Peinado

Mat J. Rogers filed a complaint against Rene Peinado and his former attorneys, Herman A.D. Franck and Stephen Gargaro, alleging that they had maliciously prosecuted a counterclaim in a private arbitration of Rogers’s action to foreclose on a mechanic’s lien. Peinado, Franck and Gargaro demurred to the complaint, arguing that a malicious prosecution action could not be based on proceedings in a private contractual arbitration. Citing Sagonowsky v. More (1998) 64 Cal.App.4th 122 [ 75 Cal.Rptr.2d 118 ] and the language of the private arbitration agreement, the trial court concluded that Rogers could not state a cause of action for malicious prosecution and sustained the demurrer without leave to amend.

We conclude that when Rogers and Peinado contracted to resolve their disputes by arbitration and made no exception for a subsequent judicial proceeding alleging malicious prosecution, they foreclosed pursuit of a judicial remedy for malicious prosecution against one another. In the absence of a contractual provision to the contrary, the aggrieved party is limited to the contract’s remedy of private arbitration. We will therefore affirm the judgment in favor of Peinado.

We…