On 11/22/2017 ROBERT S CROWDER filed an Other - Arbitration lawsuit against FREEMAN FREEMAN SMILEY LLP. This case was filed in Los Angeles County Superior Courts, Stanley Mosk Courthouse located in Los Angeles, California. The case status is Pending - Other Pending.
Pending - Other Pending
Los Angeles County Superior Courts
Stanley Mosk Courthouse
Los Angeles, California
CROWDER ROBERT S.
FREEMAN FREEMAN & SMILEY LLP
MCNEIL MALCOLM S.
BAYLES DAVID G. ESQ.
BAYLES DAVID GRANT ESQ.
BAYLES DAVID ESQ.
MCNEIL MALCOLM S. ESQ.
CVETON KYLE ESQ.
KVETON KYLE ESQ.
FITZGIBBONS TERRENCE JOHN JR.
FITZGIBBONS JR. TERRENCE J. ESQ.
4/6/2018: OPPOSITION TO MOTION FOR AN ORDER TO SEAL DOCUMENTS
4/19/2018: COURTS TENTATIVE RULING
5/10/2018: NOTICE TO CLERK REGARDING DISPOSITION OF DOCUMENTS PREVIOUSLY SUBMITTED UNDER SEAL
5/10/2018: PUBLIC - REDACTS MATERIALS FROM CONDITIONALLY SEALEO EXHIBITS B, C, E, F AND J TO THE VERIFIED PETITION TO VACATE ARBITRATION
5/10/2018: PROOF OF SERVICE
5/10/2018: DECLARATION OF ROBERT S. CROWDER IN SUPPORT OF AMENDED MOTION FOR ORDER TO SEAL EXHIBITS B, C, E, F AND J TO THE VERIFIED PETITION TO VACATE ARBITRATION AWARD
1/4/2019: Notice of Change of Address or Other Contact Information
1/22/2019: Notice of Case Reassignment and Order for Plaintiff to Give Notice
2/21/2019: Minute Order
4/10/2019: Minute Order
12/14/2017: REQUEST FOR JUDICIAL NOTICE IN SUPPORT OF RESPONSE TO PETITION AND CROSS-PETITION
11/27/2017: DECLARATION OF ROBERT S. CROWDER IN SUPPORT OF MOTION FOR ORDER TO SEAL DOCUMENTS SUBMITTED IN SUPPORT OF VERIFIED PETITION TO VACATE ARBITRATION AWARD
11/27/2017: PROOF OF SERVICE OF MULTIPLE DOCUMENTS
11/28/2017: PROOF OF SERVICE SUMMONS
DocketNotice (of Hearing Date Reservation on Cross-Motions to Vacate and/or Confirm Arbitration Award); Filed by Robert S. Crowder (Plaintiff)Read MoreRead Less
DocketNotice ( OF ENTRY OF MINUTE ORDER); Filed by Robert S. Crowder (Plaintiff)Read MoreRead Less
Docketat 3:00 PM in Department 37; Court OrderRead MoreRead Less
DocketCertificate of Mailing for ((In Chambers Court Order) of 08/01/2019); Filed by ClerkRead MoreRead Less
DocketMinute Order ( (In Chambers Court Order)); Filed by ClerkRead MoreRead Less
DocketMemorandum of Points & Authorities; Filed by Robert S. Crowder (Plaintiff)Read MoreRead Less
Docketat 08:30 AM in Department 37; Hearing on Motion for Leave to Amend (Verified Petition to Vacate Arbitration Award) - HeldRead MoreRead Less
DocketNotice of Ruling; Filed by Robert S. Crowder (Plaintiff)Read MoreRead Less
DocketAmended Verified Petition to Vacate Arbitration Award; Filed by Robert S. Crowder (Plaintiff)Read MoreRead Less
DocketMinute Order ( (Hearing on Motion for Leave to Amend Verified Petition to Vac...)); Filed by ClerkRead MoreRead Less
DocketPROOF OF SERVICE SUMMONSRead MoreRead Less
DocketDeclaration; Filed by Plaintiff/PetitionerRead MoreRead Less
DocketPETITIONER'S NOTICE OF MOTION AND MOTION FOR AN ORDER TO SEAL DOCUMENTS SUBMITTED IN SUPPORT OF VERIFIED PETITION TO VACATE ARBITRATION AWARDRead MoreRead Less
DocketPROOF OF SERVICE OF MULTIPLE DOCUMENTSRead MoreRead Less
DocketDECLARATION OF ROBERT S. CROWDER IN SUPPORT OF MOTION FOR ORDER TO SEAL DOCUMENTS SUBMITTED IN SUPPORT OF VERIFIED PETITION TO VACATE ARBITRATION AWARDRead MoreRead Less
