Is a Client Bound by the Acts of the Attorney If Submission to Arbitration Affects His Substantial Rights ?
In Blanton v. Womancare, Inc. (1985) 38 Cal. 3d 396 212 Cal. Rptr. 151, 696 P.2d 645, 48 A.L.R.4th 109. Blanton ordered an arbitration agreement and award set aside because the plaintiff's attorney's stipulation to submit to binding arbitration was made without the plaintiff's consent.
The court explained that " 'the client as principal is bound by the acts of the attorney-agent within the scope of his actual authority (express or implied) or his apparent or ostensible authority; or by unauthorized acts ratified by the client.' " (Id. at p. 403.)
In Blanton, the attorney conceded that his client had told him she would agree to arbitration only if her right to a de novo trial was preserved.
The client did not learn about the stipulation until almost three months after it was entered and immediately objected, fired the attorney and retained new counsel who moved to invalidate the stipulation.
On these facts, Blanton held the arbitration agreement was invalid because the attorney had no actual authority, submission to arbitration affects the client's "substantial rights" and therefore cannot be supported by apparent authority, and the client did not ratify but rather disaffirmed the agreement.
The court did not, however, preclude the possibility of an arbitration agreement entered without the client's express authority being ratified by the client. (Id. at pp. 403, 408.)