Friday. March 22, 2002
Glendale Firm Sanctioned for Challenge to Arbitration Award in C.A.
By a MetNews Staff Writer
A Glendale law firm was ordered yesterday to pay more than $11,000 in sanctions for what this district’s Court of Appeal characterized as a frivolous effort to overturn an arbitration award.
Div. Six ordered Kevin J. Stack and Knapp, Petersen & Clarke to reimburse a Santa Barbara County landowner for the fees she incurred fighting their appeal after a trial judge upheld an arbitrator’s ruling in her favor.
Stack’s client, Todd A. Harris, sought judicial review after the arbitrator held that Harris failed to timely exercise an option to purchase land from Rosalie M. Sandro and awarded Sandro attorney fees.
In opposing Sandro’s motion to confirm the award, Harris claimed the fee award was beyond the arbitrator’s authority; that the arbitrator could not justify his ruling on the merits; and that the arbitrator was required to cite a “basis” for his decision.
Santa Barbara Superior Court Judge Denise DeBellefuille rejected those arguments and confirmed the award. Harris and Stack should have left well enough alone at that point, rather than file an appeal that was “indisputably without merit,” Justice Kenneth Yegan wrote yesterday for the appellate panel.
“Whatever the merits of [Harris’] position in the arbitration, his appeal of the resulting judgment was without factual or legal support,” the justice wrote. “Given the clarity and frequency with which our Supreme Court has rejected attempts to obtain judicial review of arbitration awards, no reasonable attorney could have concluded otherwise.”
None of the arguments raised by the appeal, Yegan elaborated, fall within the limited grounds on which awards may be reviewed under the arbitration law. While an award may be overturned where the arbitrators have “exceeded their powers and the award cannot be corrected without affecting the merits of the decision upon the controversy submitted,” the jurist acknowledged, arbitrators do not exceed their powers by making legal or factual errors.
Nor did the arbitrator exceed his powers in awarding attorney fees, the jurist said, noting that both parties had requested fee awards during the arbitration and that the option agreement and the American Arbitration Association rules—which the parties agreed to abide by—provided for such awards.
Yegan rejected the contention that because the option agreement did not specify that an arbitrator could award attorney fees, it was necessary that a court make the determination. “Where, as here, a contract both compels arbitration and awards attorneys’ fees to the prevailing party in ‘litigation’ arising out of the contract, the attorneys’ fee provision applies to the arbitration,” the justice said.
The panel declined, however, to impose sanctions against Melbourne B. Weddle, who was Harris’ trial counsel. While his name was on the brief, along with those of Stack and his firm, “it appears from the declaration of Harris’ counsel on appeal that M.. Weddle performed no services in connection with the appeal,” Yegan explained.
Staff did not return a phone call seeking comment.
The case is Harris v. Sandro, B148018.
Copyright 2002, Metropolitan News Company