Crooymans v. Givner CA2/3

Filed 9/7/21 Crooymans v. Givner CA2/3
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION THREE
KATHRYN CROOYMANS et al., B305916
Plaintiffs and Appellants, Los Angeles County
Super. Ct. No.
v. 19SMCP00467
BRUCE GIVNER et al.,
Defendants and Appellants.
APPEALS from a judgment of the Superior Court of
Los Angeles County, H. Jay Ford III, Judge. Affirmed.
Fagelbaum & Heller, Philip Heller and Peter M.
DelVecchio for Plaintiffs and Appellants.
Chamberlin & Keaster, Robert W. Keaster and Allan J.
Favish for Defendants and Appellants.
_________________________
Kathryn Crooymans and David King (the King children),
in their capacities as executors of their late father’s estate, filed
an arbitration claim against their father’s tax planning attorneys,
Bruce Givner and Givner & Kaye (collectively, Givner), alleging
Givner committed legal malpractice by advising their father
to purchase a private annuity less than a year before his death.
The King children also asserted the claim in their capacities
as co-trustees of the Preston and Merle King Trust (the Trust),
alleging Givner failed to advise them about the defensibility
of their father’s estate plan and instead persuaded them to
sign documents that effectively rescinded the private annuity,
resulting in substantial tax liability. The arbitrator found Givner
liable on both theories and awarded the King children damages
“both in their individual and Trust and Estate representative
capacities,” as well as prevailing party attorney fees and costs.
The arbitrator later vacated the award and issued a new final
award increasing the attorney fee and cost amounts based on
what the arbitrator said were incorrect “calculations.”
Givner appeals the trial court’s judgment confirming the
arbitration award. He contends the award should have been
vacated because the arbitrator exceeded his powers by failing
to issue a “reasoned Award” as the arbitration provider’s rules
required. We conclude the court correctly denied Givner’s
petition to vacate.
In their cross-appeal from the judgment, the King children
challenge the trial court’s correction of the attorney fee and cost
award. The court determined that, in the absence of an evident
miscalculation, the arbitrator was not authorized to correct
the final award. We conclude the court correctly applied the
controlling law and properly corrected the award to reflect the
2
amount of attorney fees and costs provided in the arbitrator’s
original final award.
We affirm.
FACTS AND PROCEDURAL BACKGROUND
We draw the facts from the findings set forth in the final
arbitration award, which we assume are true for purposes of this
appeal. (See Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 11
(Moncharsh) [“[A] court may not review the sufficiency of the
evidence supporting an arbitrator’s award.”].)
1. Factual Background
For over 30 years, until his death in 2013, Preston King
was the manager and full owner of BIG Enterprises, Inc.,
a successful manufacturer of parking lot “boothettes.” In the
mid-1980’s, King formed a personal and professional relationship
with Bruce Givner, an estate and tax planning attorney who held
himself out as an expert on an aggressive estate tax reduction
strategy known as a private annuity. In June 2007, King entered
into an engagement agreement with Givner for tax planning
legal representation.
In 2012, around the same time King was in negotiations
to sell BIG Enterprises for over $20 million, he learned he
had Stage IV non-small cell lung cancer—a diagnosis that he
communicated to his tax planning attorney. In August 2012,
King stopped all sale negotiations for BIG Enterprises and,
in the months that followed, Givner formulated an estate plan
involving a part-gift, part-sale of the company to a newly formed
trust for King’s children. Givner proposed a private annuity
as a major component of the estate plan.
As part of the formation of the Preston King Children’s
Trust (the Children’s Trust), King was to sell 142.105 shares of
3
BIG Enterprises to the Children’s Trust in exchange for a private
annuity with an effective date of December 31, 2012. Consistent
with his client’s desire to avoid estate taxes to the extent legally
possible, Givner advised King to purchase the private annuity.
Givner, however, failed to inform King that the private annuity
would fail for tax-saving purposes if King were to die within one
year. Givner also failed to propose other tax-saving techniques
that would have provided post-death economic benefits to King’s
estate.
On May 3, 2013, Preston King succumbed to his cancer
and died. That month, the King children, in their capacities
as co-trustees of the Trust, retained Givner to provide
comprehensive legal services regarding, among other things,
estate tax and asset transfer issues.1 However, Givner did not
advise the King children about the defensibility of their father’s
estate plan. Instead, he persuaded them to sign documents
that effectively rescinded the private annuity.
1 Preston King’s and the King children’s engagement
agreements with Givner contained substantively similar
arbitration clauses, requiring binding arbitration of “[a]ll non-fee
disputes related to our agreement . . . before a retired California
Superior Court judge,” and emphasizing that by “agreeing to
arbitrate you are waiving a jury trial.” (Boldface omitted.)
The arbitration clauses also specified that “[t]he prevailing party
at the arbitration shall be entitled to attorneys’ fees, expenses
of litigation and/or arbitration, including expert witnesses, and
costs, related to obtaining and collecting any judgment and/or
arbitration award, and any other relief to which that party
may be entitled.”
4
2. Arbitration Proceedings
In 2018, the King children filed an arbitration claim
against Givner in their capacities as the executors of their late
father’s estate and the co-trustees of the Trust. They alleged
Givner breached the standard of professional care owed to
Preston King and the Trust by failing to provide proper and
effective estate planning representation with the consequence
that substantial estate taxes were incurred.
After several days of hearings, on April 25, 2019, the
arbitrator issued a final award in favor of the King children,
awarding them $654,800 “both on their own behalves and in
their capacities as Co-Trustees” of the Trust. The arbitrator
found Givner had “actual knowledge of the terminal nature of
Mr. King’s condition well before the end of 2012” and, on account
of that knowledge, Givner “owed a duty to his Client, Preston
King[,] to advise him that alternative tax-savings techniques
were not only available (and given his dire medical situation,
much more appropriate to the circumstances) so as to save
his Estate significant taxes.” The arbitrator found Givner
“breached that duty both by putting Mr. King into an
inappropriate Private Annuity and in failing to advise him
as to other tax-saving options.” Had Givner properly advised
King, the arbitrator concluded “Preston King’s Estate would
have achieved a tax savings of $654,800.”
