This case was last updated from Los Angeles County Superior Courts on 08/15/2019 at 09:23:55 (UTC).

ROBERT S. CROWDER VS FREEMAN FREEMAN & SMILEY LLP

Case Summary

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.
Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    ****1615

  • Filing Date:

    11/22/2017

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Other - Arbitration

  • County, State:

    Los Angeles, California

 

Party Details

Plaintiff

CROWDER ROBERT S.

Defendant

FREEMAN FREEMAN & SMILEY LLP

Attorney/Law Firm Details

Plaintiff Attorneys

BAYLES DAVID ESQ.

MCNEIL MALCOLM S. ESQ.

Defendant Attorneys

KVETON KYLE ESQ.

FITZGIBBONS JR. TERRENCE J. ESQ.

 

Court Documents

Memorandum of Points & Authorities

6/20/2019: Memorandum of Points & Authorities

Minute Order

8/1/2019: Minute Order

Certificate of Mailing for

8/1/2019: Certificate of Mailing for

Notice

8/14/2019: Notice

Notice

8/14/2019: Notice

NOTICE OF CASE REASSIGNMENT AND OF ORDER FOR PLAINTIFF TO GIVE NOTICE

3/14/2018: NOTICE OF CASE REASSIGNMENT AND OF ORDER FOR PLAINTIFF TO GIVE NOTICE

NOTICE OF CASE REASSIGNMENT AND OF ORDER FOR PLAINTIFF TO GIVE NOTICE

3/14/2018: NOTICE OF CASE REASSIGNMENT AND OF ORDER FOR PLAINTIFF TO GIVE NOTICE

NOTICE OF CASE REASSIGNMENT

3/20/2018: NOTICE OF CASE REASSIGNMENT

OPPOSITION TO MOTION FOR AN ORDER TO SEAL DOCUMENTS

4/6/2018: OPPOSITION TO MOTION FOR AN ORDER TO SEAL DOCUMENTS

FETITIONER'S REPLY TO RESPONDENT FREEMAN, FREEMAN & SMILEY LLP'S "PARTIAL OPPOSITION" TO MOTION FOR ORDER TO SEAL DOCUMENTS

4/12/2018: FETITIONER'S REPLY TO RESPONDENT FREEMAN, FREEMAN & SMILEY LLP'S "PARTIAL OPPOSITION" TO MOTION FOR ORDER TO SEAL DOCUMENTS

PROOF OF PERSONAL SERVICE

4/18/2018: PROOF OF PERSONAL SERVICE

Minute Order

4/19/2018: Minute Order

COURTS TENTATIVE RULING

4/19/2018: COURTS TENTATIVE RULING

PETITIONER'S NOTICE OF AMENDED MOTION AND AMENDED MOTION FOR AN ORDER TO SEAL EXHIBITS B, C, E, F AND J TO THE VERIFIED PETITION TO VACATE ARBITRATION AWARD

5/10/2018: PETITIONER'S NOTICE OF AMENDED MOTION AND AMENDED MOTION FOR AN ORDER TO SEAL EXHIBITS B, C, E, F AND J TO THE VERIFIED PETITION TO VACATE ARBITRATION AWARD

NOTICE TO CLERK REGARDING DISPOSITION OF DOCUMENTS PREVIOUSLY SUBMITTED UNDER SEAL

5/10/2018: NOTICE TO CLERK REGARDING DISPOSITION OF DOCUMENTS PREVIOUSLY SUBMITTED UNDER SEAL

PUBLIC - REDACTS MATERIALS FROM CONDITIONALLY SEALEO EXHIBITS B, C, E, F AND J TO THE VERIFIED PETITION TO VACATE ARBITRATION

5/10/2018: PUBLIC - REDACTS MATERIALS FROM CONDITIONALLY SEALEO EXHIBITS B, C, E, F AND J TO THE VERIFIED PETITION TO VACATE ARBITRATION

PROOF OF SERVICE

5/10/2018: PROOF OF SERVICE

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

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

42 More Documents Available

 

