The Arbitration Clause Analyzed By The Court Is Common In Automobile Sales Contracts.
The Arbitration Clause analyzed in Raczynski v. Daland Nissan, Inc., et al., A146992 (1/5 2/15/17) (Bruiniers, Jones, Needham) (unpublished), provides that the arbitrator's award "shall be final and binding on all parties, except that in the event the arbitrator's award for a party is $0 or against a party is in excess of $100,000, or includes an award of injunctive relief against a party, that party may request a new arbitration under the rules of the arbitration organization by a three-arbitrator panel." The provision is standard in automobile sales contracts, and provides an escape valve for a buyer who gets skunked, or a seller who gets whacked in arbitration. But if the arbitration award to the buyer is greater than $100,000, does the seller get a "new arbitration under the rules of the arbitration organization by a three-arbitrator panel" if the arbitration organization does not have rules providing for appeal to a three-arbitrator panel? (Note: JAMS had such rules; ADR did not have such rules at the time, and the arbitration was in front of ADR).
When the seller requested an appeal to a three-party panel of the adverse award, ADR punted, saying it would not provide a three-party panel, unless a court ordered it to do so. The superior court refused to order a second arbitration, citing the absence of appellate rules in ADR, and the seller appealed.
Reversed. The arbitration clause provided a right to a "new arbitration", and this did not require formal appeal rules within the arbitration association. ADR indicated it would provide a new arbitration, if the court so ordered – and the Court of Appeal ordered the superior court to grant defendants' petition to compel a new arbitration.