Grabowski v. Kaiser Foundation Health Plan, Inc.

Filed 4/19/21 Certified for Publication 5/10/21 (order attached)
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
JOANNA G. GRABOWSKI, D076968
Plaintiff and Appellant,
v. (Super. Ct. No. 37-2019-
00013115-CU-PA-CTL)
KAISER FOUNDATION HEALTH
PLAN, INC., et al.,
Defendants and Respondents.
APPEAL from an order of the Superior Court of San Diego County,
David M. Rubin, Judge. Reversed with directions.
Joanna G. Grabowski, in pro. per., for Plaintiff and Appellant.
Cole Pedroza, Kenneth R. Pedroza, Alysia B. Carroll; Davis, Grass,
Goldstein & Finlay and Vincent J. Iuliano, for Defendants and Respondents.
Joanna G. Grabowski brought claims for medical malpractice against
Kaiser Foundation Health Plan, Inc., Southern California Permanente
Medical Group, and various associated physicians (collectively, Kaiser). 1 The
1 The physicians are Barbie Lynn Norman, Walter D. Vasquez, John
Stewart Kennedy, and Diana Cantu.
claims were heard by an arbitrator, Byron Berry, pursuant to a contractual
arbitration agreement. After a contested hearing, the arbitrator awarded
judgment in favor of Kaiser.
Grabowski petitioned the trial court to vacate the arbitration award.
(Code Civ. Proc., § 1285; further statutory references are to the Code of Civil
Procedure.) She alleged (1) the arbitrator committed misconduct, and
revealed disqualifying bias, by engaging in an ex parte communication with
Kaiser’s counsel about Grabowski’s self-represented status; (2) the arbitrator
failed to disclose two matters involving Kaiser where he was selected as an
arbitrator; and (3) the arbitrator improperly denied Grabowski’s request for a
continuance of the arbitration hearing. The trial court found that “the
arbitrator’s conduct did not rise to a level that substantially prejudiced
[Grabowski’s] rights” and therefore dismissed her petition.
Grabowski appeals the trial court’s order dismissing her petition. She
reasserts all three grounds for vacating the arbitration award. We agree the
award should be vacated. The ex parte communication between the
arbitrator and Kaiser’s counsel was recorded by Grabowski’s mother as part
of her effort to document the arbitration hearing. The audio recording
reveals comments by the arbitrator making light of Grabowski’s self-
representation and her inability, in the arbitrator’s view, to effectively
represent herself. The arbitrator volunteered these comments to Kaiser’s
counsel, ex parte, and they shared a hearty laugh about Grabowski’s
perceived shortcomings as an advocate.
The arbitrator committed misconduct on several levels. At least one
requires vacating the arbitration award. A neutral arbitrator has a
continuing duty to disclose all matters that could cause a person aware of the
facts to reasonably entertain a doubt that the neutral arbitrator would be
2
able to be impartial. The arbitrator’s ex parte communication with Kaiser’s
counsel certainly qualifies. Because the arbitrator was aware of this
communication and did not disclose it to Grabowski, the award must be
vacated. (§ 1286.2, subd. (a)(6)(A).) We therefore reverse the order
dismissing the petition with directions to grant the petition and vacate the
arbitration award. In light of our conclusion, we need not consider the other
grounds for vacating the award asserted by Grabowski.
FACTUAL AND PROCEDURAL BACKGROUND
In the underlying arbitration, Grabowski alleged that Kaiser
negligently failed to diagnose a large, benign ovarian tumor. A Kaiser
physician noted abnormalities in an early radiological scan and recommended
follow-up, but this recommendation was not followed by Kaiser. Over the
ensuing years, Grabowski suffered severe pain and discomfort, which she
attributed to the growing tumor. The tumor was discovered when Grabowski
was a teenager, after it had grown close to the size of a melon. Kaiser
performed surgery to remove it. After the surgery, Grabowski continued to
suffer severe pain. A different medical provider discovered that a portion of
Grabowski’s small intestine had become trapped when her surgical incision
was closed.
Kaiser disputed that it should have diagnosed the tumor or that the
tumor caused Grabowski’s years-long symptoms. It contended Grabowski’s
pain was caused by other conditions.
The arbitration hearing was held over five days. The arbitrator heard
percipient and expert testimony from both sides. Grabowski, now college-
aged, represented herself. She was assisted by her mother. Kaiser was
represented by an attorney, Vincent Iuliano, who is also co-counsel of record
in this appeal.