Docket Entries

  • 08/14/2019
  • DocketNotice (of Hearing Date Reservation on Cross-Motions to Vacate and/or Confirm Arbitration Award); Filed by Robert S. Crowder (Plaintiff)

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  • 08/14/2019
  • DocketNotice ( OF ENTRY OF MINUTE ORDER); Filed by Robert S. Crowder (Plaintiff)

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  • 08/01/2019
  • Docketat 3:00 PM in Department 37; Court Order

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  • 08/01/2019
  • DocketCertificate of Mailing for ((In Chambers Court Order) of 08/01/2019); Filed by Clerk

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  • 08/01/2019
  • DocketMinute Order ( (In Chambers Court Order)); Filed by Clerk

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  • 06/20/2019
  • DocketMemorandum of Points & Authorities; Filed by Robert S. Crowder (Plaintiff)

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  • 04/10/2019
  • Docketat 08:30 AM in Department 37; Hearing on Motion for Leave to Amend (Verified Petition to Vacate Arbitration Award) - Held

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  • 04/10/2019
  • DocketNotice of Ruling; Filed by Robert S. Crowder (Plaintiff)

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  • 04/10/2019
  • DocketAmended Verified Petition to Vacate Arbitration Award; Filed by Robert S. Crowder (Plaintiff)

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  • 04/10/2019
  • DocketMinute Order ( (Hearing on Motion for Leave to Amend Verified Petition to Vac...)); Filed by Clerk

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64 More Docket Entries
  • 11/28/2017
  • DocketPROOF OF SERVICE SUMMONS

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  • 11/27/2017
  • DocketDeclaration; Filed by Plaintiff/Petitioner

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  • 11/27/2017
  • DocketPETITIONER'S NOTICE OF MOTION AND MOTION FOR AN ORDER TO SEAL DOCUMENTS SUBMITTED IN SUPPORT OF VERIFIED PETITION TO VACATE ARBITRATION AWARD

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  • 11/27/2017
  • DocketPROOF OF SERVICE OF MULTIPLE DOCUMENTS

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  • 11/27/2017
  • DocketDECLARATION OF ROBERT S. CROWDER IN SUPPORT OF MOTION FOR ORDER TO SEAL DOCUMENTS SUBMITTED IN SUPPORT OF VERIFIED PETITION TO VACATE ARBITRATION AWARD

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  • 11/27/2017
  • DocketMotion for an Order; Filed by Plaintiff/Petitioner

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  • 11/22/2017
  • DocketVERIFIED PETITION TO VACATE ARBITRATION AWARD

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  • 11/22/2017
  • DocketMEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PETITION TO VACATE ARBITRATION AWARD

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  • 11/22/2017
  • DocketPetition; Filed by null

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  • 11/22/2017
  • DocketSUMMONS

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Tentative Rulings

Case Number: ****1615 Hearing Date: March 22, 2022 Dept: 37

Case Name: Robert S. Crowder v. Freeman Freeman & Smiley LLP

Hearing Date: March 22, 2022

Case No. ****1615

Trial Date: Post Judgment

Motion: Motion for Attorney Fees filed by Respondent Freeman, Freeman & Smiley LLP

Opposed: Yes. March 9, 2022.

Reply: Yes. March 15, 2022

Tentative: Grant

BACKGROUND

On July 1, 2021, the Court of Appeal affirmed the judgment in this case. The remittitur was filed on September 3, 2021.

Respondent moves the Court for the award of attorney fees incurred on appeal. The total amount of fees sought by this motion is $19,880.00. Defendant asserts the following:

  1. The contract upon which the arbitration was based provides that attorney fees may be awarded to the prevailing party in the arbitration.

  2. Under California law, a court shall award costs upon any judicial proceeding under California's arbitration statutes. Attorney fees, if authorized by contract, are allowable as costs. (Code Civ. Proc. 1293.2; 1033.S(a)(l0)(A).) Any "judicial proceeding" includes a petition to compel arbitration as well any proceeding which results in confirmation of an arbitration award. (Code Civ. Proc. 1281.2, 1285.)

