Felner v. Meritplan Ins. Co.

• Court: California Court of Appeals
• Writing for the Court: FLEMING; ROTH, P.J., and HERNDON
• Citation: 466 P.2d 722,86 Cal.Rptr. 178,6 Cal.App.3d 540
• Parties: Berek N. FELNER and Fay Felner, Plaintiffs and Respondents, v. MERITPLAN INSURANCE COMPANY, Defendant and Appellant. Civ. 34758.
• Decision Date: 13 April 1970

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86 Cal.Rptr. 178 6 Cal.App.3d 540 Berek N. FELNER and Fay Felner, Plaintiffs and Respondents,
v.
MERITPLAN INSURANCE COMPANY, Defendant and Appellant. Civ. 34758. Court of Appeal, Second District, Division 2, California. April 13, 1970.

Page 179

[6 Cal.App.3d 542] Steck & Marston, Pasadena, for appellant.

Sanford M. Gage, Los Angeles, for respondents.

FLEMING, Associate Justice.

Meritplan Insurance appeals a superior court judgment confirming an arbitration award of $4,100 in favor of the Felners, an award based on the uninsured motorist coverage of their liability insurance policy.

At the arbitration hearing Meritplan disclaimed liability under the policy, claiming that no physical contact had occurred between the Felner automobile and the unidentified automobile which caused the accident and therefore the uninsured motorist coverage of the policy did not apply. Both sides presented evidence on this issue, and the arbitrator decided in favor of the Felners, finding that physical contact between vehicles had occurred. [6 Cal.App.3d 543] Meritplan, in opposing confirmation of the arbitration award in the superior court, contended the court should conduct a new evidentiary hearing on the issue of physical contact, but the court rejected this contention and affirmed the award. On appeal, Meritplan argues procedural error because the superior court refused an evidentiary hearing on the issue of physical contact.

Section 11580.2 of the Insurance Code requires a motor vehicle liability insurance policy to provide coverage for injuries to the insured caused by an uninsured automobile. An uninsured automobile includes a hit-and-run automobile which had physical contact with the insured. Subsection (f) declares that the parties to the policy shall determine--by agreement or by arbitration--whether the insured is legally entitled to recover damages, and, if so, the amount of the damages.

The Felner policy provided that 'if any person making claim hereunder and the company Do not agree that such person is legally entitled to recover damages from the owner or operator of an uninsured automobile because of bodily injury to the insured, or do not agree as to the amount of payment which may be owing under the coverage, then, upon written demand of either, The matter or matters upon which such person and the company do not agree shall be settled by arbitration * * * and judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof.' (Italics added.)

At bench the issue between the parties no longer involves the validity of the finding of physical contact between the insured and a hit-and-run automobile but rather the question whether the arbitrator or the superior court has ultimate authority to make a finding of physical contact between vehicles. Such a procedural controversy is to be settled by reference to the terms of the agreement authorizing the submission of the dispute to arbitration. On examining the Felner policy we conclude that its arbitration submission is broad enough to cover a dispute over the meaning of the term uninsured automobile

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(which for a hit-and-run automobile requires a finding of physical contact). We view the agreement to submit to the arbitrator the question whether the insured was 'legally entitled to recover damages from the owner or operator of an uninsured automobile' as sufficiently comprehensive to include the subordinate question whether the vehicle which caused the accident was an uninsured automobile within the meaning of the policy. 'It is for the arbitrators to determine which issues were actually 'necessary' to the ultimate decision. (See Grunwald-Marx, Inc. v. Los Angeles Joint Board, 52 Cal.2d 568, 589--590, 343 P.2d 23.) Likewise, any doubts as to the meaning or extent of an arbitration agreement are for the arbitrators and not the court to resolve. [6 Cal.App.3d 544] (See O'Malley v. Wilshire Oil Co., 59 Cal.2d 482, 490--491, 30 Cal.Rptr. 452, 381 P.2d 188 (collective bargaining agreement.)' (Morris v. Zuckerman, 69 Cal.2d 686, 690, 72 Cal.Rptr. 880, 883--884, 446 P.2d 1000, 1003--1004; Code Civ.Proc. § 1283.4.) Since the issue of physical contact was properly before the arbitrator for decision, the only questions for the superior court to consider in confirming or vacating the arbitration award were whether there had been corruption or misconduct by the arbitrator and whether the arbitrator had improperly conducted the hearing or exceeded his powers in making his award. (Code Civ.Proc. § 1286.2.) The record indicates that the parties to the arbitration had been given an opportunity to litigate the issue of physical contact, that both sides took advantage of this opportunity, and that the arbitrator decided the issue in favor of the policyholders. Since the disputed issue fell within the terms of the submission, the superior court properly confirmed the award. (Jordan v. Pacific Auto. Ins. Co., 232 Cal.App.2d 127, 132, 42 Cal.Rptr. 556; American Ins. Co. v. Gernand, 262 Cal.App.2d 300, 68 Cal.Rptr. 810; Esparza v. State Farm Mut. Auto. Ins....