Arbitration: $66,375 Fee Award In A Convoluted Arbitration Battle Over “Consumer Arbitration” Rights Issue Affirmed On Appeal

4/3 DCA Determines That Interim Fights On Arbitration Threshold Issues Gave A Basis For Fees.

            This next one, Just a Fluke, Inc. v. Litalien, Case No. G058535 (4^th Dist., Div. 3 Mar. 23, 2021) (unpublished), while convoluted, still shows that potentially arbitrating parties need to make sure they are not going to litigate and not prevail on threshold issues of a clearly discernible nature in a separate court action relating to an upcoming arbitration.  If you do, and win --you get fees; if you lose, you lose.  Plaintiff suffered a dismissal of a declaratory relief action seeking a declaration that an arbitration between plaintiff and defendants was not a “consumer arbitration.”  Plaintiff argued the lower court’s award of $66,375 in attorney’s fees was premature because the underlying construction defect dispute had yet to be arbitrated.  The 4/3 DCA, in a 3-0 opinion authored by Justice Thompson, affirmed the fee award.  In rejecting the prematurity argument, the appellate court determined that the sole “consumer arbitration” issue—the sole one in the action—had been finally resolved against plaintiff so as to authorize a fee recovery.  (Cf.  Turner v. Schultz, 175 Cal.App.4^th 974, 983, 985 (2009).)  However, not all was lost—if plaintiff prevails in the separate arbitration, it might be able to recover fees in that separate proceeding.  The fee award here was no fluke!  (Groan—very punny!)