Cases in which non-signatories are bound by arbitration contracts are not limited to those involving relatives of patients who have accepted arbitration. Madden v. Kaiser Foundation Hospitals (1976) 17 Cal.3d 699 was a claim of misconduct by a government employee against health care providers who treated her as part of a health plan in which she was registered by her job. The interim contract between the employer (by the Board of Directors of the National Workers` Pension Plan) and the health plan required a mandatory reconciliation of misbehaviour claims. Madden concluded that, because the House had the legal authority to negotiate group medical contracts on behalf of state employees, arbitration has become an accepted means of dispute resolution and a general plenipotentiary is entitled to “do whatever is necessary or normal and usual . . . . for the achievement of its agency`s objective, the House had the power to approve a contract that would include an arbitration provision binding the workers. (Id. under 706.) As a result, the employee was required to settle her misconduct claims when she had not signed the arbitration agreement. This finding does not detract from the statement of Newton`s counsel, Murphy, that he did not provide services to the respondent independently of those made on behalf of Harvey Newton and that the respondent did not benefit from NORCAL`s agreement to grant him a defence.
It does not matter that Newton`s trial ended quickly and that he required little work, specific to the interviewee`s representation. The advantage conferred by the insurance policy was legal representation to defend the right to abuse. At the time it accepted this submission, the underlying debt had not yet been settled and it was not possible to predict what services Murphy was to provide in the defence against it. In accepting NORCalL`s defence, the interviewee avoided paying solely for the cost of a defence for the act of misconduct. The respondent must be subject to the insurance policy in order to obtain representation, but denying him the applicability of the arbitration provision would allow him to choose and choose the parts of the policy that she wanted to accept. On March 27, 1996, counsel James Murphy filed an abuse complaint with NORCAL for defence and compensation “on behalf of Dr. Newton and Nancy Newton.” Murphy`s letter stated that if NORCAL decided to provide a defence subject to rights, Dr. Newton requested that Murphy`s company be named on April 23, 1996, in accordance with Civil Code 2860, NORCAL agreed to defend Dr. Newton. In accordance with the allegations of NORCAL`s subsequent request to impose arbitration and the statement of NORCAL`s counsel, NORCAL stated that it was “ready to defend DR NEWTON and MRS NEWTON on an interim basis, subject to further investigations and a legal reserve, including the right to refuse or compensate for any payment and to demand reimbursement of all costs and costs related to the defence.” The common thread of all the cases mentioned above is the existence of an agency or a similar relationship between the non-signatory and one of the parties to the arbitration agreement. In the absence of such a relationship, the courts refused to retain non-signatories to arbitration agreements. For example, in Contra Costa County v.
Kaiser Foundation Health Plan, Inc. (1996) 47 Cal.App.4th 237, another department of that court found that an arbitration agreement between a patient and a health care provider did not apply to a complainant who is not a party to the agreement and is seeking damages from the health care provider.