Judge: Frank M. Tavelman, Case: 24NNCP00724, Date: 2025-04-18 Tentative Ruling

Case Number: 24NNCP00724    Hearing Date: April 18, 2025    Dept: A

PETITION TO CONFIRM ARBITRATION AWARD

NOTICE:

The Court is not requesting oral argument on this matter.  The Court is guided by California Rules of Court, Rule 3.1308(a)(1) whereby notice of intent to appear is requested.  Unless the Court directs argument in the Tentative Ruling, no argument is required and any party seeking argument should notify all other parties and the court by 4:00 p.m. on the court day before the hearing of the party’s intention to appear and argue.  The tentative ruling will become the ruling of the court if no argument is received.  

Notice may be given either by email at BurDeptA@LACourt.org or by telephone at (818) 260-8412.

ALLEGATIONS: 

Charles Schwab & Co., Inc. (Petitioner) brings this petition to confirm an arbitration award pursuant to C.C.P. § 1285. Petitioner asks the Court to confirm an award achieved at arbitration by Petitioner as against Daniel Duong (Respondent). Petitioner states that the underlying dispute was related to a self-directed brokerage account Respondent opened with Petitioner. Petitioner sought arbitration as to the resolution of an outstanding $466,689.03 debit balance on Respondent’s account.

On August 7, 2024, an arbitral panel with the Financial Industry Regulatory Authority (FINRA), issued its final award. (Wynne Decl. Exh. C.) The award notes there was no appearance or response to the arbitration from Respondent but found that service was sufficient to bind Respondent to the panel’s decision.

Petitioner has made no response to this petition.

ANALYSIS: 

I.                    LEGAL STANDARD 

Any party to an arbitration award may petition the court to confirm, correct, or vacate the award. (C.C.P. § 1285.) “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 proceeding.” (C.C.P. § 1286.) A petition to confirm a binding arbitration shall name as respondents all parties to the arbitration and may name any other parties to be bound by the award. (C.C.P. § 1285.) The petition shall (1) set forth the substance of or have attached a copy of the agreement to arbitrate unless petitioner denies the existence of such an agreement; (2) set forth the name(s) of the arbitrator(s); and (3) set forth or have attached a copy of the award and written opinion of the arbitrator. (C.C.P. § 1285.4(a)-(c).)

The petition to confirm must be served and filed no later than four years after the date of service of a signed copy of the award on the petitioner (C.C.P. § 1288) but may not be served and filed until at least 10 days after service of the signed copy of the award upon the petitioner. (C.C.P. § 1288.4.) Where the arbitration agreement does not provide the manner in which service shall be made and the person on whom service is to be made has not previously appeared in the proceeding and has not previously been served in accordance with C.C.P. § 1290.4(a), the petition and notice of hearing must be served in a manner provided by law for the service of summons in an action. (C.C.P. § 1290.4(b).)

II.                 MERITS

The Court finds the petitioner should be denied without prejudice on grounds of ineffective service. As stated above, service of a petitioner to confirm an arbitration award is proper (1) when rendered pursuant to a method specified in the arbitration agreement or (2) when rendered pursuant to the method for serving a summons and complaint. (C.C.P. § 1290.4(b).) Here, the arbitration agreement does establish a method of service for this petition. The arbitration agreement provides only the following:

All notices from one party to the other involving arbitration shall be considered to have been fully given when so served, mailed by first-class, certified or registered mail, or otherwise given by other commercially accepted medium of written notification.

(Wynne Decl. Exh. B at p. 11.)

Accordingly, Petitioner is required to serve its petition in the same manner as a summons pursuant as outlined in C.C.P. §§ 415.10, 415.20. Here, it appears that Petitioner attempted to serve Respondent with this petition via substitute service. Ordinarily, the declaration of a process server is usually sufficient to establish a presumption of effective service. (See American Express Centurion Bank v. Zara (2011) 199¿Cal.App.4th 383, 390 [internal citation omitted]; Evid. Code § 647.) However, the Court finds that there are conflicting details as to service which prevent the creation of that presumption here.  