3
In his award, the arbitrator found that Grabowski’s tumor could not
have been diagnosed until it became approximately the size of a melon. He
understood Grabowski’s expert to testify that Kaiser’s physicians had
individually met the requisite standard of care, but that Kaiser as a whole
“breached its standard of care for not diagnosing the tumor earlier.” The
arbitrator rejected this theory, which he characterized as “an attempt to
impose liability on Kaiser without finding fault or blame on any of the
doctors” who treated Grabowski. The arbitrator noted that Grabowski had
suffered severe pain for many years and continued to experience pain. He
theorized that her pain was caused by “her intense engagement in athletics
as a pitcher on her college softball teams.”
The arbitrator concluded that Grabowski “failed to establish through
expert testimony that the legal cause of her injuries was the failure of her
Kaiser doctors to exercise the care and skill required under the
circumstances.” He therefore awarded judgment in favor of Kaiser.
Grabowski, represented by counsel, petitioned the trial court to vacate
the award based on three primary grounds. She supported her petition with
several declarations, documentary exhibits, and the audio recording of the
arbitrator’s ex parte communication with Kaiser’s counsel.
First, Grabowski contended that the arbitrator committed misconduct
during an early break in the arbitration proceedings by joking with Kaiser’s
counsel, ex parte, about Grabowski’s self-representation. Grabowski’s mother
was recording the proceedings on her cell phone and had inadvertently left it
going while she and Grabowski left the room. The unofficial transcript of the
audio record submitted by Grabowski is reproduced below, with minor
punctuation changes. Kaiser does not contest its general accuracy.
4
THE ARBITRATOR: “I’ve been doing this for a long time.
This has been one of the bigger—bigger challenges, uh,
because she doesn’t have an attorney. It makes it just
kinda awkward.”
KAISER’S COUNSEL: “First time in 30 years in my
practice . . . .”
THE ARBITRATOR: “For you?”
KAISER’S COUNSEL: “ . . . I’ve never seen this before.”
THE ARBITRATOR: “He’d, uh, everybody had
representatives before?”
KAISER’S COUNSEL: “Absolutely.”
THE ARBITRATOR: “And this is the wrong case. This is the
wrong case. How can you not have an attorney? Even
in some union cases and stuff that I deal with quite a
bit. (Laughs.) Private cases, uh, or what have you,
’cause even with, uh, in union cases, uh, they have
representatives who are not attorneys, but they know
this stuff so well, they might, uh, you know, they’re just
as qualified as an attorney. So, she must have a
representative that you can rely on, you know, to make
sure that everything’s done correctly. You know, but
this is . . . . (Laughs.) [She] picked one of the toughest,
factual cases I’ve ever dealt with to have somebody in
[pro. per.] (Laughs.)”
Grabowski asserted that the arbitrator was “ ‘yukking it up’ ” with
Kaiser’s counsel and that his comments, especially his tone and laughter,
showed his disrespect and disregard for Grabowski. She contended that the
5
ex parte communication showed bias, which was grounds for disqualification.
(See §§ 170.1, subd. (a)(6), 1281.91, subd. (d).) She also argued that the
communication showed corruption, fraud, or other undue means that
required vacating the award. (See § 1286.2, subd. (a)(1)-(3).)
Second, Grabowski contended the arbitrator failed to disclose two
matters involving Kaiser where he accepted appointment as an arbitrator.
Grabowski maintained that she would have sought to disqualify the
arbitrator if these two matters had been disclosed. She argued that the
arbitrator’s failure to disclose the two matters breached his ethical
obligations and constituted a further ground for vacating the award.
(See § 1286.2, subd. (a)(6)(A).)
Third, Grabowski contended the arbitrator failed to grant a
continuance of the arbitration hearing, despite her showing of good cause to
do so. Grabowski wanted more time to speak with her surgeon about
treatment for spine conditions she believed were caused by Kaiser’s
negligence. Grabowski argued the arbitrator’s failure to grant a continuance
substantially prejudiced her rights and was therefore grounds for vacating
the award as well. (See § 1286.2, subd. (a)(5).)
Kaiser opposed the petition to vacate. It contended that the recorded
ex parte communication was not improper because it did not involve the
merits of the arbitration. It maintained that the communication was not
derogatory, did not reveal any bias, and did not constitute misconduct.