On May 9, 2019, Givner filed a “Motion for Clarification
Regarding the Final Arbitration Award,” seeking “clarification
of the proper capacity in which the Claimants were awarded
damages in this matter.” The motion emphasized the King
children “did not pursue any claims in the arbitration in their
individual capacities” and asserted the $654,800 award related
5
entirely to legal services that Givner rendered to Preston King
before his death. Givner also argued the award did not comply
with the arbitration provider’s governing rules, specifically
Rule 34(c) of the ADR Services, Inc. Arbitration Rules (ADR
Rules), which required a “written, reasoned Award enumerating
the disposition of each claim and the relief, if any, as to each
claim.” Givner insisted clarification of the capacity issue was
key to his statute of limitations defense, which, he maintained,
the arbitrator also failed to address in the award.
On May 10, 2019, the King children filed a motion for
attorney fees and arbitration expenses, with a supporting
declaration by their lead attorney Philip Heller, requesting
an award of fees and costs totaling $2,733,866 (the initial
Heller declaration).
On May 17, 2019, the King children filed a motion to strike
Givner’s motion for clarification and, on May 31, 2019, they filed
an opposition to the motion for clarification.
On June 20, 2019, the Arbitrator issued a corrected final
arbitration award, denying the King children’s motion to strike
and granting Givner’s motion for clarification. The arbitrator
concluded Givner was entitled to have the arbitrator “set forth
with specificity the nature and extent of [his] determinations.”
The corrected award explained:
“Though not addressed in the earlier
Award, this Arbitrator finds that [Givner]
committed professional negligence not only in
[his] mishandling of the private annuity, which
Mr. Givner counseled and advised Preston King
to obtain[,] but in breaching those professional
duties owed to [the King children] following
6
their Father’s death. . . . [¶] Based thereupon
this Award is intended to be in favor of
[the King children] individually and in their
representative capacities as Trustees and
Executors acting on behalf of their Father’s
Estate and Trust.”
On July 24, 2019, the King children filed an amended
and supplemental declaration of Philip Heller in support of
their motion for attorney fees and costs (the supplemental
Heller declaration). According to Heller, as of the date of
his declaration, the King children had incurred fees and costs
totaling $3,197,876, including additional attorney fees incurred
in connection with the motion for clarification and motion to
strike.
On August 21, 2019, the arbitrator issued an updated
final award, finding the King children were the prevailing party
on the claim and awarding them attorney fees and costs totaling
$1,738,292.10. Heller’s initial and supplemental declarations
were among the documents the arbitrator said he considered
in rendering the award.
On August 27, 2019, the King children filed a motion to
correct the arbitration award with respect to the amount of
attorney fees and costs. The motion suggested the arbitrator
may have accidently used Heller’s initial declaration to calculate
the attorney fee and cost awards instead of the updated figures
stated in Heller’s supplemental declaration. With respect
to costs, the King children noted the award omitted amounts
for certain expenses and awarded only the amounts set forth
in the initial Heller declaration for others. This, in the King
children’s words, led them to “respectfully assume that the
7
omission of post-April 30, 2019 . . . expenses was an inadvertent
computational error.”2
Likewise, the King children “respectfully assume[d]” the
arbitrator “inadvertent[ly]” used the initial Heller declaration
in calculating the attorney fee award. They explained that,
by dividing the dollar amounts awarded for each attorney’s work
by the attorney’s hours stated in the initial Heller declaration,
they had deduced that the arbitrator reduced the hourly rates
requested for each attorney, but gave them credit for all the
attorney’s hours stated in the initial declaration.3
The King children’s motion requested a new award
“correcting” these supposed errors by including the omitted
expenses and applying the reduced rates to the total hours
stated in Heller’s supplemental declaration, resulting in a
total award of $2,084,378.91 for attorney fees and costs.
On September 17, 2019, the arbitrator issued another
corrected final award, explaining:
“Upon the Arbitrator’s further review of
this Matter and his Award of August 21, 2019,
2 The King children also noted the arbitrator omitted $7,500
paid to one of their experts when calculating the “aggregate sum”
of expert witness fees. Givner did not dispute that the arbitrator
had authority to correct this evident computational error.
3 For example, by dividing the dollar amount awarded
for Heller’s work by his total number of hours as stated in
his initial declaration, the King children deduced that the
arbitrator assigned Heller an hourly rate of $600 (reduced
from the $875–$950 rate requested), then applied that rate
to the total hours stated in his initial declaration (812.1 hours)
to yield an award of $487,260 for Heller’s fees.
8
it seems clear, regretfully, that the fee and cost
calculations set forth therein were incorrect in
the following two respects: [¶] 1) An incorrect
calculation of ‘Total Expert Fees’ through the
omission of $7,500 paid to John Thompson;
and [¶] 2) A reliance on Philip Heller’s Fee/Cost
Declaration filed on May 10, 2019 rather
than Mr. Heller’s Supplemental Fee/Cost
Declaration filed on July 24, 2019.”
Correcting for these stated errors, the arbitrator awarded the
King children a total of $2,025,485.91 for attorney fees and costs.4
3. Trial Court Proceedings
On September 30, 2019, the King children filed their
petition to confirm the arbitration award.
Givner opposed the petition to confirm and filed his own
petition to vacate or correct the arbitration award under Code
of Civil Procedure sections 1286.2 and 1286.6.5 He argued the
award “should be vacated because the arbitrator failed to provide
a reasoned decision as required by Rule 34c of the ADR Services,
Inc. Arbitration Rules.” In the alternative, Givner argued the
award should be corrected to reflect the amount of attorney
fees and costs specified in the August 21, 2019 award because
“the arbitrator exceeded his authority . . . by amending his prior
Final Arbitration Award . . . to add an additional $287,193.81
in attorneys’ fees and costs.” (Boldface omitted.)
4 The King children’s motion to correct included an
additional request of $58,893 for unspecified “expenses advanced
to Claimants by their counsel” that the arbitrator apparently
did not include in the new award.
5 Statutory references are to the Code of Civil Procedure.
9
The trial court denied Givner’s petition to vacate, but
granted the petition to correct the arbitration award. Consistent
with the court’s order, the King children filed a proposed
judgment confirming the arbitration award, as corrected, and
adjudging that “Petitioners Kathryn Crooymans and David King
recover from Respondents Bruce Givner and Givner & Kaye,
P.C.”