DocketMotion for an Order; Filed by Plaintiff/PetitionerRead MoreRead Less
DocketVERIFIED PETITION TO VACATE ARBITRATION AWARDRead MoreRead Less
DocketMEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PETITION TO VACATE ARBITRATION AWARDRead MoreRead Less
DocketPetition; Filed by nullRead MoreRead Less
DocketSUMMONSRead MoreRead Less
Case Number: BS171615 Hearing Date: October 25, 2019 Dept: 37
HEARING DATE: October 25, 2019
CASE NUMBER: BS171615
CASE NAME: Robert S. Crowder v. Freeman, Freeman & Smiley, LLP
TO VACATE: Plaintiff Robert S. Crowder
OPPOSING PARTY: Defendant Freeman, Freeman & Smiley, LLP
TO CONFIRM: Defendant Freeman, Freeman & Smiley, LLP
OPPOSING PARTY: Plaintiff Robert S. Crowder
TRIAL DATE: None
PROOF OF SERVICE: OK
PROCEEDING: Motions to Vacate Arbitration Award and Cross Motion to Confirm Arbitration Award
OPPOSITION: Opposition/Response to First Petition to Vacate Arbitration Award timely filed on December 14, 2017. Opposition to Amended Petition to Vacate Arbitration Late-filed on October 15, 2019
REPLY: Timely filed October 18, 2019
TENTATIVE: The court DENIES Plaintiff Robert S. Crowder’s motion to vacate arbitration award and CONFIRMS the arbitration award in Defendant Freeman, Freeman & Smiley, LLP’s favor. Counsel for Defendant to give notice.
This action arises in connection with a dispute between Petitioner Robert S. Crowder (“Crowder”) and Respondent Freeman, Freeman & Smiley, LLP (“Freeman”) regarding aspects of Crowder’s withdrawal from Freeman. Crowder and Freeman allegedly entered into a written partnership agreement (the “Agreement”) on January 1, 2012. (Amended Pet., ¶ 1b, Ex. A.) Freeman argued that Crowder’s withdrawal from Freeman foreclosed Crowder’s right to any and all funds not provided to him prior to his withdrawal; Crowder argued that the compensation-forfeiture aspects of the Agreement between the parties constituted impermissible and unenforceable penalties under California law. (Amended Pet., ¶ 3.)
Section 8.2 of the Agreement provided for arbitration of disputes arising out of the Agreement. (Amended Pet., ¶ 2.) Respondent initiated arbitration proceedings, and the Honorable Rosalyn Chapman (ret.) (the “Arbitrator”) was assigned to conduct the arbitration. The parties submitted motions for summary adjudication in the arbitration. On June 6, 2017, the Arbitrator issued a tentative order, denying Crowder’s motion for summary adjudication and initially determining that Freeman did not owe Crowder money under the Partnership Agreement. (Amended Pet. ¶ 8, Ex. C.) The Arbitrator issued an interim award (“Interim Award”) determining that Freeman did not owe any sums of money under the Agreement and that Crowder would take nothing on any of the claims presented by way of his cross-complaint in the arbitration. (Amended Pet., ¶ 10, Ex. E.) The Arbitrator rendered her decision in her written final award (“Final Award”) on August 14, 2017. (Amended Pet., ¶ 17, Ex. J.)
On November 22, 2017, Crowder filed a petition to vacate arbitration award. On December 14, 2017, Freeman filed its response and a cross petition to confirm arbitration award. On January 16, 2018, Crowder filed his opposition/response to Freeman’s cross petition to confirm arbitration award. These petitions did not ultimately come to hearing.
