Judge: Walter P. Schwarm, Case: 30-2023-01300791, Date: 2023-08-15 Tentative Ruling

Plaintiff’s (G. Emmett Raitt, Jr. dba The Raitt Law Firm) Motion to Vacate Stay (Motion), filed on 4-10-23 under ROA No. 13, is DENIED. 

The Motion states, “Because Defendants failed to request arbitration within 30 days after service of the Notices, they have waived the right to arbitrate this fee dispute. As a result this ‘matter is not appropriate for arbitration under the provisions of’ §6201, and Defendants’ request for a stay of this action must be vacated.” (Motion; 4:10-13.)

Defendants’ (Shirin Manighalam, Shahram Manighalam, and Hajar Azadmard) Opposition to Plaintiff’s Motion to Vacate (Opposition), filed on 8-3-23 under ROA No. 20, responds, “Based on all of the foregoing, Defendants respectfully submit that they have provided ample and more than sufficient evidence showing that they were never served the Notice of Client’s Right to Fee Arbitration Rights by mail or personal service on 1/5/2022, 1/5/2021, 1/6/2022 or on any other date by Raitt and therefore they never waived their right to fee arbitration and that Orange County Bar Association has jurisdiction to hear this fee dispute and that the Plaintiff’s Motion to Vacate Stay should be denied.” (Opposition; 9:8-14.)

Business and Professions Code section 6201 states in part, “(a) The rules adopted by the board of trustees shall provide that an attorney shall 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. The written notice shall be in the form that the board of trustees prescribes, and shall include a statement of the client's right to arbitration under this article. Failure to give this notice shall be a ground for the dismissal of the action or other proceeding. The notice shall not be required, however, prior to initiating mediation of the dispute. [¶] The rules adopted by the board of trustees shall provide that the client's failure to request arbitration within 30 days after receipt of notice from the attorney shall be deemed a waiver of the client's right to arbitration under the provisions of this article. . . . [¶] (c) 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. The action or other proceeding may thereafter proceed subject to the provisions of Section 6204.”

The Proof of Service of the Summons and Complaint (Proof of Service), filed on 8-7-23 under ROA No. 32, reflects service of Summons and Complaint on Defendant—Azadmar.  This Proof of Service does not show that Plaintiff served Defendant—Azadmard, or any defendant, with the written notice required by Business and Professions Code section 6201, subdivision (a).  This Proof of Service also does not reflect service of the Summons and Complaint on Defendants—Shirin Manighalam, Shahram Manighalam.

The Opposition cites to the Orange County Bar Association’s Rules of Procedure for Mandatory Fee Arbitration. (Opposition; 5:1-24.)  Citing Business and Professions Code section 6201, subdivision (a), Orange County Bar Association rule 2(A), states, “Prior to or at the time of filing any court action or commencing any other proceeding through another arbitration organization against a client for the recovery of fees, an attorney must serve by first class mail, or have a process server deliver to the client the State Bar approved ‘Notice of Client's Right to Arbitrate’ form [Bus. & Prof. Code § 6201(a)].” (Orange County Bar Association; www.ocbar.org/Public-Services/Disputing-Attorney-Fees.)

Here, Plaintiff has not demonstrated compliance with Orange County Bar Association, rule 2(A), by showing service of the notice required under Business and Professions Code section 6201, subdivision (a), by first class mail or by way of process server.  Plaintiff’s declaration, filed on 8-7-23 under ROA No. 30, states, “All mailings from my law firm are sent through Stamps.com. Stamps.com maintains a history of those mailings. While stamps.com does not permit the printing of that history directly from the program, it is possible to take a screenshot of that history. A true and correct copy of that screenshot is attached to this declaration as Exhibit ‘1’. That screenshot shows mailings of the January 5, 2022, Notices to Sharam Manighalam, Shirin Manighalam, and Hajar Azadmard on January 6, 2022.” (Raitt Decl., ¶ 3.)  The attached screenshot do not indicate the identity of the documents sent, and the method of service described in the declaration does not comply with Orange County Bar Association, rule 2(A).  Therefore, the evidence is insufficient to demonstrate that Defendants have waived their right to mandatory fee arbitration.

Further, it appears that the parties are currently in arbitration.  Exhibit 3 attached to the Opposition is the 5-23-23 “Declaration of G. Emmett Raitt, Jr. in Reply to Orange County Bar Association’s Memorandum Dated 4/25/2023.”  The 5-23-23 declaration states, “Despite the failure of Respondents to timely respond to the Notices, I am willing to waive that defect and arbitrate the fee dispute, as long as the Arbitration is binding and not ‘advisory’.” (5-23-23 Raitt Decl., ¶ 7.)_

Titan/Value Equities Group, Inc. v. Superior Court (1994) 29 Cal.App.4th 482, 487-488 (Titan), explains, “In the interim, the arbitrator takes over. It is the job of the arbitrator, not the court, to resolve all questions needed to determine the controversy. [Citation.] The arbitrator, and not the court, decides questions of procedure and discovery. [Citations.] It is also up to the arbitrator, and not the court, to grant relief for delay in bringing an arbitration to a resolution. [Citations.]  As the court reasoned in McRae v. Superior Court, supra, 221 Cal.App.2d at page 171: ‘When it has been determined that arbitration should be pursued and all judicial proceedings have been suspended until completion of the arbitration, it would be wholly incompatible with established policies of the law to permit the court thereafter to intervene in, and necessarily to interfere with, the arbitration ordered. In large measure, it would not only preclude the parties from obtaining “an adjustment of their differences by a tribunal of their choosing,” but it would also recreate the very “delays incident to a civil action” that the arbitration agreement was designed to avoid.’ ” (Footnotes 7 and 8 omitted.)  “ ‘[A]n arbitration has a life of its own outside the judicial system.’ [Citation.] The trial court may not step into a case submitted to arbitration and tell the arbitrator what to do and when to do it: it may not resolve procedural questions, order discovery, determine the status of claims before the arbitrator or set the case for trial because of a party's alleged dilatory conduct. It is for the arbitrator, and not the court, to resolve such questions.” (Id., at p. 489.)

Since it appears that the parties are currently in arbitration, the court does not have jurisdiction to lift the stay.

Based on the above, the court DENIES Plaintiff’s (G. Emmett Raitt, Jr. dba The Raitt Law Firm) Motion to Vacate Stay filed on 4-10-23 under ROA No. 13.

Court Clerk is to give notice.