Filed 11/3/14 Shea Homes Ltd. v. Loeffler CA4/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not 

certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been 

certified for publication or ordered published for purposes of rule 8.1115. 

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION THREE

SHEA HOMES LIMITED 

PARTNERSHIP,

 Plaintiff and Respondent,

v.

JENNIFER LOEFFLER,

 Defendant and Appellant.

 G049358

 (Super. Ct. No. 30-2012-00578921)

 O P I N I O N

Appeal from a judgment of the Superior Court of Orange County, Franz E. 

Miller, Judge. Motion for Sanctions. Motion Denied. Judgment affirmed.

Steven L. Rader for Defendant and Appellant.

Palumbo Bergstrom, Julia Bergstrom and Scott M. Halberstadt for Plaintiff 

and Respondent.

* * *
2

Defendant Jennifer Loeffler appeals from a judgment entered after the trial 

court confirmed an arbitration award in favor of plaintiff Shea Homes Limited 

Partnership. 

Defendant raises several arguments: there was insufficient evidence she 

agreed to arbitrate; the arbitration agreement was unconscionable; she did not waive her 

objections to the arbitration agreement or to the award itself; the arbitrator exceeded his 

powers by not correctly determining her claim under the California Fair Employment and 

Housing Act (Gov. Code, § 12900 et seq.; FEHA); the written award did not satisfy the 

FEHA requirements; the trial court did not sufficiently review the award to determine 

whether the arbitrator complied with FEHA; she did not get a hearing on the merits; and 

finally, the arbitrator did not make sufficient disclosures to ensure belief in his 

impartiality. 

Plaintiff filed a motion for sanctions, claiming the appeal is frivolous.

We find no error and affirm the judgment. We also deny the motion 

because the appeal was not frivolous.

FACTS

1

AND PROCEDURAL HISTORY

In May 2011 the parties executed a Purchase and Sale Agreement and Joint 

Escrow Instructions (Agreement) for defendant’s purchase of a home in Aliso Viejo 

(Property) from plaintiff for $714,900. Escrow closed in July. 

The Agreement contained an alternate dispute resolution (ADR) provision, 

that included procedures for arbitration. One section provided: “POST-CLOSING 

DISPUTE RESOLUTION AND LIMITATION OF REMEDIES: Any disputes between 

Buyer and Seller arising after Close of Escrow, regardless of whether any aspect of the 

 

1

 The facts are taken primarily from the Award and the Statement of Decision. 

The Award provides that if its statement of facts conflicts with those proffered by a party 

it is because of the arbitrator’s assessment of credibility and weight of the evidence 

presented.
3

dispute arises from any act or omission committed or omitted prior to Close of Escrow, 

relating to or arising out of this Agreement, or to the use, condition, operation, design, 

surveying, grading, development, construction or installation of the Property and any 

improvements, landscaping or personal property located thereon, shall be resolved in 

accordance with this Section 23 and the procedures set forth in the Title 7 Master 

Declaration. The provisions of this Section 23 shall survive Close of Escrow. . . . [¶] . . .

[¶] . . . If the Formal Claim Process [an alternative non-adversarial procedure as 

authorized by Civil Code section 914] does not result in a resolution of the dispute/action 

or if the dispute/action is not subject to the Formal Claim Process, the dispute/action shall 

be resolved through the Binding Dispute Resolution Procedures set forth in Section 23.4. 

Buyer, by initialing below, acknowledges that Buyer has received this notice.” 

Defendant’s initials are directly below this provision. 

The Binding Dispute Resolution Procedures in section 23.4 explain that the 

procedures are set out in Exhibit 7 to the Title 7 Master Declaration. Directly below that 

section, the following is set out: “THE BINDING DISPUTE RESOLUTION 

PROCEDURES DO NOT INVOLVE A JURY AND BUYER AND SELLER HEREBY 

EXPRESSLY WAIVE ANY RIGHT TO A JURY.” Defendant’s initials are right below 

this sentence. 

