Ourfali v. 21st Century Ins. Co. CA2/4

Filed 3/27/24 Ourfali v. 21st Century Ins. Co. CA2/4
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FOUR

GHOUGAS OURFALI, B324150

Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. 21GDCP00151)
v.

21ST CENTURY INSURANCE
COMPANY,

Defendant and
Respondent.

APPEAL from a judgment of the Superior Court of
Los Angeles County, Colin P. Leis, Judge. Affirmed.
Robert Alan Sheinbein for Plaintiff and Appellant.
Lewis Brisbois Bisgaard & Smith, Tracy D. Forbath,
Charles L. Harris and Eric R. Hagle for Defendant and
Respondent.
 After he suffered injuries from an automobile accident with
an uninsured motorist, appellant Ghougas Ourfali sought to
recover his damages through arbitration with his insurer,
respondent 21st Century Insurance Company. The arbitrator
awarded appellant his damages and also granted his motion for
costs of proof pursuant to Code of Civil Procedure section
2033.4201 based on respondent’s failure to admit certain requests
for admission.
The trial court affirmed the arbitration award in favor of
appellant, but denied his petition to affirm the award of his costs
of proof. Instead, the court granted respondent’s petition to
vacate the award of costs of proof, finding that the arbitrator
exceeded his jurisdiction based on the language of the arbitration
clause in appellant’s insurance policy. On appeal, appellant
contends that the arbitrator was empowered to decide discovery
disputes under the relevant statutory framework and the
language of the parties’ agreement. We disagree and affirm.
FACTUAL AND PROCEDURAL HISTORY
I. Appellant’s Accident and Demand for Arbitration
On July 1, 2020, appellant was in an automobile accident
with an uninsured motorist. At the time, he was insured under a
policy issued by respondent, which included uninsured motorist
coverage. Appellant’s insurance policy contained an arbitration
provision, providing that “If we and a person insured do not
agree as to whether he or she is legally entitled to recover
damages from an Uninsured Motorist or the amount of such
damages, then upon written demand of either, the disagreement
shall be submitted to a single neutral Arbitrator for decision, in

1 All further statutory references are to the Code of Civil
Procedure unless otherwise indicated.

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accordance with the law of California. All other issues between
us and any person insured, including the existence or limits of
coverage, may not be decided by the Arbitrator, but must be
decided by a Court of competent jurisdiction.” (Emphasis in
original.)
Appellant claimed that he sustained bodily injury, loss of
earnings, medical expenses, and other damages from the
accident. He tendered a claim for his damages to respondent, but
respondent refused to settle. Appellant therefore sent respondent
a demand for arbitration pursuant to the arbitration provision in
the insurance policy and Insurance Code section 11580.2.
Appellant filed a petition for order compelling arbitration
in the trial court in April 2021. The court granted the petition
and ordered the parties to arbitration. After the parties agreed
upon an arbitrator, the arbitration commenced on February 3,
2022.
II. Arbitration Decision and Award of Costs
In March 2022, the arbitrator issued a written decision,
awarding appellant $88,011.26 in damages for medical expenses
and pain and suffering.
Appellant subsequently brought a motion before the
arbitrator for costs of proof expenses and attorney fees pursuant
to section 2033.420 (the fee motion). He contended that during
discovery, respondent “failed or refused to admit” several
requests for admission related to the cause of appellant’s injuries
and whether the medical expenses he incurred were reasonable
and necessary. Appellant argued that respondent’s failure to
admit these requests required additional discovery, including
taking appellant’s deposition and retaining expert witnesses.
Therefore, he sought $45,189.50 in expenses and attorney fees

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incurred as costs of proof for the requests for admissions
respondent failed to admit. Respondent opposed the motion
arguing, as relevant here, that a decision regarding entitlement
to attorney fees and costs under the discovery statutes was
outside the scope of the parties’ arbitration agreement and
therefore such an award would be in excess of the arbitrator’s
powers.
The arbitrator conducted a hearing on appellant’s fee
motion on April 25, 2022. In a written decision issued May 4,
2022, the arbitrator partially granted the fee motion. The
arbitrator acknowledged that the “ruling could go either way”
and that the policy language was “somewhat ambiguous.”
Ultimately, the arbitrator found that the insurance policy “did
not preclude this type of motion and indicated California law
should apply,” and therefore concluded that appellant’s costs of
proof were properly awarded pursuant to Insurance Code section
11580.2, subdivision (f)(6). The arbitrator awarded appellant
$34,789.50 in attorney fees and expenses.
III. Petition to Vacate
On May 27, 2022, appellant filed a petition with the
superior court to confirm the arbitration award and the fee award
and for entry of judgment. The same day, respondent filed a
petition to vacate the fee award.2 It sought to vacate the fee
award on the ground that the arbitrator exceeded his powers by
deciding a discovery dispute, which was outside the scope of the
parties’ arbitration agreement.

