American Arbitration Assn. v. Superior Court

The issue before us is whether the arbitral immunity granted by section 1280.1 of the Code of Civil Procedure extends to the American Arbitration Association (AAA). We hold that it does.

Facts

Patricia Carpentier Morgan and James Vandervoort disagreed about the terms of a lease and Vandervoort initiated arbitration proceedings before the AAA. Vandervoort did not diligently prosecute the arbitration and the AAA gave notice that unless a response was received by February 25, 1991, the matter would be closed, with prejudice. Although no timely response was received, the AAA reopened the case. In August 1991, Morgan sued the AAA for damages and declaratory relief, alleging it should have stuck to its decision to close the case. The AAA demurred, claiming arbitral immunity under section 1280.1. The trial court overruled the demurrer and the AAA filed a petition for writ of mandate. We requested and received opposition (Palma v. U.S. Industrial Fasteners, Inc. (1984) 36 Cal.3d 171, 180 [ 203 Cal.Rptr. 626 , 681 P.2d 893 ]) and, for the reasons we now explain, we issue a peremptory writ.

Discussion

Simply stated, a grant of immunity to an individual arbitrator is illusory…