Kaiser also contended that the arbitrator had served notice of the two
additional matters involving Kaiser on Grabowski’s prior attorney, while he
was still representing Grabowski. Regarding the continuance, Kaiser argued
that Grabowski did not show good cause for a continuance because she did
not link her spine treatment to Kaiser’s alleged negligence with competent
6
evidence. And, in any event, Grabowski had not shown that the arbitrator’s
failure to grant a continuance prejudiced her.
After hearing argument, the trial court issued a written statement of
decision. It found that the ex parte communication was improper and
unethical. The court wrote, “Though very short, this was not a general
discussion about scheduling or administration. Rather, the conversation
centered on [Grabowski]: Her pro per status, that the case is factually
complicated and the potential for an adverse result as a consequence of
lacking an attorney to assist her.” However, the court found that Grabowski
did not show how the communication “substantially prejudiced her rights”
and she did not establish “a nexus between the communication and the
award.” The court also found that Grabowski had not shown the arbitrator
failed to provide notice of the two additional Kaiser matters to her prior
counsel. Finally, it found that Grabowski did not adequately justify her
request for a continuance and the arbitrator did not abuse his discretion by
denying it. Overall, Grabowski “fail[ed] to demonstrate ‘substantial
prejudice’ or a nexus between the arbitrator’s conduct and the arbitration
award.” The court therefore dismissed her petition. Grabowski appeals.2
DISCUSSION
As noted, Grabowski contends the trial court erred by not vacating the
arbitration award based on the arbitrator’s ex parte communication with
Kaiser’s counsel. Among other things, Grabowski argues that the award
must be vacated because the arbitrator failed to disclose the communication
2 Grabowski represents herself in this appeal. “Under the law, a party
may choose to act as his or her own attorney. [Citations.] ‘[S]uch a party is
to be treated like any other party and is entitled to the same, but no greater
consideration than other litigants and attorneys.’ ” (Nwosu v. Uba (2004)
122 Cal.App.4th 1229, 1246-1247.)
7
as required by statute and ethical rules. (§ 1286.2, subd. (a)(6)(A).) We
agree.3
“The California Arbitration Act (§ 1280 et seq.) ‘represents a
comprehensive statutory scheme regulating private arbitration in this state.’
[Citation.] The statutory scheme reflects a ‘strong public policy in favor of
arbitration as a speedy and relatively inexpensive means of dispute
resolution.’ [Citation.] ‘[I]t is the general rule that parties to a private
arbitration impliedly agree that the arbitrator’s decision will be both binding
and final.’ [Citation.] [¶] Generally, in the absence of a specific agreement
by the parties to the contrary, a court may not review the merits of an
arbitration award. [Citation.] Although the parties to an arbitration
agreement accept some risk of an erroneous decision by the arbitrator, ‘the
Legislature has reduced the risk to the parties of such a decision by providing
for judicial review in circumstances involving serious problems with the
award itself, or with the fairness of the arbitration process.’ ” (Haworth,
supra, 50 Cal.4th at p. 380.)
“The statutory scheme, in seeking to ensure that a neutral arbitrator
serves as an impartial decision maker, requires the arbitrator to disclose to
the parties any grounds for disqualification.” (Haworth, supra, 50 Cal.4th at
3 In the trial court, Grabowski framed her contention somewhat
differently, focusing on the misconduct of the arbitrator, rather than the
failure to disclose. To the extent this reframing constitutes a new theory
presented for the first time on appeal, Kaiser has not objected to it and we
exercise our discretion to allow it. (See Ward v. Taggart (1959) 51 Cal.2d
736, 742; Sheller v. Superior Court (2008) 158 Cal.App.4th 1697, 1709.) The
material facts are undisputed. And, as we explain, the disclosure
requirement presents a mixed question of fact and law that is predominantly
legal and subject to de novo review. (Haworth v. Superior Court (2010)
50 Cal.4th 372, 385-386 (Haworth).)
8
p. 381, fn. omitted.) If the arbitrator “failed to disclose within the time
required for disclosure a ground for disqualification of which the arbitrator
was then aware,” the trial court must vacate the arbitration award.
(§ 1286.2, subd. (a)(6)(A).) “Under the applicable California statute, an
arbitrator’s failure to make a required disclosure requires vacation of the
award, without a showing of prejudice.” (Haworth, at p. 394.) The statute
“leaves no room for discretion.” (Ovitz v. Schulman (2005) 133 Cal.App.4th
830, 845; accord, Benjamin, Weill & Mazer v. Kors (2011) 195 Cal.App.4th 40,
73 (Benjamin).)