At the end of the Agreement it states that the Title 7 Master Declaration, 

defined as an “Additional Document,” is attached as Exhibit C. On the same page, just a 

few lines below, defendant signed the Agreement. 

Exhibit C follows within six pages of the main portion of the Agreement. 

As shown on its title page, the eight-page document is entitled “Master Declaration for 

Title 7 & Dispute Resolution” (capitalization omitted; Master Declaration). It states it “is 

being provided to Buyer concurrently with this [Agreement].” The document was 

recorded in September 2007. 
4

The Master Declaration provides procedures for the Formal Claim Process 

and, if that does not resolve the dispute, for Binding Dispute Resolution. The procedures 

for Binding Dispute Resolution are explained in Exhibit 7 to the Master Declaration. 

The Binding Dispute Resolution Procedures set out the nature of the 

disputes subject to the process, the parties subject to the procedures, a requirement for 

mediation prior to arbitration, and the final remedy of arbitration. 

The specifics of the arbitration process are also detailed in the document. 

The arbitration is to be governed by the Federal Arbitration Act (9 U.S.C. § 1; FAA) and 

conducted by JAMS. It provides for limited discovery. Plaintiff is required to advance 

costs but final costs are to be allocated by the arbitrator after the hearing. The parties are 

to bear their own attorney fees. The arbitrator is required to issue a written statement of 

decision and the decision is to be binding. 

The final page of Exhibit 7 states the following, in all caps and bold: 

“Notice: . . . [B]y taking title to the property, homeowner/association is 

agreeing to have any dispute arising out of the matters included in these Binding Dispute 

Resolution Procedures decided by neutral arbitration as provided by the [FAA] and 

homeowner/association is giving up any rights homeowner/association might possess to 

have the dispute litigated in a court or jury trial[, and] to discovery and appeal, unless 

those rights are specifically included in these Binding Dispute Resolution Procedures 

provision. . . . Homeowner/association’s agreement to this arbitration provision is 

voluntary.” There is no other text on this page.

In addition to those documents, plaintiff provided a “Notice of NonAdversarial Procedure and Individual Declaration of Covenants for Title 7 & Dispute 

Resolution” (capitalization omitted; Individual Declaration), making the Master 

Declaration applicable not only to the development but also to defendant’s real property. 

Defendant initialed a provision stating she knew of and had received a copy of the Master 

Declaration and knew the Formal Claim Process affected her legal rights. The Individual 
5

Declaration required the parties to abide by the Formal Claim Process and Binding 

Dispute Resolution Procedures in the Master Declaration. Defendant signed this 

document. 

The Agreement required defendant to landscape her side yard. Plaintiff 

declined her request it undertake that as part of the sale of the Property. Later, at 

defendant’s request, plaintiff provided her with the names of three landscapers. 

Defendant selected the company landscaping her neighbor’s yard. After disputes arose 

and defendant requested plaintiff mediate the disputes, defendant and the landscapers 

terminated any relationship. 

Shortly after she moved into the home, defendant made a number of

complaints of defects. Plaintiff corrected more than 20 items, including claims not under 

warranty. It never refused to respond to a warranty claim. Plaintiff’s expert witness in 

the arbitration testified most of defendant’s complaints had no merit. Defendant 

proffered no credible rebuttal evidence on this issue. 

Defendant began the ADR process when she served a Notice of Claim 

pursuant to the Agreement and the recorded covenants, conditions, and restrictions 

(CC&R’s). She maintained plaintiff had induced her to enter into a contract with a 

landscape contractor and/or had interfered with that contract and had violated FEHA. 

She also alleged there were construction defects. 

After an unsuccessful mediation, defendant filed a demand for arbitration, 

claiming plaintiff was required to install landscape and correct alleged warranty 

problems. She also sought property damages and damages for loss of use of the property, 

retaliation, discrimination, and emotional distress. JAMS appointed an arbitrator, Retired 

Superior Court Judge Jonathon Cannon, after the parties could not jointly select one. 

