Arbitration/Costs/Deadlines/Scope/Section 998: Second District, Div. 2, Affirms Trial Court’s Denial of Costs

 

Look to the Scope of the Arbitration Provision to Determine Whether Costs Need to Be Addressed by the Arbitrator or the Court

     The plaintiff, a patient alleging malpractice, suing through his guardian ad litem, lost a first arbitration against a doctor. Unfortunately for the doctor, his party arbitrator had an ex parte contact with the neutral arbitrator while the award was pending -- leading the court to vacate the eventual award that would have helped the doctor. In a second arbitration, the patient won a significant monetary award, and then sought costs (based on an earlier cost shifting CCP section 998 offer). Costs were denied by the trial court on the grounds that costs should have been determined by the arbitrator. Maaso v. Signer, Case No. B228314 (2nd Dist., Div. 2 Feb. 7, 2012) (certified for publication).

     The patient appealed the denial of costs, and the doctor appealed the vacation of the first arbitration.

     Result: affirmed across the board.

     The broad arbitration clause meant that the decision regarding costs was within the purview of the arbitrator, not the court -- and therefore the issue should have been addressed by the arbitrator.

     The Court of Appeal upheld the vacation of the first arbitration based on the evidence of the ex parte contact, tellingly quoting the language of the trial judge (“. .. and I’m just going to say it stinks”).

     There is a more obscure discussion of the 100 day deadline for moving to vacate an award. Code of Civil Procedure section 1288 provides that “[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.” The court explained, “[h]ere, [Defendant] is not challenging an error of law or the correctness of the second arbitration award on any grounds under Code of Civil Procedure section 1286.2 for vacating an award. Rather, he challenges the order which required his participation in a second arbitration.” In any case, the court found the appeal by the defendant to be timely. If this deadline issue comes up for you, read the case.