“The arbitrator disclosure rules are strict and unforgiving. And for
good reason. Although dispute resolution provider organizations may be in
the business of justice, they are still in business. The public deserves and
needs to know that the system of private justice that has taken over large
portions of California law produces fair and just results from neutral decision
makers.” (Honeycutt v. JPMorgan Chase Bank, N.A. (2018) 25 Cal.App.5th
909, 931 (Honeycutt).)
Section 1281.9 requires that, “when a person is to serve as a neutral
arbitrator, the proposed neutral arbitrator shall disclose all matters that
could cause a person aware of the facts to reasonably entertain a doubt that
the proposed neutral arbitrator would be able to be impartial,” including
certain enumerated matters. (§ 1281.9, subd. (a).) Among the enumerated
matters is “[t]he existence of any ground specified in Section 170.1 for
disqualification of a judge.” (§ 1281.9, subd. (a)(1).) Section 170.1, in turn,
states that a judge “shall be disqualified” if, for any reason, “[a] person aware
of the facts might reasonably entertain a doubt that the judge would be able
to be impartial.” (§ 170.1, subd. (a)(6)(A)(iii).) “Bias or prejudice toward a
9
lawyer in the proceeding may be grounds for disqualification.” (§ 170.1,
subd. (a)(6)(B).)
Section 1281.85 imposes additional disclosure requirements. It states,
“a person serving as a neutral arbitrator pursuant to an arbitration
agreement shall comply with the ethics standards for arbitrators adopted by
the Judicial Council pursuant to this section. . . . The standards shall
address the disclosure of interests, relationships, or affiliations that may
constitute conflicts of interest, including prior service as an arbitrator or
other dispute resolution neutral entity, disqualifications, acceptance of gifts,
and establishment of future professional relationships.” (§ 1281.85,
subd. (a).)
The Judicial Council subsequently adopted the Ethics Standards of
Neutral Arbitrators in Contractual Arbitration. (Honeycutt, supra,
25 Cal.App.5th at p. 921.) California Rules of Court, Ethics Standard 7
addresses disclosure. Like its statutory counterpart, Ethics Standard 7
requires disclosure of “all matters that could cause a person aware of the
facts to reasonably entertain a doubt that the arbitrator would be able to be
impartial,” including various enumerated matters. (Ethics Standards,
std. 7(d).) Among the enumerated matters is any other matter that “[m]ight
cause a person aware of the facts to reasonably entertain a doubt that the
arbitrator would be able to be impartial[.]” (Ethics Standards,
std. 7(d)(15)(A).)
The Ethics Standards impose a continuing duty of disclosure, “applying
from service of the notice of the arbitrator’s proposed nomination or
appointment until the conclusion of the arbitration proceeding.” (Ethics
Standards, std. 7(f); see Honeycutt, supra, 25 Cal.App.5th at pp. 922-923.) If,
after the time for initial disclosures has passed, “an arbitrator subsequently
10
becomes aware of a matter that must be disclosed . . . , the arbitrator must
disclose that matter to the parties in writing within 10 calendar days after
the arbitrator becomes aware of the matter.” (Ethics Standards, std. 7(c)(2).)
A federal appellate court has interpreted these statutes as imposing an
initial duty of disclosure under section 1281.9 and a continuing duty of
disclosure under section 1281.85 and the Ethics Standards. (See Johnson v.
Gruma Corp. (9th Cir. 2010) 614 F.3d 1062, 1067-1068.) As relevant here,
regardless of its source, the substantive duty to disclose “all matters that
could cause a person aware of the facts to reasonably entertain a doubt that
the proposed neutral arbitrator would be able to be impartial” remains the
same. (§ 1281.9, subd. (a); Ethics Standards, std. 7(d).)
“ ‘The “reasonable person” is not someone who is “hypersensitive or
unduly suspicious,” but rather is a “well-informed, thoughtful observer.” ’
[Citation.] ‘[T]he partisan litigant emotionally involved in the controversy
underlying the lawsuit is not the disinterested objective observer whose
doubts concerning the judge’s impartiality provide the governing standard.’ ”
(Haworth, supra, 50 Cal.4th at p. 389.)
“ ‘Impartiality’ entails the ‘absence of bias or prejudice in favor of, or
against, particular parties or classes of parties, as well as maintenance of an
open mind.’ [Citation.] In the context of judicial recusal, ‘[p]otential bias and
prejudice must clearly be established by an objective standard.’ ” (Haworth,
supra, 50 Cal.4th at p. 389.) “ ‘An impression of possible bias in the
arbitration context means that one could reasonably form a belief that an
arbitrator was biased for or against a party for a particular reason.’ ” (Ibid.)