  3. Where a contract permits the arbitrator to award attorney fees to the prevailing party in arbitration, that language is sufficiently broad enough to pennit a court (trial or appellate) to award attorney fees to the prevailing party on any petition which results in confirmation of the award, and any appeal arising therefrom.

  4. The Court of Appeal affirmed the judgment confirming the Arbitration Award favor of Respondent, and directed that Respondent be awarded its costs on appeal. Respondent was in all respects the prevailing party on the appeal.

LEGAL STANDARD

Per Code of Civil Procedure section 1033.5(a)(10)(A), Attorney fees may be awarded as costs when permitted by contract. ( Code Civ. Proc. 1033.5(a)(10)(A).)

Code of Civil Procedure section 1293.2 provides: “The court shall award costs upon any judicial proceeding under this title [governing arbitration] as provided in Chapter 6 (commencing with Section 1021) . . . of this code.” Judicial proceedings covered by this provision include petitions to confirm or vacate an arbitration award. (Code Civ. Proc., 1285.) “The award of costs pursuant to section 1293.2, including attorney fees when authorized by contract, is mandatory.” (Marcus & Millichap Real Estate Investment Brokerage Co. v. Woodman Investment Group (2005) 129 Cal.App.4th 508, 513, citing Corona v. Amherst Partners (2003) 107 Cal.App.4th 701, 707, 132 Cal.Rptr.2d 250 [“A court must award costs in a judicial proceeding to confirm, correct or vacate an arbitration award.”].)

Code of Civil Procedure section 1021 states, “Except as attorney's fees are specifically provided for by statute, the measure and mode of compensation of attorneys and counselors at law is left to the agreement, express or implied, of the parties; but parties to actions or proceedings are entitled to their costs, as hereinafter provided.”

The most common method for calculating reasonable attorney fees begins with the “lodestar” approach which is calculated as: “[T]he number of hours reasonably expended multiplied by the reasonable hourly rate.” (Margolin v. Regional Planning Com. (1982) 134 Cal.App.3d 999, 1004-1005.) “California courts have consistently held that a computation of time spent on a case and the reasonable value of that time is fundamental to a determination of an appropriate attorneys' fee award.” (Id.) The reasonable hourly rate is that prevailing in the community for similar work. (Id. at 1004.) The lodestar figure may then be adjusted, based on consideration of factors specific to the case, in order to fix the fee at the fair market value for the legal services provided. (Serrano v. Priest (1977) 20 Cal. 3d 25, 49; PLCM Group, Inc. v. Drexler (2000) 22 Cal. App. 4th 1084, 1095.)

In Serrano, supra, the California Supreme Court listed relevant factors as including:

  1. the novelty and difficulty of the questions involved, and the skill displayed in presenting them;

  2. the extent to which the nature of the litigation precluded other employment by the attorneys;

  3. the contingent nature of the fee award, both from the point of view of eventual victory on the merits and the point of view of establishing eligibility for an award;

  4. the fact that an award against the state would ultimately fall upon the taxpayers;

  5. the fact that the attorneys in question received public and charitable funding for the purpose of bring law suits of the character here involved;

  6. the fact that the monies awarded would inure not to the individual benefit of the attorneys involved but the organizations by which they are employed; and

  7. the fact that in the court's view the two law firms involved had approximately an equal share in the success of the litigation.

DISCUSSION

The general rule is that the prevailing party is determined after a final judgment is entered. (See Lindenstadt v. Staff Builders, Inc. (1997) 55 Cal.App.4th 882, 894, fn. [a party is not entitled to fees incurred in appellate court until and unless the action later concludes in favor of that same party].) Here, Plaintiff is attempting to use the decision on the appeal to obtain attorney’s fee based on the argument that they prevailed on appeal. The Court notes that Plaintiff obtained a reversal of the order granting summary judgment, but they did not obtain a final judgment in their favor and did not prevail on the case.

