$4,602,229.07 Fees And Costs Awarded By Arbitrator To Prevailing Party Winning $8 Million In Damages.
Co-contributor Marc, for the last few years, has been doing posts on his independent California Mediation and Arbitration blog. One thing that has resonated with co-contributor Mike is that the chosen arbitrator has lots of discretion in adjudging a matter unless the arbitration clause dictates otherwise. For example, the arbitrator can use either principles of law or equity in rendering an award. The arbitrator can fashion a remedy or “blue pencil” unless doing so would violate some very precisely delineated public policy/illegality principles, or unless the parties’ agreement specifically requires the arbitrator to follow the law, making it clear that the arbitrator who does not do so will be acting outside the arbitrator’s power.
Also, the awards can be quite high where complex, sophisticated transactions are involved, as the next case illustrates.
In Tricor Energy v. U.S. Full Service Energy, Case No. G050703 (4th Dist., Div. 3 Sept. 4, 2015) (unpublished), Hon. William F. McDonald (Ret.), the arbitrator, awarded the prevailing claimant $8 million in compensatory damages (but no punis) in a case involving a natural gas storage transaction. Based on a fees clause in a joint venture agreement, the arbitrator also awarded $4 million in fees and $602,229.07 in costs/expenses to the prevailing party. The Fourth District, Division 3, affirmed in an opinion authored by Presiding Justice O’Leary.
Marc tried a case involving a view dispute between Laguna Beach neighbors in Judge McDonald’s courtroom some twenty years ago. Hello, Judge McDonald.