On January 15, 2019, Crowder filed a motion to seal documents submitted in support of his motion to vacate arbitration award. On February 21, 2019, the Court granted Crowder’s motion to file Exhibits K through P to the Amended Petition and denied the motion as to Exhibit Q. On February 13, 2019, Crowder filed an unopposed motion for leave to file an amended verified petition to vacate arbitration award. On April 10, 2019, the Court granted Crowder’s motion and entered the proposed amended petition as the operative petition in this action.
On July 30, 2019, the parties filed a request to set a hearing on Crowder’s petition to vacate and Freeman’s cross petition to confirm arbitration award. On August 1, 2019, the Court ordered the parties to reserve a hearing date through the court’s reservation system. On August 14, 2019, Crowder filed notice of this hearing date requesting that the court consider (1) Crowder’s petition to vacate filed on November 22, 2017; (2) Crowder’s operative amended petition to vacate filed on April 10, 2019; (3) Crowder’s memorandum of points and authorities in support of his amended petition filed on June 20, 2019; and (4) Crowder’s response filed on January 15, 2018.
On October 15, 2019, Freeman filed its response to Crowder’s amended petition to vacate arbitration award. On October 18, 2019, Crowder filed his reply.
This matter now comes to hearing.
Timeliness of Freeman’s Response
As a preliminary matter, the Court observes that Crowder objects to Attorney Kveton’s (“Kveton”) declaration in support of his response to Crowder’s amended petition on the grounds that it is untimely. The Court overrules this objection. The Court notes that Kveton’s declaration filed on October 15, 2019 contains the same statements made in his declaration filed on December 14, 2017. The new declaration makes minor, non-substantive, changes and is amended to respond to the operative amended petition to vacate filed on April 10, 2019. Rather than penalize Freeman for late-filing its opposition, the Court exercises its discretion to consider Kveton’s original declaration and referenced exhibits filed on December 14, 2017 in conjunction with its response to Crowder’s amended petition.
The court “may take judicial notice of the fact of a document’s recordation, the date the document was recorded and executed, the parties to the transaction reflected in a recorded document, and the document’s legally operative language…. From this, the court may deduce and rely upon the legal effect of the recorded document, when that effect is clear from its face.” (Fontenot v. Wells Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 265, disapproved on other grounds by Yvanova v. New Century Mortg. Corp. (2016) 62 Cal.4th 919, 939.)
On December 14, 2017, Freeman requested judicial notice of the complaint in case No. BC685444, Crowder v. O’Rielly & Roche LLP, et al., filed on December 1, 2017 (Compendium, Exhibit 6.) On October 10, 2019, Freeman filed the same request. As Freeman’s October 10, 2019 request was untimely, the Court considers its December 14, 2017 request.
Freeman requests the court take judicial notice (“RJN”) of a complaint filed in the Los Angeles County Superior Court, the Orange County Superior Court. The existence and legal effect of these documents are judicially noticeable; reasonably disputable assertions of fact contained therein are not. (Evid. Code, §§ 452, subds. (c), (d).)
Crowder’s Evidentiary Objections
Objection 1: Overruled. It is undisputed the opposition papers were served by overnight mail on October 14, 2019. Freeman’s response was due nine court days prior to this hearing. Because of the court holiday on October 14, 2019, Freeman’s responses were due on October 11, 2019. Thus, Freeman’s response is untimely. However, as discussed above, Freeman filed the same request for judicial notice and compendium of evidence, as well as essentially the same declaration (changed only to reflect response to the operative, amended verified petition to vacate filed on April 10, 2019) and an amended memorandum of points and authorities as the response it filed on December 14, 2017. The Court therefore exercises its discretion to consider these papers in conjunction with Freeman’s papers timely filed and served on December 14, 2017.
Declaration of Kyle Kveton (“Kveton Decl.”)
Overruled: 1, 4, 11-17, 28-30, 32, 34, 42 Sustained: 2-3, 5-9, 18-27, 31, 33, 35-41, 43
Objection 10: Overruled-in-part, sustained-in-part. Sustained as to “Under JAMS Rules, Interim and Final Awards are issued and served on the Parties after each Party has paid its required fees under the Rules and as invoiced by JAMS. [Rule 24(i).]” Overruled as to the balance. Kveton can testify to facts of which he has personal knowledge.
Code of Civil Procedure, section 1285 provides: “Any party to an arbitration in which an award has been made may petition the court to confirm, correct or vacate the award. The petition shall name as respondents all parties to the arbitration and may name as respondents any other persons bound by the arbitration award.” (Code Civ. Proc., § 1285.) The petition must: “(a) Set forth the substance of or have attached a copy of the agreement to arbitrate unless the petitioner denies the existence of such an agreement. (b) Set forth the names of the arbitrators. (c) Set forth or have attached a copy of the award and the written opinion of the arbitrators, if any.” (Code Civ. Proc., § 1285.4.)
Crowder’s motion to vacate (1) attaches the first amended and restated partnership agreement containing the agreement to arbitrate (Amended Pet., 1b, Exh. A); (2) sets forth the name of the arbitrator, the Honorable Rosalyn Chapman (ret.) (“Arbitrator”) (Amended Pet., ¶ 4); and attaches a copy of the award (Amended Pet., ¶ 17, Exh. J).
This is sufficient to substantially comply with the requirements of sections 1285 and 1285.4.
The Arbitration was set to commence on July 25, 2017. (Amended Pet., ¶ 5.) However, Freeman’s motion for summary adjudication was granted and it was resolved that Freeman did not owe Crowder any money under the Partnership Agreement on February 21, 2017. (Amended Pet., ¶ 8, Exh. C, p. 20.) The remaining issue of whether any money was owed by Crowder to Freeman was set for hearing on July 26, 2017. (Amended Pet., ¶ 9, Exh. D.) On June 19, 2017, the Arbitrator issued an interim award. (Amended Pet., ¶ 10, Exh. E.) The interim award upheld the Arbitrator’s February 21, 2017 decision and found again that Freeman did not owe Crowder any money. (Id. at p. 20.) Additionally, the Arbitrator found that Crowder shall take nothing on his cross-complaint. (Ibid.) On July 13, 2017, the Arbitrator’s case manager informed the parties that the scheduled hearing on the remaining issues was taken off calendar. (Amended Pet., ¶ 12, Exh. G.) On July 14, 2017, the case manager informed the parties that the hearing was back on calendar for July 26, 2017. (Amended Pet., ¶ 13.) On July 17, 2017, Crowder wrote to the Arbitrator and Freeman stating that he was unavailable on that date. (Amended Pet., ¶ 13, Exh. H.) On July 19, 2017, Freeman wrote to the Arbitrator stating that it would like to move forward with the hearing. (Amended Pet., ¶ 14, Exh. I.) On Juy 28, 2017, the hearing went forward. (Amended Pet., ¶ 15.) On August 14, 2017, Arbitrator signed and served the Award, awarding Judgment in favor of Freeman. (Amended Pet., ¶ 17, Exh. J.) The Arbitrator specifically found that (1) Freeman did not owe Crowder any money under the Partnership agreement; (2) Crowder would take nothing on his cross-complaint; and (3) Crowder owed Freeman $13,260.60 as unrepaid Production Holdback under Schedule C, Section III, of the Partnership Agreement (without interest). The Arbitrator also awarded Freeman (as prevailing party in the arbitration) $78,936.99 in attorney fees and costs under the Partnership Agreement. (Id. at p. 24.)
California law favors the resolution of disputes in arbitration “as a speedy and relatively inexpensive means of dispute resolution.” (Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 9 (Moncharsh), internal quotations omitted.) As a consequence, the grounds for challenging an arbitration award are limited: “[I]t is the general rule that, with narrow exceptions, an arbitrator’s decision cannot be reviewed for errors of fact or law.” (Id. at p. 11.)
The court may vacate an arbitration award only on the grounds set forth in Section 1286.2. (Id. at p. 12–13.) Section 1286.2 provides that the court shall vacate the award if it determines any of the following:
1. The award was procured by corruption, fraud, or other undue means;
2. There was corruption in any of the arbitrators;
3. The rights of the party were substantially prejudiced by misconduct of a
4. The arbitrators exceeded their powers and the award cannot be corrected
without affecting the merits of the decision upon the controversy
5. The rights of the party were substantially prejudiced by the refusal of the
arbitrators to postpone the hearing upon sufficient cause being shown
therefore or by the refusal of the arbitrators to hear evidence material to
the controversy or by other conduct of the arbitrators contrary to the
provisions of this title; or
6. An arbitrator making the award either failed to disclose a ground for
disqualification or was subject to disqualification but failed upon receipt
of timely demand to disqualify himself or herself.
(§ 1286.2, subd. (a).)
The court must confirm the award as made unless, in accordance with the Code of Civil Procedures, it corrects the award and confirms it as corrected, vacates the award, or dismisses the proceeding. (§ 1286.)
Crowder moves to vacate the arbitration award under Section 1286, subd. (a)(5) because the Arbitrator prevented him from presenting evidence during the arbitration proceeding by sustaining Freeman’s objections to his evidence, he attempted to postpone the hearing on remaining issues set for July 26, 2017, and the Arbitrator was biased in favor of Freeman. Specifically, the Arbitrator did not consider Crowder’s evidence because of the Arbitrator’s “willingness to sustain [Freeman’s] objections to evidence.” The Arbitrator also considered Freeman’s untimely response to Crowder’s cross-complaint. Additionally, Crowder contends that the Arbitrator incorrectly permitted the same attorney that represented him in a protracted litigation to represent Freeman. Moreover, Crowder claims prejudice because Freeman failed to produce witnesses and evidence during discovery and almost all the evidence submitted with Freeman’s cross-motions for summary adjudication/disposition had not been produced during discovery. Crowder asserts that the Arbitrator deprived Crowder from presenting evidence by summarily adjudicating essentially all the issues and ignoring evidence submitted by Crowder. Additionally, the Arbitrator failed to analyze the “propriety of the compensation-forfeiture aspects of the [Freeman Partnership] Agreement under controlling California Law,” and allowed the hearing to proceed on Freeman’s entitlement to additional funds despite Freeman’s non-compliance with the hearing obligations described in the Arbitrator’s orders. (Amended Pet., ¶ 22.)
None of these stated reasons support a vacatur of an arbitration award.
Crowder does not argue that the Arbitrator refused to hear evidence material to the controversy; rather, he argues that the Arbitrator sustained Freeman’s objections to his evidence. Review of an arbitrator’s decision to sustain objections requires a review for errors of law. It is undisputed that Freeman moved for summary adjudication after the close of non-expert discovery on April 28, 2017. The Arbitrator considered Crowder’s opposition to Freeman’s motion and granted Freeman’s motion. Additionally, Crowder raised these arguments in a subsequent hearing, and the Arbitrator issued an interim order again sustaining Freeman’s objections.
In support of his argument that the arbitration award should be vacated under Section 1286.2, subdivision (a)(5), Crowder cites Royal Alliance Associates, Inc. v. Liebhaber (2016) 2 Cal.App.5th 1092 (Royal Alliance) and Burlage v. Superior Court (2009) 178 Cal.App.4th 528 (Burlage).
Royal Alliance involved circumstances where a party to an arbitration, a securities broker, was allowed to speak, unsworn, at length at a post-arbitration hearing to expunge the allegations from his public record. Opposing party objected to this testimony but was unable to cross-examine the broker. The arbitration panel commented that it had already considered opposing party’s position and did not want to make the hearing run any longer. The Court of Appeal vacated the award because the opposing party was unable to present her side of the story to the arbitration panel.
Here, Crowder was given the opportunity to provide the Arbitrator with evidence in support of his arguments; however, the Arbitrator sustained many of Freeman’s objections to this evidence. After sustaining these objections, the Arbitrator gave Crowder another opportunity to be heard. In fact, Crowder was able to challenge the Arbitrator’s sustaining objections at a subsequent hearing. Although the Arbitrator considered Crowder’s arguments prior to issuing her interim order, she ultimately sustained Freeman’s objections. Thus, Crowder’s reliance on Royal Alliance is inapposite because, unlike in Royal Alliance, the Arbitrator allowed Crowder to present his position.