Givner objected to the proposed judgment to the extent it
purported to award the King children damages in their individual
capacities as provided in the arbitration award. Because
the King children did not bring an arbitration claim in their
individual capacities, Givner argued the arbitrator lacked
authority to award them damages in that capacity.6
6 On appeal, Givner also argues the award should have been
vacated because the arbitrator exceeded his powers by awarding
the King children damages in their individual capacity—an
argument he raised for the first time in his objection to the
proposed judgment. Unlike the subject matter jurisdiction
of a court, parties confer jurisdiction on an arbitrator by
their agreement, and a party can forfeit an objection that
the arbitrator acted in excess of his or her powers by failing to
file a petition to vacate the award on that ground. (See § 1286.4
[“The court may not vacate an award unless: [¶] (a) A petition
or response requesting that the award be vacated has been duly
served and filed.”]; § 1286 [“[T]he court shall confirm the award
as made . . . unless in accordance with this chapter it corrects
the award and confirms it as corrected, vacates the award or
dismisses the proceeding.”]; § 1287.4 [“If an award is confirmed,
judgment shall be entered in conformity therewith.”]; Abers v.
Rohrs (2013) 217 Cal.App.4th 1199, 1211 [“The trial court’s
power to vacate an arbitration award is governed by statute.”];
cf. Housing Group v. United Nat. Ins. Co. (2001) 90 Cal.App.4th
1106, 1113 [“It is well settled that parties cannot confer subject
10
The trial court overruled Givner’s objection and entered
judgment in favor of the King children.7
matter jurisdiction upon the court by consent, waiver or
estoppel.”]; see also Alexandrou v. Alexander (1974) 37
Cal.App.3d 306, 315, fn. 4 [issue raised “for the first time in
[appellant’s] objections to the proposed judgment” was forfeited
for appeal].)
National Union Fire Ins. Co. v. Stites Prof. Law Corp.
(1991) 235 Cal.App.3d 1718 is inapposite. There, the issue
was whether the respondent “could first raise the arbitrators’
purported lack of subject matter jurisdiction in the trial court.”
(Id. at p. 1723, italics added.) The National Union court did
not address the situation we confront here—namely, Givner’s
implied consent to the arbitrator’s jurisdiction by failing to
raise the issue in his petition to vacate, as required under
section 1286.4. (Cf. National Union, at p. 1724 [recognizing
trial court’s “limited” power to set aside an arbitration award
is “ ‘[s]ubject to [s]ection 1286.4.’ ”]; see also Environmental
Barrier Co. v. Slurry Systems, Inc. (7th Cir. 2008) 540 F.3d 598,
606–607 [“the right to a judicial determination of arbitrability is,
like many rights, one that can be waived”].) Because Givner’s
petition to vacate was limited to the ground that the arbitrator
failed to provide a reasoned decision, he forfeited any other
potential ground to vacate the award.
Moreover, while the fact that the King children did not
bring a claim in their individual capacities means the award
could have been corrected “without affecting the merits of the
decision upon the controversy submitted” (§ 1286.6, italics added),
Givner has also forfeited that ground by failing to assert it in
his petition to correct. (See § 1286.8 [“The court may not correct
an award unless: [¶] (a) A petition or response requesting that
the award be corrected has been duly served and filed.”].)
7 Because Givner forfeited the contention that the arbitrator
exceeded his powers by awarding the King children damages in
11
DISCUSSION
1. Governing Law
The California Arbitration Act (§ 1280 et seq.) “represents
a comprehensive statutory scheme regulating private arbitration
in this state.” (Moncharsh, supra, 3 Cal.4th at p. 9.) “The
statutes set forth procedures for the enforcement of agreements
to arbitrate (. . . §§ 1281.2–1281.95), establish rules for the
conduct of arbitration proceedings except as the parties otherwise
agree (. . . §§ 1282–1284.2), describe the circumstances in
which arbitrators’ awards may be judicially vacated, corrected,
confirmed, and enforced (. . . §§ 1285–1288.8), and specify where,
when, and how court proceedings relating to arbitration matters
shall occur (. . . §§ 1290–1294.2).” (Vandenberg v. Superior Court
(1999) 21 Cal.4th 815, 830 (Vandenberg).)
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.” Section 1286 provides: “[T]he court
shall confirm the award as made . . . unless in accordance with
this chapter it corrects the award and confirms it as corrected,
vacates the award or dismisses the proceedings.” Under section
1286.2, subdivision (a)(4), “the court shall vacate the award if the
court determines . . . [that the] arbitrators exceeded their powers
and the award cannot be corrected without affecting the merits
of the decision upon the controversy submitted.” (Italics added.)
their individual capacity (see fn. 6, ante), we deny his request
to take judicial notice of the turnover motion the King children
filed to aid in execution of the judgment. The motion is irrelevant
to the legal issues in this appeal. (See People v. Stoll (1989) 49
Cal.3d 1136, 1144, fn. 5.)
12
The circumstances under which a court may vacate
or correct a final arbitration award on the ground that the
arbitrator “exceeded their powers” are strictly limited. Most
significantly, an arbitrator does not exceed his or her powers
when he or she renders a decision that is based on errors of fact
or law. (Moncharsh, supra, 3 Cal.4th at p. 10; Advanced Micro
Devices, Inc. v. Intel Corp. (1994) 9 Cal.4th 362, 381 (AMD).)
“Limited judicial review is a well-understood feature of
private arbitration, inherent in the nature of the arbitral forum
as an informal, expeditious, and efficient alternative means of
dispute resolution. By choosing private arbitration, the parties
‘evince [their] intent to bypass the judicial system and thus avoid
potential delays at the trial and appellate levels.’ [Citation.]
Judicial interference with the arbitrator’s decision would
thus defeat the very advantages the arbitral parties sought
to achieve.” (Vandenberg, supra, 21 Cal.4th at p. 831, quoting
Moncharsh, supra, 3 Cal.4th. at p. 10.)
Thus, parties, “simply by agreeing to arbitrate, are deemed
to accept limited judicial review by implication, particularly
where their agreement specified that the award would be ‘final’
and ‘binding’ upon them. [Citation.] In effect, it is appropriate
to insulate a private arbitral award from close judicial scrutiny
because, given the inherent nature of arbitration, ‘the parties
have agreed that it be so.’ ” (Vandenberg, supra, 21 Cal.4th
at p. 831; Moncharsh, supra, 3 Cal.4th. at pp. 9–10.)