“ ‘Bias is defined as a mental [predilection] or prejudice; a leaning of the
mind; “a predisposition to decide a cause or an issue in a certain way, which
11
does not leave the mind perfectly open to conviction.” ’ ” (Baxter v. Bock
(2016) 247 Cal.App.4th 775, 791.)
As noted, in order to prevail, Grabowski “is not required to prove that
[the arbitrator] actually was influenced by bias.” (Haworth, supra, 50 Cal.4th
at p. 384.) Instead, the “sole issue” is whether the information was required
to be disclosed. (Ibid.) Whether disclosure was required “is a mixed question
of fact and law that should be reviewed de novo. The applicable rule provides
an objective test by focusing on a hypothetical reasonable person’s perception
of bias. The question is not whether [the arbitrator] actually was biased or
even whether he was likely to be impartial; those questions involve a
subjective test that appropriately could be characterized as primarily factual.
The question here is how an objective, reasonable person would view [the
arbitrator’s] ability to be impartial.” (Id. at pp. 385-386.) Where, as here,
there are no underlying material facts in dispute, our review of the court’s
order denying Grabowski’s petition to vacate is de novo. (Mt. Holyoke
Homes, L.P. v. Jeffer Mangels Butler & Mitchell, LLP (2013) 219 Cal.App.4th
1299, 1312.)
Initially, we note that the arbitrator’s ex parte communication with
Kaiser’s counsel was not ethical. Kaiser does not dispute this conclusion.
California Rules of Court, Ethics Standard 14, subdivision (a) provides, “An
arbitrator must not initiate, permit, or consider any ex parte communications
or consider other communications made to the arbitrator outside the presence
of all of the parties concerning a pending or impending arbitration, except as
permitted by this standard, by agreement of the parties, or by applicable
law.” Even where an ex parte communication is permitted, as for example
about administrative matters, “the arbitrator must promptly inform the other
parties of the communication and must give the other parties an opportunity
12
to respond before making any final determination concerning the matter
discussed.” (Ethics Standards, std. 14(b).) The ex parte communication here
was not about “administrative matters” and was therefore prohibited by
Ethics Standard 14.
Beyond its prohibited nature, we conclude a person aware of the ex
parte communication could reasonably entertain a doubt that the arbitrator
would be able to be impartial. The communication showed that the arbitrator
had concluded that Grabowski could not be an effective advocate for herself.
While this conclusion may not necessarily evince bias in and of itself, the
arbitrator’s decision to share his conclusion with Kaiser’s counsel certainly
does. The arbitrator plainly felt a connection to Kaiser’s counsel, which made
him comfortable enough to violate ethical rules and comment on Kaiser’s
opponent.
Moreover, the arbitrator’s comments went far beyond the bare
conclusion that Grabowski was ineffective. The audio recording, which
reveals the arbitrator’s tone and attitude, is striking. The arbitrator
commiserated with Kaiser’s counsel about their shared predicament (in his
view) and shared a hearty laugh at Grabowski’s expense. The arbitrator
vividly expressed his incredulity that Grabowski was representing herself.
The arbitrator also commented on the nature of the case itself, stating that
Grabowski “picked one of the toughest, factual cases [the arbitrator had] ever
dealt with to have somebody in [pro. per.]” His emotional response is
apparent. The exact reason for the laughter is somewhat unclear, but it was
clearly improper. Whether it was nervous laughter at the ethical
transgression that had just occurred, disbelieving laughter that Grabowski
was so unable to represent herself, or derisive laughter about Grabowski’s
13
perceived incompetence, it highlights the reasons why the ex parte
communication was improper.
A person aware of the ex parte communication could reasonably believe
that the arbitrator did not take Grabowski seriously and could not maintain
an open mind about her claims. He was biased against her for a particular
reason, i.e., her self-represented status. A person aware of the ex parte
communication could also reasonably believe that the arbitrator was partial
to Kaiser’s counsel, again for a specific reason. He was a fellow professional
at the mercy (in the arbitrator’s view) of Grabowski’s lack of legal training
and perceived incompetence.
Again, we emphasize that an arbitrator’s private conclusion that an
advocate is ineffective or incompetent does not necessarily create grounds for
disqualification. The dispositive circumstances here are the arbitrator’s
decision to share this conclusion with Kaiser’s counsel and the arbitrator’s
obviously emotional response to Grabowski’s self-representation. A
reasonable person could conclude that these were not the actions and
statements of an impartial decision maker.
