Metropolitan News-Enterprise


Thursday, March 6, 2003


Page 3


Court Rejects Review in Arbitration of Lawyer’s Claim Against Firm


By a MetNews Staff Writer


The California Supreme Court yesterday left standing a Court of Appeal ruling that requires a prominent lawyer/lobbyist to arbitrate his claim that he was wrongfully and fraudulently expelled from his former law firm.

No justice voted to review the decision of this district’s Div. Seven in Marzec v. Arter & Hadden, B157849.

Edwin K. Marzec claims that Arter & Hadden never had any intention of honoring an agreement that he receive 45 percent of all billings generated by the “California Governmental Affairs Practice” that he started at the firm in late 1999. He said he was wrongfully expelled form the firm in April 2001.

Marzec, who has also served as chairman of the California Law Revision Commission and for many years on the county’s Judicial Procedures Commission, sued in June of last year.

The firm countered that Marzec had signed two partnership agreements requiring that disputes related to the practice be arbitrated. Marzec denied signing any binding agreement and said the agreements asserted by the firm were one-sided and unconscionable, in part because they would require him to pay half the costs of arbitration and allow an organization selected by the firm to choose the arbitrator.

Los Angeles Superior Court Judge Ray Hart agreed with Marzec, citing Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83. The high court held in that 4-3 decision that portions of an arbitration agreement that limited damages, limited discovery, and forced the employee to share in the costs of arbitration were unconscionable.

The court last week extended that ruling to a claim for wrongful termination in violation of public policy.

But the high court did not choose to review Div. Seven’s ruling, set forth last December in an opinion by Presiding Justice Dennis Perluss, that the Armendariz reasoning does not apply to Marzec because he had an opportunity to negotiate the terms of his joining the law firm.

Unlike the plaintiffs in Armendariz, Perluss wrote, “Marzec does not proffer either evidence or argument to suggest that the partnership agreement was procedurally unilateral.” That lack of proof, the presiding justice said, “is fatal to his claim of unconscionability.”


Copyright 2003, Metropolitan News Company