As our Supreme Court observed, “private arbitration
is a process in which parties voluntarily trade the safeguards
and formalities of court litigation for an expeditious, sometimes
roughshod means of resolving their dispute. The traditional
rule is that ‘ “[a]rbitrators, unless specifically required to act in
13
conformity with rules of law, may base their decision upon broad
principles of justice and equity, and in doing so may expressly
or impliedly reject a claim that a party might successfully have
asserted in a judicial action.” [Citations.] As early as 1852,
[our high] court recognized that, “The arbitrators are not bound
to award on principles of dry law, but may decide on principles
of equity and good conscience, and make their award ex aequo
et bono [according to what is just and good].” [Citation.] “As a
consequence, . . . ‘[p]arties who stipulate in an agreement that
controversies . . . shall be settled by arbitration, may expect
not only to reap the advantages that flow from the use of that
nontechnical, summary procedure, but also to find themselves
bound by an award reached by paths neither marked nor
traceable and not subject to judicial review.’ ” ’ ” (Vandenberg,
supra, 21 Cal.4th at pp. 831–832, quoting Moncharsh, supra,3 Cal.4th at pp. 10–11, italics omitted.)
The above principles must not be construed “to suggest an
arbitrator’s exercise of discretion in ordering relief is unrestricted
or unreviewable. Such an extreme position enjoys no support
in our statutes or cases.” (AMD, supra, 9 Cal.4th at p. 375.)
“The powers of an arbitrator derive from, and are limited by, the
agreement to arbitrate,” and awards “in excess of those powers
may, under sections 1286.2 and 1286.6, be corrected or vacated
by the court. Unless the parties ‘have conferred upon the arbiter
the unusual power of determining his own jurisdiction’ [citation],
the courts retain the ultimate authority to overturn awards as
beyond the arbitrator’s powers, whether for an unauthorized
remedy or decision on an unsubmitted issue.” (Ibid.)
However, what does follow from the considerations
discussed above is that review of whether an arbitrator exceeded
14
his or her powers cannot be de novo. (AMD, supra, 9 Cal.4th at
pp. 375–376.)8 “To the contrary, an appropriately deferential
review starts not from the beginning, but from the arbitrator’s
own rational assessment of his or her contractual powers and
is dependent on (that is, rests on acceptance of) this and any
other factual or legal determination made by the arbitrator.
The principle of arbitral finality, the practical demands of
deciding on an appropriate remedy for breach, and the prior
holdings of [our Supreme Court] all dictate that arbitrators,
unless expressly restricted by the agreement or the submission
to arbitration, have substantial discretion to determine the
scope of their contractual authority to fashion remedies, and
that judicial review of their awards must be correspondingly
narrow and deferential.” (Id. at p. 376, italics added.)
With these principles in mind, we turn to the parties’
challenges to the judgment confirming the arbitration award,
as corrected.
2. The Arbitrator Did Not Exceed His Powers Under
the ADR Rule Requiring a Reasoned Award
An arbitrator derives his or her powers from the parties’
arbitration agreement, including their agreement to the rules
that will govern the arbitration. (AMD, supra, 9 Cal.4th at
p. 375; Greenspan v. LADT, LLC (2010) 185 Cal.App.4th 1413,
1438 (Greenspan) [“the rules of a provider like JAMS may
determine the scope of the arbitrator’s powers”].)
8 We review the trial court’s order denying Givner’s petition
to vacate and granting Givner’s petition to correct de novo—not
the arbitrator’s award. (AMD, supra, 9 Cal.4th at p. 376, fn 9.)
15
In this case, the parties’ arbitration agreements did not
specify what rules would govern the arbitration. (See fn. 1, ante.)
However, in their arbitration claim the King children specified
that the ADR Rules would govern and, in a declaration in
support of Givner’s petition to vacate the award, Givner’s
attorney asserted the arbitration was conducted under and
subject to the ADR Rules. We therefore accept that the parties
agreed the ADR Rules would define the scope of the arbitrator’s
powers in this case.
Givner contends the trial court should have vacated
the arbitration award under section 1286.2, subdivision (a)(4)
because the arbitrator exceeded his powers by failing to
follow ADR Rule 34(c). The rule states in relevant part:
“The Arbitrator is required to render a written, reasoned Award
enumerating the disposition of each claim and the relief, if any,
as to each claim.” Givner contends the arbitrator’s written award
failed to satisfy the “reasoned” requirement with respect to three
issues: (1) the allocation of damages between the King children’s
different capacities; (2) Givner’s statute of limitations defense;
and (3) the reasonable hourly rate and number of hours
underlying the attorney fee award.
Consistent with the general principle of limited judicial
review, deference must be given to the arbitrator’s interpretation
of the procedural rules that the parties have chosen to govern
the arbitration. (See Greenspan, supra, 185 Cal.App.4th at
p. 1451 [unless parties have agreed arbitrator’s interpretation
of provider rules may be judicially reviewed on the merits,
the court must “defer to the arbitrator’s interpretation and
application of the Rules”]; cf. Cable Connection, Inc. v.
DIRECTV, Inc. (2008) 44 Cal.4th 1334, 1355, 1361, 1364–1365
16
& fn. 23.) As the Greenspan court explained: “ ‘[A]rbitrators,
comparatively more expert about the meaning of their own
rule[s], are comparatively better able to interpret and to
apply [them]. In the absence of any statement to the contrary
in the arbitration agreement, it is reasonable to infer that the
parties intended the agreement to reflect that understanding. . . .
And for the law to assume an expectation that aligns
(1) decisionmaker with (2) comparative expertise will help
better to secure a fair and expeditious resolution of the
underlying controversy—a goal of arbitration systems and
judicial systems alike.’ ” (Greenspan, at p. 1452, quoting
Howsam v. Dean Witter Reynolds, Inc. (2002) 537 U.S. 79, 85.)
In this case, the principle of deference to the arbitrator’s
interpretation of the meaning and scope of the arbitration
provider’s rules is especially applicable to ADR Rule 34(c).
Here, as discussed, the parties’ arbitration agreements did not
specify that a “reasoned” award would be required and, as Givner
acknowledges, the ADR Rules do not define the phrase “written,
reasoned Award.” All the parties’ arbitration agreements
required was that non-fee disputes would “be subject to binding
arbitration in L.A., before a retired California Superior Court
judge” and that judgment on the arbitrator’s award would
“be final and may be entered in any competent court.” Thus,
while we cannot conclusively say the parties had a mutual
understanding about the meaning of the phrase “written,
reasoned Award” when they agreed to use the ADR Rules,
we can reasonably infer they intended to have a retired
California Superior Court judge, like their arbitrator in this case,
resolve all procedural disputes that arose in the arbitration,
17
including those implicating the interpretation of the ADR Rules.
(See Greenspan, supra, 185 Cal.App.4th at pp. 1451–1452.)
