I attach a recent "to be published" opinion from the California Court of Appeals District 2 Division 2 dealing with enforcement of ADR agreements. In this case, plaintiffs filed suit against multiple defendants, including Heritage Nursing Home, alleging that each contributed to the death of the patient/resident. Upon admission to Heritage, the resident’s family properly executed an ADR agreement. After receiving service of the complaint, Heritage filed a motion to enforce arbitration. The trial court denied the petition stating that due to the multiple defendants there would be a risk for conflicting outcomes – thereby denying the petition pursuant to Cal. Code section 1281.2. The Court of Appeals affirmed the decision holding that the alleged actions of each of the defendants "arouse out of the same transaction as that involving defendant Heritage." The court added that "a temporal separation does not necessarily negate the existence of the requisite ‘series of related transactions,’" as set out in section 1281.2. Thus, the court held that if the trial court did not join all the defendants in the court action, there would be a possibility of conflicting rulings – thereby making the decision not to enforce the ADR appropriate.

Author: CA Ct. Appeals from