Kling v. Horn

Decision Date14 December 2021
Docket NumberB305967
CourtCalifornia Court of Appeals
PartiesANTHONY N. KLING, Plaintiff and Appellant, v. STEVEN J. HORN, Defendant and Respondent.


APPEAL from a judgment of the Superior Court of Los Angeles County No. BC682318, David Sotelo, Judge. Affirmed.

Law Office of David Knieriem and David Knieriem; Kling Law Firm and Anthony N. Kling for Plaintiff and Appellant.

Valerie F. Horn & Associates and Valerie F. Horn for Defendant and Respondent.



Steven J. Horn, an attorney, represented Anthony L. Kling, also an attorney, in a lawsuit. A fee dispute arose: Horn wanted Kling to pay fees he owed, Kling wanted to recover fees he had paid. Horn filed a demand for arbitration with the American Arbitration Association (AAA) pursuant to the arbitration provision in his retainer agreement. Kling, in turn, filed a demand for arbitration with the Los Angeles County Bar Association (LACBA) under the Mandatory Fee Arbitration Act (MFAA), Business and Professions Code section 6200 et seq.[1]

The AAA stayed its arbitration while Kling and Horn participated in the LACBA arbitration. Kling partially prevailed in the latter, obtaining a nonbinding award that required Horn to repay Kling some of the fees Kling had paid him. But Kling apparently believing he could recover more from Horn rejected the award and filed an action in the Los Angeles County Superior Court seeking a trial after the LACBA arbitration.

Meanwhile back in the AAA arbitration, Horn sought and obtained an order lifting the stay. Despite receiving notice the AAA arbitration was no longer stayed, Kling declined to participate. The AAA arbitrator awarded Horn $192, 000.

Horn filed a petition to confirm the AAA arbitration award, and Kling filed a petition to vacate it. The trial court granted Horn's petition, denied Kling's, and entered judgment. Kling appeals, and we affirm.

A. The Klings Retain Horn

In 2011 Kling and his mother, Mary, retained Horn to represent them in a lawsuit they had filed, Kling et al. v. Hassid et al. (Super. Ct. L.A. County, 2014, No. SC098810).[2] Horn's retainer agreement included a provision requiring the Klings to submit any dispute "arising from th[e] Agreement," including those concerning "fees, costs or the quality of the work," to "binding arbitration in accordance with the Commercial Arbitration Rules of the [AAA]."

B. Horn and the Klings File Arbitration Demands

In November 2013 Horn withdrew as counsel from the Hassid action after a dispute arose over Horn's handling of the case.[3] In September 2014 Horn filed with the AAA a demand for arbitration against the Klings, seeking $84, 000 in unpaid fees, costs, and interest. Horn later added to the proceeding 3123 SMB LLC, Lincoln One Corporation, and Cliffwood, LLC, entities Kling identified as "successors in interest" to the Klings.

In May 2015 the Klings filed a petition for arbitration with the LACBA under the MFAA. The Klings alleged that Horn committed malpractice when he represented them in the Hassid action and that they were entitled to the return of $648, 000 in attorneys' fees the Klings claimed they had paid him. The AAA notified Horn and the Klings it was holding the AAA arbitration "in abeyance pending the outcome" of the LACBA arbitration.

The Klings and Horn participated in the LACBA arbitration. In October 2017 the arbitration panel issued a statement of decision and award. The panel concluded Horn's alleged misconduct "was not sufficiently serious under the circumstances to warrant that [Horn] should not be entitled to payment for [his] legal services . . . ." The panel ruled, however, that Horn charged the Klings fees that did "not represent time reasonably necessary . . . to attain [the Klings'] goals" in the litigation and that Horn had padded his time entries. The panel ruled that the reasonable value of Horn's services and costs was $380, 245 and that the Klings had paid Horn $603, 231. The panel issued an award in favor of the Klings in the amount of $217, 986, representing the difference, minus $5, 000 in arbitration costs.

C. The Klings Reject the LACBA Award, and Horn Proceeds with the AAA Arbitration

The Klings were not satisfied with $217, 986. In November 2017 the Klings, 3123 SMB, and Kling Corporation-another entity that participated in the Hassid action-filed a complaint in the Los Angeles County Superior Court requesting a trial after the LACBA arbitration.[4] In addition to seeking a return of the attorneys' fees they had paid Horn, the Klings and the related entities asserted several causes of action alleging Horn committed legal malpractice in the Hassid action. The trial court eventually sustained Horn's demurrer to those causes of action, ruling they were time-barred (a ruling Kling does not challenge in this appeal).[5] The Klings' only cause of action remaining after the court's ruling on Horn's demurrer was the Klings' request for a trial after the LACBA arbitration.