2 Respondent subsequently filed an opposition to appellant’s
petition to confirm the awards, raising the same arguments as in
its petition to vacate.

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 Appellant opposed the petition to vacate. He argued that
the policy language did not preclude the arbitrator’s award of
costs of proof and that the discovery statutes applied to
uninsured motorist arbitrations.
At the July 12, 2022 hearing on the petitions, the court
asked appellant’s counsel to address the scope of the contractual
arbitration provision. Appellant’s counsel responded that the
policy language granting the arbitrator authority to determine
liability and amount of damages encompassed rulings on related
discovery issues, such as the cost of proof award at issue here.
Appellant also contended that the contrary holding in Miranda v.
21st Century Ins. Co. (2004) 117 Cal.App.4th 913 (Miranda) was
dicta. The court took the matter under submission.
The court issued a written order affirming the arbitration
award of $88,011.26 in favor of appellant. However, the court
vacated the fee award, finding that the arbitrator exceeded his
authority in awarding costs of proof. Relying on Miranda, supra,
117 Cal.App.4th at p. 926, the court found that it had “exclusive
jurisdiction to hear discovery matters arising under uninsured
motorist arbitrations.” The court further found that the language
of the policy similarly limited the scope of the arbitration to “only
whether Petitioner ‘is legally entitled to recover damages’ and
‘the amount of such damages.’” The court entered judgment
confirming the arbitration award on September 29, 2022.
Appellant timely appealed.
DISCUSSION
Appellant argues that arbitrator had the authority to grant
his motion for costs of proof and the trial court therefore erred in
concluding to the contrary. We conclude, as the trial court did,

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that the arbitrator exceeded the scope of his authority under the
parties’ arbitration agreement and relevant case law.
I. Applicable Legal Principles
A. Uninsured Motorist Arbitrations
Insurance Code section 11580.2 governs uninsured and
underinsured motorist coverage.3 Subdivision (a) requires all
automobile insurance policies in California, which cover bodily
injury liability, to include insurance for amounts the insured is
“legally entitled to recover as damages for bodily injury or
wrongful death from the owner or operator of an uninsured motor
vehicle.”
The requirement for arbitration of uninsured motorist
claims is contained in subdivision (f), which provides in pertinent
part, “the determination as to whether the insured shall be
legally entitled to recover damages, and if so entitled, the amount
thereof, shall be made by agreement between the insured and the
insurer or, in the event of disagreement, by arbitration.” (Ins.
Code, § 11580.2, subd. (f).) Thus, the statute requires arbitration
of two issues only: (1) whether the insured is entitled to recover
against the uninsured motorist and (2) if so, the amount of
damages. “In this context, the term ‘damages’ refers to the
amount of damages the insured is entitled to recover from the
underinsured motorist; ‘it does not include determination of the
extent of coverage and the amount of money the insurance
company is obligated to pay the insured.’” (Weinberg v. Safeco
Ins. Co. of America (2004) 114 Cal.App.4th 1075, 1082
(Weinberg), italics omitted, disapproved on another ground in
Barnett v. First National Ins. Co. of America (2010) 184

