Court Opinion

ID: 9926435
Source: CourtListenerOpinion
Date Created: 2024-01-24 19:02:07.400817+00
Date Added: 2024-06-11T09:20:02.122546
License: Public Domain

Filed 1/24/24 Raziel v. Extended Vision CA2/5
   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for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

                      SECOND APPELLATE DISTRICT

                                    DIVISION FIVE

 EYAL RAZIEL,                                                     B323008

          Plaintiff and Respondent,                               (Los Angeles County
                                                                  Super. Ct. No. 20STCP01873)
          v.

 EXTENDED VISION, LLC et al.,

          Defendants and Appellants.

      APPEAL from a judgment of the Superior Court of Los
Angeles County, Armen Tamzarian, Judge. Affirmed.
      Catanzarite Law Corporation and Kenneth J. Catanzarite
for Defendants and Appellants.
      Levinson Arshonsky Kurtz & Komsky, Robert A. Levinson,
and Nathan T. Lowery for Petitioner and Respondent.
       Eyal Raziel (Raziel) is a member of Extended Vision, LLC.
Farhad Eliasi (Eliasi) and Elad Benisti (Benisti) are managing
members. (We will refer to Extended Vision, LLC, Eliasi, and
Benisti collectively as Extended Vision.) When Raziel filed a
petition to compel inspection of Extended Vision’s books and
records, Extended Vision moved to compel arbitration. The
arbitrator issued an award in favor of Raziel, which the trial
court confirmed. We are asked to decide whether the trial court
should have vacated the award because the arbitrator
purportedly erred in finding Extended Vision waived its right to a
hearing.

                         I. BACKGROUND
       A.    The Underlying Dispute and Referral to Arbitration
       Extended Vision was formed in 2008 to operate a
restaurant in Santa Monica. Raziel, Eliasi, and Benisti’s initial
capital contributions gave them 9.5 percent, 40.5 percent, and 25
percent membership interests in the company, respectively. As of
2019, documents on file with the California Secretary of State
indicated Eliasi and Benisti were the company’s managers.
       After formation of the company, a dispute arose concerning
Raziel’s employment classification. Eliasi and Benisti claim they
made Raziel a manager, while Raziel contends he is not a
manager and works in the restaurant as a non-exempt employee.
Believing Extended Vision may be liable for wage and hour
violations (not just as to him, but also as to other employees),
Raziel demanded to inspect Extended Vision’s books and records
pursuant to his statutory and contractual rights as a member of
the company and “to evaluate the scope and extent of Extended

                                2
Vision’s liability . . . .” Extended Vision allegedly failed to
cooperate.
      Raziel then filed a petition for writ of mandate in the trial
court to compel inspection and copying of the company’s books
and records.1 The trial court granted Extended Vision’s motion to
compel arbitration of the dispute pursuant to the company’s
operating agreement.2

      B.    The Arbitration
      Raziel filed a demand for arbitration with the American
Arbitration Association (AAA) and Extended Vision filed an
answering statement.3 In May 2021, Gayle L. Eskridge was
appointed to serve as the arbitrator.
      Raziel filed a motion challenging the jurisdiction of the
arbitrator and the AAA, which the arbitrator denied on
September 13, 2021. In the final section of the order denying
Raziel’s challenge to her jurisdiction, the arbitrator set forth

1
      A few days prior to filing his petition for writ of mandate,
Raziel filed a complaint against Extended Vision alleging failure
to pay minimum wages, failure to pay overtime wages, failure to
provide meal periods, failure to provide rest breaks, failure to
provide itemized wage statements, retaliation, and unfair
business practices.
2
      This Court denied Raziel’s petition for a writ of mandate
directing the trial court to vacate its order granting Extended
Vision’s motion to compel arbitration, and our Supreme Court
denied Raziel’s petition for review.
3
      Neither the demand for arbitration nor the answering
statement is included in the appellate record.

                                 3
“INSTRUCTIONS GOING FORWARD.” The parties were
ordered to state their availability for an arbitration management
conference to be held later in September 2021 to discuss, among
other things, “[w]hat, if any, further briefing should be had prior
to the [a]rbitrator ruling on [Raziel’s] petition . . . .”
       A telephonic arbitration management conference was held
on September 24, 2021. Consistent with earlier instructions, and
as memorialized in the arbitrator’s “ARBITRATION
MANAGEMENT ORDER NO. 2” (Order No. 2) issued
immediately after the conference, “[t]he purpose of th[e]
arbitration management conference was to discuss” issues
including “(1) [w]hat, if any, further briefing should be had prior
to the [a]rbitrator ruling on [Raziel’s] [p]etition for [w]rit of
[m]andate” and “(2) [i]f further briefing is to be had, the schedule
for same . . . .” As further documented in Order No. 2, “[t]he
parties agreed no further briefing was needed prior to the
[a]rbitrator ruling on [Raziel’s] [p]etition for [w]rit of [m]andate.
[¶] The [a]rbitrator will rule on the [p]etition for [w]rit of
[m]andate as soon as possible, but certainly by October 15, 2021.”
Order No. 2 was electronically served on all counsel of record the
same day.
       Just shy of a week later, the arbitrator issued a written
order granting Raziel’s petition for writ of mandate and requiring
Extended Vision to make certain records available for inspection
and copying. The arbitrator found Raziel had a right to inspect
certain documents pursuant to statute and the company’s
operating agreement and the arbitrator noted that although
Extended Vision had “filed an [a]nswering [s]tatement which
included 37 separate affirmative defenses,” it did not address
Raziel’s statutory rights.

                                  4
       The day after the arbitrator issued the order granting
Raziel’s petition, one of Extended Vision’s attorneys sent an
email to the arbitrator, counsel for Raziel, and others stating
Extended Vision “did not realize this issue [i.e., the merits of
Raziel’s petition] was under consideration yet” and “request[ing]
this matter be briefed before [the] ruling goes into effect.”
Extended Vision asserted the waiver of further briefing at the
September 24, 2021, arbitration management conference “had to
do with the jurisdiction-related issues.” As Extended Vision
argued it, “there was no reference to consideration of the merits
of [Raziel’s] petition, and [Extended Vision] certainly did not
knowingly or intentionally waive its right to further briefing
thereon.”
       The arbitrator construed the email from Extended Vision’s
attorney as a motion to re-open or reconsider the matter. In a
written order denying the motion, the arbitrator found Extended
Vision’s purported belief that its waiver related only to further
briefing of jurisdictional issues “ma[de] no sense” because she
denied Raziel’s motion challenging her jurisdiction more than a
week before the September 24, 2021, arbitration management
conference. Extended Vision “could not possibly have believed
the issue of briefing was related to the [m]otion to [c]hallenge
[a]rbitrator’s [j]urisdiction,” and its protest to the contrary was
“disingenuous.” Extended Vision, the arbitrator reasoned, was
“on notice regarding what was planned to be discussed, and then
participated in the telephonic conference in which they clearly
stated they did not need to do any further briefing regarding the
[p]etition for [w]rit of [m]andate. As if that was not sufficient,
the [a]rbitrator issued [Order No. 2] which specifically stated that
the parties had agreed no further briefing on the [p]etition for

                                 5
[w]rit of [m]andate was required, and that the [a]rbitrator would
be issuing her ruling on the [p]etition for [w]rit of [m]andate by
October 15, 2021.”
       Over the next several months, the arbitrator issued further
orders addressing issues including, among other things,
Extended Vision’s compliance with the order granting Raziel’s
petition.
       In May 2022, the arbitrator issued a final award that
included a summary of its previous orders. With respect to the
waiver issue, the arbitrator again emphasized Extended Vision
“could not have believed the issue of briefing” discussed at the
September 24, 2021, arbitration management conference “was
related to [Raziel’s] [m]otion to [c]hallenge [the] [a]rbitrator’s
[j]urisdiction” because she had already denied Raziel’s
jurisdictional challenge. Moreover, Extended Vision “had been on
notice regarding what was planned to be discussed, and then
participated in the telephonic conference in which they clearly
stated they did not need to do any further briefing regarding the
[p]etition for [w]rit of [m]andate.” And “Order No. 2 specifically
stated that the parties had agreed no further briefing on the
[p]etition for [w]rit of [m]andate was required . . . .”
       The final award indicated Extended Vision complied with
the arbitrator’s order granting Raziel’s petition and awarded
Raziel $100,290.66 in attorney fees and costs.

      C.    The Trial Court’s Judgment Confirming the Award
      Raziel petitioned the trial court to confirm the arbitrator’s
award, and Extended Vision responded with a request to vacate
the award. Extended Vision argued the arbitrator exceeded her
powers and it was prejudiced by the arbitrator’s purported

                                 6
misconduct, including her refusal to hear material evidence.
Extended Vision’s position rested on the contention that
Extended Vision did not waive its right to a hearing on the merits
of Raziel’s petition. Extended Vision disputed the arbitrator’s
recollection of the September 24, 2021, arbitration management
conference and argued that only an express, written waiver
would be sufficient to waive a hearing in arbitration.
       The trial court rejected Extended Vision’s arguments and
confirmed the award. With respect to the contention that the
waiver of a hearing must be in writing, the trial court concluded
there was no authority supporting Extended Vision’s position.
The trial court also found, alternatively, that even if the
arbitrator had committed legal error, a legally erroneous ruling
by the arbitrator would still be binding on the parties.
       As to the argument that there was no waiver—written or
otherwise—the trial court reasoned “[v]acating this
award . . . would require disturbing the arbitrator’s factual
findings,” which “[t]he court has no authority to do . . . .”
Alternatively, the trial court determined that “[e]ven if the court
had the authority to disregard the arbitrator’s findings of fact, it
would not do so” because “the record shows the arbitrator gave
[Extended Vision] th[e] opportunity” to be heard on the merits of
Raziel’s petition, “and they declined.” The trial court “agree[d]
with the arbitrator’s conclusion” that Extended Vision’s
purported belief the waiver was limited to further briefing on
Raziel’s jurisdictional challenge was “disingenuous.” The trial
court cited Order No. 2 and found “[t]he only reasonable inference
[was] that the arbitrator planned on ruling on the briefs as soon
[sic] and no later than October 15, 2021. [Extended Vision] knew
that and still did not request a hearing.”

                                 7
       With respect to Extended Vision’s argument that it was
prejudiced by the arbitrator’s decision to proceed without a
hearing on the merits, the trial court explained that Extended
Vision “make[s] no offer or proof as to what evidence, if any, they
would have presented that could have resulted in a different
outcome . . . . This is unsurprising because deciding such a
petition requires little evidence and all the material facts were
before the arbitrator.”
       The trial court awarded Raziel an additional $10,676.65 in
expenses associated with the petition to confirm the award plus
$1,016.07 in interest accrued on the arbitrator’s award. The
judgment awarded Raziel a total of $90,600.22.4

                        II. DISCUSSION
      Extended Vision contends the judgment must be reversed
and the arbitration award vacated because they legally could not,
and factually did not, waive their right to a hearing on the merits
during the September 24, 2021, arbitration management
conference. These contentions are meritless. Neither the
California Arbitration Act nor the applicable AAA rules require a
hearing when the parties are content to rest on the pleadings,
and waiver of a hearing need not take any particular form.
Substantial evidence (indeed, evidence we would find persuasive
even reviewing the matter de novo) supports the trial court’s
determination that Extended Vision agreed to forgo a hearing
during the arbitration management conference.

4
      The trial court’s judgment, based on a proposed judgment
submitted by Raziel, omits $21,383.16 in costs awarded by the
arbitrator. Raziel took no appeal from the judgment.

                                 8
       A.    Legal Framework and Standard of Review
       “‘Because the decision to arbitrate grievances evinces the
parties’ intent to bypass the judicial system and thus avoid
potential delays at the trial and appellate levels, arbitral finality
is a core component of the parties’ agreement to submit to
arbitration.’” (Richey v. AutoNation, Inc. (2015) 60 Cal.4th 909,
916, quoting Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 10.)
Accordingly, “[t]he California Arbitration Act (Code Civ. Proc.,
§ 1280 et seq.) and the Federal Arbitration Act (9 U.S.C. § 10 et
seq.) provide limited grounds for judicial review of an arbitration
award.” (Ibid.)
       This appeal concerns three grounds for vacating an
arbitration award set forth in Code of Civil Procedure section
1286.2.5 Among other things, and subject to exceptions, the trial
court “shall” vacate an award if (1) “[t]he arbitrator[ ] exceeded
their powers and the award cannot be corrected without affecting
the merits of the decision upon the controversy submitted”
(§ 1286.2, subd. (a)(4)), (2) “[t]he rights of [a] party were
substantially prejudiced by misconduct of a neutral arbitrator”
(§ 1286.2, subd. (a)(3)), or (3) “[t]he rights of [a] party were
substantially prejudiced . . . by the refusal of the arbitrator[ ] to
hear evidence material to the controversy or by other conduct of
the arbitrator[ ] contrary to the provisions of [the California
Arbitration Act]” (§ 1286.2, subd. (a)(5)).
       “Generally, courts cannot review arbitration awards for
errors of fact or law, even when those errors appear on the face of

5
     Undesignated statutory references that follow are to the
Code of Civil Procedure.

                                  9
the award or cause substantial injustice to the parties.” (Richey,
supra, 60 Cal.4th at 916, citing Moncharsh, supra, 3 Cal.4th at 6,
28.) “To the extent the trial court made findings of fact in
confirming the award, we affirm the findings if they are
supported by substantial evidence.” (Cooper v. Lavely & Singer
Professional Corp. (2014) 230 Cal.App.4th 1, 11-12.)

      B.     Extended Vision’s Right to a Hearing on the Merits of
             Raziel’s Petition Is Subject to Waiver
      We will assume for argument’s sake that the arbitrator’s
legal determination that Extended Vision could waive its right to
a hearing is within the permissible scope of our review. Even so,
Extended Vision’s contention that a right to a hearing is either
unwaivable—or at least not subject to an oral waiver—rests only
on the California Arbitration Act and the AAA rules. As we shall
explain, neither provides support for Extended Vision’s position.
To the contrary, requiring a hearing that neither party desires
would undermine several key advantages of arbitration,
including “‘its informality,’” “‘lower costs, [and] greater efficiency
and speed . . . .’” (Sonic-Calabasas A, Inc. v. Moreno (2013) 57
Cal.4th 1109, 1138, quoting AT&T Mobility LLC v. Concepcion
(2011) 563 U.S. 333, 348.)

            1.     The California Arbitration Act
      Extended Vision cites section 1282.2, subdivision (d) for the
proposition that its right to a hearing in arbitration is not subject
to waiver. Section 1282.2 provides that, “[u]nless the arbitration
agreement otherwise provides, or unless the parties to the
arbitration otherwise provide by an agreement which is not
contrary to the arbitration agreement as made or as modified by

                                  10
all the parties thereto: [¶] . . . [¶] (d) The parties to the
arbitration are entitled to be heard, to present evidence and to
cross-examine witnesses appearing at the hearing, but rules of
evidence and rules of judicial procedure need not be observed. On
request of any party to the arbitration, the testimony of witnesses
shall be given under oath.”
       Focusing only on the “entitled to be heard” language in
subdivision (d), Extended Vision does not grapple with the
opening sentence of section 1282.2 that makes the entitlement to
be heard subject to an agreement by the parties otherwise. Here,
the arbitrator determined the parties reached such an agreement
at the September 24, 2021, arbitration management conference,
and nothing in the statute requires the agreement to be in
writing. The agreement to forgo a hearing that was documented
by the arbitrator also is not contrary to the parties’ overarching
arbitration agreement. Section 1282.2 is therefore no help to
Extended Vision.

            2.     The AAA rules
      On our own motion, we take judicial notice of the
arbitration rules in effect during the arbitration. (AAA
Commercial Arbitration Rules and Mediation Procedures (eff.
Oct. 1, 2013), available at
https://www.adr.org/sites/default/files/CommercialRules_Web-
Final.pdf [as of Oct. 12, 2023]; Evid. Code, §§ 452, subd. (h), 459,
subd. (a).)
      Although Rules R-32 and R-45 expressly contemplate the
waiver of a hearing,6 Extended Vision relies on Rules R-24, R-

6
      Rule R-32(d) provides “[t]he parties may agree to waive oral
hearings in any case,” and R-45 provides “[t]he award shall be

                                 11
32(d), R-34(a), and R-39(a) to argue a hearing is nonetheless
required.7 None of these rules is amenable to Extended Vision’s
reading, however.
       Rule R-24 provides “[t]he arbitrator shall set the date, time,
and place for each hearing. The parties shall respond to requests
for hearing dates in a timely manner, be cooperative in
scheduling the earliest practicable date, and adhere to the
established hearing schedule. The AAA shall send a notice of
hearing to the parties at least 10 calendar days in advance of the
hearing date, unless otherwise agreed by the parties.” Nothing in
this rule indicates the parties cannot waive their right to a
hearing. The rule merely sets forth procedures to follow if a
hearing is to be held.
       Extended Vision suggests Rule R-32 supports its position
even though the rule actually provides “[t]he parties may agree to
waive oral hearings in any case.” Extended Vision points to other
language in Rule R-32 that states the parties “may also agree to
utilize the Procedures for Resolution of Disputes Through
Document Submission, found in Rule E-6” and believes this
means there can be no waiver absent an agreement to utilize
Rule E-6 procedures. But that just misreads the rule. Under

made promptly by the arbitrator and, unless otherwise agreed by
the parties or specified by law, no later than 30 calendar days
from the date of closing the hearing, or, if oral hearings have been
waived, from the due date set for receipt of the parties’ final
statements and proofs.” (Emphasis added.)
7
      For the first time on appeal, Extended Vision argues the
arbitrator was required to “re-open” the hearing upon request
pursuant to Rule R-40. This argument is forfeited.

                                 12
Rule R-32, the parties need not, but “may also,” agree to use Rule
E-6 procedures. Rule E-6 itself is similarly couched in permissive
language: “Where cases are resolved by submission of documents,
the following procedures may be utilized at the agreement of the
parties or the discretion of the arbitrator.” (Emphasis added.)
The text of the rule accordingly does not support the view that
waivers are only authorized when Rule E-6 procedures are used.
       Rule R-34(a) provides “[t]he parties may offer such evidence
as is relevant and material to the dispute and shall produce such
evidence as the arbitrator may deem necessary to an
understanding and determination of the dispute. Conformity to
legal rules of evidence shall not be necessary. All evidence shall
be taken in the presence of all of the arbitrators and all of the
parties, except where any of the parties is absent, in default, or
has waived the right to be present.” Again, nothing in this rule
suggests the right to present certain evidence cannot be waived.
       Rule R-39 is entitled “Closing of Hearing.” Rule R-39(a)
provides “[t]he arbitrator shall specifically inquire of all parties
whether they have any further proofs to offer or witnesses to be
heard. Upon receiving negative replies or if satisfied that the
record is complete, the arbitrator shall declare the hearing
closed.” Even if this rule applies in contexts other than closing a
hearing, there is no indication that the parties’ replies must be in
writing. Indeed, the rule does not even require affirmations by
the parties that there are no “further proofs” or witnesses at all;
it states an arbitrator may close the hearing regardless if
“satisfied that the record is complete.”

                                13
      C.     The Trial Court’s Waiver Finding Is Supported by
             Substantial Evidence
       Assuming for the sake of argument, again, that the
arbitrator’s waiver finding here is not entitled to the deference
afforded findings on the merits, the trial court’s judgment
confirming the award is nevertheless subject to substantial
evidence review. Extended Vision’s argument that the de novo
standard applies because “the predicate facts are not in dispute”
mistakenly assumes the salient facts relate to the bare denial of
their right to brief and be heard on the merits—as opposed to
what was discussed during the September 24, 2021, arbitration
management conference. Substantial evidence supports the trial
court’s determination that Extended Vision waived its rights to
brief and be heard on the merits of Raziel’s petition, choosing
instead to rest on its answer to Raziel’s demand for arbitration.
       Both the arbitrator and the trial court found Extended
Vision’s purported belief that the discussion of further briefing
during the arbitration management concerned only Raziel’s
jurisdictional challenge to be meritless to the point of being
disingenuous. That finding has ample support. The arbitrator
denied Raziel’s jurisdictional challenge more than a week before
the arbitration management conference, and Extended Vision
never explains why further briefing on this issue would have
been up for discussion. Indeed, the arbitrator’s order denying
Raziel’s jurisdictional challenge and proposing the arbitration
management conference was clear that the discussion would
address the need for briefing on the merits of Raziel’s petition.
Order No. 2, issued immediately after the arbitration
management conference, confirmed the parties’ agreement “that
no further briefing was needed prior to the [a]rbitrator ruling on

                                14
[Raziel’s] [p]etition for [w]rit of [m]andate.” In response to
Extended Vision’s motion to re-open the proceedings, the
arbitrator emphasized Extended Vision “clearly stated [it] did not
need to do any further briefing regarding the [p]etition for [w]rit
of [m]andate.”
       In an effort to argue the contrary, Extended Vision points
to a declaration from one of its attorneys, Scott M. Nenni (Nenni),
that discusses the September 24, 2021, arbitration management
conference and a minute order from a status conference held in
the trial court on September 29, 2021—i.e., between the
arbitration management conference and issuance of the
arbitrator’s order granting Raziel’s petition.8 Nenni avers that he
understood the discussion of waiver at the arbitration
management conference to concern Raziel’s jurisdictional
challenge. But he does not address the orders issued before and
after the conference indicating the discussion was focused on the
need for briefing on the merits of Raziel’s petition. Nor does he
explain why briefing of the already-decided jurisdictional
challenge remained a live issue. The minute order, which states
“[c]ounsel represent to the court that arbitration is ongoing and
the arbitrator is evaluating whether or not he/she has jurisdiction
to arbitrate the case,” likewise fails to shed any light on why the
parties would have believed this given the arbitrator’s orders
indicating this issue had already been resolved and her ruling on
the merits was imminent.9

8
      The same judge presided at the September 29, 2021, status
conference and entered judgment confirming the arbitration
award.
9
     Regardless, the trial court was entitled to decline to credit
Extended Vision’s evidence (In re Alexandria P. (2016) 1

                                15
       Extended Vision further contends that even if it waived its
right to brief the merits of Raziel’s petition, this waiver cannot be
construed as a waiver of its right to a hearing. Again, Extended
Vision fails to account for the arbitrator’s orders. Order No. 2
indicates “no further briefing was needed prior to the [a]rbitrator
ruling on [Raziel’s] [p]etition” (emphasis added), not that no
further briefing was needed prior to a hearing on the petition.
Moreover, the order emphasizes the arbitrator was to rule on the
petition “as soon as possible,” with no mention of a hearing to be
held in the interim. This is substantial evidence that Extended
Vision waived both briefing and a hearing on the merits of
Raziel’s petition.

Cal.App.5th 331, 354), and, on appeal, we would defer to such a
decision.

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                        DISPOSITION
     The judgment is affirmed. Raziel is awarded costs on
appeal.

   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

                          BAKER, J.

We concur:

     RUBIN, P. J.

     KIM, J.

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