More arbitration surprises in California!

No, this isn't becoming an arbitration blog, but the threat of arbitration directly impacts the value of litigation and negotiating the price of a release from litigation is what I spend my days helping attorneys negotiate.  So this news from the Second District Court of Appeal (controlling Los Angeles trial court decisions) is yet another shot across the bow of arbitration's efficiency for the resolution of disputes (and did I mention how much better mediation is?  No?  Well, later on that).  An excerpt from the Los Angeles Daily Journal and a link for paying subscribers below:

A California appellate court on Monday upheld a lower court's decision to throw out a $1.5 million arbitration award in a Ventura County property dispute - a decision that some observers said could lead to increased judicial review of arbitration and larger legal bills for litigants.

"As far as I know, it's the first time the Court of Appeal has reversed an arbitration award," said Lisa J. Perrochet, a partner at Horvitz & Levy in Encino, who, along with John A. Taylor Jr., represented land-seller Martha Martinez Spencer.

A 2-1 decision of the 2nd District Court of Appeal determined that JAMS' David D. Perez erred by preventing Spencer from showing that a title company solved the land encroachment problem of a couple that bought a property from Spencer in 2004. Burlage v. Superior Court [.pdf] . . .

The court's decision will do much to dispel the "urban legend" that arbitration awards are bulletproof on appeal, Perrochet said.

But Wendy C. Lascher of the Ventura-based Lascher & Lascher, who represented Ronald and Cheryl Burlage, the couple who sued Spencer, said the court's decision "will do away with many of the advantages arbitration is supposed to have."

Daily Journal subscribers can read more here.  My brief of this case appears here.