Opinion
NOT TO BE PUBLISHED
San Francisco County Super. Ct. No. CGC-05-445009
RIVERA, J.
Plaintiff Joe D. Turner (Turner) appeals an order denying a request to enjoin an arbitration. Defendants Asset Allocation Advisors, Inc. (the company), Gregory E. Schultz (Schultz), and Bruce D. Grenke (Grenke) have moved to dismiss this appeal as moot. We grant the motion and dismiss the appeal.
We also grant defendants’ request for judicial notice filed August 8, 2006.
I. BACKGROUND
Turner, a shareholder in the company, entered into a “Buy/Sell Agreement II” (the agreement) in 2003 with Schultz and Grenke, two other shareholders in the company. The agreement provided a formula for buying out the shares of a shareholder who was terminated as an employee of the company. The agreement also contained an arbitration clause, which provided in pertinent part: “[I]n the event any controversy or claims arising out this Agreement cannot be settled by the parties hereto or their legal representatives, . . . such controversy or claims shall be settled by arbitration in accordance with the then current rules of the American Arbitration Association and judgment upon the award may be entered in any Court having jurisdiction thereof.” The agreement included a choice-of-law clause providing that it would “be construed and governed by the laws of the State of California.” According to the complaint in this action, the company’s board of directors terminated Turner’s employment in 2004, and Turner was dissatisfied with the amount the company offered him for his shares. The company, Schultz, and Grenke demanded arbitration of the dispute.
Through his attorney, Turner took part in a discussion with a manager for defendant American Arbitration Association (the AAA) on June 10, 2005, and requested that arbitration take place in San Francisco. However, on June 28, 2005, he informed defendants that he refused to participate in the arbitration absent a court order compelling arbitration, taking the position that the agreement was void ab initio because it was procured by “fraud in the inception.” The next day, the AAA notified the parties that it would proceed with the arbitration unless the parties agreed or a court ordered otherwise.
Turner filed an action against the company, Schultz, Grenke and another corporation in the Contra Costa County Superior Court on August 9, 2005 (Turner v. Schultz (2006, No. C-05-01521) (the Contra Costa action)), which included allegations that Grenke and Schultz made false representations to induce Turner to enter into the agreement. Nine days later, Turner wrote to the AAA, taking the position that the AAA lacked jurisdiction because Turner had filed his action in superior court. Turner also objected to the arbitrators proposed by the AAA because of that lack of jurisdiction. The AAA administratively appointed three arbitrators on August 22, 2005, and later confirmed the appointment.
According to the AAA’s letter to the parties, the parties were required to raise any “factual objections” to the appointment of the three arbitrators within five business days. The letter confirming the arbitrators is dated October 7, 2005.
Turner brought the action that is the subject of this appeal against the AAA, Schultz, Grenke, and the company in the San Francisco Superior Court on September 20, 2005 (the San Francisco action). He sought a declaration that the defendants could not proceed with arbitration relating to the agreement without first obtaining a court order; he also sought an injunction requiring the AAA to stay its proceedings until the defendants obtained an order compelling arbitration pursuant to Code of Civil Procedure section 1281.2 (section 1281.2).
Turner then filed an application in the San Francisco action for a temporary restraining order and order to show cause, seeking a preliminary injunction prohibiting defendants from “taking any action concerning the American Arbitration Association arbitration entitled Bruce Grenke and Gregory Schultz and Asset Allocation Advisors, Inc. vs. Joe Turner, 74 168 Y 00529 05 DEAR, other than dismissing that arbitration, unless an order compelling arbitration is issued.” The trial court denied the temporary restraining order, but issued an order to show cause. After further briefing and a hearing, the trial court denied Turner’s application on November 7, 2005. Turner filed his notice of appeal on January 5, 2006.
Meanwhile, on December 21, 2005, the company, Schultz, and Grenke filed a petition to compel arbitration in the Contra Costa action. Turner opposed the petition, but against the possibility that the petition would be granted, he also requested that the court take action to allow him to participate in a new selection of the arbitrators. The Contra Costa County Superior Court granted the petition on March 13, 2006, and declined to intervene in the AAA’s procedures for selecting an arbitrator.
II. DISCUSSION
The company, Schultz, and Grenke contend this appeal was rendered moot by the Contra Costa County Superior Court’s order granting the petition to compel arbitration. They argue that the very event that Turner contended was a prerequisite to his obligation to participate in the AAA arbitration—a court order requiring him to do so—has now occurred, and as a result this court can grant no effective relief.
The AAA has not taken any position on the substantive issues in this appeal. As we discuss in our opinion filed today in Turner v. American Arbitration Assn. (Oct. 24, 2007, A113905) [nonpub. opn.] (Turner II), the trial court sustained the AAA’s demurrer to the complaint in the San Francisco action primarily on the ground that the action was barred by the doctrine of arbitral immunity. Turner’s appeal of that decision is the subject of Turner II. We take judicial notice of the record in Turner II.