Because a reasonable person aware of the ex parte communication
could reasonably entertain a doubt that the arbitrator would be able to be
impartial, the arbitrator was required to disclose the communication within
10 calendar days. (Ethics Standards, std. 7(c)(2).) Grabowski would then
have had the opportunity to disqualify the arbitrator. (See § 1281.91,
subd. (d); Ethics Standards, std. 10(a)(3).) The arbitrator did not make the
required disclosure. The statute therefore requires that the arbitration
award be vacated, without any further showing. (§ 1286.2, subd. (a)(6)(A);
see Haworth, supra, 50 Cal.4th at p. 394.)
14
In its appellate briefing, Kaiser did not address whether the arbitrator
should have disclosed the ex parte communication or whether the arbitration
award must be vacated based on his failure to do so. Instead, it argued only
that the ex parte communication did not constitute corruption, fraud, or the
use of undue means to obtain an arbitration award. At oral argument, Kaiser
conceded the ex parte communication should have been disclosed, but it
maintained that a further showing was required to vacate the award. In its
briefing, Kaiser asserted that Grabowski must show “ ‘substantial prejudice
or a nexus between the award and the alleged undue means used to attain
it.’ ” Although this phrase appears in quotation marks in Kaiser’s briefing, it
does not appear in either of the authorities Kaiser cites: section 1286.2,
subdivision (a), and Pour Le Bebe, Inc. v. Guess? Inc. (2003) 112 Cal.App.4th
810, 834 (Pour Le Bebe).
In any event, Kaiser does little to explain the basis for this legal
standard or why it should be applied here. Pour Le Bebe references a “nexus”
requirement in discussing a federal appellate decision: “As the Ninth Circuit
said in A.G. Edwards, a court should not presume that perjured evidence or
evidence procured by undue means had an impact on the arbitrators. Since
‘arbitrators are not required to state the reasons for their decisions’; we
‘presume[] the arbitrators took a permissible route to the award where one
exists’; and the applicable statute provides for vacation of an award
‘ “procured by corruption, fraud, or undue means” ’ [citation], the moving
party needs to demonstrate a nexus between the award and the alleged
undue means used to attain it.” (Pour Le Bebe, supra, 112 Cal.App.4th at
pp. 833-834, quoting A.G. Edwards & Sons, Inc. v. McCollough (9th Cir.
1992) 967 F.2d 1401, 1403.) Perjured evidence or evidence procured by
undue means—through no fault of the arbitrator—is not at issue here.
15
Pour Le Bebe itself considered “whether ‘other undue means’ includes
representation of the prevailing party by an attorney with a potential conflict
of interest[.]” (Pour Le Bebe, supra, 112 Cal.App.4th at p. 826.) The losing
party criticized the arbitration panel “for its limited inquiry into the conflict
issue, but [it] highlight[ed] no aspect of the arbitrators’ award that might
have been impacted by any confidential information allegedly obtained” by
the conflicted attorneys. (Id. at p. 835.) Because the losing party “failed to
show by clear and convincing evidence that a conflict existed and that it had
a substantial impact on the panel’s decision,” the court affirmed an order
denying a petition to vacate. (Id. at p. 837.) A conflicted attorney—likewise
not due to any fault of the arbitrator—is also not at issue here.
Kaiser also relies on Pacific Vegetable Oil Corp. v. C.S.T., Ltd. (1946)
29 Cal.2d 228, but it does not explain how that 70-year-old opinion relates to
the current statutory scheme governing arbitration. Pacific Vegetable held
that, in order to justify vacating an arbitration award, “the misconduct or
error complained of, to whatever class it might belong, must be of such
character that the rights of the party complaining were prejudiced thereby.”
(Id. at p. 240.) Here, to the extent this standard is relevant, Grabowski’s
rights were substantially prejudiced because she was unable to exercise her
statutory right to disqualify an arbitrator that a reasonable person could
doubt would be impartial. (See Benjamin, supra, 195 Cal.App.4th at p. 73.)
We disagree with Kaiser’s suggestion that her rights were not prejudiced
because she was able to present her evidence to the arbitrator and the
arbitrator allegedly “paid careful consideration to Grabowski’s argument and
evidence.” Grabowski was entitled to the safeguards set out in the statutory
scheme to ensure that she was informed of any potential for bias in the
neutral arbitrator, so that her evidence and argument would be heard by an
16
impartial decision maker (or at least one whose potential biases were known).