Applying the principle of deference, our courts “have
employed two formulas to determine whether an arbitrator’s
award exceeded his or her powers. The courts have asked
whether the award rests on a ‘completely irrational’ construction
of the contract” (or, in this case, the arbitration rules), or
“whether [the award] amounts to an ‘arbitrary remaking’ of
the contract.” (AMD, supra, 9 Cal.4th at p. 376.) In other cases,
the courts have combined these tests into a single formula that
holds “a decision exceeds the arbitrator’s powers only if it is so
utterly irrational that it amounts to an arbitrary remaking of
the contract between the parties.” (Southern Cal. Rapid Transit
Dist. v. United Transportation Union (1992) 5 Cal.App.4th 416,
423 (SCRTD); Paramount Unified School Dist. v. Teachers Assn.
of Paramount (1994) 26 Cal.App.4th 1371, 1381; cf. AMD, at
p. 377.)9
9 As our Supreme Court noted in AMD, at least one Court
of Appeal has questioned whether this “ ‘completely irrational’ ”
test is sufficiently deferential to the arbitrator’s decision post-
Moncharsh. (AMD, supra, 9 Cal.4th at p. 377, fn. 10, citing Hall
v. Superior Court (1993) 18 Cal.App.4th 427, 434.) Because the
AMD case involved an arbitrator’s choice of remedies, rather than
the interpretation of the parties’ agreement, the high court did
not decide whether an arbitrator’s interpretation of a contract is
subject to review for “ ‘irrationality’ ” or “ ‘arbitrariness.’ ” (AMD,
at p. 377, fn. 10.) The AMD court reiterated only that “an award
generally may not be vacated or corrected, under California law,
for errors of fact or law.” (Ibid.) Because Givner’s argument
concerns the arbitrator’s construction of the ADR Rules, we
believe the completely irrational formulation is a “[u]seful” test
in this case. (Id. at p. 377.) In any event, were we to apply
18
The arbitrator did not state how he interpreted the
directive to provide a “written, reasoned Award enumerating the
disposition of each claim and the relief, if any, as to each claim”
in ADR Rule 34(c). We must nevertheless presume that the
award the arbitrator prepared satisfied the requirement, as he
construed it. (See City of Oakland v. United Public Employees
(1986) 179 Cal.App.3d 356, 364 [“Every intendment of validity
must be given the award and doubts must be resolved in its
favor.”].) Thus, we can hold the arbitrator exceeded his powers
under ADR Rule 34(c) only if the award implies a construction
of the reasoned award requirement that is “so utterly irrational
that it amounts to an arbitrary remaking” of the rules the
parties agreed to have govern their arbitration. (SCRTD, supra,
5 Cal.App.4th at p. 423; AMD, supra, 9 Cal.4th at pp. 376–377.)
In Cat Charter, LLC v. Schurtenberger (11th Cir. 2011)
646 F.3d 836 (Cat Charter), the Eleventh Circuit Court of
Appeals considered whether an arbitration panel exceeded
its powers because it purportedly failed to provide a “ ‘reasoned
award’ ” as agreed to by the parties. (Id. at p. 839.) In reversing
the district court’s order vacating the award, the circuit court
offered the following instructive analysis: “Determining whether
an award is reasoned first requires some context. Generally,
a formulation akin to the AMD test for whether an arbitrator
exceeded his or her powers in awarding a particular item of relief
—e.g., was the arbitrator’s award rationally drawn from the
ADR Rules as interpreted—the award here would unquestionably
satisfy the standard. (See ibid. [where question is whether
arbitrator has exceeded powers in awarding a particular item
of relief, test is whether “the remedy chosen is rationally drawn
from the contract as so interpreted” by the arbitrator].)
19
an arbitrator need not explain her decision; thus, in a typical
arbitration where no specific form of award is requested,
arbitrators may provide a ‘standard award’ and simply announce
a result. [Citation.] At the other end of the spectrum, the
Arbitration Rules allow parties to request that the arbitrators
make ‘findings of fact and conclusions of law,’ a relatively
exacting standard familiar to the federal courts. [Citation.] [¶]
Logically, the varying forms of awards may be considered along
a ‘spectrum of increasingly reasoned awards,’ with a ‘standard
award’ requiring the least explanation and ‘findings of fact and
conclusions of law’ requiring the most. [Citation.] In this light,
therefore, a ‘reasoned award is something short of findings and
conclusions but more than a simple result.’ ” (Id. at p. 844.)
In Rain CII Carbon, LLC v. ConocoPhillips Co. (5th Cir.
2012) 674 F.3d 469 (Rain), the Fifth Circuit Court of Appeals
likewise considered whether an arbitration award should have
been vacated due to the arbitrator’s alleged failure to provide
a “reasoned award.” (Id. at p. 474.) Contrasting the case with
another where the parties had requested “findings of fact and
conclusions of law, an exhaustive standard familiar to the courts”
(ibid. [distinguishing Western Employers Ins. Co. v. Jefferies
& Co. (9th Cir. 1992) 958 F.2d 258]), the Rain court observed
the parties had agreed to only “a reasoned award, without further
elaboration.” (Rain, at p. 474.) That directive, according to
Cat Charter and the circuit court’s past holding in Sarofim v.
Trust Co. of the West (5th Cir. 2006) 440 F.3d 213, 215, fn. 1,
required only something “more than a simple result.” (Rain, at
p. 474.) Because it was “doubtful that the award is not more than
a simple result,” the circuit court held “vacatur is not appropriate
and the award must be enforced.” (Ibid.)
20
The reasoning in Cat Charter and Rain is sound and
it comports with the principle of deference articulated in our
state’s precedents. It logically follows from this reasoning that,
however the arbitrator in this case construed the reasoned award
requirement in ADR Rule 34(c), as long as his award offered
an explanation that was “more than a simple result” (Rain,
supra, 674 F.3d at p. 474), the arbitrator’s interpretation of
the requirement could not have been “so utterly irrational that
it amount[ed] to an arbitrary remaking” of the rules (SCRTD,
supra, 5 Cal.App.4th at p. 423). The arbitrator gave more than
a simple result in explaining the reasons for his disposition of
the King children’s claim. On this record, we cannot conclude
the arbitrator exceeded his powers under the parties’ agreements
or ADR Rule 34(c). (SCRTD, at p. 423.)
