Category: CPLR § 7503

7503(b)

Matter of Jewish Ctr. of Forest Hills W., Inc. v Goldberg, 2018 NY Slip Op 02325 [2d Dept 2018]

Pursuant to CPLR 7503(b), "a party who has not participated in the arbitration and who has not made or been served with an application to compel arbitration, may apply to stay arbitration on the ground that a valid agreement was not made or has not been complied with or that the claim sought to be arbitrated is barred by [the statute of] limitation[s]" (emphasis added). The statute requires that a party raise these threshold issues before participating in arbitration (see Matter of United Fedn. of Teachers, Local 2, AFT, AFL-CIO v Board of Educ. of City School Dist. of City of N.Y., 1 NY3d 72, 79; cf. CPLR 7502[b]). Consequently, a party, such as the Jewish Center, which participates in arbitration, waives the right to later object to the arbitration on the grounds that a valid agreement to arbitrate was not made or that the claim sought to be arbitrated is barred by the statute of limitations (see Matter of Silverman [Benmor Coats], 61 NY2d 299, 307; Matter of Tri State Consumer Ins. Co. v High Point Prop. & Cas. Co., 127 AD3d 980, 981; Matter of Allstate Ins. Co. v New York Petroleum Assn. Compensation Trust, 104 AD3d 682; Matter of Utica Mut. Ins. Co. v Incorporated Vil. of Floral Park, 262 AD2d 565, 566). Inasmuch as the Jewish Center argues that the arbitrator is exceeding the scope of its authority in the course of a pending arbitation, these arguments are more properly the subject of a motion to vacate an arbitration award (see CPLR 7511[b][1][iii]; Matter of United Fedn. of Teachers, Local 2, AFT, AFL-CIO v Board of Educ. of City School Dist. of City of N.Y., 1 NY3d at 79; Matter of Silverman [Benmor Coats], 61 NY2d at 307). Accordingly, the Supreme Court properly denied the petition and dismissed the proceeding.

CPLR § 7503 Arbs

CPLR § 7503 Application to compel or stay arbitration; stay of action; notice of intention to arbitrate

Shah v Monpat Constr., Inc., 2009 NY Slip Op 06132 (App. Div., 2nd, 2009)

Arbitration is favored in New York State as a means of resolving
disputes, and courts should interfere as little as possible with
agreements to arbitrate (see Matter of Smith Barney Shearson v Sacharow, 91 NY2d 39, 49; Matter of Miller, 40 AD3d 861,
861-862). There is a substantial countervailing consideration as well:
"by agreeing to arbitrate a party waives in large part many of his
normal rights under the procedural and substantive law of the State" (Matter of Marlene Indus. Corp. [Carnac Textiles], 45 NY2d 327, 333 334; see Matter of Miller, 40
AD3d at 862). For that reason, "a party will not be compelled to
arbitrate and, thereby, to surrender the right to resort to the courts,
absent evidence which affirmatively establishes that the parties
expressly agreed to arbitrate their disputes'" (Matter of Waldron [Goddess], 61 NY2d 181, 183, quoting Schubtex, Inc. v Allen Snyder, Inc., 49 NY2d 1, 6; see TNS Holdings v MKI Sec. Corp. 92 NY2d 335, 339; Matter of Miller, 40 AD3d at 862). "The agreement must be clear, explicit and unequivocal" (Matter of Waldron [Goddess], 61 NY2d at 183; see God's Battalion of Prayer Pentecostal Church, Inc. v Miele Assoc., LLP, 6 NY3d 371, 374; Matter of Miller, 40
AD3d at 862). Once the court has determined the threshold issues of the
existence of a valid agreement to arbitrate, that the party seeking
arbitration has complied with the agreement, and that the claim sought
to be arbitrated would [*3]not be time-barred were it asserted in state court (see CPLR 7502[b]; Matter of Smith Barney, Harris Upham & Co. v Luckie, 85 NY2d 192, 201-202), the remaining issues are for the arbitrator.

Here, the written contract was clear, explicit, and unequivocal
and established a valid agreement to arbitrate. The agreement expressly
adopted Document A201-1997 by reference, in effect, listed it as one of
the "Contract Documents" in Article 1, enumerated it as one of the
"Contract Documents" in Article 8, and referred to it by document
number throughout. Consequently, the arbitration provisions included in
Document A201-1997 are part of the written contract (see Matter of Level Export Corp. [Wolz, Aiken & Co.],
305 NY 82, 87). Shah's contention that he never received Document
A201-1997 is unavailing, and his ignorance of its provisions must be
attributed to " negligence or inexcusable trustfulness'" (Matter of Level Export Corp. [Wolz, Aiken & Co.], 305 NY 82, 87, quoting Metzger v Aetna Ins. Co., 227 NY 411, 416]).

The plaintiffs did not contend in the Supreme Court, either in
support of their motion to stay arbitration or in opposition to the
defendants' motion to compel arbitration, that Monpat had not complied
with conditions precedent to arbitration. Consequently, that issue is
not properly before us (see Matter of New York Cent. Mut. Fire Ins. Co. v Daley, 273 AD2d 315; Matter of County of Suffolk v Faculty Assn. of Suffolk County Community Coll., 247
AD2d 472). Indeed, had the issue been raised in the Supreme Court,
Monpat may have been able to present evidence that it had in fact
complied with conditions precedent (see Matter of New York Cent. Mut. Fire Ins. Co. v Daley, 273 AD2d 315; cf. Misicki v Caradonna, 12 NY3d 511; Weiner v MKVII-Westchester, 292 AD2d 597, 598).

In general, where there is a broad arbitration clause, any issue
with respect to changes in the substantive provisions of a contract or
its termination are to be resolved by the arbitrator, unless the
modification or termination relates to the arbitration clause itself (see Matter of Cassone, 63 NY2d 756, 759; Matter of All Metro Health Care Servs. Inc. v Edwards, 57 AD3d 892; Matter of Meetze [La Belle], 295 AD2d 991, 992; Matter of Cantor Fitzgerald, L.P. [Ginsberg],
228 AD2d 591). Here, the plaintiffs' contention that the written
contract was abandoned was not directly related to the arbitration
provisions, so the issue of abandonment should be left for the
arbitrator. The issue of the statute of limitations is so intertwined
with the parties' substantive contentions and the contentions regarding
abandonment that the issue of the statute of limitations should be left
to the arbitrator (see Matter of Corbo v Les Chateau Assoc., 127
AD2d 657, 658). As well, issues regarding proper service of the demand
for arbitration should be determined by the arbitrator (see Matter of Rockland County v Primiano, 51 NY2d 1, 8; Cooper v Bruckner, 21 AD3d 758, 759; J. Castronovo, Inc. v Hillside Dev. Corp., 140 AD2d 585).

Finally, the written contract was between Shah and Monpat, and
there is no clear evidence that the plaintiffs ever agreed to arbitrate
any disputes with Patel and RB. Consequently, the Supreme Court should
not have compelled the plaintiffs to arbitrate their claims against
those defendants (see Estate of Castellone v JP Morgan Chase Bank, N.A., 60 AD3d 621, 623).

The bold is mine.