In Cooper v. Lavely Singer Professional Corp., 2014 DJDAR 13272, the California Court of Appeal for the Second Appellate District ruled that a post‑hearing substantive “correction” of a “Final Award” of attorney fees awarded by an arbitrator was inappropriate.
Jeffrey Cooper (“Cooper”) hired a law firm (“law firm”) to represent him in a fraud case. The case was submitted to arbitration and the arbitrator ruled against Cooper. Cooper then commenced an arbitration with JAMS against the law firm, alleging attorney negligence and malpractice. The law firm represented itself in the arbitration. Following a hearing, the arbitrator found that the law firm was the prevailing party and permitted the law firm to submit a motion for attorney fees. The arbitrator then issued a “Final Award” but denied the request for attorney fees in total. Thereafter, the law firm moved for “correction” of the award, arguing that the arbitrator had the discretion to “correct the award” in the “interest of justice.” Based on new paperwork and evidence that was submitted by the law firm, the arbitrator made a revised award granting an award of attorney fees.
The court of appeal reversed the decision and actions of the arbitrator. The court of appeal noted that under CCP§ 1284, an arbitrator has the power to “correct” a final arbitration award only if the correction is for “miscalculation of figures” or “nonsubstantive matters of form” that have no impact on the substantive merits of the arbitration. The court of appeal specifically concluded that an arbitrator is prohibited from substantively amending the final award to include new awards of damages or attorney fees. The court of appeal concluded that the arbitrator’s award of attorney fees in the revised final award was not a “correction” as defined by CCP§ 1284. The court of appeal concluded that the trial court erred in denying Cooper’s petition to vacate the attorney fee award on that basis.