3 We use these terms interchangeably for the purposes of
this appeal.

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Cal.App.4th 1454; see also Storm v. Standard Fire Insurance
Company (2020) 52 Cal.App.5th 636, 643 (Storm) [“absent
language in the insurance agreement expanding the issues to be
arbitrated [citation], underinsured motorist arbitrations
contemplate only two issues”].) “While the parties voluntarily
may submit to arbitration issues other than those required by
statute and the policy, ‘the courts will not infer a voluntary
submission of a nonstatutory issue in the absence of a clear
showing that the parties so intended, either by actual litigation
or argument of the issue . . . or by some other unambiguous
conduct.’” (Weinberg, supra, 114 Cal.App.4th at p. 1082, quoting
Furlough v. Transamerica Ins. Co. (1988) 203 Cal.App.3d 40, 45–
46.)
Insurance Code section 11580.2 also adopts the entire Civil
Discovery Act. “Title 4 (commencing with Section 2016.010) of
Part 4 of the Code of Civil Procedure shall be applicable to these
determinations, and all rights, remedies, obligations, liabilities
and procedures set forth in Title 4 (commencing with Section
2016.010) of Part 4 of the Code of Civil Procedure shall be
available to both the insured and the insurer at any time after
the accident, both before and after the commencement of
arbitration, if any,” subject to certain enumerated limitations.
(Ins. Code, § 11580.2, subd. (f).)
B. Standard of Review
A court’s review of an arbitration award is expressly
limited to the statutory grounds for vacating an award under
section 1286.2 or correcting an award under section 1286.6.
(Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 33.) Here, the
trial court vacated the fee award pursuant to section 1286.2,
subdivision (a)(4), which provides that the trial court shall vacate

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the award if it determines that “[t]he arbitrator[ ] exceeded [his]
powers and the award cannot be corrected without affecting the
merits of the decision upon the controversy submitted.” As
relevant here, an arbitrator exceeds his powers when he acts in a
manner not authorized by contract or by law. (Jordan v.
Department of Motor Vehicles (2002) 100 Cal.App.4th 431, 443.)
On appeal from an order vacating an arbitration award, we
review the trial court’s order under a de novo standard. (Malek v.
Blue Cross of California (2004) 121 Cal.App.4th 44, 55; Haworth
v. Superior Court (2010) 50 Cal.4th 372, 383 [de novo standard
applies to claim that arbitrator exceeded his or her powers].) We
give substantial deference to the arbitrator’s own assessment of
the contractual scope of his powers. (See Advanced Micro
Devices, Inc. v. Intel Corp. (1994) 9 Cal.4th 362, 372.)
II. Analysis
We first turn to appellant’s contention that the language of
the arbitration agreement allowed appellant to bring his motion
for costs of proof before the arbitrator. Notably, the language of
the agreement tracked the limited scope of arbitrable issues set
out in Insurance Code section 11580.2, subdivision (f)—the
agreement expressly stated that disagreements regarding
whether the insured “is legally entitled to recover damages from
an Uninsured Motorist or the amount of such damages” were
subject to arbitration. On the other hand, “[a]ll other issues
between [insurer] and . . . insured, including the existence or
limits of coverage, may not be decided by the Arbitrator, but must
be decided by a Court of competent jurisdiction.”
We interpret the policy based on well-established rules of
contract interpretation, giving effect to the “mutual intention” of
the parties at the time the contract was formed. (Civ. Code,

8
§ 1636.) “Such intent is to be inferred, if possible, solely from the
written provisions of the contract. (Id., § 1639.) The ‘clear and
explicit’ meaning of these provisions, interpreted in their
‘ordinary and popular sense,’ unless ‘used by the parties in a
technical sense or a special meaning is given to them by usage’
(id., § 1644), controls judicial interpretation. (Id., § 1638.)’”
(Ameron Internat. Corp. v. Insurance Co. of State of Pennsylvania
(2010) 50 Cal.4th 1370, 1378.) Here, the contract expressly limits
arbitration to two specific issues: whether appellant is entitled to
recover damages from the uninsured motorist, and the amount of
those damages. We will not read into the contract a term about
which it is silent, such as an intent for the arbitrator to handle
discovery disputes. (See The Ratcliff Architects v. Vanir
Construction Management, Inc. (2001) 88 Cal.App.4th 595, 602;
Civ. Code, § 1641 [“The whole of a contract is to be taken
together, so as to give effect to every part, if reasonably
practicable, each clause helping to interpret the other.”].)
A different panel of this court reached the same conclusion
under similar circumstances in Storm, supra, 52 Cal.App.5th 636.
There, the plaintiff in an underinsured motorist arbitration
sought an award before the trial court of arbitration costs under
section 998 and post-arbitration costs under section 1293.2. (Id.
at p. 640.) As relevant here, the appellate court rejected the
insurer’s argument that the plaintiff was required to seek costs
from the arbitrator in the first instance. The court found that the
language of the insurance policy “strictly limited the decisional
authority of the arbitrator to two issues—Storm’s entitlement to
damages, and the amount thereof. It did not give the arbitrator
the power to award costs.” (Ibid.) Thus, the plaintiff was “not
required to request those costs from the arbitrator, and the

