Case ID: ad2d_114/html/0667-01.html
Source: Caselaw Access Project
Author: {"author": "Harvey, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Palcon Industries, Inc., Appellant, v Travelers Indemnity Company, Respondent.
   Harvey, J.

Appeal from an order of the Supreme Court at Special Term (Conway, J.), entered January 29, 1985 in Albany County, which granted defendant’s motion to stay proceedings in the action pending arbitration.

Plaintiff was a paving subcontractor on a construction project for the Schenectady Municipal Housing Authority. Defendant was the surety on behalf of the general contractor, RSJ Construction Corporation (RSJ). RSJ had purchased a bond from defendant guaranteeing payment for labor and materials provided by subcontractors including plaintiff.

By notice of demand for arbitration dated November 7, 1984, plaintiff sought arbitration with RSJ of the dispute over payment of the balance allegedly due under the subcontract between the parties. On December 5, 1984, plaintiff commenced the instant action against defendant seeking payment of the undetermined balance due to the subcontractor. Defendant then moved for an order staying the proceedings in this action pending the result of the arbitration proceeding. Special Term granted defendant’s motion and plaintiff appeals.

CPLR 2201 provides that "the court in which an action is pending may grant a stay of proceedings in a proper case, upon such terms as may be just”. The amount of defendant’s liability on the bond is the amount owed plaintiff by RSJ. Because of the arbitration agreement and the commencement of arbitration proceedings, the amount owed is an issue for the exclusive determination by the arbitrator (Matter of Aetna Cas. & Sur. Co. v Cochrane, 64 NY2d 796, 797-798; Rochester City School Dist. v Rochester Teachers Assn., 41 NY2d 578, 581-583; see, 22 Carmody-Wait 2d, NY Prac §§ 141:57, 141:58, at 800-804; see also, Siegel, NY Prac § 588, at 834-837). Consequently, it appears that Special Term properly stayed the proceedings in this action pending the arbitrator’s decision (Armco Steel Corp. v Renago Constr., 34 AD2d 887, 888, lv denied 27 NY2d 483).

Order affirmed, with costs. Mahoney, P. J., Weiss, Yesawich, Jr., Levine and Harvey, JJ., concur.