Respondent was awarded fees in the underlying action, and that award was not appealed. Since the judgment was affirmed on appeal, Respondent seeks to recovery its fees on appeal.

  1. Prevailing Party

“‘Prevailing party’ includes the party with a net monetary recovery, a defendant in whose favor a dismissal is entered, a defendant where neither plaintiff nor defendant obtains any relief, and a defendant as against those plaintiffs who do not recover any relief against that defendant. If any party recovers other than monetary relief and in situations other than as specified, the ‘prevailing party’ shall be as determined by the court, and under those circumstances, the court, in its discretion, may allow costs or not and, if allowed, may apportion costs between the parties on the same or adverse sides pursuant to rules adopted under Section 1034.” (CCP 1032.)

Civil Code, section 1717, subdivision (a) provides for the award of attorney fees and costs to the prevailing party in an action on a contract that provides for the recovery of attorney fees and costs. “Except as provided in paragraph (2), the party prevailing on the contract shall be the party who recovered a greater relief in the action on the contract.” (Id. at (b).)

‘[B]ecause contractually authorized attorney fees are now listed as costs under Code of Civil Procedure section 1033.5, … they may either be requested of the court of appeal while the appeal is pending, or of the trial court upon issuance of the remittitur. The trial court has jurisdiction to award them, regardless of the lack of specific instructions in the opinion or the remittitur.’” (Butler-Rupp v. Lourdeaux (2007) 154 Cal.App.4th 918, 924, quoting Harbour Landing- Dolfann, Ltd. v. Anderson (1996) 48 Cal.App.4th 260, 264-265.)

Petitioner argues the Partnership Agreement does not contemplate or permit an award of post-arbitration fees never awarded by the arbitrator.

2. Basis for Attorney Fees Request

FFS contends that it is entitled to an award of attorney for the same reasons this court previously granted fees. (See Minute Order of August 5 2020.) For the reasons stated in that ruling the court awards Respondent fees on appeal,Reasonable Amount of Attorney’s Fees Award

A trial court assessing attorney fees begins with a touchstone or lodestar figure, based on the ‘careful compilation of the time spent and reasonable hourly compensation of each attorney ... involved in the presentation of the case.” (Christian Research Inst. v. Alnor (2008) 165 Cal.App.4th 1315, 1321 (Christian).) The Court “need not simply award the sum requested. To the contrary, ascertaining the fee amount is left to the trial court’s sound discretion.” (Ibid.) “The reasonableness of attorney fees is within the discretion of the trial court, to be determined from a consideration of such factors as the nature of the litigation, the complexity of the issues, the experience and expertise of counsel and the amount of time involved. The court may also consider whether the amount requested is based upon unnecessary or duplicative work.” (Wilkerson v. Sullivan (2002) 99 Cal.App.4th 443, 448.) “The basis for the trial court’s calculation must be the actual hours counsel has devoted to the case, less those that result from inefficient or duplicative use of time.” (Horsford v. Board of Trustees of California State University (2005) 132 Cal.App.4th 359, 395 (Horsford).) “The law is clear, however, that an award of attorney fees may be based on counsel’s declarations, without production of detailed time records. (Raining Data Corp. v. Barrenechea (2009) 175 Cal.App.4th 1363, 1375.)

  1. Billing Rates Requested

FFS requests attorney’s fees at a rate of $350.00 per hour for Kyle Kveton. FFS submits Kveton Declaration to demonstrate that the requested rates are reasonable. (Kveton Decl. 9-10.)

Kveton attests that FFS seeks attorney fees at a rate of $350 per hour for Kveton for work performed after service of the Arbitration Award. (Kveton Decl. 9-10.) According to Kveton, Kveton handled the remaining work on in this action. (Kveton Decl. 19.)

As to his own rate, Kveton attests that he has been admitted to practice since 1983 and primarily practices in the areas of legal malpractice and malicious prosecution. (Kveton Decl. 12.) Kveton attests that he also has experience in defense of insurance carriers in bad faith and coverage actions. (Kveton Decl. 15-16.) Kveton attests that he has served as a faculty member for the National Institute for Trial Advocacy continuously since 2005 and has tried over 30 cases to verdict. (Kveton Decl. 15.)

