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A non-signatory to an arbitration agreement is bound by an arbitration award issued against him if he participated in the arbitration hearing and did not object to jurisdiction prior to the award, a California appellate court held.
In Proctor v. Georgiades, No. G036462, 2007 WL 106380 (Cal. Ct. App.4d Jan. 17, 2007), Proctor hired Emperor, a construction company. Georgiades negotiated the contract, containing an arbitration agreement, with Proctor on behalf of Emperor and signed it in his capacity as salesman.
Subsequently, Proctor pursued arbitration for complaints against Emperor and Georgiades. An award was issued in Proctor's favor and his motion to confirm the award was granted. Georgiades appealed.
The Court rejected Georgiades' argument that he was not subject to the arbitration agreement because he was not party to the contract between Proctor and Emperor. Georgiades participated in the arbitration proceedings. He did not raise the jurisdictional issue properly and an award had been issued against him. The Court concluded that "[a] party who knowingly participates in the arbitration process without disclosing a ground for declaring it invalid is properly cast into the outer darkness of forfeiture." Cummings v. Future Nissan, 128 Cal.App.4th 321, 329 (Cal. App.3d 2005).
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