Engalla v. Permanente Medical Group, Inc.

Engalla (plaintiff), whose lung cancer went undiagnosed until inoperable under Kaiser's (defendants) care, filed an arbitration claim requiring three arbitrators be appointed within 60 days, but Kaiser delayed participating in selecting the third arbitrator for 144 days despite repeated urgent requests citing Engalla's failing health; Engalla died the day after the third arbitrator was finally seated. Kaiser then refused to stipulate around a rule that would merge and effectively halve the family's available damages once Engalla died, so Engalla's estate withdrew from arbitration and sued, arguing Kaiser's chronic, systemic delays (evidence showed a two-year average delay in appointing arbitrators across nearly all claims from 1984-86) both fraudulently induced the arbitration agreement and waived Kaiser's right to enforce it; the trial court agreed, and the Court of Appeal reversed.