The arbitrator’s award, as supplemented in response
to Givner’s motion for clarification, gave the following reasons
for the arbitrator’s disposition of the King children’s claim:
“Respondents herein, Bruce Givner and
Givner and Kaye breached the professional
duty owed to Preston King in establishing
Mr. King’s Estate Plan. More specifically,
[due to] his actual knowledge of the terminal
nature of Mr. King’s condition well before
the end of 2012, Bruce Givner owed a duty to
his Client, Preston King[,] to advise him that
alternative tax-savings techniques were not
only available (and given his dire medical
situation, much more appropriate to the
circumstances) so as to save his Estate
significant taxes. He breached that duty both
21
by putting Mr. King into an inappropriate
Private Annuity and in failing to advise him
as to other tax-saving options. Too, following
Preston King’s death[,] such professional
duties, based upon the attorney/client
relationship then existent, were owed to
Mr. King’s Children, Kathy Crooymans and
David King, both in their individual and
Trust and Estate representative capacities.”
“Respondents committed professional
negligence not only in their mishandling of the
private annuity, which Mr. Givner counseled
and advised Preston King to obtain[,] but in
breaching those professional duties owed to
Kathy Crooymans and David King following
their Father’s death. Specifically, such
breaches included a failure to communicate
properly with Ms. Crooymans and Mr. King
regarding the possibility of defending the
private annuity; a failure to investigate and
discuss with them the defensibility of the
subject annuity; [and] his rescission of the
annuity without either explaining alternative
courses of action or discussing the economic
consequences of such rescission.”
“Based thereupon[,] this Award is
intended to be in favor of Ms. Crooymans
and Mr. King individually and in their
representative capacities as Trustees
22
and Executors acting on behalf of their
Father’s Estate and Trust.”
Contrary to Givner’s contention, the above explanation
provides reasoning, beyond a simple result, for the arbitrator’s
allocation of damages or, more accurately, his decision not to
allocate damages among the different capacities in which the
King children asserted the claim. As the arbitrator explained,
he determined Givner’s professional duties, following Preston
King’s death, continued to be owed to the King children “both in
their individual and Trust and Estate representative capacities.”
Because he construed the King children to have a right to relief
jointly and severally with their father in their individual, trustee,
and executor capacities, the arbitrator plainly concluded no
allocation of damages was required. Whether this is a correct
understanding of our state law regarding joinder or the rendering
of a joint judgment is irrelevant. As stated in the parties’
arbitration agreements, Givner contracted for an award that
would “be final”—not one that was necessarily correct on the law.
(See Vandenberg, supra, 21 Cal.4th at p. 831; Moncharsh,
supra, 3 Cal.4th. at pp. 9–10.) All we are authorized to review
is whether the arbitrator provided a “reasoned Award,” as he
reasonably interpreted that obligation. He did.
The same is true with respect to Givner’s statute of
limitations defense. In responding to Givner’s specific charge
that the award failed to address the statute of limitations issue,
the arbitrator supplemented the award to explain that Givner’s
breach continued after Preston King’s death insofar as Givner
failed to communicate properly with the King children about
defending the private annuity and, instead, persuaded them
to rescind it. The reasonable implication of this explanation is
23
that the arbitrator concluded the statute of limitations was tolled
during the period that Givner continued to represent the King
children. Again, whether this would be a sufficient reason to
invoke tolling had the King children asserted their malpractice
claim in court is not relevant. The only matter subject to our
review on Givner’s claim of error is whether the arbitrator
provided something more than a simple result that, in his
reasonable interpretation, constituted a “reasoned Award
enumerating the disposition of each claim.” He did.
Finally, we are not convinced that ADR Rule 34(c) applies
to the arbitrator’s calculation of attorney fees, and we certainly
cannot say that it would be “utterly irrational” for the arbitrator
to construe the details of a fee calculation to lie outside the
directive. (SCRTD, supra, 5 Cal.App.4th at p. 423). By its terms,
ADR Rule 34(c) applies to “the disposition of each claim and the
relief, if any, as to each claim.” (Italics added.) The ADR rules
refer to a “claim” in various places, but nowhere do they purport
to equate prevailing party attorney fees with a claim or with
relief as to a claim. (See, e.g., ADR Rule 6 [discussing notice
of claims, counterclaims, and affirmative defenses]; ADR Rule 7
[discussing changes of claims]; ADR Rule 8 [discussing
arbitrability of a claim].)
In any event, the arbitrator awarded attorney fees well
below the amount the King children requested, and the amount
of the award plainly is not subject to judicial review either for
the sufficiency of the evidence supporting it or with respect to the
arbitrator’s assessment of the necessity or reasonableness of the
services provided during the arbitration. (See Moncharsh, supra,3 Cal.4th at pp. 11–12; Morris v. Zuckerman (1968) 69 Cal.2d
686, 691 [“ ‘Neither the merits of the controversy . . . nor the
24
sufficiency of the evidence to support the arbitrator’s award are
matters for judicial review.’ ”].) Given the principle of deference
and the arbitrator’s implicit determination that ADR Rule 34(c)
does not apply to the calculation of prevailing party attorney fees,
we cannot order vacatur of the arbitration award simply because
the arbitrator declined to explain why he awarded the King
children substantially less attorney fees than they requested.
3. The Arbitrator Exceeded His Authority to Correct
a Final Arbitration Award
The trial court concluded the arbitrator had no power
to revise the final award of August 21, 2019 to include the
additional attorney fees the King children suggested had been
omitted in their motion to correct. In their cross-appeal, the King
children argue the arbitrator corrected an evident miscalculation
appearing on the face of the August 21, 2019 final award and
the trial court thus erred in ruling the arbitrator exceeded his
authority. We conclude the court correctly applied the controlling
law.
As we have discussed, to enforce the finality of arbitration,
the arbitration statutes generally minimize judicial intervention.
(Moncharsh, supra, 3 Cal.4th. at p. 10; Cooper v. Lavely & Singer
Professional Corp. (2014) 230 Cal.App.4th 1, 11 (Cooper).)
Critically, this principle of limited intervention extends as well
to the arbitrator once a final award has been rendered. “The
arbitrator, like the court on review, is limited by statute in
correcting an award.” (Severtson v. Williams Construction Co.
(1985) 173 Cal.App.3d 86, 93 (Severtson).)
25
Section 1284 specifies and “narrowly circumscribes”
the powers of an arbitrator to correct a final award.10 (Cooper,
supra, 230 Cal.App.4th at p. 12; Elliott & Ten Eyck Partnership
v. City of Long Beach (1997) 57 Cal.App.4th 495, 501–502 (Elliott
& Ten Eyck).) Under section 1284, the arbitrator, “upon written
application of a party to the arbitration, may correct the award
upon any of the grounds set forth in subdivisions (a) and (c) of
Section 1286.6 not later than 30 days after service of a signed
copy of the award on the applicant.” Subdivisions (a) and (c) of
section 1286.6 authorize the trial court to correct an award if
it determines that “(a) There was an evident miscalculation of
figures or an evident mistake in the description of any person,
thing or property referred to in the award;” or “(c) The award
is imperfect in a matter of form, not affecting the merits of
the controversy.”
