Judge: Armen Tamzarian, Case: 22STCP03245, Date: 2023-02-16 Tentative Ruling

Case Number: 22STCP03245    Hearing Date: February 16, 2023    Dept: 52

Tentative Ruling:

Petitioner Los Angeles County Fire Department’s Petition to Vacate or Correct Arbitration Award; Respondent Service Employees International Union, Local 721’s Motion to Confirm Arbitration Award

Petitioner Los Angeles County Fire Department petitions to vacate or confirm an arbitration award issued against it.  Respondent Service Employees International Union, Local 721 filed a competing motion to confirm the award.  “If a petition or response under this chapter is duly served and filed, the court shall confirm the award as made, whether rendered in this state or another state, unless in accordance with this chapter it corrects the award and confirms it as corrected, vacates the award or dismisses the proceedings.”  (CCP § 1286.)   

Courts have limited authority to vacate an arbitration award.  “A court’s power to correct or vacate an erroneous arbitration award is closely circumscribed.”  (Heimlich v. Shivji (2019) 7 Cal.5th 350, 367.)  “An arbitrator’s legal or factual error in determining which party prevailed may not be reversed.”  (Ibid.)  “It is within the power of the arbitrator to make a mistake either legally or factually.  When parties opt for the forum of arbitration they agree to be bound by the decision of that forum knowing that arbitrators, like judges, are fallible.”  (Id. at p. 370, internal quotes and alterations omitted.) 

Petitioner contends the arbitrator exceeded his authority.  Courts must vacate an award when “[t]he arbitrators exceeded their powers and the award cannot be corrected without affecting the merits of the decision upon the controversy submitted.”  (CCP § 1286.2(a)(4).)

Petitioner relies on two United States Supreme Court cases about judicial review of contractual arbitration awards.  First, Eastern Associated Coal Corp. v. United Mine Workers of America, Dist. 17 (2000) 531 U.S. 57, 62 stated that “an arbitrator’s award ‘must draw its essence from the contract and cannot simply reflect the arbitrator’s own notions of industrial justice.’ [Citation.]  ‘But as long as [an honest] arbitrator is even arguably construing or applying the contract and acting within the scope of his authority,’ the fact that ‘a court is convinced he committed serious error does not suffice to overturn his decision.’ ”  Second, United Paperworkers Intern. Union, AFL-CIO v. Misco, Inc. (1987) 484 U.S. 29, 38 stated, “The arbitrator may not ignore the plain language of the contract; but the parties having authorized the arbitrator to give meaning to the language of the agreement, a court should not reject an award on the ground that the arbitrator misread the contract.”

Petitioner contends the arbitrator exceeded his authority in two ways.  First, the arbitrator rejected petitioner’s defense that the Union and its member Jorge Velasquez did not timely submit the grievance or the request for arbitration.  The award states it was “a last minute surprise defense” and a “belated argument.”  (Pet. Ex. 6, Award, p. 13.)  The arbitrator concluded that defense was a “ ‘belated’ or ‘untimely’ assertion of a procedural arbitrability defense so as to amount to a waiver.”  (Ibid.)    

The arbitrator did not exceed his authority in making this finding.  The issue of waiver is not an interpretation of a contract.  Waiver is a general doctrine of law applicable to a person’s rights, including contractual rights, in general.  “Waiver is the intentional relinquishment of a known right after full knowledge of the facts.”  (DRG/Beverly Hills, Ltd. v. Chopstix Dim Sum Cafe & Takeout III, Ltd. (1994) 30 Cal.App.4th 54, 59.)  In the alternative, even if the issue of wavier constitutes interpreting a contract, the arbitrator’s award does not deviate from the essence of the MOU or delete or modify its terms.

Second, the arbitrator rejected petitioner’s argument about the following provision in the Memorandum of Understanding:

Any permanent, full-time employee shall be entitled to additional compensation equivalent to two standard salary schedules for the performance of additional responsibilities of a higher level which are assigned or approved by the Department Head or designated Management representative and approved by the Chief Executive Office.

Within ten (10) business days, the Department shall notify an employee in writing of the approval or denial of his/her written request for the additional responsibilities bonus.

(Pet. Ex. 1, MOU, Art. 24.)

Petitioner argued that because neither the Department nor the Chief Executive Office approved Velasquez’s request for an ARB.  The arbitrator’s award stated “the lack of CEO approval is irrelevant.”  (Pet. Ex. 6, Award, p. 16.)

That the arbitrator used the word “irrelevant” does not mean the award ignored, deleted, or modified the MOU’s terms.  The award still draws its essence from the MOU.  Depending on the circumstances, some provisions in a contract can be irrelevant.  The award explained, “there would have been no reason to grieve or appeal to arbitration if the CEO had approved the ARB.”  (Award, p. 16.)  The arbitrator thus found that, when reasonably interpretating the MOU, the lack of CEO approval did not preclude Velasquez from getting an ARB.  Even if that interpretation is wrong, the award draws its essence from the contract. 

Petitioner’s grounds for vacating the award constitute, at most, misreading the parties’ MOU.  The arbitrator did not ignore its plain language.  His award draws from the essence of the MOU.

Disposition 

Petitioner Los Angeles County Fire Department’s motion to vacate or correct arbitration award is denied.  Respondent Service Employees International Union, Local 721’s motion to confirm arbitration award is granted.  The final award issued by arbitrator Jan Stiglitz is hereby confirmed. 

The court will sign the proposed order submitted by respondent.