their claims rather than pursue them in court is the unavailability of a direct route of appeal from the arbitration award. Generally, the only way to get out from under an adverse award is to petition the superior court to vacate the award (Code Civ. Proc., § 1285 et seq.), and then only on very limited grounds such as fraud, corruption, or misconduct by the arbitrator, generally unrelated to the substantive merits of the decision. If you’re on the other side — i.e., you were the prevailing party in the arbitration — you can take some comfort from the fact that if the…
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Supreme Court denies review in Burlage v. Superior Court
Image via Wikipedia The Supreme Court denied review today in Burlage v. Superior Court, leaving intact the decision that, by speculation of some (including yours truly), will increase the number of legal challenges to arbitration decisions. I won’t go so far as to say that it will “open the floodgates,” but it certainly opens an avenue to judicial review that many would not have tried before the decision was published. Expect to see many challenges that assert, though not in so many words, that the legal error that occurred in their case is grounds for vacating an award if the error led the arbitrator to exclude evidence. The challenge for…
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Arbitration challenges get a big boost — but maybe not for long
If you’re a litigation or appellate lawyer, you’ve probably already read about Burlage v. Superior Court, case no. B211431 (2d Dist. Oct. 20, 2009 [opinion after rehearing]), and you’re probably not surprised to learn that the petitioners filed their petition for review in the California Supreme Court yesterday. The case had petition for review written all over it: a contentious area of the law (arbitration), a split decision, amicus involvement, lots of attention in the legal community, and heavy-hitter appellate counsel (full disclosure: I know and have worked with one of the attorneys, Ventura appellate ace Wendy Lascher, who represents the Burlages). Other bloggers have reported the case in detail…
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Federal Question Jurisdiction and the Federal Arbitration Act
Anyone who reads this blog regularly knows I am a jurisdiction geek, so a post about Federal Question Jurisdiction and the Federal Arbitration Act at Civil Procedure Prof Blog caught my eye. The post links to an article on the topic at Social Science Research Network (SSRN). UPDATE (3/26/08): Texas Appellate Law Blog has an interesting post up on the related issue of whether parties can contract for judicial review of arbitration decisions under the FAA.
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ADR/Appellate Crossover
Thanks to Victoria Pynchon at Settle it Now Negotiation Blog for linking to two recent posts on this blog. I’m announcing this in a post because the trackbacks from her posts are not showing up in the comments to my posts as they should, which may cheat her of traffic from people who might be interested in her mediator’s viewpoint on my recent posts (or who might be interested in a mediation blog generally). My recent comment that some justices at appellate oral argument are actively looking to have their minds changed made Victoria wonder how lessons from the appellate arena might benefit parties in mediation who need to change…
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The Arbitration Skill Set
Are the skills and tactics best suited for arbitration very different than those routinely used in litigation? Legal Writing Prof Blog has a link to an upcoming law review article on the topic.
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Federal Judicial Review of Arbitration Decisions
I’m pretty sure that Judge Bea didn’t intend to give me a chuckle in the first paragraph of his opinion in Collins v. D. R. Horton, Inc., case no. 05-15737 (9th Cir. Sept. 24, 2007). But he did. Appellants contend their motion [for summary judgment] should have been granted because the arbitrators manifestly disregarded the law when deciding not to apply offensive non-mutual collateral estoppel because judicial review of an arbitration award under the Federal Arbitration Act (“FAA”) is more limited than judicial review of a district court judgment. We hold the arbitrators did not manifestly disregard the law because no “well defined, explicit, and clearly applicable” law existed to…
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Arbitration Agreement May Be Invoked by Non-Parties Sued as Alter Egos of a Party to the Agreement
A contract contains an arbitration provision. Plaintiff sues you on the contract, even though you are not a party, on the ground that you are an alter ego of the corporation that is a party to the agreement. Can you invoke the arbitration provision even though you are not a party to the contract? Yes, says the Court of Appeal in Rowe v. Exline, case no.A116463 (1st Dist. July 31, 2007). After all, reasons the court, the whole theory behind alter ego liability is that the corporation and the alter ego are one in the same. Since the corporate party is entitled to the benefit of the provision, so must…
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Go Ahead, Challenge that Arbitration Provision!
The arbitration provision of yet another giant is struck down. See this How Appealing post for relevant links and a summary of a Washington Supreme Court decision voiding Cingular’s arbitration provision in its subscriber agreement. After recent decisions in the Ninth Circuit and California’s First District Court of Appeal voiding arbitration provisions, which I blogged about here, I suspect there may be a few lawyers scattered around the West pulling late nights poring over their clients’ arbitration provisions . . . and perhaps a few plaintiffs’ lawyers tearing up their arbitration demands and drafting complaints.
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American Express Waives Arbitration through Settlement Misrepresentations
Remember that case in contracts class about whether promising to do something you were already going to do constituted consideration for a promise? The lawyers for American Express in the First District Court of Appeal case of Aviation Data, Inc. v. American Express Travel Related Services Co., Inc., case no. A111602 (July 6, 2007) apparently didn’t remember that day in contracts class. So they promised during class action settlement negotiations to implement a computer program in exchange for a release of claims . . . even though AmEx had already been using the program for two years. Then, as part of proceedings for court approval of the settlement, AmEx made…
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An Arbitrator with Chutzpah
It takes some cheek for an arbitrator to reform a collective bargaining memorandum of understanding (“MOU”) between a state agency and an employee bargaining unit when the MOU has already been approved by the legislature pursuant to the Dills Act. And its reversible error, of course. In Dept. of Personnel Administration v. Calif. Correctional Peace Officers Assn., case no. C051636 (June 29, 2007), the Third District Court of Appeal affirms the trial court’s order vacating the arbitration award. Such employment agreements must be submitted to and approved by the legislature. By reforming the agreement to conform to her findings regarding the parties’ intent, thus changing the provisions approved by the…
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Waiving Issues in Arbitration
Keep a close watch on those arbitration arguments, especially as they relate to the scope of the arbitrator’s power as defined by the arbitration agreement. That’s the lesson of J.C. Gury Co. v. Nippon Carbide Industries (USA) Inc., case no. B194926 (June 29, 2007), in which the Second District Court of Appeal holds that Nippon waived the contractual limitation on the power of the arbitrator by its conduct during the arbitration, and thus may not petition to vacate the award on the ground the arbitrator exceeded his powers. The agreement stated that the arbitrator “shall not have the power to change, alter or modify” any term of the parties’ agreement. …
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Great Lawyers Can Write Unenforceable Arbitration Agreements
I’m beginning to wonder if writing the perfect arbitration provision is something like understanding the rule against perpetuities. You all remember that case from torts class, don’t you? The court holds that an attorney can’t be liable for malpractice related to the rule against perpetuities because no one understands the rule against perpetuities. Hence, the attorney could not have violated the standard of care. A little over a month ago, the Ninth Circuit ruled in Davis v. O’Melveny & Myers, case no. 04-56039 (9th Cir. May 14, 2007) that the arbitration provision in the employment contract of a prominent, powerful L.A.-based law firm was unenforceable. Not just unenforceable, but “shock…