Metropolitan News-Enterprise

 

Tuesday, November 30, 2021

 

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Agreement to Arbitrate Pre-Trial Rows Broadly Construed

Court of Appeal Panel’s Majority Declares That Disputes Over Allred Firm’s Litigation Conduct Are ‘Related’

To Pre-Litigation Services, Rendering Arbitration Agreement Applicable; Rubin Has Contrary View

 

By a MetNews Staff Writer

 

An arbitration clause in a retainer agreement between an out-of-work television weatherman and the firm of high-profile lawyer Gloria Allred—which expressly applied to prelitigation services, only—also covered a dispute over alleged malpractice once the case got to court because those were related services, the majority of a Court of Appeal panel in this district said yesterday.

The agreement set forth that the firm of Allred, Maroko & Goldberg would seek a settlement with CBS over allegations by meteorologist Kyle Hunter that he had been unlawfully discriminated against when the network’s Los Angeles stations KCBS and KCAL denied him an on-air position, choosing instead to employ females who were younger than he. The agreement left open whether the firm would take the case if it were necessary to sue.

It was specified that “[i]n the event of any dispute between you and our firm...relating in any way to this agreement or our representation of you, the parties agree that either party may proceed as the law may require to initiate one or more arbitrations….”

Suit was brought by the Allred firm on behalf of Hunter against CBS; the plaintiff lost; Hunter sued Allred, her colleagues, and the law firm for malpractice; the dispute was ordered to arbitration and the lawyers won; Los Angeles Superior Court Judge David Sotelo dismissed the lawsuit, and Hunter appealed from the earlier order compelling arbitration.

Justice Lamar Baker of Div. Five, joined by Justice Carl H. Moor, took the position that litigation services are “related” to pre-litigation services, and that Hunter’s malpractice action was therefore subject to arbitration. Presiding Justice Laurence D. Rubin maintained that the wording of the retainer agreement indicated no such an intent, but concurred on the basis of the conduct of the parties having evidenced an agreement to arbitrate disputes arising from litigation services.

Baker’s Opinion

Baker wrote:

“Plaintiff advances four arguments on appeal, but three are really just window dressing. The sole issue on which this appeal turns is whether plaintiffs malpractice lawsuit is a dispute ‘arising out of or relating to’ the professional services defendant rendered to plaintiff as described in the Retainer….[I]t plainly is, and it therefore does not matter whether it is true that ambiguity in an| arbitration agreement should be construed against the drafter or a lawyer, nor does it matter what the retainer agreement said about when it would terminate.”

The justice explained:

“[E]ven assuming (as plaintiff contends) the arbitration provision can apply only to representation with some connection to the Retainer rather than any dispute between the parties in perpetuity, and even assuming (as plaintiff now contends) that the Retainer did not set the terms of defendants’ representation of plaintiff once litigation commenced because the Retainer stated it would terminate if defendants did not procure a satisfactory settlement in a reasonable time, it is still the case that the plain language of the arbitration provision covers the claims raised in plaintiffs malpractice lawsuit.”

He continued: “That lawsuit complains of defendants’ performance in litigation against the very same adverse party (CBS) and involving the very same alleged legal wrong (the refusal to hire him as an on-camera weatherman) that was the subject of defendants’ representation of plaintiff in pre-litigation settlement demands. On any fair understanding, the representation in litigation accordingly ‘relates to’ the Retainer and the pre-litigation settlement efforts. And that means arbitration of plaintiffs malpractice lawsuit was required.”

Rubin’s View

Rubin said in a concurring opinion:

“I part with the majority because, the arbitration clause’s breadth notwithstanding, the plain reading of the Retainer is that it terminated once the settlement negotiations concluded. The subsequent malpractice litigation did not arise out of the settlement negotiations and did not pertain to defendants’ representation under the Retainer agreement. The alleged malpractice occurred after the Retainer agreement terminated and after the parties agreed separately that defendants would represent plaintiff in the CBS litigation.

“To be sure, California has strong policies that favor arbitration….Those policies do not allow us to avoid careful consideration of whether arbitration may be compelled in any particular case. I write to remind us of something that we know: that these policies do not extend to compelling arbitration where the parties have not agreed to arbitrate….In my view, the issue is not whether the language of the Retainer might be susceptible to a reading that encompassed defendants’ subsequent representation of plaintiff, but whether the parties intended it to do so.”

While the writing communicates no such intent, he said, the conduct of the parties did, pointing to a July 25, 2016 letter from Hunter to the lawyers, after he lost the case against CBS, saying:

“I prefer to settle this matter with you privately and personally and you are welcome to contact me directly to arrange a meeting to resolve this matter. If you prefer to go the arbitration route as per agreement, then I will engage lawyers and proceed accordingly.”

He said in a Feb. 3, 2017 email:

“When an award comes, you will be paying my lawyers and costs and fees of arbitration, when you could settle this matter directly with me for considerably less.”

‘Practical Construction Rule’

Rubin observed that Hunter’s acknowledgement prior to bringing his malpractice action that the arbitration clause applied “is a significant consideration in how a court should interpret the Retainer,” saying that the plaintiff’s words “implicate the so-called ‘practical construction rule,’ venerable since 1906.” He quoted a California Supreme Court opinion issued that year as saying that “[t]he law…recognizes the practical construction of a contract as the best evidence of what was intended by its provisions.”

The presiding justice declared:

“Considering the Retainer agreement alone, I believe the better view is that it does not cover the arbitration of the malpractice claims against defendants.  But plaintiff explicitly stated that the malpractice claims were to go “the arbitration route as per agreement.”  Plaintiff’s statements, made before the parties disagreed on the proper forum, is the best evidence of what the Retainer meant, and arbitration was properly compelled.”

The case is Hunter v. Allred, B305869.

Downtown Los Angeles attorney Robert E. Barnes presented arguments for Hunter. Andrew J. Waxler and Brian D. Peters of the Westwood firm of Kaufman Dolowich & Voluck represented the lawyers.

Hunter’s Allegations

Hunter, a former weatherman for the Fox station in San Diego, announced in 2017 that he had complained to the State Bar that Allred had been negotiating with CBS for a series on her life at the same time her firm was representing him against CBS, without his knowledge. No disciplinary charges are pending.

The law firm said in response to Hunter’s public statement:

“Mr. Hunter has been threatening to sue our law firm for approximately one year in an attempt to get our law firm to pay him money which he is not entitled to. We represented Mr. Hunter vigorously and with devotion and with the utmost integrity. We advanced his case through all the courts in California, including two attempts to have his case heard in the California Supreme Court. He has no valid claim against our law firm or its partners and we will pay him nothing for his worthless claims. We will vigorously defend ourselves and we believe that we will prevail.”

The complaint in the malpractice action says:

“Allred has spent her career more focused on winning press conferences than winning cases. In this case, Allred sandbagged her client to serve her personal pecuniary interests, her penchant for public fame, and to protect the malfeasance of her media allies. Allred needs to spend less time in front of a TV camera, and more time in an ethics library.”

 

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