Because those safeguards were disregarded here, the entire arbitration is
suspect.4
Kaiser asserts that the award should not be vacated because “even if
the ex parte communication did not occur, the result would have been the
same.” Kaiser does not offer any support for such a legal standard in this
context or any cogent argument why we should adopt it. Moreover, as
evidence that the result would have been the same, Kaiser cites the
arbitrator’s factual findings. In a situation where the arbitrator’s
impartiality is at issue, such reliance is unpersuasive.
Although Kaiser did not raise them in its briefing, the trial court relied
on several authorities that considered ex parte communications in other
contexts. They are not applicable because they did not consider—and
apparently did not involve—communications that could cause a person aware
of the facts to reasonably entertain a doubt that the arbitrator would be able
to be impartial, thereby imposing the requirement of disclosure. The focus in
these authorities was whether the arbitrator’s receipt of the communication
exposed him to new evidence or arguments, to which the opposing party could
not respond. (See Baker Marquart LLP v. Kantor (2018) 22 Cal.App.5th 729,
740-741 [reversing an order confirming an arbitration award, based on ex
parte confidential brief submitted to the arbitrator without notice to the
opposing party; “Under the facts of this case, we conclude Baker Marquart
had no meaningful or adequate opportunity to respond to the new claims
4 For this reason, it could be argued that the arbitration award must be
vacated for the additional reason that Grabowski’s rights “were substantially
prejudiced by [the] misconduct of a neutral arbitrator.” (§ 1286.2,
subd. (a)(3).)
17
Kantor raised for the first time in its confidential brief. This is neither fair
nor proper.”]; Maaso v. Signer (2012) 203 Cal.App.4th 362, 372 [affirming an
order vacating an arbitration award, based on an ex parte letter brief
submitted by a party arbitrator to the neutral arbitrator; “While it may be
true that Maaso had an opportunity to present all of his evidence during the
arbitration hearing, Maaso was prevented from presenting all of his
arguments to the neutral arbitrator. As the plaintiff with the burden of proof
on the issue of causation, Maaso did not have the last word because he did
not have an opportunity to rebut the arguments made in Hammond’s ex
parte letter brief.”]; A.M. Classic Construction, Inc. v. Tri-Build
Development Co. (1999) 70 Cal.App.4th 1470, 1476 [affirming an order
denying a petition to vacate, based on an ex parte communication informing
the arbitrator that he had inadvertently failed to resolve one claim; “In the
absence of a showing that the arbitrator was improperly influenced or
actually considered evidence outside the original arbitration proceedings such
that appellants needed a further opportunity to be heard on the stop notice
claim, appellants cannot demonstrate that the amended award was procured
by corruption, fraud, undue means, or misconduct of the arbitrator within the
meaning of section 1286.2, subdivisions (a), (b) or (c).”].)
Unlike these cases, the issue here is not a party’s (or a party
arbitrator’s) attempt to influence the neutral arbitrator through an ex parte
communication. Instead, the issue is the arbitrator’s own decision to engage
in an ex parte communication, revealing significant potential bias. It is not
primarily a matter of Grabowski’s inability to respond; it is the arbitrator’s
failure to disclose a potentially disqualifying matter.
The trial court also cited Cox v. Bonni (2018) 30 Cal.App.5th 287. In
Cox, there were two ex parte communications at issue: (1) a short
18
conversation between the arbitrator and defense counsel, during a different
arbitration, about scheduling for the next week; and (2) an ex parte email
from defense counsel to the arbitrator declining to seek costs in the
arbitration under section 998. (Cox, at pp. 296-297.) The plaintiff argued
that the arbitration award should be vacated based on, among other things,
the arbitrator’s failure to disclose the communications. (Id. at pp. 309-310.)
On the first ex parte communication, Cox noted that plaintiff’s counsel was
actually aware of the communication before the arbitration hearing began.
(Id. at p. 310.) By not objecting at that time, the plaintiff forfeited any
challenge to the resulting award. (Id. at p. 311.) On the second ex parte
communication, Cox noted that “ ‘not every item of information that is
required to be disclosed under section 1281.9 constitutes a “ground for
disqualification” as the term is used in section 1286.2.’ ” (Id. at p. 310,
quoting Dornbirer v. Kaiser Foundation Health Plan, Inc. (2008)
166 Cal.App.4th 831, 842 (Dornbirer).) Cox agreed that it would be “absurd”
to vacate an arbitration award “based on minor omissions of details.” (Cox, at
p. 310.) It therefore concluded that “section 1286.2 cannot be read to require
vacation of an award when an arbitrator fails to disclose an ex parte
19
communication waiving section 998 costs that did not prejudice the other
party.” (Ibid.)5
Here, unlike Cox, there is no issue of forfeiture. And the required
disclosure, of a matter that could cause a person aware of the facts to
reasonably entertain a doubt that the arbitrator would be able to be
impartial, is a ground for disqualification. (See §§ 170.1, subd. (a)(6)(A)(iii),
1281.91, subd. (d).) The prejudice to Grabowski is apparent.
