Judge: Katherine Chilton, Case: 22STLC04200, Date: 2022-11-07 Tentative Ruling

Case Number: 22STLC04200     Hearing Date: November 7, 2022    Dept: 25

PROCEEDINGS:      MOTION TO VACATE AUTOMATIC STAY

MOVING PARTY:   Plaintiff Mashian Law Group

RESP. PARTY:         None

MOTION TO VACATE AUTOMATIC STAY

(Bus. & Prof. Code § 6200 et seq.)

TENTATIVE RULING:

Plaintiff Mashian Law Group’s Motion to Vacate Automatic Stay is GRANTED.  Stay of proceedings is VACATED and the action is recommenced.

SERVICE: 

[X] Proof of Service Timely Filed (CRC, rule 3.1300)                 OK

[X] Correct Address (CCP §§ 1013, 1013a)                                                 OK

[X] 16/21 Court Days Lapsed (CCP §§ 12c, 1005(b))                     OK

OPPOSITION:          None filed as of November 3, 2022.                                   [   ] Late          [X] None

REPLY:                     None filed as of November 3, 2022.                                   [   ] Late          [X] None

ANALYSIS:

I.                Background

On June 22, 2022, Plaintiff Mashian Law Group (“MLG” or “Plaintiff”) filed an action against Afsaneh Karimi (“Karimi”) and Melody LLC (“Melody”) for breach of contract, account stated, and quantum meruit for allegedly failing to pay for legal services rendered.

On September 26, 2022, Defendant Karimi filed a Notice of Stay of Proceedings and a copy of a letter indicating that Defendant had submitted the fee dispute to the Attorney-Client Mediation and Arbitration Services (“ACMAS”), facilitated by the Los Angeles County Bar Association.  (9-26-22 Notice of Stay of Proceedings.)

On October 7, 2022, Plaintiff filed a Motion to Vacate Automatic Stay, Due to Matter Being Inappropriate for Mandatory Fee Arbitration (“Motion”).  No opposition was filed.  On October 27, 2022, Plaintiff filed a Notice of Defendant’s Failure to File Opposition to Motion.

On October 20, 2022, the Court took Plaintiff’s Application for Right to Attach Order and for Issuance of Writ of Attachment off calendar.  (10-20-22 Minute Order.)

II.              Legal Standard & Discussion

Plaintiff moves to vacate the automatic stay in the case pursuant to Business and Professions Code § 6201(c).  (Mot. p. 2.)  Plaintiff argues that Defendants waived their right to mandatory arbitration because they did not request arbitration within thirty (30) days after receiving the required Notice of Client’s Right to Fee Arbitration and since mandatory arbitration is not appropriate, the stay should be vacated.  (Ibid.)

Plaintiff states that Defendants have failed to pay $6,730.00 in outstanding legal fees owed for legal services rendered by Plaintiff MLG.  (Mot. p. 3; Mashian Decl. ¶¶ 2-3, Exs. 1-2.)  Before initiating this action, Plaintiff served Defendants with a Notice of Client’s Right to Fee Arbitration on March 18, 2022.  (Mot. p. 3; Mashian Decl. ¶ 4; Ex. 3.)  Defendants filed a mandatory fee arbitration demand with the Los Angeles County Bar Association on September 7, 2022, nearly six months after being served with the Notice.  (Mot. p. 3.; Mashian Decl. ¶ 8, Ex. 6.)  Plaintiff states that Defendants admitted to receipt of the Notice on March 18, 2022, as indicated in the Fee Petition, which states that Defendants received the Notice on “3-18-22 on paper but i [sic] received it much later.”  (Ibid.)  On September 26, 2022, Defendants filed a Notice of Stay of Proceedings.  (Mot. p. 5; 9-26-22 Notice of Stay.)

Plaintiff states that it did not learn about the Notice of Stay until September 29, 2022, when it reviewed the case summary on the Los Angeles Superior Court summary.  (Mot. p. 5.; Mashian Decl. ¶¶ 6-7; Stanton Decl. ¶¶ 4-5.)  MLG requested the Fee Petition and any correspondence from ACMAS and as of the date of the instant Motion, intends to file an objection to the Fee Petition by the October 18, 2022, deadline.  (Mot. pp. 4-6; Mashian Decl. ¶¶ 8-9, Exs. 6-7; Stanton Decl. ¶¶ 4-7.)  Upon review of the Fee Petition, Plaintiff discovered that Defendants had used an incorrect address for Plaintiff and its counsel and thus, Plaintiff had not received any correspondence regarding the Petition.  (Ibid.)  Furthermore, Defendant Karimi impermissibly served the Notice of Stay of Proceedings herself, despite being a party to the action.  (Mashian Decl. ¶ 5, Stanton Decl. ¶ 5.)

Business and Professions Code § 6201(c) states that: “Upon filing and service of the request for arbitration, the action or other proceeding shall be automatically stayed until the award of the arbitrators is issued or the arbitration is otherwise terminated. The stay may be vacated in whole or in part, after a hearing duly noticed by any party or the court, if and to the extent the court finds that the matter is not appropriate for arbitration under the provisions of this article.”

According to § 6201(a), an attorney must “forward a written notice to the client prior to or at the time of service of summons or claim in an action against the client, or prior to or at the commencement of any other proceeding against the client under a contract between attorney and client which provides for an alternative to arbitration under this article, for recovery of fees, costs, or both.”  A client must request fee arbitration within thirty (30) days of the receiving the notice of their right to arbitrate, otherwise the right to arbitrate will be waived.  (Code of Civ. Proc. § 6201(a); California State Bar Rules, rule 3.502(A)(1).)

Defendants have not opposed the Motion.

The Court finds that arbitration was waived by Defendants because they failed to request arbitration by ACMAS within the thirty (30) day timeframe permitted.  Since arbitration was waived and not appropriate in this case, the Court grants Plaintiff’s Motion to Vacate Stay.

III.            Conclusion & Order

For the foregoing reasons,

Plaintiff Mashian Law Group’s Motion to Vacate Automatic Stay is GRANTED.  Stay of proceedings is VACATED and the action is recommenced.

Moving party is ordered to give notice.