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proper forum to hear her request is the trial court that confirmed
the arbitration award.” (Id. at p. 648.) The court distinguished
Heimlich v. Shivji (2019) 7 Cal.5th 350, 358, in which the “broad”
agreement committed “the parties to arbitrate ‘all disputes or
claims of any nature whatsoever,’” and therefore meant that the
plaintiff was required to request costs from the arbitrator. (See
Storm, supra, 52 Cal.App.5th at p. 647; see also Weinberg, supra,
114 Cal.App.4th at p. 1082 [when insurance agreement restates
Insurance Code section 11580.2’s statutory language,
“‘arbitration is limited to issues relating to liability of the
uninsured motorist to the insured’”].)
Appellant points to the language in the agreement that the
parties’ issues shall be submitted to an arbitrator “in accordance
with the law of California.” He contends that this clause defined
the scope of the arbitrator’s powers broadly under California law
and therefore gave the arbitrator “the authority to address and
redress all discovery matters” related to the arbitration. We
reject this interpretation as inconsistent with the arbitration
provision as a whole and the rules of contract interpretation.
“‘The whole of a contract is to be taken together, so as to
give effect to every part, if reasonably practicable, each clause
helping to interpret the other.’” (Civ. Code, § 1641.) Thus, we
must “‘interpret contractual language in a manner which gives
force and effect to every provision,’ and avoid constructions which
would render any of its provisions or words ‘surplusage.’ Put
simply, ‘[a] contract term should not be construed to render some
of its provisions meaningless or irrelevant.’” (In re Marriage of
Nassimi (2016) 3 Cal.App.5th 667, 688; see also Civ. Code,
§§ 1641, 1643; Safeco Ins. Co. v. Robert S. (2001) 26 Cal.4th 758,
765 [“When reasonably practical, contracts are to be interpreted

10
in a manner that makes them reasonable and capable of being
carried into effect, and that is consistent with the parties’
intent.”].) Under appellant’s construction, the phrase invoking
California law would substantially broaden the scope of the
arbitrator’s authority, failing to give effect to every part of the
contract and rendering meaningless the provisions limiting the
scope of the arbitration in accordance with Insurance Code
section 11580.2. We decline to read the contract in this manner.
Although generally we defer to the arbitrator’s interpretation of
the contract language regarding the scope of his powers, we note
that the arbitrator found the policy language “somewhat
ambiguous” and assessed that his determination “could go either
way.” Given that the arbitrator did not provide a clear
assessment of the contractual language and in light of the
express policy language mirroring the statutory scope of
authority set forth in Insurance Code section 11580.2, we
conclude that the trial court did not err in vacating the
arbitrator’s determination.
Further, we are not persuaded by appellant’s argument
that limiting the arbitrator’s powers to the narrow scope
expressly set forth in the agreement would violate public policy.
Appellant contends that interpreting the contract to preclude the
arbitrator from determining discovery matters would deny him
his right to recover costs of proof and therefore circumvent the
“substantive law of this State.” By interpreting the parties’
agreement to limit the scope of the arbitrator’s powers, we do not
foreclose appellant’s ability to seek costs of proof. However, he
must seek them before the trial court.
Our conclusion that the trial court was the appropriate
forum for appellant’s motion for costs of proof is further