In sum, the arbitrator’s ex parte communication with Kaiser’s counsel
could cause a person aware of the facts to reasonably entertain a doubt that
5 In Dornbirer, this court considered a neutral arbitrator’s disclosure
statement, which disclosed a number of prior arbitrations where the
defendant was a party, but which did not include certain information
required by statute for each arbitration, such as the dates, the prevailing
parties, the names of the attorneys, and the amount of any monetary
damages awarded. (Dornbirer, supra, 166 Cal.App.4th at p. 840; see
§ 1281.9, subd. (a)(3)-(4).) The plaintiff argued that “each and every item of
information that is required to be disclosed pursuant to section 1281.9
constitutes a ‘ground for disqualification’ ” under section 1286.2,
subd. (a)(6)(A). (Dornbirer, at p. 842.) This court disagreed. We held that
“section 1286.2 cannot be read to nullify every arbitration award that stems
from an arbitration in which the arbitrator failed to disclose all of the details
of prior arbitrations, particularly where neither party challenged the
arbitrator despite being aware that this information was not contained in the
arbitrator’s disclosure.” (Ibid.) We explained, “When a party has been
informed of the existence of a prior relationship between the arbitrator and
another party or an attorney, that party is aware of facts that would put the
party on notice of the potential for bias. If the arbitrator does not include
additional information regarding such a relationship in the disclosure, a
party has sufficient information to inquire of the arbitrator concerning that
information. It is only when the arbitrator fails to acknowledge the existence
of such a relationship that a party is without sufficient information to
question the impartiality of the arbitrator.” (Ibid.) Dornbirer does not apply
here. Among other things, Grabowski was completely unaware of the facts
that could lead to doubts about the arbitrator’s impartiality.
20
the arbitrator would be able to be impartial. The arbitrator was therefore
required to disclose the communication to Grabowski, so she could decide
whether to seek his disqualification. (§ 1281.85; Ethics Standards, std. 7(d).)
The arbitrator did not disclose the communication, and Grabowski was
unable to exercise her right. The arbitrator’s failure to disclose a ground for
disqualification requires that the arbitration award be vacated without any
further showing of prejudice. (§ 1286.2, subd. (a)(6)(A); Haworth, supra,50 Cal.4th at p. 394.) “While that rule seems harsh, it is necessary to
preserve the integrity of the arbitration process.” (Gray v. Chiu (2013)
212 Cal.App.4th 1355, 1366; accord, Honeycutt, supra, 25 Cal.App.5th at
pp. 931-932.)
DISPOSITION
The order dismissing Grabowski’s petition to vacate is reversed. On
remand, the trial court is directed to grant Grabowski’s petition, vacate the
arbitration award, and proceed pursuant to Code of Civil Procedure
section 1287. Grabowski is entitled to her costs on appeal.
GUERRERO, J.
WE CONCUR:
BENKE, Acting P. J.
DO, J.
21
Filed 5/10/21
CERTIFIED FOR PUBLICATION
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
JOANNA G. GRABOWSKI, D076968
Plaintiff and Appellant,
v. (Super. Ct. No. 37-2019-
00013115-CU-PA-CTL)
KAISER FOUNDATION HEALTH
PLAN, INC., et al., ORDER CERTIFYING
OPINION FOR PUBLICATION
Defendants and Respondents.
THE COURT:
The opinion in this case filed April 19, 2021, was not certified for
publication. It appearing the opinion meets the standards for publication
specified in California Rules of Court, rule 8.1105(c), the request pursuant to
rule 8.1120(a) for publication is GRANTED.
IT IS HEREBY CERTIFIED that the opinion meets the standards for
publication specified in California Rules of Court, rule 8.1105(c); and
ORDERED that the words "Not to Be Published in the Official Reports"
appearing on page 1 of said opinion be deleted and the opinion herein be
published in the Official Reports.
BENKE, Acting P. J.
Copies to: All parties
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