Given the foregoing, the court finds that the requested rates of $350 for Kveton is reasonable for the Los Angeles market.

  1. Hours Requested

FFS requests a total of $19,880.00 in fees, representing a total of 56.8 hours, broken down as follows: (1) 3.6 hours of communication with client or opposing counsel re: appeal, (2) 2.9 hours of review and analyzing Appellant’s Opening Brief and Appendix, (3) 37.0 hours on Preparation of Respondent’s Brief (4) 8.3 hours on Review and analyze Reply Brief, and prepared for, and appear at, oral argument, review opinion, review Petition for Rehearing Court Order Denying Petition (5) 5.0 hours of preparation of motion for attorney fees, review of opposition, preparation of reply and appearing at hearing. (Kveton Decl. 19.)

Accordingly, the court grants FFS motion in part and awards attorney fees in connection with a total of 56.8 hours of attorney time.

CONCLUSION

Respondent’s motion for attorney fees is GRANTED. Respondent to give notice.



Case Number: ****1615    Hearing Date: August 05, 2020    Dept: 37

HEARING DATE: August 5, 2020

CASE NUMBER: ****1615

CASE NAME: Robert Crowder v. Freeman Freeman & Smiley LLP , et al.

TRIAL DATE: None. Arbitration Award Confirmed November 1, 2019

PROOF OF SERVICE: OK

MOTION: Motion for Prejudgment Interest

MOVING PARTY: Freeman, Freeman & Smiley, LLP

RESPONDING PARTY: Plaintiff, Robert Crowder

OPPOSITION: March 17, 2020

REPLY: March 26, 2020

TENTATIVE: FFS’ Motion is GRANTED. Prejudgment interest is awarded in the total amount of $27,204.59 through July 30, 2020. Moving party to give notice.

MOTION: Motion for Attorney’s Fees

MOVING PARTY: Freeman, Freeman & Smiley LLP

RESPONDING PARTY: Plaintiff, Robert Crowder

OPPOSITION: July 23, 2020

REPLY: July 29, 2020

TENTATIVE: FFS’ motion is DENIED, as FFS has not demonstrated its entitlement to an award of attorney’s fees. Moving party to give notice.

Background

This action arises out of Petitioner, Robert S. Crowder (“Crowder”)’s work as a former partner in the law firm of Respondent, Freeman, Freeman & Smiley LLP (“FFS”). According to Crowder’s initial Petition to Vacate Arbitration Award, Crowder withdrew as a partner from FFS in August of 2016 but allegedly received around one-quarter of the total annual compensation he had been due under the Partnership Agreement for each of his prior eight years of service. Crowder and FFS went to arbitration regarding their dispute over Crowder’s compensation before the Honorable Rosalyn Chapman (ret.) (the “Arbitrator”) and on August 18, 2017, the Arbitrator issued an arbitration award which awarded FFS $13,260.60 in compensation and $78,936.99 in attorney’s fees and costs, for a total award of $92,197.59. (the “Arbitration Award”)

After further litigation, this court confirmed the Arbitration Award on November 1, 2019 in all aspects. FFS now moves for prejudgment interest on the total Arbitration Award from September 1, 2017 to October 29, 2019, the filing of the instant motion, in the total amount of $19,904.56. FFS also moves for an award of attorney fees. Crowder opposes both motions.

MOTION FOR PREJUDGMENT INTEREST

Discussion

Civil Code section 3287 allows a party to recover prejudgment interest in either of the following situations:

  1. “A person who is entitled to recover damages certain, or capable of being made certain by calculation, and the right to recover which is vested in the person upon a particular day, is entitled also to recover interest thereon from that day, except when the debtor is prevented by law, or by the act of the creditor from paying the debt.

  2. Every person who is entitled under any judgment to receive damages based upon a cause of action in contract where the claim was unliquidated, may also recover interest thereon from a date prior to the entry of judgment as the court may, in its discretion, fix, but in no event earlier than the date the action was filed.”

  1. Prejudgment Interest under Civil Code section 3287(a)

“[P]rejudgment interest is allowable where the amount due plaintiff is fixed by the terms of a contract, or is readily ascertainable by reference to well-established market values.” (Leaf v. Phil Rauch, Inc. (1975) 47 Cal.App.3d 371, 375.) “A dispute concerning liability does not preclude prejudgment interest in a civil action.” (Boehm & Assocs v. Workers’ Comp. Appeals Bd. (1999) 76 Cal.App.4th 513, 517.)

FFS contends that it is entitled to prejudgment interest because the entry of a final arbitration award establishes its entitlement to “recover damages certain,” as the arbitration award itself creates a fixed liability for Crowder. (Motion, 3-4.) FFS relies on Britz Inc. v. Alfa-Laval Food & Diary Co. (1995) 34 Cal.App.4th 1085 (Britz) as well as Code of Civil Procedure sections 1287.4 and 1287.6 for this proposition.

Code of Civil Procedure section 1287.6 provides that “an award that has not been confirmed or vacated has the same force and effect as a contract in writing between the parties to the arbitration.” Further, Code of Civil Procedure section 1287.4 provides “if an award is confirmed, judgment shall be entered in conformity therewith. The judgment so entered has the same force and effect as, and is subject to all the provisions of law relating to, a judgment in a civil action of the same jurisdictional classification.” Finally, Britz held that a trial court properly awarded prejudgment interest on an arbitration award from the date of the award because as of the date of the award, respondents were entitled to “recover damages certain.” (Britz, supra, 34 Cal.App.4th at 1106.) Further, Britz specifically held that it was proper to award prejudgment interest on the attorney fees and costs portion of the arbitration award, noting that “[i]n the context of a judicial judgment, it is clear that interest after judgment accrues as to the entire award, including attorney’s fees.” (Britz, supra at 1106-1107.) Britz also noted that in a “contested action” Plaintiff may be awarded prejudgment interest if he is otherwise entitled to it even if the complaint does not include a prayer for interest. (Id.)

In opposition, Crowder contends that FFS should not be awarded prejudgment interest on three grounds: (1) FFS’s Partnership Agreement does envision an award of prejudgment interest, and (2) JAMS’ rules only specifically state that the Arbitrator may award attorney’s fees and costs, and makes no mention of prejudgment interest, and (3) FFS’s motion for prejudgment interest is untimely as a general matter because prejudgment interest should have been requested in the initial pleading. (Opposition, 3-5.)

Crowder relies on North Oakland Medical Clinic v. Rogers (1998) 65 Cal.App.4th 824 (Rogers) for the proposition that FFS’s prejudgment interest request is untimely. Rogers held that a general prayer in the Complaint is sufficient to allow the court to award prejudgment interest, such as a prayer for “such other and further relief as may be proper.” (Id. at 829.) Further, the court in Rogers also held that plaintiffs are not entitled to prejudgment interest “where damages had been awarded but no interest was included in the verdict and where neither court nor jury had determined whether the damages were liquidated or unliquidated.” (Id.) However, Rogers discussed whether an award of prejudgment interest granted after trial was proper. (Id. at 826-828.) As such, Rogers is not factually on point to the instant action, which arises from cross petitions to vacate and confirm the arbitration award.

In reply, FFS contends that Crowder’s reliance on Rogers is misplaced as it discusses an award of prejudgment interest following the entry of a jury verdict rather than an arbitration award. (Reply, 4-5.) FFS further contends that Crowder’s reliance on the JAMS rules is also misplaced because the JAMS rules govern how the arbitration is to be conducted rather than post arbitration proceedings. (Reply, 5-6.) FFS contends that an award of prejudgment interest at 10% per annum is appropriate given the controlling authority in Britz.