Petitioner submits the declaration of process server Anthony Yanizzi (Yanizzi) (See February 26, 2025 Proof of Service.) Yanizzi states he effectuated substitute service on February 20, 2025 at 1706 Laurel Drive, Monterey Park, CA 91755. Yanizzi states he thereafter mailed a copy of the documents served to that same address. Despite these representations, further explanation by Yanizzi casts doubt on whether proper substitute service was made.  As discussed below, the Court is uncertain whether the address is a valid address for service.

Yanizzi states that his attempts at service were preceded by four attempts at service by the Los Angeles County Sheriff at the Monterey Park address. (See February 26, 2025 Proof of Service p. 7.) Yanizzi states that, on February 13, 2025, he waited outside the Monterey Park residence waiting for anyone to leave the house, but no one appeared. Yanizzi states that on February 15, he observed a person leaving the residence via what appeared to be Petitioner’s automobile (a white Tesla). Yanizzi attempted to serve the person as he entered the vehicle, but the person entered the vehicle and sped off. On February 20, 2025, Yanizzi returned to the Monterey Park residence where he observed another person leaving the residence via a different automobile (a gray Honda Odyssey).  Yanizzi approached the person who identified himself as Jason Sov (Sov). When asked Duong’s whereabouts, Sov responded “He is not here.” When Yanizzi attempted to serve Sov, Sov verbally refused service. When Sov entered his vehicle, Yanizzi placed the papers on Sov’s lap and told him he was sub-served. Sov refused and threw the papers into the street before departing. Yanizzi does not state whether the papers were retrieved or left at the residence.

Substitute service upon an individual is properly effectuated by leaving a copy of the papers to be served at the person’s office or mailing address the person who is apparently in charge thereof. (C.C.P. § 415.20(a).) In instances where personally delivery cannot be made with due diligence, a summons may be served by leaving a copy at the persons dwelling house, usual place of abode, usual place of business, or usual mailing address in the presence of a competent member of the household or a person apparently in charge. (C.C.P. § 415.20(b).) In either case, completion of service requires the papers be mailed to the same address of substitute service thereafter.

Here, Yanizzi’s declaration does not state that the papers were left with a competent member of the household. The papers appear to have been thrust upon Sov, who was not identified as a member of the household, and who thereafter ejected them into the street. This is not a condemnation of Yannizi’s attempt at service, merely an observation that the papers were not “left” with a competent member of the household as required.

The declaration of the Sheriff’s prior attempts is also a case of concern. The last attempt by the Sheriff to serve at the Monterey Park address states “Per Sandy, Defendant no longer living at location.” Petitioner has not explained who Sandy might be, nor is she referenced in Yannizi’s declaration. There is no information in the petition explaining why substitute service was attempted at the same address after the Sheriff’s were told Defendant no longer lived there. It may be that Petitioner has evidence Respondent does still live at the Monterey Park residence, but they do not provide it here.

In short, the Court finds service of the petition was inadequate. While the Court understands the difficulties serving Respondent has presented, the proof of service shows a failure to comply with the requirements for substitute service. As such, the petition is DENIED without prejudice. This permits Petitioner the opportunity to properly serve and refile this petition.

--- 

RULING:

In the event the parties submit on this tentative ruling, or a party requests a signed order or the court in its discretion elects to sign a formal order, the following form will be either electronically signed or signed in hard copy and entered into the court’s records. 

ORDER 

Charles Schwab & Co., Inc. Petition to Confirm Arbitration Award came on regularly for hearing on April 18, 2025, with appearances/submissions as noted in the minute order for said hearing, and the court, being fully advised in the premises, did then and there rule as follows: 

THE PETITION IS DENIED WITHOUT PREJUDICE.

CHARLES SCHWAB & CO., INC. TO GIVE NOTICE.  

IT IS SO ORDERED.