APPEAL from an order of the Superior Court of Los Angeles County. John L. Segal, Judge. (Los Angeles County Super. Ct. No. SC113248)
The opinion of the court was delivered by: Rothschild, J.
CERTIFIED FOR PARTIAL PUBLICATION*fn1
Gohar Barsegian filed suit against attorney Warren J. Kessler and the law firm of Kessler & Kessler (collectively "the Kessler defendants"), Danny Pakravan, and 218 LLC, a limited liability company of which Pakravan was the sole member. The Kessler defendants moved to compel arbitration, but the remaining defendants did not. The trial court denied the motion to compel on grounds of waiver and the possibility of inconsistent rulings resulting from litigation with third parties, namely, Pakravan, 218 LLC, and Newman. The Kessler defendants appeal. We affirm on the basis of the possibility of inconsistent rulings resulting from litigation with third parties, and we therefore do not reach the issue of waiver.
In support of their argument for reversal, the Kessler defendants argue that because Barsegian's operative first amended complaint alleges that all defendants are agents of one another, that allegation is a binding judicial admission that gives Pakravan, 218 LLC, and Newman the right to enforce the arbitration agreement between Barsegian and the Kessler defendants. On that basis, the Kessler defendants conclude that Pakravan, 218 LLC, and Newman are not "third parties" to that arbitration agreement within the meaning of Code of Civil Procedure section 1281.2, subdivision (c).*fn2 We hold that the Kessler defendants' argument lacks merit because, in the context of this case, Barsegian's allegation that all defendants are one another's agents is not a judicial admission.
According to the allegations of the first amended complaint, in 2007 Barsegian sold property in Arizona and "began looking for replacement property to purchase for the purpose of completing a 1031 exchange." (See 26 U.S.C. § 1031.) Barsegian's then-boyfriend, Newman, introduced her to his brother-in-law, Pakravan. Pakravan was interested in selling a property in California (the Property) owned by 218 LLC.
Pakravan allegedly recommended to Barsegian that she retain the Kessler defendants to represent her in the purchase of the Property. According to the complaint, Pakravan and the Kessler defendants "had a longstanding attorney-client relationship" of which Barsegian was unaware, and the Kessler defendants "secretly represented" Pakravan in the sale of the Property at the same time that they represented Barsegian in the same matter.
In approximately April 2008, Barsegian entered into an agreement to purchase the Property for $3,781,000 and lease it back to 218 LLC. She also borrowed nearly half of the purchase price from 218 LLC.
In January 2010, 218 LLC stopped paying rent on the Property. The absence of rental income left Barsegian unable to make her loan payments to 218 LLC, which then threatened her with foreclosure.
In March 2011, Barsegian filed suit in Riverside County Superior Court against 218 LLC, Pakravan, and Newman, alleging breach of lease, fraud, and related claims. One month later, Barsegian amended her complaint to add the Kessler defendants and to allege several additional claims, including legal malpractice.
In June 2011, upon stipulation of all parties, the trial court in Riverside County transferred the action to Los Angeles County. In August 2011, the Kessler defendants demurred to all causes of action. In September 2011, the court sustained the demurrer with leave to amend.
On October 3, 2011, the Kessler defendants moved to compel arbitration pursuant to an arbitration provision contained in the engagement agreement between Barsegian and Kessler & Kessler. The Kessler defendants also sought to recover attorney fees of $4,840 incurred in moving to compel arbitration. Barsegian opposed the motion on the grounds that (1) the Kessler defendants had waived their right to compel arbitration and (2) her claims against 218 LLC, Pakravan, and Newman, arising from the same transaction, created a possibility of conflicting rulings on common issues of law or fact. (See § 1281.2, subd. (c).) Barsegian also sought to recover attorney fees of $9,100 incurred in opposing the motion.
Pakravan and 218 LLC did not move to compel arbitration. At the hearing on the Kessler defendants' motion to compel arbitration, counsel for Pakravan and 218 LLC stated that if the court granted the Kessler defendants' motion, then Pakravan and 218 LLC "would consent to arbitration." The purchase agreement and the lease, both of which are attached as exhibits to Barsegian's first amended complaint, contain arbitration provisions. (The parties initialed the ...