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Dispute Resolution Keyed to Carbonneau, 8th Ed.
Engalla v. Permanente Medical Group, Inc.
Citation:
15 Cal. 4th 951, 64 Cal. Rptr. 2d 843, 938 P.2d 903 (1997)Facts
Wilfredo Engalla immigrated to the United States in 1980 and began working for Oliver Tire & Rubber Company, where he enrolled in Kaiser’s health plan. In 1986, Engalla presented to Kaiser with respiratory symptoms, and despite abnormalities noted in his right lung, Kaiser failed to perform proper diagnostic tests for several years, repeatedly diagnosing him with common colds and allergies. In 1991, x-rays finally revealed lung cancer, but by then Engalla’s condition was inoperable. Engalla and his family filed a demand for arbitration on May 31, 1991, as required by Kaiser’s health plan agreement, which specified that arbitrators should be selected within 60 days. Despite Engalla’s counsel’s repeated requests to expedite the process due to Engalla’s terminal condition, Kaiser’s counsel engaged in numerous delays in selecting arbitrators. Statistical evidence showed that in 99% of Kaiser arbitrations, neutral arbitrators were not appointed within the contractually specified 60-day period. A neutral arbitrator was finally agreed upon 144 days after the initial claim, but Engalla died the next day. The Engallas subsequently withdrew from the arbitration and filed a lawsuit, alleging fraud in the inducement of the arbitration agreement.
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