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supported by our sister court’s decision in Miranda, supra, 117
Cal.App.4th 913. In Miranda, the plaintiff demanded arbitration
of her underinsured motorist claim against her insurer. (Id. at p.
917.) The insurer commenced discovery, but Miranda refused to
comply with the discovery demands and subsequent court orders,
contending that the court lacked jurisdiction over her. The court
granted the insurer’s motion for terminating sanctions. (Id. at
pp. 918-919.)
On appeal, Miranda argued that the court lacked subject
matter jurisdiction to enter discovery orders and to dismiss the
arbitration; instead, she asserted that only the arbitrator had
power to rule on “arbitration-related discovery.” (Miranda,
supra, at p. 920.) The appellate court analyzed Insurance Code
section 11580.2 and its interplay with the general law governing
contractual arbitrations. In particular, the court noted
differences between the general laws for discovery in contractual
arbitrations and the specific provisions of Insurance Code section
11580.2 governing uninsured motorist claims, including that in
the latter, discovery may be commenced before and after the
commencement of arbitration. (Id. at p. 923, comparing
§ 1283.05, subd. (a) with Ins. Code, § 11580.2, subd. (f).) The
court also noted that “in contractual arbitrations, the arbitrator
has the power to ‘enforce the rights, remedies, procedures, duties,
liabilities, and obligations of discovery’” (ibid., quoting § 1283.05,
subd. (b)), while in uninsured motorist arbitrations, the statute
provided that “all rights, remedies, obligations, liabilities and
procedures set forth in [Title 4 of the Civil Discovery Act] shall be
available to both the insured and the insurer. . . . [¶] [W]henever
. . . provision is made for application to the court or obtaining
leave of court or approval by the court, the court that shall have

12
jurisdiction for the purposes of this section shall be the superior
court of the State of California.” (Ibid., quoting Ins. Code, §
11580.2, subd. (f)(1).)
The Miranda court concluded that it could “harmonize
these conflicting provisions by reading the discovery provisions
governing uninsured motorist arbitrations as an exception to the
discovery provisions governing contractual arbitrations
generally.” (Miranda, supra, 117 Cal.App.4th at p. 924.) As
such, the court held that the trial court “had the power to rule on
the discovery dispute. And because we conclude the Legislature
could not have intended the arbitrator and the court to possess
concurrent power, the uninsured motorist law grants the superior
court the exclusive jurisdiction to hear discovery matters arising
under uninsured motorist arbitrations.” (Id. at p. 926; see also
Menchaca v. Farmers Insurance Exchange (1976) 59 Cal.App.3d
117, 124 [Insurance Code section 11580.2, subdivision (f) “also
enables the parties to utilize the deposition and discovery
provisions of the Code of Civil Procedure [and] the superior court
to have jurisdiction over those matters.”].)
Appellant contends that the applicable holding in Miranda
was dicta. We disagree. As detailed above, at issue in Miranda
was whether the arbitrator or the court had jurisdiction to hear
discovery disputes, and to issue discovery sanctions, related to
the uninsured motorist arbitration. The court’s analysis of the
relevant statutory framework and conclusion that the superior
court had jurisdiction was therefore necessary to its decision and
squarely on point. (See Fireman’s Fund Ins. Co. v. Maryland
Cas. Co. (1998) 65 Cal.App.4th 1279, 1301[court must “read the
language of an opinion in the light of its facts and the issues
raised, in order to determine which statements of law were

13
necessary to the decision, . . . and which were general
observations unnecessary to the decision,” and therefore dicta].)
In any event, we find the analysis in Miranda persuasive.
The cases cited by appellant do not disturb the conclusion that
the arbitrator lacked authority to rule on appellant’s discovery
motion. Appellant cites Pilimai v. Farmers Ins. Exchange Co.
(2006) 39 Cal.4th 133, 141, for example, for the general
proposition that uninsured motorist arbitrations are a form of
contractual arbitration governed by the California Arbitration
Act. Appellant’s reliance on Berglund v. Arthroscopic & Laser
Surgery Center of San Diego, L.P. (2008) 44 Cal.4th 528 is also
misplaced, as that case did not involve an uninsured motorist
arbitration, but examined an arbitrator’s power to enforce
discovery in a contractual arbitration related to medical
treatment. (Id. at p. 535.)
Thus, we conclude that the trial court did not err in
vacating the arbitrator’s award of costs of proof to appellant, as
the award was in excess of the arbitrator’s powers under the
parties’ arbitration agreement.4 We therefore affirm, without
prejudice to appellant bringing a proper motion for costs in the
trial court. We express no opinion as to the outcome of any such
motion.

4 We do not reach respondent’s alternative argument that
the award should be vacated because the language of the
insurance policy provides for equal division of costs and fees and
therefore bars recovery of costs of proof.

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 DISPOSITION
The judgment is affirmed. Respondent is entitled to its
costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

COLLINS, J.

We concur:

CURREY, P. J.

ZUKIN, J.

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