Because the parties did not agree as to the scope of the arbitration, they submitted briefs 

to the arbitrator for his decision. Defendant argued plaintiff should be required to pay all 
6

costs of arbitration and claimed the arbitration provision would be unconscionable if it 

was interpreted to require her to pay any costs other than her court filing fee. 

Thereafter, defendant asserted additional construction defects and 

demanded further mediation. When that proved unsuccessful those claims were added to 

the arbitration. 

Before the arbitration hearing began, defendant served a notice of 

rescission, offering to restore title to the Property in exchange for almost $848,000.

Plaintiff accepted the offer to rescind, reserving the right to litigate the amount necessary 

to restore defendant to her original position. 

At the arbitration, direct testimony was submitted via declaration and at the 

hearing the parties conducted cross-examination of the declarants. After the original 

hearing and further briefing as to rescission, the parties presented closing arguments. At 

that hearing, defendant argued her FEHA claim was separate and she was entitled to 

emotional distress and punitive damages and attorney fees. After taking that claim under 

submission, the arbitrator ultimately awarded defendant just under $750,000, comprised 

of the purchase price and sums defendant spent for property insurance, homeowner 

association dues, property inspection and improvements she made to the Property

(Award). 

After several iterations of escrow instructions to implement the rescission, 

the parties finally agreed plaintiff would pay the sum awarded before defendant vacated 

the Property so defendant would have time to purchase a new residence. Subsequently,

the instructions were amended to substitute a different piece of property to be purchased 

by defendant. The grant deed for the Property executed by defendant and plaintiff’s 

payment were deposited into escrow and the grant deed was recorded. 

The instructions gave defendant 10 days from the close of escrow on her 

new home to vacate the Property. On the tenth day, defendant gave plaintiff written 

notice escrow on her new residence had not closed. Defendant also advised plaintiff she 
7

disputed the amount of the arbitration award and would not leave the Property until she 

was paid an additional almost $74,000. 

At that point plaintiff filed a petition to confirm the Award (Petition). 

Defendant filed a response seeking to dismiss the Petition, or vacate or correct the Award

(Request to Vacate). 

After hearing, the trial court granted the Petition and ordered plaintiff to 

prepare a statement of decision. When defendant objected to the original statement 

plaintiff submitted, the court ordered plaintiff to prepare a new statement of decision,

including a response to 27 questions defendant had submitted. Defendant objected to the 

revised statement. The court then ordered plaintiff to amend the statement to include a 

statement of facts and procedural history, which was done. At about that time defendant 

vacated the Property. 

The court signed the final version of the statement of decision (Statement of 

Decision). It ordered defendant to convey title to the Property to plaintiff in substantially 

the original condition and plaintiff to pay to defendant the sum of $733,421. The parties 

were ordered to bear their own attorney fees and costs. No arbitration costs were 

reallocated. Finally, the court decided any cause of action, claim or defense not

specifically discussed in the Statement of Decision failed due to lack of proof. 

Subsequently, defendant filed a motion to set aside or correct the judgment, 

essentially making the same arguments as in the Request to Vacate. After hearing, the 

court denied the motion and entered judgment. 

DISCUSSION

1. Review of Arbitration Awards

Based on the strong public policy in support of arbitration as a means to 

resolve disputes, courts generally do not review arbitration awards for factual or legal 

errors (Jones v. Humanscale Corp. (2005) 130 Cal.App.4th 401, 407), including 

sufficiency of the evidence or reasoning of the arbitrator (Moncharsh v. Heily & Blase 
8

(1992) 3 Cal.4th 1, 11). In the vast majority of cases arbitration awards are final. (Id. at 

p. 10.)

There are limited grounds on which an arbitration award may be vacated, 

including where the “arbitrators exceeded their powers and the award cannot be corrected 

without affecting the merits of the decision upon the controversy submitted.” (Code Civ. 

Proc., § 1286.2, subd. (a)(4).) The “merits” described in this section encompass all 

contested legal and factual issues before the arbitrator. (Moncharsh v. Heily & Blase,

supra, 3 Cal.4th at p. 28.) 

Within this statutory exception is a claim the award violated “‘an explicit 

legislative expression of public policy.’” (Ahdout v. Hekmatjah (2013) 213 Cal.App.4th 

21, 37.) Although defendant does not clearly make the argument, because of the strong 

public policy underlying the statute (Gov. Code, § 12920 [housing discrimination based 

on disability violates public policy]), a FEHA claim falls within this limited exception. 

(See Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 

107.)

A trial court’s review of an arbitrator’s decision is de novo. (Ahdout v. 

Hekmatjah, supra, 213 Cal.App.4th at pp. 39-40.) “Generally, when faced with a petition 

to confirm or vacate an arbitration award, a court may not review the merits of the 

parties’ controversy or claims that the arbitrator’s decision is either legally or factually 

erroneous. [Citation.]” (Jones v. Humanscale Corp., supra, 130 Cal.App.4th at p. 409.)

It must consider all admissible evidence the parties present, whether or not it was 

submitted to the arbitrator. (Ahdout, at pp. 39-40.) It must also take into account the 

award itself, including any evidence and testimony described therein. (Lindenstadt v. 

Staff Builders, Inc. (1997) 55 Cal.App.4th 882, 893, fn. 8.) 

“On appeal from an order confirming an arbitration award, we review the 

trial court’s order (not the arbitration award) under a de novo standard. [Citations.] To 

the extent that the trial court’s ruling rests upon a determination of disputed factual 
9

issues, we apply the substantial evidence test to those issues.” (Lindenstadt v. Staff 

Builders, Inc., supra, 55 Cal.App.4th at p. 892, fn. 7.) “[W]e presume the court found 

every fact and drew every permissible inference necessary to support its judgment. 

[Citation.]” (Brown v. Wells Fargo Bank, NA (2008) 168 Cal.App.4th 938, 953.)

Defendant, as the party moving to vacate the award, has the burden to show 

error. (Comerica Bank v. Howsam (2012) 208 Cal.App.4th 790, 826.) 

2. Enforceability of Arbitration Provision

Defendant contends the trial court erred for three reasons in finding the 

arbitration provision enforceable. First, it failed to determine whether she agreed to 

arbitrate. Second, the provision was unconscionable. Finally, the Agreement fails to 

comply with the font, typeface, and content requirements of Code of Civil Procedure 

section 1298. None of these arguments persuades.

a. Agreement to Arbitrate

As part of the Petition, plaintiff attached the Agreement and the other 

documents containing all of the ADR and arbitration provisions detailed above. 

Defendant’s claim plaintiff included only the Agreement and the Individual Declaration 

is misleading. The Agreement incorporates all the documents containing the various 

arbitration clauses. Contrary to defendant’s implication, there need not be a discrete 

“arbitration agreement” signed by defendant. She signed and initialed what was 

necessary. 

Defendant argues plaintiff failed to show the “document” she purportedly 

signed was not incorporated into documents she did sign. It is unclear as to which 

document defendant refers. But in any event, the language of the documents attached to 

the Petition makes it clear those documents, including the Master Declaration, bound 

defendant. Provisions in those same documents, initialed or signed by defendant, stated 

she acknowledged the arbitration provisions and had received copies of the documents. 

Contrary to defendant’s claim, this was evidence she knew of the terms of the arbitration 
10

provisions. Thus, in filing the Petition, plaintiff met its burden of proof to show a written 

agreement to arbitrate. (Toal v. Tardif (2009) 178 Cal.App.4th 1208, 1220.)

b. Unconscionability 

Defendant claims the arbitration provisions are also unenforceable because 

they are unconscionable. Unconscionability is a question of law, which we review de 

novo. (Thompson v. Toll Dublin, LLC (2008) 165 Cal.App.4th 1360, 1369.) Defendant 

has the burden to prove the provisions unconscionable. (Pinnacle Museum Tower Assn v. 

Pinnacle Market Development (US), LLC (2012) 55 Cal.4th 223, 236 (Pinnacle).)

There are two facets of unconscionability, procedural and substantive, and 

both must be proven. (Pinnacle, supra, 55 Cal.4th at p. 246.) “The procedural element 

addresses the circumstances of contract negotiation and formation, focusing on 

oppression or surprise due to unequal bargaining power. [Citations.] Substantive 

unconscionability pertains to the fairness of an agreement’s actual terms and to 

assessments of whether they are overly harsh or one-sided. [Citations.] A contract term 

is not substantively unconscionable when it merely gives one side a greater benefit; 

rather, the term must be ‘so one-sided as to “shock the conscience.”’ [Citation.]” (Ibid.)

Here, whether or not the arbitration provision is procedurally 

unconscionable, which we do not decide, it is not substantively unconscionable. 

Defendant’s three claims in that regard do not persuade.

Defendant first relies on Thompson v. Toll Dublin, LLC, supra, 165 

Cal.App.4th 1360, where the court held the terms of an arbitration agreement similar to 

the one here unconscionable. This was because, in the capacity of builder and seller of 

the homes, the defendants “‘would have no conceivable reason to institute legal 

proceedings against a homeowner after escrow closed, but virtually every claim the 

homeowners might raise . . . would be subject to arbitration.’ [Citation.]” (Id. at p. 

1373.) That may be, but it does not mean arbitration under those circumstances would 
11

also inure to plaintiff’s benefit. Further, this provision is not so one-sided as to shock the 

conscience.

Second, defendant argues plaintiff was not obliged to arbitrate prior to close 

of escrow unless she forfeited her deposit as liquidated damages. Defendant misreads 

this provision. It actually states that if buyer fails to purchase the property, and certain 

procedural requirements are met, whether seller is entitled to retain the deposit as 

liquidated damages will be arbitrated. 

Finally, defendant points to a provision that plaintiff would not be required 

to arbitrate if a third party against whom plaintiff might have a claim was not joined. 

Even if this is a substantively unconscionable provision, which we do not consider, it 

does not infect the arbitration provisions as a whole. The term does not permeate the 

entire arbitration provision, has nothing to do with the issues at hand, and could be 

severed. (Armendariz v. Foundation Health Psychcare Services, Inc., supra, 24 Cal.4th

at p. 122.)

c. Code of Civil Procedure Section 1298

Finally, defendant argues the arbitration provisions are unenforceable 

because they did not comply with Code of Civil Procedure section 1298. That section 

prescribes certain language, font, and typeface requirements for arbitration clauses. 

Defendant’s failure to set out those requirements or argue why the provisions at hand 

were invalid could operate as a forfeiture of her argument. (Evans v. CenterStone 

Development Co. (2005) 134 Cal.App.4th 151, 165.)

On the merits the contention fails because that section has been preempted 

by the FAA in transactions involving interstate commerce. (Hedges v. Carrigan (2004) 

117 Cal.App.4th 578, 585. The arbitration clause provides the FAA is to govern and the 

sale involves commerce. (Ibid. [preemption applied to contract for purchase and sale of 

home, a “‘transaction involving commerce’”].)
12

3. FEHA Claim

Defendant argues neither the arbitrator nor the trial court properly 

addressed her FEHA claim. She asserts the arbitrator exceeded his powers because he 

did not properly apply FEHA to her claims, did not issue a sufficient written award, and 

deprived her of a hearing on the merits. She maintains the trial court did not review the 

Award as to the FEHA decision. But, because defendant did not prove her FEHA claim, 

her arguments fail.

“In order to establish discrimination based on a refusal to provide 

reasonable accommodations, a party must establish that he or she (1) suffers from a 

disability as defined in FEHA, (2) the discriminating party knew of, or should have 

known of, the disability, (3) accommodation is necessary to afford an equal opportunity 

to use and enjoy the dwelling, and (4) the discriminating party refused to make this 

accommodation. [Citations.]” (Auburn Woods I Homeowners Assn. v. Fair Employment 

& Housing Com. (2004) 121 Cal.App.4th 1578, 1592.) Disabilities are defined at length 

in Government Code sections 12926 and 12955.3. 

The owner, i.e., the discriminating party, is defined as “the lessee, 

sublessee, assignee, managing agent, real estate broker or salesperson, or any person 

having any legal or equitable right of ownership or possession or the right to rent or lease 

housing accommodations, and includes the state and any of its political subdivisions and 

any agency thereof.” (Gov. Code, § 12927, subd. (e).)

A review of the record reveals there is insufficient evidence to support 

some of the elements defendant claims. In her brief, defendant did not direct us to 

evidence of the nature of her alleged disability or show that it falls within the statutory 

definition of a disability. She points to no evidence offered at the arbitration hearing. 

Although the Award does not specifically discuss the FEHA issue, it provides that any 

claim not specifically mentioned in the Award failed for lack of proof. The Statement of 

Decision explains that, at the arbitration hearing, defendant presented live testimony and 
13

written declarations in support of her claims, including her FEHA claim. It notes 

defendant did not present declarations from any medical expert. Defendant does not 

contest these findings. 

As to the Petition, defendant directs us only to one page in her exhibits filed 

in the Request to Vacate. It refers to one of her notices of action, conclusorily claiming it 

requested a reasonable accommodation of her disability pursuant to FEHA. 

On our own review of the record

2

we located defendant’s declaration filed 

in support of her Request to Vacate. In it defendant states she has “a debilitating back 

injury” resulting from a car accident which necessitated several surgeries. As a result her 

physical activities are limited and she suffers from chronic pain and periods of anxiety. 

The declaration further states that the Agreement required purchasers to 

install certain landscaping within nine months after they moved in. At some point 

defendant asked plaintiff if plaintiff would install the landscaping in exchange for 

defendant’s “‘incentive’” money allowed as part of the sale. Plaintiff declined but 

referred her to contractors. Although defendant tried to complete the landscaping, she 

was unable to because it caused her severe anxiety and interfered with her pain 

management. Thereafter, in September after close of escrow, she e-mailed plaintiff, 

describing the physical manifestations of her severe stress occasioned by her having to 

deal with the landscape contractor, and advised she could not complete her landscaping. 

The declaration also explained that in October defendant provided to 

plaintiff a document from her doctor “stating that because of [her] medical condition 

[she] could not handle negotiating with and overseeing a landscape contractor.” She 

 

2

 Defendant’s failure to direct us to this evidence is a ground for forfeiting the 

issue. (Schmidlin v. City of Palo Alto (2007) 157 Cal.App.4th 728, 738 [“‘It is neither 

practical nor appropriate for us to comb the record on [a party’s] behalf’”]; Evans v. 

CenterStone Development Co., supra, 134 Cal.App.4th at pp. 166-167 [forfeiture on this 

basis].)
14

asked for mediation, seeking a resolution to accommodate her physical and mental 

condition, and also tried to resolve the matter with plaintiff and the landscaper. 

Additionally, we also reviewed defendant’s two Notices of Action, also 

contained in her Request to Vacate. The first states that plaintiff “refused without 

comment or explanation [defendant’s] request for a reasonable accommodation for her 

own medical condition and/or her mother’s medical condition – which request is hereby 

restated and renewed.” The second states plaintiff “has already been provided with a 

written medical opinion stating that [defendant’s] medical condition renders it impossible 

for her to negotiate with, engage, and oversee the work of trade contractors. [Plaintiff] 

must remedy its violations in a way which accommodates [defendant’s] medical 

condition.” 

This is the extent of the evidence regarding defendant’s purported 

disability. Defendant did not designate the trial transcript from the hearing on the

Petition and it is not contained in our record.

This evidence is not enough to show defendant met her burden. The Award 

found defendant never asked for an accommodation based on a disability and plaintiff 

had no knowledge of any “claimed disability until these proceedings were well underway 

[sic].” We agree the record does not show defendant specifically asked plaintiff for an 

accommodation due to a disability. In addition, she has not sufficiently set out a legal

argument to support her claim. Defendant even admits “the precise contours of [those] 

claims are not readily apparent from the record.” 

Further, defendant has not shown she suffers from a statutorily-defined 

disability. (See Gelfo v. Lockheed Martin Corp. (2006) 140 Cal.App.4th 34, 47 [party 

must prove impairment is disability as defined in statute].) Moreover there is no 

evidence the doctor’s note given to plaintiff described her medical condition, only that 

she had one. Thus, she has not shown plaintiff knew, or should have known of her 

alleged disability. 
15

Then there is a serious question as to whether plaintiff was even required to 

offer an accommodation. The notifications and requests to plaintiff were made after 

close of escrow, so defendant, not plaintiff, owned the Property. In her brief, defendant 

makes a cursory statement that plaintiff had an “equitable power” to enforce the 

landscaping requirement since it was the declarant under the CC&R’s, controlled the 

homeowner’s association board of directors, and appointed the architectural review 

committee, thus making it an owner under the FEHA definition. She also points to a 

provision in the CC&R’s that plaintiff could install landscaping at an owner’s expense if 

an owner failed to do so. Therefore, defendant “thought” having plaintiff install the 

landscaping was a reasonable accommodation. 

Defendant directs us to nothing in the record to support these factual claims

and we cannot consider any evidence not in the record. (Kinney v. Overton (2007) 153 

Cal.App.4th 482, 485.) Equally important, the argument is insufficiently developed to 

support a conclusion plaintiff is an owner for purposes of making an accommodation. 

(Benach v. County of Los Angeles (2007) 149 Cal.App.4th 836, 852 [failure to make 

reasoned legal argument forfeits claim].)

Without making a prima facie case, none of defendant’s arguments has

merit. The Award states defendant did not prove her case. This satisfied the requirement 

that in a FEHA case, the arbitrator “must issue a written arbitration decision that will 

reveal, however briefly, the essential findings and conclusion on which the award is 

based.” (Armendariz v. Foundation Health Psychcare Services, Inc., supra, 24 Cal.4th at 

pp. 106-107.) The basis of the decision is clear and the record supports the finding.

Likewise the Award disposes of defendant’s claim the arbitrator exceeded 

his powers by misinterpreting FEHA. Without sufficient evidence, defendant’s belief 

plaintiff had to coordinate installation of defendant’s landscaping was a reasonable 

accommodation is of no moment. 
16

And nothing supports defendant’s claim she was deprived of a hearing on 

the merits at the arbitration. She was allowed to put on evidence and argue her case. 

That the arbitrator ruled against her does not negate this. Moreover, we do not review the 

Award, only the trial court’s order. (Lindenstadt v. Staff Builders, Inc., supra, 55 

Cal.App.4th at p. 892, fn. 7.)

In the Statement of Decision, in response to several of defendant’s 

questions, the trial court found any issue relating to FEHA was “not germane” because of 

the arbitrator’s finding there was no evidence of a FEHA violation. This defeats 

defendant’s claim the court failed to review the Award as to FEHA. Further, since the 

Statement of Decision explains the factual and legal grounds for the ruling, “‘any conflict 

in the evidence or reasonable inferences to be drawn from the facts will be resolved in 

support of the determination of the trial court decision.’ [Citation.]” (In re Marriage of 

Davenport (2011) 194 Cal.App.4th 1507, 1531.)

4. Waiver

Because we have reviewed defendant’s arguments on the merits, we need 

not discuss her claims the court erred in finding she had waived them. 

5. Failure to Disclose

Defendant briefly argues the arbitrator failed to disclose “his prior 

participation, along with [plaintiff’s] counsel, as a ‘panelist’ at construction industry 

seminars jointly ‘sponsored,’ in part, by the law firm representing [plaintiff] . . . and 

[JAMS].” Defendant characterizes these seminars as activities conducted “obviously to 

further some share business objective” and refers to a preprinted form from JAMS that an 

unnamed arbitrator might have participated on a panel with an unnamed lawyer. She 

argues this was not an adequate disclosure and the court erred when it failed to vacate the 

award on that basis. We disagree.
17

First, the generalized description of what purportedly occurred lacks record 

references. As noted above, we may not consider anything outside the record. Without 

factual support, the argument fails. 

Second, Code of Civil Procedure section 1281.9, subdivision (a) requires an 

arbitrator to “disclose all matters that could cause a person aware of the facts to 

reasonably entertain a doubt that the proposed neutral arbitrator would be able to be 

impartial . . . .” Plaintiff points to evidence in the record that the disclosure given was as 

follows: “Please note JAMS neutrals regularly engage in speaking engagements, CLEs, 

discussion groups, and other professional activities, and it is possible that a lawyer or law 

firm connected with this proceeding either attended, participated or was on a panel with 

the Arbitrator.” Thus, before the arbitration, defendant knew of the possible connection 

and did not object. 

Defendant does not direct us to anything in the record to support her 

characterization of the seminars as furthering some business objective. Further, she does 

not even suggest the arbitrator would reap some financial reward from participating as a 

panelist. “‘“‘[O]rdinary and insubstantial business dealings’” arising from participation 

in the business or legal community do not necessarily require disclosure.’ [Citations.]” 

(Benjamin, Weill & Mazer v. Kors (2011) 195 Cal.App.4th 40, 72.)

The trial court found there was “no evidence that the arbitrator failed to 

disclose a ground for disqualification.” Based on our de novo review, we agree. 

(Haworth v. Superior Court (2010) 50 Cal.4th 372, 385.)

6. Motion for Sanctions

Plaintiff filed a motion for sanctions, claiming the appeal was frivolous, 

both objectively and subjectively. (Code Civ. Proc., § 907; Cal. Rules of Court, rule 

8.276(a); In re Marriage of Flaherty (1982) 31 Cal.3d 637, 649-650.) Under the 

objective standard, the merits of the appeal are considered from the perspective of a 

reasonable person, i.e., would one conclude the appeal is “totally and completely devoid 
18

of merit.” (Flaherty, at p. 649) As to the subjective standard, we look to the motives of 

defendant and her lawyer. (Ibid.)

Plaintiff argues the appeal is objectively without merit because defendant 

waived her right to appeal after accepting the sum awarded by the arbitrator, her appeal is 

merely “‘sour grapes’” because she did not recover as much as she sought, and she did 

not meet her burden on appeal because she did not file a sufficient record. 

In his declaration in opposition to the motion, defendant’s counsel sets out

his explanation of the legal basis for filing the appeal and his belief in its merit. 

We are aware that a lawyer’s subjective belief in the validity of an appeal is 

not the test. But “[c]ounsel and their clients have a right to present issues that are 

arguably correct, even if it is extremely unlikely that they will win on appeal. An appeal 

that is simply without merit is not by definition frivolous and should not incur sanctions.” 

(In re Marriage of Flaherty, supra, 31 Cal.3d at p. 650.) We are also cognizant of the 

need to “avoid a serious chilling effect on the assertion of litigants’ rights on appeal.” 

(Ibid.) 

As discussed above, the appeal had no merit. And failure to file the 

reporter’s transcript bears its own penalty. But we cannot say with confidence that no 

reasonable attorney would have filed it or that it had no merit whatsoever.

As to the subjective test, plaintiff contends the appeal was filed for 

purposes of delay, to attack plaintiff, the arbitrator, and the trial court, and as a catharsis 

after losing. 

However, the record does not show the appeal is frivolous using a 

subjective standard. There is no evidence defendant would gain anything from delay and, 

except for plaintiff’s claim, nothing supports a conclusion she filed the appeal merely to 

harass him. (In re Marriage of Flaherty, supra, 31 Cal.3d at p. 651.) While it is true lack 

of merit can be evidence of an appellant’s bad faith, we do not consider it so here.
19

DISPOSITION

The judgment is affirmed. The motion for sanctions is denied. Plaintiff is 

entitled to costs on appeal.

THOMPSON, J.

WE CONCUR:

FYBEL, ACTING P. J.

IKOLA, J.