Engalla

*960 Opinion

In this case we consider the circumstances under which a court may deny a petition to compel arbitration because of the petitioner’s fraud in inducing the arbitration agreement or waiver of the arbitration agreement. Plaintiffs are family members and representatives of the estate of Wilfredo Engalla (hereafter sometimes the Engallas). Engalla was enrolled, through his place of employment, in a health plan operated by the Permanente Medical Group, Inc., Kaiser Foundation Hospitals, and the Kaiser Foundation Health Plan (hereafter Kaiser).

Prior to his death, Engalla was engaged in a medical malpractice dispute with Kaiser, which, according to the terms of Kaiser’s “Group Medical and Hospital Services Agreement” (Service Agreement), was submitted to arbitration. After attempting unsuccessfully to conclude the arbitration prior to Engalla’s death, the Engallas filed a malpractice action against Kaiser in superior court, and Kaiser filed a petition to compel arbitration pursuant to Code of Civil Procedure section 1281.2. 1 In opposing the petition, plaintiffs claimed that Kaiser’s self-administered arbitration system was corrupt or biased in a number of respects, that…

I concur in the majority opinion. I write separately to note that this case illustrates yet again the essential role of the courts in ensuring that the arbitration system delivers not only speed and economy but also fundamental fairness.

Unfairness in arbitration sufficiently extreme to justify court intervention can take many forms. As I have previously stated, in my view courts have the power to overturn an arbitrator’s decision if it contains manifest error that causes substantial injustice. (Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 36-40 [ 10 Cal.Rptr.2d 183 , 832 P.2d 899 ] (dis. opn. of Kennard, J.).) It is also my view that arbitrators are limited to the same remedies that a court could award under the circumstances of the case, and that a court may overturn an arbitrator’s award of relief that exceeds that limit. (Advanced Micro Devices, Inc. v. Intel Corp. (1994) 9 Cal.4th 362, 394-395, 400-401 [ 36 Cal.Rptr.2d 581 , 885 P.2d 994 ] (dis. opn. of Kennard, J.).)

*987 This case illustrates the role that courts play in maintaining the procedural fairness, as well as the substantive fairness, of arbitration proceedings. Procedural manipulations can be used by a party…

The intended target of the majority’s wrath—the Permanente Medical Group, Inc., Kaiser Foundation Hospitals, and the Kaiser Foundation Health Plan (hereafter Kaiser)—could not be more deserving. I write separately to represent the interests of the unintended victim of the majority’s holding—private arbitration in California.

I. Introduction

Pursuant to the terms of a prior written agreement, the parties in this case submitted a medical malpractice dispute to private, or nonjudicial, arbitration. California law, like corresponding federal law under the United States Arbitration Act ( 9 U.S.C. §§ 1-16 ), has long reflected a strong policy in favor of such arbitration.

As this court recently explained, “Title 9 of the Code of Civil Procedure,[ 1 ] as enacted and periodically amended by the Legislature, represents a comprehensive statutory scheme regulating private arbitration in this state. (§ 1280 et seq.) Through this detailed statutory scheme, the Legislature has expressed a ‘strong public policy in favor of arbitration as a speedy and relatively inexpensive means of dispute resolution.’ [Citations.] Consequently, courts will ‘ “indulge every intendment to give effect to such…