Meanwhile, Horn filed in the AAA arbitration and sent to the Klings' counsel of record a document titled "Notice of Revival of Demand and/or Demand to Compel and/or Proceed with Contractual Binding Arbitration and To Lift the Stay." Horn stated that the LACBA arbitration panel had issued a nonbinding award and that he was filing the notice in the AAA arbitration "in order to proceed with contractual binding arbitration which was stayed pending said award . . . ." Kling, purportedly acting as counsel for Mary Kling (but not for himself), filed a motion to dismiss the AAA arbitration. Kling subsequently sent the arbitrator and Horn a letter stating the Klings and their related entities were refusing to participate in the AAA arbitration because they did not believe the AAA had "jurisdiction" to hear the dispute.

D. The AAA Arbitrator Issues an Award in Favor of Horn, Which the Trial Court Confirms

The arbitrator in the AAA arbitration set the matter for a hearing. Horn participated; the Klings did not. In September 2018 the arbitrator issued an award in favor of Horn and against the Klings and the related entities in the amount of $193, 921. The award included fees and costs Horn claimed the Klings owed him, the attorneys' fees and expert witness fees Horn incurred in the AAA arbitration, and the AAA arbitration costs and fees Horn paid.

Horn filed a new action in superior court to confirm the award. The Klings responded by filing their own new action to vacate the AAA award under Code of Civil Procedure section 1286.2. The superior court eventually consolidated all three related actions: Horn's petition to confirm the AAA arbitration award; the Klings' petition to vacate the AAA arbitration award; and the Klings' earlier action requesting a trial after the LACBA arbitration.

In September 2019 the Klings filed a document titled "request to set a jury trial," contending they were entitled to have a jury hear their petition to vacate the arbitration award because the petition to vacate was both a "fraud lawsuit" and a "contract dispute." The trial court denied the request, ruling that Code of Civil Procedure section 1286.2, which governs petitions to vacate an arbitration award, does not give the moving party a right to a jury trial.

The Klings raised numerous grounds for vacating the arbitration award. Those relevant to this appeal included that the AAA award attached to Horn's petition to confirm was "not a self-validating document"; that Horn did not comply with the MFAA because he did not file a new action requesting a trial after arbitration within 30 days of the LACBA award; that the AAA proceeding was "void as a matter of law" because Horn did not give the Klings notice of their right to arbitrate under the MFAA and never served the Klings with a demand for arbitration; and that Horn's retainer agreement contained an illegal block billing provision that rendered the entire agreement unenforceable.

The trial court granted Horn's petition to confirm the AAA arbitration award against the Klings (but not against the other entities) and denied Kling's petition to vacate the award. The court ruled that Horn's petition complied with Code of Civil Procedure section 1285.4, which lists the requirements for confirming an arbitration award; that Horn complied with the MFAA by filing a notice of revival and a demand for arbitration with the AAA; that the Klings waived any objections to service by making a general appearance in the AAA arbitration; and that the arbitrator was not required to determine the retainer agreement was illegal. The court entered judgment in favor of Horn and against the Klings. Kling timely appealed; Mary Kling did not.

A. Horn's Petition To Confirm the Award Complied with the California Arbitration Act

Kling first contends Horn "never introduced any evidence to suggest the [AAA] award existed" because the copy of the award Horn attached to his petition was "hearsay." This argument is meritless.

The California Arbitration Act (CAA) prescribes the requirements of a petition to confirm an arbitration award. The petition must "(a) [s]et forth the substance of or have attached a copy of the agreement to arbitrate," "(b) [s]et forth names of the arbitrators," and "(c) [s]et forth or have attached a copy of the award and the written opinion of the arbitrators, if any." (Code Civ. Proc § 1285.4.) "If a petition . . . is duly served and filed, the court shall confirm the award as made," unless the court corrects or vacates the award, or dismisses the petition, pursuant to one of the statutory grounds. (Id., § 1286; see id., §§ 1286.2, 1286.6, 1287.2.) "The purpose of [the predecessor to Code of Civil...

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