The court agrees with FFS and finds that an award of prejudgment interest is warranted. AS FFS correctly contends, Rogers is not factually applicable to this action because it does not discuss an award of prejudgment interest following a final arbitration award. Instead, the court finds this case factually similar to Britz and agrees that as of the date of the arbitration award, FFS was entitled to recover “damages certain” through entry of judgment confirming the arbitration award.

For these reasons, FFS’ motion is GRANTED.

Conclusion

FFS’ Motion is GRANTED. Prejudgment interest is awarded in the total amount of $27,204.59 through July 30, 2020. Moving party to give notice.

MOTION FOR ATTORNEY FEES

Discussion

  1. Legal Standard

    California follows the “American rule,” pursuant to which litigants ordinarily pay their own attorney fees.  (Musaelian v. Adams (2009) 45 Cal.4th 512, 516.)  Thus, a request for attorney fees must be based on either a statutory or contractual provision authorizing their recovery.  (See Code Civ. Proc., ; 1021.)  

    Civil Code, section 1717, subdivision (a) provides in relevant part:

    In any action on a contract, where the contract specifically provides that attorney’s fees and costs, which are incurred to enforce that contract, shall be awarded either to one of the parties or to the prevailing party, then the party who is determined to be the party prevailing on the contract, whether he or she is the party specified in the contract or not, shall be entitled to reasonable attorney’s fees in addition to other costs.

    (Civ. Code, ; 1717, subd. (a).)  “[T]he party prevailing on the contract shall be the party who recovered a greater relief in the action on the contract.”  (Civ. Code, ; 1717, subd. (b).)  Attorney fees are awarded based “upon the terms of the contractual attorney fee provision” pursuant to Code of Civil Procedures, section 1021.  (Santisas v. Goodin Santisas).)  “The primary purpose of section 1717 is to ensure mutuality of remedy for attorney fee claims under contractual attorney fee provisions.”  (Id. at p. 610.)  The Supreme Court recognized that in order to ensure mutuality, “it has been consistently held that when a party litigant prevails in an action on a contract by establishing that the contract is invalid, inapplicable, unenforceable, or nonexistent, section 1717 permits that party’s recovery of attorney fees whenever the opposing parties would have been entitled to attorney fees under the contract had they prevailed.  (Id. at p. 611.)

    “ ‘[B]ecause Lourdeaux (2007) 154 Cal.App.4th 918, 924, quoting Harbour Landing-Dolfann, Ltd. v. Anderson (1996) 48 Cal.App.4th 260, 264-265.)

  2. Basis for Attorney’s Fees Request

FFS contends that it is entitled to an award of attorney’s fees because it was the prevailing party in this action based on the Arbitration Award and the court’s ruling confirming the Arbitration Award. (Motion, 3-5.) FFS also points to the FFS Partnership Agreement, which provides as follows:

“8.2 Attorneys’ Fees

Any dispute or controversy in connection with this Agreement which cannot be settled by the parties shall be submitted to Judicial Arbitration and Mediation services (JAMS) in Los Angeles County California, and the parties shall follow all applicable procedural rules set forth by JAMS to conduct the arbitration; any arbitration awarded will be final and binding upon the parties, and judgment thereon may be entered in any court of competent jurisdiction. The arbitrator may award reasonable attorneys’ fees and arbitration costs to the prevailing party.”

(Motion, 3-4; see also Kveton Decl., Exhibit A (Final Arbitration Award).) Further, FFS relies on Ajida Technologies, Inc. v. Roos Instruments, Inc. (2001) 87 Cal.App.4th 534 (Ajida) for the proposition that it is entitled to post judgment attorney fees. In Ajida, two companies entered into a joint marketing agreement which required the parties to submit disputes to arbitration. (Id. at 538.) The two parties went to arbitration over certain disputes, during which the arbitration panel found that the parties’ agreement had been terminated. (Id.) Further, the arbitration panel determined that, notwithstanding the termination of the agreement, the agreement’s provisions requiring arbitration and payment of attorney fees would apply to future disputes of the arbitration award. (Id. at 539.) Thereafter, cross petitions to confirm and vacate the arbitration award followed, wherein the trial court found that the carry over of arbitration and attorney fees provisions. (Id.) The Court of Appeal concluded that the carryover of arbitration provision to future disputes was proper, finding that such an interpretation was in line with the parties’ original intent in entering the joint marketing agreement. (Id. at 544-545.) The Court of Appeal further held that the respondent company was entitled to its attorney fees on appeal because the attorney fees provision was found to carry over into disputes regarding the arbitration award itself. (Id. at 551.) Specifically, the Ajida court noted that underlying arbitration award including the following provision:

The arbitration provision in the award reads as follows: “[¶] 13. The JMDA [agreement] contains an arbitration provision. Consistent with the purposes of the JMDA, that provision shall be applicable to any dispute arising under or related to this Final Award.” As to attorneys' fees, the award provides: “[¶] 12. The JMDA contains an attorney fee provision. Consistent with the purposes of the JMDA, that provision shall be applicable to any dispute arising under or related to this Final Award.”

(Id. at 538, n. 2.)

In opposition, Crowder contends that FFS is not entitled to post-judgment attorney fees because FFS already received an award of attorney fees through the Final Arbitration Award and the Partnership Agreement does not permit any further award. (Opposition, 2-4.) Crowder points to the Partnership Agreement for this argument and contends that the Partnership Agreement only intended to allow the arbitrator to award attorney fees on its face. (Id.) Further, Crowder contends that FFS’ reliance on Ajida is misplaced because the Arbitration Award in this instance does not include a provision specifically providing that the attorney fees provision of the underlying Agreement will apply to “any dispute arising under or related to this Final Award.” (Id.)

In reply, FFS contends that Crowder has misinterpreted Ajida and that Ajida stands for a more general proposition. (Reply, 1-3). Specifically, FFS contends that Ajida stands for the proposition that if the underlying agreement between the parties purports to award attorney fees for the prevailing party on “any dispute” regarding the underlying agreement, then this means that FFS is entitled to attorney fees in this instance because a dispute regarding the arbitration award of the underlying agreement is “any dispute.” (Id.)

The court agrees with Crowder’s reading of Ajida. Ajida is distinguishable from this case because the Arbitration Award in this action does not provide that the attorney fees provision of the Partnership Agreement is applicable to “any dispute arising under or related to this Final Award.” The Partnership Agreement specifically provides that the Arbitrator is to award attorney fees, and the Arbitrator has already done so.

FFS’ motion is DENIED. Having denied FFS’ motion on this basis, the court does not address the remainder of the parties’ arguments.

Conclusion

FFS’ motion is DENIED, as FFS has not demonstrated its entitlement to an award of attorney fees. Moving party to give notice..



Case Number: ****1615    Hearing Date: October 25, 2019    Dept: 37

HEARING DATE: October 25, 2019

CASE NUMBER: ****1615

CASE NAME: Robert S. Crowder v. Freeman, Freeman & Smiley, LLP

PARTY MOVING

TO VACATE: Plaintiff Robert S. Crowder

OPPOSING PARTY: Defendant Freeman, Freeman & Smiley, LLP

PARTY MOVING

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.

Background

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.

Request for Judicial Notice

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).)

Evidentiary Objections

Crowder’s Evidentiary Objections[1]

Procedural Objection

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.

Discussion

I. Procedural Requirements

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.)[2] 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.

II. Arbitrator’s Award

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.)

III. Discussion

A. Legal Standard

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. 1213.) 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

neutral arbitrator;

4. The arbitrators exceeded their powers and the award cannot be corrected

without affecting the merits of the decision upon the controversy

submitted;

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.)

  1. Analysis

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. 530532.)

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.

IV. Conclusion

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.


[1] Crowder’s evidentiary objections do not conform to the format specified by California Rules of Court, rule 3.1354(b).

[2] All subsequent statutory references will be to the Code of Civil Procedure unless otherwise specified.



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