EQUITABLE DEFENSES AND WRITTEN FINDINGS In a further extension of an arbitrator’s powers, Gueyffier v. Ann Summers, Ltd. (2008) 43 Cal.4th 1179 holds that arbitrators do not exceed their authority when they apply equitable defenses to excuse a party from performing a material condition of an agreement that provides the arbitrator may not modify or change any of the agreement’s material provisions.

THE TIMING OF AN ARBITRATOR’S DISCLOSURE OBLIGATIONS Neutral arbitrators in contractual arbitrations are required, pursuant to Code of Civil Procedure section 1281.9, subd. (a), to disclose, within 10 calendar days of service of their proposed nomination or appointment (section 1281.9, subd. (b)), “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.”

THE FEDERAL ARBITRATION ACT AND LOCAL ARBITRATIONS The U.S. Supreme Court’s recent holding in Preston v. Ferrer (2008) 128 S.Ct. 978 that the Federal Arbitration Act (9 U.S.C. § 1 et seq.) (FAA) (fn. 1) supersedes state laws that lodge primary jurisdiction of contractual arbitration questions in judicial or administrative forums shall have a substantial impact on who decides arbitral issues in California. (The FAA rests on Congress’s authority under the Commerce Clause “for the…

THE PRELIMINARY HEARING The preliminary hearing (also known as an arbitration management conference) is an essential first step in assuring that the arbitration process proceeds smoothly. The following may be discussed at this session:

A LIMITATIONS DEFENSE IS FOR ARBITRATORS TO DECIDE Recently decided Wagner Construction Company v. Pacific Mechanical Corporation (2007) 41 Cal.4th 19 held that a statute of limitations defense in contractual arbitrations is for the arbitrator and not the court to decide. The opinion is more useful for the primer it provides on the waiver of arbitrable rights. It also threw out a one-liner that presages a further Supreme Court decision as to arbitration procedure.

Unconscionability in Employment Arbitration Clauses The Ninth Circuit’s May 14, 2007 decision in Davis v. O’Melveny & Myers, no. 04-56039, 2007 DJDAR 6741, is of interest because it provides a detailed analysis of unconscionability under California law in an employment arbitration provision; more importantly, it is one more in a line of appellate cases which affirm that the courts have no hesitancy in invalidating one-sided arbitration agreements. (See, for example, Armendariz v. Foundation Health Psychcare…

THREE EASY STEPS TO A SUCCESSFUL ARBITRATION Be familiar with the terms of the arbitration clause in the operative agreement. The location, scope, costs and possible success of the arbitration will be impacted by the existence or non-existence of language in the arbitration clause mandating where and before whom the arbitration shall be conducted;

LEGAL ERRORS IN ARBITRATION CANNOT BE REVIEWED (PART II) At the conclusion of Arbitration Insight no. 5, I observed that “The continuing moral of (recent case law, including Baize v. Eastridge Companies (2006) 142 Cal.App.4th 293) is if attorneys want to have the right to challenge an arbitrator’s application of the law, they must not only require the arbitrator to apply the law in question but also agree to judicial review of that application.” Cable…

ARBITRATION AWARD NOT REVIEWABLE FOR ERRORS OF LAW While not establishing new law, the recent decision of Baize v. Eastridge Companies (2006) No. B185823, 2006 DJDAR 11430, provides a good reminder that, absent an exception, “[a]n arbitrator’s award is not reviewable for claimed errors of law.”

ARBITRATION CLAUSE UNCONSCIONABILITY Higgins v. Superior Court (2006) 140 Cal.App.4th 1238 is a text book example of how the courts may apply Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83 guidelines for determining whether an arbitration provision is unconscionable. For ease in following Higgins, I have provided the relevant Armendariz language, without quotation marks and internal citations, concerning unconscionability: