UNITED HEALTH CENTERS OF THE SAN JOAQUIN VALLEY, INC. Petitioner,
THE SUPERIOR COURT OF FRESNO COUNTY, Respondent; JENNIFER VRADENBURG-HAWORTH, Real Party in Interest.
ORIGINAL PROCEEDINGS; petition for writ of mandate, No. 11CECG02953 Mark W. Snauffer, Judge.
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Motschiedler, Michaelides, Wishon, Brewer and Ryan and Russell K. Ryan for Petitioner.
No appearance for Respondent.
Michael J.F. Smith and John L. Migliazzo for Real Party in Interest.
GOMES, ACTING P. J.
The trial court vacated an arbitration award issued in favor of defendant United Health Centers of the San Joaquin Valley, Inc. (UHC) in a wrongful termination case brought against it by its former employee, plaintiff Jennifer Vradenburg-Haworth. The basis of the trial court’s action was that the neutral arbitrator failed to comply with the mandatory disclosure requirements of Code of Civil Procedure section 1281.9 and the ethics standards for arbitrators. Although UHC presented evidence from which the trial court could find that Vradenburg-Haworth’s counsel forfeited the right to seek to have the award vacated on this basis, as that principle is explained in Dornbirer v. Kaiser Foundation Health Plan, Inc. (2008) 166 Cal.App.4th 831 [83 Cal.Rptr.3d 116] (Dornbirer), the trial court determined that, pursuant to section 1281.85, subdivision (c) (hereafter section 1281.85(c)), an arbitrator’s mandatory disclosure obligations cannot be waived, and refused to consider Dornbirer. The question before us is whether the forfeiture principles stated in Dornbirer remain viable after the enactment of section 1281.85(c). We conclude that they do. Accordingly, we grant UHC’s petition for writ of mandate and reverse the trial court’s order vacating the arbitration award.
FACTUAL AND PROCEDURAL BACKGROUND
UHC hired Jennifer Vradenburg-Haworth as a part-time physician in 2005. After UHC terminated her employment in September 2010, she filed an action against UHC for retaliation and wrongful termination in violation of public policy. UHC moved to compel arbitration pursuant to an arbitration provision in Vradenburg-Haworth’s employment contract. The trial court granted the motion on April 10, 2012.
UHC’s counsel, Russell K. Ryan, recommended to Vradenburg-Haworth’s counsel, Michael J.F. Smith, that they select either Retired Judge Howard Broadman or Retired Justice Nickolas Dibiaso as the arbitrator. Ryan further advised Smith that he had used both arbitrators on a number of occasions and asked Smith to let him know if he would agree to either one, or if he proposed an alternative. Eventually, Smith agreed to have Judge Broadman
arbitrate the case, and a stipulation and order was filed in which the parties agreed to refer the matter to him.
The arbitration hearing was held before Judge Broadman from October 15 to October 18. The parties submitted post-arbitration briefs. On December 15, Judge Broadman issued written findings and judgment in UHC’s favor. Judge Broadman found that UHC terminated Vradenburg-Haworth’s position due to the company’s financial distress, the impracticality of employing part-time physicians, and personnel issues within the clinic where she worked, and her termination was proper because she was an at-will employee. He found there was no basis for her claims of retaliation and wrongful termination in violation of public policy.
UHC filed a petition to confirm the arbitration award on January 4, 2013. In response, Vradenburg-Haworth asked the trial court to vacate the arbitration award pursuant to section 1285.2, on the ground that Judge Broadman failed to comply with the mandatory disclosure requirements of sections 1281.9 and 1281.85. She also asked the trial court to vacate the award pursuant to section 1286.2, subdivision (a)(4), on the ground Judge Broadman exceeded his powers when he made clear legal errors in his decision.