10 A final award is an award that resolves all the issues
the parties have submitted to the arbitrator. (Cooper, supra,
230 Cal.App.4th at p. 12; see § 1283.4 [arbitrators must issue
awards that “include a determination of all the questions
submitted”].) It is undisputed that the award the arbitrator
issued on August 21, 2019 was a final award.
The King children assert the purported correction was
authorized under ADR Rule 34(e), which permits correction of
“any computational, typographical or other error in an Award,”
as long as the arbitrator does not “reconsider the merits of any
claim already decided.” However, they do not contend the rule
displaces the limitations imposed under section 1284 or otherwise
empowers the arbitrator to correct an award in circumstances
that section 1284 does not permit. We therefore confine our
analysis to the governing statute.
26
As the court explained in Elliott & Ten Eyck: “It is,
apparently, an ancient rule that ‘when arbitrators have published
their award by delivering it to the parties as the award, that it
is not the subject of revision or correction by them, and that any
alteration without the consent of the parties will vitiate it.’ . . . [¶]
. . . Section 1284 codifies the rule against changes in the award.
Some amelioration from the stringency of the rule is provided
in [the] referenced provision of section 1286.6, which allows
correction of an award, but in very narrow terms.” (Elliott &
Ten Eyck, supra, 57 Cal.App.4th at pp. 501–502, fn. omitted;
Cooper, supra, 230 Cal.App.4th at pp. 13–14.)
Under the statutory grounds for correction recognized
in section 1284, “[t]he arbitrator may not reconsider the merits
of the original award and make a new award under the guise
of correction of the award.” (Landis v. Pinkertons, Inc. (2004)
122 Cal.App.4th 985, 992.) “The statutory grounds authorize
the arbitrator to correct an award after it has been issued to
the parties only regarding ‘evident miscalculations of figures
or descriptions of persons, things or property [citation] and
nonsubstantive matters of form that do not affect the merits
of the controversy.’ ” (Cooper, supra, 230 Cal.App.4th at p. 14,
quoting Century City Medical Plaza v. Sperling, Isaacs &
Eisenberg (2001) 86 Cal.App.4th 865, 877.)
The King children contend the arbitrator acted within
his authority under section 1284 to correct an “evident
miscalculation of figures” (§ 1286.6, subd. (a)) in the August 21,
2019 final award. In Severtson, the court held there are “two
elements” to satisfy this condition for correction: “There must
be a miscalculation; and, the miscalculation must be ‘evident.’ ”
(Severtson, supra, 173 Cal.App.3d at p. 93.) A miscalculation is
27
a “ ‘palpable error in computation.’ ” (Id. at p. 94.) To be evident,
a miscalculation “must appear on the face of the award [citation]
or be so readily apparent from the documentation in the case
that explanation by proofs is not necessary.” (Ibid.) “[E]vident”
as used in section 1286.6 means something that “ ‘is apparent
by an examination of the [document], needing no evidence
to make it more clear’ ”; it is a miscalculation that “ ‘is open,
palpable[,] . . . incontrovertible[,] . . . visible, plain, [and] obvious
to the understanding from an examination of the . . . document;
or, at the most, only requiring a mathematical calculation to
demonstrate it.’ ” (Id. at p. 93.)
The King children maintain the August 21, 2019 final
award “fit squarely” within the Severtson court’s “articulation
of the standard for correction of calculation errors.” They retell
their process for uncovering the purported miscalculation as
follows:
“Upon review of [the arbitrator’s] August 21,
2019 Award, it immediately became apparent
that he had used the wrong declaration
because: (1) the ADR fees and Veritext
expenses awarded were in the exact amounts
stated in the [initial Heller declaration]; and
(2) there was no indication anywhere in the
award that [the arbitrator] intended to deny
recovery for fees and costs incurred during
the period between the dates of the two
declarations. The August 21, 2019 Award’s
award of attorneys’ fees did not reflect
the figures in either the [initial Heller
declaration] or the [supplemental Heller
28
declaration], so the obvious next step
in figuring out what had happened was
to divide the amount of the fees awarded
for each attorney by the number of hours
that attorney had worked.”
Because the process of dividing the amount of fees awarded for
each attorney by the number of hours assigned to each attorney
in the initial Heller declaration yielded “round hourly rates for
each . . . attorney[ ],” the King children say “[i]t could not have
been more obvious that, in calculating his attorneys’ fee award,
[the arbitrator] had simply reduced the hourly rates sought
for each attorney, but had not reduced the hours.” They go on
to assert, “The odds against the arithmetic exercise described
above somehow coincidentally resulting in such neat, round
hourly rates for each of four attorneys, especially when all of
the hours figures involved decimals, was astronomical, removing
the calculations far from the realm of ‘assumption.’ ”
Arithmetic probabilities aside, what is clear from the
King children’s retelling of their process for uncovering the
arbitrator’s supposed mistake is that they were not confronted
with an “evident miscalculation of figures” appearing on the face
of the final arbitration award. By their own admission, what
the King children saw when they received the August 21, 2019
final award were figures for “the ADR fees and Veritext
expenses” that were “in the exact amounts stated” in the initial
Heller declaration. All that was possibly evident from these
figures was that the arbitrator had used the initial Heller
declaration as the basis for awarding these items of costs;
the notion that this was a mistake, let alone a miscalculation,
was supposition that could be confirmed only by bringing a
29
speculative motion for correction to inquire about the arbitrator’s
intention. But it is precisely this type of speculative motion,
which delays the swift and inexpensive finality that parties
bargain for when they contract for arbitration, that the evident
miscalculation requirement is meant to prevent. (See William B.
Logan & Associates v. Monogram Precision Industries, Inc. (1960)
184 Cal.App.2d 12, 17 [when there is no way to know from the
face of the award “why the arbitrator arrived at the particular
amount,” “a miscalculation is suppositional rather than evident”
and motion for correction is improper under the arbitration
statutes].)
The King children’s reliance on supposition is even more
apparent with respect to the attorney fee award. As the King
children admit, the attorney fee award was less than the figures
in either the initial Heller declaration or the supplemental
declaration. Thus, they say they were prompted to reconstruct
the arbitrator’s process for calculating the fee award because,
in their minds, “there was no indication anywhere in the award
that [the arbitrator] intended to deny recovery for fees and
costs incurred during the period between the dates of the two
declarations.” But that supposition merely begged the question.