“ ‘It is well settled that an appellate court will decide only actual controversies. Consistent therewith, it has been said that an action which originally was based upon a justiciable controversy cannot be maintained on appeal if the questions raised therein have become moot by subsequent acts or events. . . . [T]he appellate court cannot render opinions “ ‘ . . . upon moot questions or abstract propositions, or to declare principles or rules of law which cannot affect the matter in issue in the case before it. It necessarily follows that when, pending an appeal from the judgment of a lower court, and without any fault of the defendant, an event occurs which renders it impossible for this court, if it should decide the case in favor of plaintiff, to grant him any effectual relief whatever, the court will not proceed to a formal judgment, but will dismiss the appeal.’ ” [Citations.]’ [Citation.] As the Court of Appeal stated in Wilson v. L. A. County Civil Service Com. (1952) 112 Cal.App.2d 450, 453 . . ., ‘ “although a case may originally present an existing controversy, if before decision it has, through act of the parties or other cause, occurring after the commencement of the action, lost that essential character, it becomes a moot case or question which will not be considered by the court.” ’ [¶] This rule has been regularly employed where injunctive relief is sought and, pending appeal, the act sought to be enjoined has been performed.” (Giles v. Horn (2002) 100 Cal.App.4th 206, 226-227.)
The relief Turner sought in his application for a temporary restraining order and preliminary injunction was an order restraining the defendants from “taking any action concerning [the arbitration that had been initiated], other than dismissing that arbitration, unless an order compelling arbitration is issued.” Similarly, in his reply brief, he asked the court to “enjoin the arbitration unless and until defendants obtain an order compelling arbitration.” They have now obtained such an order. Even if we were to agree with Turner that the trial court should have granted him his requested relief—a stay of arbitration until the defendants obtained an order compelling arbitration—our decision would have no practical effect on the parties because they have now done so.
Turner argues, however, that effective relief is still possible because a reversal would allow the arbitration to start again from the beginning, with a new selection of arbitrators. He points out that he did not participate in selection of the arbitrators because he took the position that the AAA lacked jurisdiction. He also contends that he has lost the opportunity to file a cross-demand as of right because the arbitrators have already been appointed, and under the AAA’s rules he may now do so only by leave of the arbitrators. According to Turner, a reversal on appeal would mean that the proceedings that have already taken place in the arbitration are void, and that in new proceedings he would have the right to object to proposed arbitrators and guarantee his right to file a cross-demand.
The parties agree that although the arbitrators have been selected, no hearings have yet taken place. The company, Schultz, and Grenke state in their brief on appeal that none will take place until after this appeal has been resolved. They have also represented to this court that they will not object to Turner’s bringing a late cross-demand.
Given the procedural posture of this case, we must reject Turner’s contention. The order under appeal merely denied Turner’s request to have defendants enjoined from proceeding with the arbitration absent a court order, an order they have now obtained. Turner did not ask the court to vacate the proceedings that had already taken place—including the selection of arbitrators—and order the arbitration to begin anew. The trial court cannot be faulted for not granting a request Turner did not make in the San Francisco action.
Turner sought similar relief in the Contra Costa action to allow him “to participate in the arbitration process afresh” and to “participate in the selection of arbitrator.” That trial court’s ruling denying that relief is not before us on this appeal.
Additionally, Turner’s contention that only through this appeal could he gain the right to participate in the selection of arbitrators is apparently premised upon his belief or assertion that any participation in the arbitration proceedings would have resulted in a waiver of his right to challenge it. But Turner cites no authority for that assertion and the law is to the contrary. While a party who participates in an arbitration without objection will not later be heard to object to it, one who participates in arbitration proceedings under protest, and expressly preserves his objections, does not thereby relinquish his right to claim that he is entitled to litigate the dispute in court. (Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 29-31; Alternative Systems, Inc., v. Carey (1998) 67 Cal.App.4th 1034, 1040-1041; Bayscene Resident Negotiators v. Bayscene Mobilehome Park (1993) 15 Cal.App.4th 119, 129.) Accordingly, it is not the dismissal of this appeal, but Turner’s own decision that prevented him from participating in the selection of the arbitrators.
It is worth noting that because Turner objected to the entire panel of arbitrators originally proposed by the AAA, the arbitrators were chosen administratively. Accordingly, the company, Schultz, and Grenke did not actively participate in the selection of the arbitrators and thus gained no advantage in the arbitrator selection process, as Turner seems to imply.
Turner urges us, alternatively, to exercise our discretion to consider this case on the merits even if we agree that we could provide no effective relief, contending that there are material questions between the parties that will arise again in an appeal after the arbitration is completed, and that this is a matter of general public interest. (See Grier v. Alameda-Contra Costa Transit Dist. (1976) 55 Cal.App.3d 325, 330; see also Dobbins v. San Diego County Civil Service Com. (1999) 75 Cal.App.4th 125, 128, fn. 3 (Dobbins).) We acknowledge the principles upon which Turner relies, but decline his request. First, we do not consider the question presented on this appeal as an “important issue[] of substantial and continuing public interest.” (Dobbins, supra, 75 Cal.App.4th at p. 128, fn. 3.) Second, if the parties’ dispute over application of section 1281.2 is likely to recur, as Turner contends, it can be addressed at such time as that occurs. For these reasons, and for those expressed in Turner II, we will not review the merits of this moot appeal.
III. DISPOSITION
The appeal is dismissed.
We concur: RUVOLO, P.J., REARDON, J.