Party-Appointed Appraiser Is Still an Arbitrator

Khorsand v. Liberty Mutual Ins. Co., No. B280273 (D2d4 Feb. 27, 2018)

Evidence Code § 703.5 strictly limits the admissibility of testimony from judges, referees, arbitrators, and mediators. There are exceptions, including when offered to prove contempt, a crime, judicial misconduct, or a grounds for disqualification. The court here accepts that an effort to prove that a ruling in an insurance claim-related appraisal (a form of arbitration) was procured by fraud falls within those exceptions. Although there’s not much analysis as to why.

But the court rejects a broader claim for admissibility on the basis that the appraiser who offered the declaration doesn’t count as an arbitrator. The procedural setup entailed each party appointing an appraiser, and then the two party appointees appointing a third appraiser, who is commonly called the “referee.” The declarant was one of the party appointed appraisers. The Court holds that even though a party-appointed appraiser might not be considered completely neutral, that doesn’t take him outside of the role of an arbitrator, and thus not outside of the exclusion under § 703.5.

Affirmed.