Judge: Gail Killefer, Case: 23STCP04253, Date: 2023-12-20 Tentative Ruling

Case Number: 23STCP04253    Hearing Date: December 20, 2023    Dept: 37

State Farm General Insurance Company v. Bella Finkel, et al..             Hearing Date: 12/20/2023

                                                                                                                  (23STCP04253)

[TENTATIVE] ORDER DENYING PETITION TO DISQUALIFY ARBITRATOR

State Farm General Insurance (“Petitioner”) moves to disqualify the appraiser for Bella Finkel and Rostislav Moshkovic (“Respondents”), Aaron Berkman, on the basis that he is not a “disinterested” and “neutral appraiser." 

The Petition is made pursuant to CCP §§ 1290 et seq., 1281.6, and 1286.2(2)(a)(1) & (2).).  The Petitioner moves to remove Mr. Berkman now rather than move to set aside the award later.  

“An agreement to conduct an appraisal contained in a policy of insurance constitutes an ‘agreement’ within the meaning of section 1280, subdivision (a), and therefore is considered to be an arbitration agreement subject to the statutory contractual arbitration law. [Citation.] Those statutory provisions represent a comprehensive statutory scheme for the arbitration of disputes. As such, the Legislature's use of the word ‘shall’ in the statutory provisions which we now discuss makes them mandatory, not precatory.” (Louise Gardens of Encino Homeowners' Assn., Inc. v. Truck Ins. Exchange, Inc. (2000) 82 Cal.App.4th 648, 658.)  

In, Mahnke v. Superior Court (2009) 180 Cal.App.4th 565, 578, the appellate court stated:  

[I]n the context of ‘competent and disinterested appraiser [s]’ [sic] selected by parties in appraisal proceedings pursuant to Insurance Code section 2071, absent express statutory direction, we decline to recognize an automatic and unlimited right of disqualification for disclosures made by those appraisers.

In other words, the disqualification of appraisers, like that of arbitrators, is limited to statutory provisions outlined by the Legislature. Yet none of the statutory provisions mentioned by Petitioner permit the court to disqualify the Respondents’ appraiser.  

CCP § 1281.6 outlines the method by which an arbitrator is to be selected and makes no mention of disqualification.  

CCP § 1290 states that proceedings commence by the filing of a petition but makes no mention of the provisions for disqualification of an arbitrator.  

CCP § 1287.2 provides the grounds for vacating an award.  

Lastly, Ins. Code § 2071 applies to the selection of an appraiser but makes no mention of disqualification.   

Like the Manhnke Court, this court declines to disqualify the Respondents’ appraiser unless the disqualification is based on a substantial business relationship existing between the Respondents and the appraiser or the disqualification is based on the appraiser's failure to make a disclosure required by law. (See CCP § 1281.91; Louise Gardens of Encino Homeowners' Assn., Inc. v. Truck Ins. Exchange, Inc. (2000) 82 Cal.App.4th 648, 658.) None of these arguments were raised by the Petitioner.  

As the Petitioner has failed to articulate a statutory basis for removing the Respondents’ appraiser, the petition is denied as there is no basis for the relief requested.  

The Respondents’ request for sanctions is also denied.