Judge: Mark E. Windham, Case: 23STCP01076, Date: 2023-08-10 Tentative Ruling

Case Number: 23STCP01076    Hearing Date: August 10, 2023    Dept: 26

Interlandi v. Reed, et al.

PETITION TO VACATE ARBITRATION AWARD

(Bus. & Profs. Code § 6200, et seq.)

TENTATIVE RULING:

Petitioner Gianfranco Interlandi’s Petition to Vacate Arbitration Award is GRANTED. PETITIONER TO FILE A PROPOSED JUDGMENT WITHIN 20 DAYS OF THIS ORDER.

ANALYSIS:

On April 6, 2023, Petitioner Gianfranco Interlandi (“Petitioner”) filed the instant Petition to Vacate Arbitration Award against Respondents Zshonette Reed and the Law Offices of Lorden and Reed (“Respondents”). Proof of substitute service of the Petition and Notice of Hearing was filed with the Court on April 14, 2023. No response has been filed to date.

Discussion

Petitioner contends the arbitration award issued on March 13, 2023 by Keith G. Wileman (“the arbitrator”) must be vacated because (1) the award was obtained by corruption, fraud, or other unfair means; (2) the arbitrator was corrupt; (3) the misconduct of a neutral arbitrator substantially prejudiced petitioner’s rights; and (4) the arbitrator exceeded his or her authority, and the award cannot be fairly corrected. (Pet., ¶10(c).) The arbitrator determined that the “total amount of fees and costs which should have been charged by the Lawyers in this matter under the doctrine of quantum meruit is: $4,147.50” and Petitioner having paid Respondent 4,147.50 is to take nothing by way of the petition for arbitration. (Pet., Exh. 2, p. 9.)

Petitioner argues that the arbitrator issued an award corruptly, with undue means, and in excess of his jurisdiction. Under Code of Civil Procedure section 1286.2, subdivision (a), fraud and fundamental defect in process are grounds to vacate an arbitration award. Petitioner claims to have invoked the Mandatory Fee Arbitration Act based on the belief that Respondent’s only failing was abandoning his case such that he should not have owed Respondent any fees. Respondent testified in response that the harm was caused by others and that she lacked the clerk’s transcripts to properly represent Petitioner in the underlying action. (Pet., Exh. 2, p. 6:1-15.) However, Respondent’s testimony was false as demonstrated by her citations to the clerk’s transcripts in the oppositions she prepared to a motion for request for judicial notice and a motion to augment. (Id. at Exh. 4, pp. 1-4; Exh. 5, pp. 1-4.) This supports Petitioner’s contention that the arbitration award was obtained by fraud or other unfair means. As Respondent has not filed a response to this Petition, her citation to the clerk’s transcripts is not explained.

Regarding Petitioner’s contention that the arbitrator was corrupt or engaged in misconduct, it cannot be determined from the Petition how the arbitrator might have discovered that Respondent falsely testified about access to the clerk’s transcripts. Petitioner does not demonstrate that the arbitrator had access to the oppositions filed by Respondent or otherwise should have discovered that Respondent’s testimony was false. 

Petitioner also argues that during the arbitration proceeding Respondent admitted to malpractice and criminal activity by splitting the $15,000.00 fee with a non-attorney but the arbitrator found this conduct did not cause Respondent harm. (Pet., pp. 2:11-13, 3:1-2, 8:1-2, Exh. 6.) Splitting fees with a non-lawyer, however, violated Cal. Rules of Professional Conduct, rule 1-320 and shows that the arbitrator’s finding substantially prejudiced Petitioner.

Petitioner also claims that upon learning these facts, he revoked his consent to voluntary binding arbitration before the award was issued and expressed a desire to bring suit against Respondent for malpractice, breach of fiduciary duty, and theft. Under Voluntary Arbitration Rules of the Los Angeles Bar Association, Rule 5, an arbitrator cannot adjudicate malpractice claims without Petitioner’s consent. However, the memorandum does not cite authority regarding a petitioner’s right to withdraw from pending arbitration, or to place conditions on their participation, as Petitioner did here. Specifically, Petitioner “objected to [the arbitration] unless the entire $15,000 paid to Ms. Reed is returned, and he is compensated for the additional $10,000 that it cost him to correct her misconduct, and he receives treble damages pursuant to PC §496.” (Pet., Exh. 3, p. 12:19-21.) The malpractice claim was not part of Petitioner’s original request for arbitration and the Petition does not show that a malpractice claim made during a pending arbitration proceeding divests the arbitrator of jurisdiction.

Finally, Petitioner argues that when he disputed signing the attorney-client fee agreement, the arbitrator was obligated to end the arbitration proceeding until the Court resolved the issue. In support, Petitioner cites to Ericksen, Arbuthnot, McCarthy, Kearney & Walsh, Inc. v. 100 Oak Street (1983) 35 Cal.3d 312, 316 n. 2 and Hotels Nevada, LLC v. Bridge Banc, LLC (2005) 130 Cal. App.4th 1431, 1437 for authority that questions of a contract’s legality must be determined by the Court.

Based on the foregoing, the Court finds that Petitioner has demonstrated the following bases to vacate the arbitration award: the award was obtained by corruption, fraud, or other unfair means, the misconduct of a neutral arbitrator substantially prejudiced Petitioner’s rights, and the arbitrator exceeded his or her authority, and the award cannot be fairly corrected.

To the extent Petitioner requests that the Court allow him to file a complaint in this action to assert claims of malpractice, breach of fiduciary duty, and theft against Respondent, no authority is cited for allowing this action to be converted to one seeking affirmative relief from Respondent. (See Pet., p. 12:5-6.) 

Conclusion

Petitioner Gianfranco Interlandi’s Petition to Vacate Arbitration Award is GRANTED. PETITIONER TO FILE A PROPOSED JUDGMENT WITHIN 20 DAYS OF THIS ORDER.

Moving party to give notice.