In Burlage, the arbitrator ruled that any damages in the action were fixed at the date that escrow closed on the property and excluded evidence regarding post-escrow events. The Court held that it could not vacate the award on the original legal error, but vacated the award based on the evidentiary rulings that logically followed from that error. (Burlage, at pp. 530–532.)
In Heimlich v. Shivji (2019) 7 Cal.5th 350 (Heimlich), the Supreme Court distinguished Royal Alliance and disapproved of Burlage because the Court in Burlage improperly vacated an award based on the arbitrator’s evidentiary rulings. The Court held that there was a significant difference between alleged improper exclusion of evidence (such as by a finding of irrelevance or otherwise) and an outright refusal to consider evidence for no reason at all. “In contrast, section 1286.2, subdivision (a)(5) does not contemplate vacation of an award merely because arbitrators refused to consider evidence they find legally irrelevant, even if the irrelevance determination rests upon an incorrect legal foundation.” (Heimlich, supra, 7 Cal.5th at p. 369.) The Court found that “[t]o allow an arbitration award to be set aside under section 1286.2, subdivision (a)(5), whenever an erroneous legal ruling results in the exclusion of evidence deemed important would undermine a foundation of the Arbitration Act, that an arbitrator’s legal error ordinarily is not judicially reviewable.” (Id. at p. 370.)
Applying the Court’s reasoning in Heimlich to the instant case, Crowder’s argument that the Arbitrator’s decision to sustain Freeman’s objections is not a valid reason to vacate the arbitration award.
Furthermore, Crowder’s argument that the Arbitrator’s failure to analyze the propriety of the compensation-forfeiture aspects of the Partnership Agreement requests a review for error of law. Crowder specifically asks the Court to review the Arbitrator’s legal conclusion regarding the propriety of portions of the Partnership Agreement. This is not a proper basis for vacatur of an award.
Additionally, Crowder’s argument that the Arbitrator improperly considered Freeman’s motion for summary adjudication contrary to her Preliminary Conference Order No. 1 because Freeman had not met and conferred with Crowder again improperly requests that this Court review the Arbitrator’s decision for an error of law.
Finally, Crowder does not successfully argue that the Arbitrator’s failure to postpone the hearing on July 28, 2017 warrants vacatur of the award under Section 1286.2, subdivision (a)(5). Here, Crowder claims that the hearing was taken off calendar on July 13, 2017 and two days later the case manager called to place the hearing back on calendar. Crowder objected to placing the hearing back on calendar on the basis that he would be traveling for business. While this may be considered sufficient cause to postpone a hearing, Crowder did not request to continue or otherwise postpone the hearing. Crowder does not provide any evidence that he requested postponement of the hearing. Rather, the record is clear that he merely objected to it being scheduled on July 28, 2017. (Compendium, Exh. 4; Suppl. Crowder Decl., ¶ 4, Exh. A.) Moreover, the parties had agreed to arbitrate their dispute pursuant to JAMS. JAMS Rules, rule 22(j) provides: “The Arbitrator may proceed with the Hearing in the absence of a Party that, after receiving notice of the Hearing pursuant to Rule 19, fails to attend.” Crowder does not argue that he did not receive notice of the reinstated hearing.
If the court does not vacate or correct an arbitration award, “the court must confirm the award.” (Law Offices of David S. Karton v. Segreto (2009) 176 Cal.App.4th 1, 8, italics in original.) As Crowder has failed to demonstrate that he is entitled to an order vacating the arbitration award, the court CONFIRMS the Final Award in Freeman’s favor. Freeman is ordered to submit to the Court a proposed order entering judgment in his favor pursuant to the terms of the Final Award.
 Crowder’s evidentiary objections do not conform to the format specified by California Rules of Court, rule 3.1354(b).
 All subsequent statutory references will be to the Code of Civil Procedure unless otherwise specified.