In Smith’s declaration in support of the request to vacate, he stated that before selecting Judge Broadman as the arbitrator, he knew Judge Broadman “as a mediator” and Judge Broadman “was once agreed upon as an arbitrator in another case” which settled without a hearing. Smith declared that after Judge Broadman’s appointment on May 17, he did not receive any disclosure from him as required by sections 1281.9 et seq. Smith trusted Judge Broadman because of his experience as a judge and “our experience using him as a mediator.” Smith further declared: “We have used him as a mediator, occasionally. When I did not receive any CCP 1281.9 disclosure from him, I trusted that this meant he had nothing to disclose.”
Smith explained that after he received Judge Broadman’s award, he felt his client was not given a fair hearing. He then “went looking for any disclosure from Mr. Broadman. None existed in our file. We have a very diligent file maintenance clerk in our office, who keeps all correspondence in all our cases filed carefully. She searched as well. [Smith’s associate] Mr. [John] Migliazzo, who has worked on this case from its beginning, also searched. No such letter was received in our office.” Neither Smith nor Migliazzo found any disclosure from Judge Broadman, or his office, in their e-mail inboxes, and no faxed disclosure was received in the office.
Migliazzo asked Judge Broadman, in a December 28 letter and e-mail, for a complete disclosure of any prior engagements Judge Broadman may have
had with UHC or Ryan, as Smith’s office had not received a disclosure. As of January 8, 2013, Smith and Migliazzo had not received a disclosure letter from Judge Broadman. They did have an e-mail exchange with him, in which Judge Broadman asked if they wanted a conference call, but Smith responded that he only wanted a complete and accurate disclosure.
After receiving copies of Smith’s and Migliazzo’s correspondence to Judge Broadman, Ryan sent Smith and Judge Broadman an e-mail advising that Judge Broadman submitted a disclosure form in a June 28 letter, which Ryan supplemented with a July 9 letter, both of which were submitted to Smith’s office. Ryan attached copies of both letters to the e-mail. Ryan also advised that during the two years before Judge Broadman’s appointment as arbitrator in this case, Judge Broadman served as a mediator in two cases in which Ryan was involved, and more than two years before, both Smith and he had selected Judge Broadman as a mediator in another case, and Judge Broadman served as a special master in consolidated cases in which Ryan represented one of the parties.
Judge Broadman’s three page letter of June 28, which is addressed to both Smith and Ryan, was characterized as a disclosure statement intended to comply with sections 170.1 and 1281.9, the disclosure requirements for arbitrators mandated by Standard 7 of California Rules of Court, Ethics Standards for Neutral Arbitrators in Contractual Arbitration and any other statutes, rules and standards that may require disclosures or disqualifications by arbitrators in proceedings such as the one at issue. Judge Broadman stated that he had not served as an arbiter in any matters involving Smith or his office, or either of the parties. He had, however, served as an arbiter in two matters involving Ryan or his law firm. For these two matters, Judge Broadman identified the case name, the attorney for each plaintiff and defendant, and the outcome, i.e., whether he ruled in favor of the plaintiff or defendant. For one matter, Judge Broadman stated the date was “[n]ot recorded, ” but the other matter took place in July 2007. Ryan’s law firm represented the prevailing party in each arbitration. The disclosures did not include the amount of monetary damages awarded as required by section 1281.9; instead, Judge Broadman explained he does not disclose the exact amount of any awards due to his “perceived duty to maintain confidentiality, ” and invited the attorneys to contact either or both sides of the dispute for that information.
Due to a “previous failure on [his] part to maintain appropriate records, ” Judge Broadman asked the parties to advise him if they knew of any cases in which he had served as an arbitrator so he could amend the disclosure. He also stated the disclosure did not include mediations which may have been conducted with the parties’ attorneys because his “system” did not “easily
afford this information[.]” He was willing, however, to try to locate the mediated cases if either party requested a complete disclosure of them; if no request was made any further disclosure was waived. The letter further advised that although Judge Broadman did not have current arrangements with any party concerning prospective employment, he would entertain offers from the parties and their counsel while the arbitration was pending for employment as a dispute resolution neutral in other cases. He was not ...