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Law School Case Brief

Blanton v. Womancare, Inc. - 38 Cal. 3d 396, 212 Cal. Rptr. 151, 696 P.2d 645 (1985)

Rule:

An attorney is not authorized merely by virtue of his retention in litigation to impair the client's substantial rights or the cause of action itself. An attorney must be specifically authorized to settle and compromise a claim that merely on the basis of his employment he has no implied or ostensible authority to bind his client to a compromise settlement of pending litigation. Similarly, an attorney may not stipulate to a matter which would eliminate an essential defense. He may not agree to the entry of a default judgment, may not stipulate that only nominal damages may be awarded and he cannot agree to an increase in the amount of the judgment against his client. Such decisions differ from the routine and tactical decisions which have been called "procedural" both in the degree to which they affect the client's interest, and in the degree to which they involve matters of judgment which extend beyond technical competence so that any client would be expected to share in the making of them. 

Facts:

A patient allegedly suffered a perforated uterus during an abortion performed by a fourth-year medical student at the clinic of defendant Womancare. The patient brought an action for malpractice against the clinic, the student, and the supervising physician. Although plaintiff informed her attorney that she would not enter into binding arbitration, her attorney signed an agreement on her behalf, subjecting her to binding arbitration. As soon as the plaintiff discovered his actions, she fired her attorney, hired a new one, and sought to invalidate the agreement. The trial court rejected the plaintiff's contention, the arbitrator ruled for the defendants, and the trial court entered judgment for the defendants. Plaintiff appealed.

Issue:

Did the lawyer bind his client to the arbitration agreement?

Answer:

No

Conclusion:

The court reversed, finding that the attorney had neither implied actual authority or apparent authority to enter into the agreement on the client's behalf. Because the agreement entailed a waiver of all but minimal judicial review, provided for unilateral selection of the arbitrator by the defendant's attorney, and waived any right to recovery beyond $15,000, it affected substantial rights of the client. Therefore, because there was no ratification, the agreement could not stand.

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