The San Francisco County Superior Court, California, denied defendants', engineer, doctor, and medical center, motion to compel arbitration in plaintiff patients' complaint, alleging violations of the Unfair Competition Act, Cal. Bus. & Prof. Code § 17200 and the Consumer Legal Remedies Act, Cal. Civ. Code §§ 1770, 1781. Defendants appealed.

 

Overview: corporate lawyer

 

Defendants argued that the terms of the arbitration agreement expressly applied to joinder of parties such as the engineer, who were necessary for a complete settlement of the dispute. The appellate court agreed with the patients that it was not appropriate to order arbitration of the merits of the dispute with the engineer. But the patients, as parties to the agreement, could not prevent the doctor, another party to the agreement, from obtaining arbitration of the issue of whether or not the engineer's presence was relevant to a full and complete settlement of any dispute within the subject matter of the arbitration agreement. If the arbitration agreement encompassed the issue of joinder of a non-objecting third party, the patients, who agreed to that term, could not resist arbitration on the ground that the third party did not sign the agreement. The parties provided that the issue of whether the engineer could intervene or be joined in the proceeding was to be determined by the arbitrator. The engineer, by seeking arbitration, waived any objection he may have asserted and was as bound as the actual parties. The injunctive relief cases were consolidated.

 

Outcome

The denial of the motion to compel arbitration as to the engineer was reversed, as was the denial of consolidation of the cases; in all other aspects the order was affirmed.