Injunctive Relief Arbitration In a Medical Malpractice Case
In Broughton v. CIGNA Healthplans (1999), a minor and his mother sued their health insurer alleging causes of action for medical malpractice based on severe injuries suffered by the minor at birth.
In the suit, the plaintiffs sought monetary damages for such tortious misconduct as well as for violations of the Consumers Legal Remedies Act (CLRA).
In addition, the plaintiffs sought injunctive relief with respect to the insurer's allegedly deceptive advertising practices.
The insurer moved to compel arbitration pursuant to the provisions of the health insurance plan it had with the plaintiffs. the trial court granted the motion as to the malpractice claims but denied it as to the statutory claim under the CLRA.
The Supreme Court reversed, concluding that arbitration was an inherently unsuitable forum for the resolution of a claim for an injunction under the CLRA and therefore it could not be arbitrated. (Broughton, supra, 21 Cal. 4th at p. 1088.)
However, the damage claims under the statute, as well as plaintiffs claims for malpractice, were subject to arbitration. (Ibid.)
Broughton rationalized its conclusion on the ground that there is an inherent conflict between private arbitration before a nonjudicial officer (who would be at an institutional disadvantage in administering a public injunctive remedy) and the underlying purpose of the remedy of injunctive relief under a statutory scheme authorizing a private plaintiff to act in the capacity of a private attorney general to enforce the statute for the benefit of the general public. (Broughton, supra, 21 Cal. 4th at p. 1082.)
Based upon this inherent conflict, the Supreme Court concluded that the Legislature did not intend for the injunctive relief claims under the CLRA to be arbitrated. (Ibid.; see also Civ. Code, 1780, subd. (c) a CLRA action is to be filed in "any court . . . having jurisdiction of the subject matter".)
The court expressly declined the parties' invitation to reach the broader issue of whether arbitrators have the power to grant injunctive relief at all. (Broughton, supra, 21 Cal. 4th at p. 1079.)
California has a strong public policy in favor of arbitration and any doubts regarding the arbitrability of a dispute are resolved in favor of arbitration. (Christensen v. Dewor Developments (1983) 33 Cal. 3d 778, 782 191 Cal. Rptr. 8, 661 P.2d 1088 the court should "indulge every intendment to give effect to" an arbitration agreement; Valsan Partners Limited Partnership v. Calcor Space Facility, Inc., supra, 25 Cal. App. 4th at pp. 816-817; Titan Group, Inc. v. Sonoma Valley County Sanitation Dist., supra, 164 Cal. App. 3d at p. 1127.)
As the Supreme Court recently noted, ". . . 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 . . . ." (Moncharsh v. Heily & Blase (1992) 3 Cal. 4th 1, 10 10 Cal. Rptr. 2d 183, 832 P.2d 899.)
This strong policy has resulted in the general rule that arbitration should be upheld "unless it can be said with assurance that an arbitration clause is not susceptible to an interpretation covering the asserted dispute." (Bos Material Handling, Inc. v. Crown Controls Corp. (1982) 137 Cal. App. 3d 99, 105 186 Cal. Rptr. 740 a terminated dealer's tort causes of action against a manufacturer, including claims for breach of the covenant of good faith and fair dealing, were all required to be arbitrated under their dealership agreement.)
It seems clear that the burden must fall upon the party opposing arbitration to demonstrate that an arbitration clause cannot be interpreted to require arbitration of the dispute.