Accepting their characterization of the “astronomical” odds
against coincidentally arriving at “such neat, round hourly rates
for each of four attorneys,” all the King children’s “arithmetic
exercise” showed was that the arbitrator had in fact awarded
attorney fees only for the work performed up to the date of
Heller’s initial declaration (albeit at reduced rates as well).
It plainly was within the arbitrator’s authority to deny recovery
for fees incurred during the arbitration, and the King children
have never disputed as much. (See Moshonov v. Walsh (2000)
30
22 Cal.4th 771, 774–775.) They nonetheless assumed the
conclusion that needed to be evident before they brought
their motion to correct—namely, that the arbitrator made
a miscalculation in denying certain fees—when the opposite
conclusion appeared to be just as, if not more likely from
the face of the final award.11
Lopes v. Millsap (1992) 6 Cal.App.4th 1679, the case upon
which the King children principally rely, brings the problem
with their speculative motion into sharper focus. In Lopes, the
parties agreed to sell a parcel of real property and divide the
net proceeds as determined by an arbitrator. (Id. at pp. 1682–
1683.) The arbitrator awarded the appellant $93,199.24 and the
two respondents $25,056.05 each from the sale proceeds. (Id. at
p. 1683.) Upon review of the award, the respondents’ attorney
sent a letter to the arbitrator noting “the ‘amounts’ to be divided
by the award ‘only equal[ed] the current balance contained in
[the appellant’s attorney’s] trust account, as opposed to the true
proceeds of sale, which [were] over $30,000.00 more.’ ” (Ibid.)
After reviewing the letter, the arbitrator corrected his
“ ‘computation error’ ” which “ ‘did not accurately reflect
the division of the sale proceeds’ [that] he ‘intended.’ ” (Id.
11 As discussed, in his August 21, 2019 final award,
the arbitrator denied the King children’s motion to strike
and granted Givner’s motion for clarification, ruling Givner
was “entitled to have [the arbitrator] set forth with specificity
the nature and extent of those determinations.” Thus, contrary
to the King children’s assertion, there was some indication in
the final award that the arbitrator may have intended to deny
the attorney fees and costs set forth in the supplemental Heller
declaration, which contained the updated figures related to
the motion for clarification and motion to strike.
31
at p. 1684.) The trial court confirmed the award as corrected
and the reviewing court affirmed. (Id. at pp. 1684–1687.) In
view of the over $30,000 shortfall, there was no question from
the face of the award that the arbitrator had made some “error
in calculations” when dividing the net sale proceeds. (Id. at
p. 1686.) That was not the case here, where the face of the
August 21, 2019 final award plainly admitted of the possibility
that the arbitrator had simply denied the recovery of certain
fees based on legal or factual determinations.
Because the arbitrator confirmed that he did in fact
make a mistake by relying on the initial Heller declaration,
the King children argue nothing was improper about their
motion to correct. Again, this argument, in effect, begs the
question. The motion to correct and subsequent amendment
to the arbitration award was proper only if a miscalculation
was evident on the face of the final award. The fact that
the arbitrator later confirmed what was not evident before
he provided confirmation does not retroactively justify the
motion to correct. Regardless of whether the arbitrator
failed to award the additional attorney fees set forth in the
supplemental Heller declaration by “mistake, ‘ “. . . the omission
was in effect a disallowance of those items.” ’ ” (Severtson,
supra, 173 Cal.App.3d at p. 95, quoting Sapp v. Barenfeld
(1949) 34 Cal.2d 515, 523–524.)
The King children will no doubt be dissatisfied with this
outcome, seeing it as an elevation of form over substance. And,
to be sure, reviewing courts have used a similar justification to
recognize a nonstatutory basis for correction where an arbitrator
amends a final award to include rulings on an omitted issue.
(See A.M. Classic Construction, Inc. v. Tri-Build Development Co.
32
(1999) 70 Cal.App.4th 1470, 1478 (A.M. Classic).)12 However,
under the circumstances we confront here, arguments about what
constitutes “form” and what constitutes “substance” do not justify
a rewriting of the governing arbitration statutes. While the
policy of “ ‘indulg[ing] every reasonable intendment to give effect
to arbitration proceedings’ ” may warrant a departure from
“ancient” strictures in some circumstances (ibid.), that policy
necessarily must yield to the fundamental directive to give effect
to the parties’ “expectation of finality” when those demands come
into conflict, as they do here. (Moncharsh, supra, 3 Cal.4th at
p. 10.)
There was no “evident miscalculation of figures” in the final
arbitration award with respect to the attorney fees and certain
cost items, and, as such, the King children had no warrant to
bring a motion to correct these items (even if their supposition
12 In adopting the nonstatutory amendment doctrine
regarding omitted issues, the A.M. Classic court explained:
“It has been suggested that an ancient rule requires the award
to be vacated under the circumstances we face here. [Citation.]
The cases holding that an incomplete award is a nullity and must
be vacated were generally decided before California’s Arbitration
Act was enacted. They pre-date public policy expressions of
the Supreme Court and numerous appellate courts favoring
arbitration and instructing us to ‘indulge every reasonable
intendment to give effect to arbitration proceedings.’ [Citations.]
Moreover, it would be irrational to discard all the time and
money spent by the parties where an arbitration award is
inadvertently incomplete in one respect and where the oversight
can be corrected without substantial prejudice to the legitimate
interests of a party. To deny arbitrators the authority to
complete their task under such circumstances elevates form
over substance.” (A.M. Classic, supra, 70 Cal.App.4th at p. 1478.)
33
about the arbitrator’s mistake ultimately proved correct).
Enforcing the rules limiting an arbitrator’s power to correct
a final award, as the Legislature has prescribed them, will
discourage future litigants from bringing motions to correct
unless a miscalculation is in fact evident. This, in turn,
will better guarantee all parties obtain the swift, relatively
inexpensive final resolution of their disputes that they
bargain for when they contract for arbitration. (See Moncharsh,
supra, 3 Cal.4th. at p. 10; Vandenberg, supra, 21 Cal.4th at
p. 831.)
34
DISPOSITION
The judgment is affirmed. The parties shall bear their own
costs.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
EGERTON, J.
We concur:
LAVIN, Acting P. J.
KALRA, J.

Judge of the Los Angeles County Superior Court, assigned
by the Chief Justice pursuant to article VI, section 6 of the
California Constitution.
35