Court Opinion

ID: 5748548
Source: CourtListenerOpinion
Date Created: 2022-01-12 16:53:24.329561+00
Date Added: 2024-06-11T08:41:13.230959
License: Public Domain

Eager, J. (concurring).
I would affirm. I do not, however, concur fully in the reasoning of the majority, and, consequently, deem it necessary to state my grounds for affirming the order which denied a stay of arbitration.
Clearly, the Supreme Court has no inherent power, on summary application, to enjoin or stay an arbitration proceeding. Such a proceeding, in and of itself, is not a special proceeding-subject to the general control and jurisdiction of the court. In fact, the former provisions of the Civil Practice Act (§ 1459) designating such a proceeding as a special proceeding were omitted in the superseding Civil Practice Law and Rules legislation. In any event, except “ in specified particulars ” an arbitration proceeding is “ outside the court realm and jurisdiction — deliberately so taken out of the court by choice and commitment of the parties ” (Matter of Katz [Burkin], 3 A D 2d 238, 239). Consequently, except as specifically authorized by agreement of the parties or by statute, the court has no right to step *11in and interfere with the jurisdiction conferred by the parties upon an arbitrator to dispose of the controversies between the parties. To permit the court to do so would tend to improperly circumscribe the contracted for authority of the arbitrator and frustrate the agreement of the parties, and this is to be avoided.
There is no statute now authorizing the Supreme Court to grant the application for the stay sought here by the petitioners. Subdivision (b) of section 7503 of the Civil Practice Law and Rules does not apply here. Said section provides for an application by “ a party who has not participated in the arbitration ”; and it is applicable only where the applicant seeks to have a court determination of any one of the three “ threshold questions ” preliminary to the assumption of jurisdiction by the arbitrator, namely, the questions (1) whether a valid agreement for arbitration was made; (2) whether such agreement was complied with; and (3) whether respondent is precluded from asserting in court the bar of a limitation of time. (See The Statutes, and Practice Commentary [by Peter W. Thornton], McKinney’s Cons. Laws of N. Y., Book 7B, CPLR, p. 488.)
Incidentally, those petitioners here, who were bound by the agreement to arbitrate, following the service upon them of the demand to arbitrate, did not apply to put in issue any one of the three threshold questions, but did submit an answering statement in the arbitration proceeding. Thus, those particular petitioners have ‘ ‘ participated in the arbitration ’ ’. Thereby, all matters in dispute between them and the respondent were committed to the jurisdiction of the arbitrators and the right to apply under the statute for a stay of the arbitration was waived. (See Matter of McGovern [Janel’s Music Corp.], 18 A D 2d 897; Matter of Leonard [Heinemann], 35 Misc 2d 421; Matter of Harris [East India Trad. Co.], 16 Misc 2d 87, 89-90.) Of course, it is true that the petitioners who were not parties to the arbitration agreement may not be said to have waived their rights, but they never had any right, to begin with, to invoke the provisions of subdivision (b) of section 7503.
In any event, concededly, there was here a valid agreement for arbitration. The respondent had complied therewith to the extent entitling it to arbitration fully in accordance with the demand served by it. This is not the case where a condition precedent under the contract or applicable statute had not been fulfilled. (See Matter of Exercycle Corp. [Maratta], 9 N Y 2d 329.) So, we do not have here a “ threshold question ” justifying the granting of a stay under the authority of said subdivision (b) of section 7503 of the Civil Practice Law and Rules.
*12The conclusion is inescapable, therefore, that subdivision (b) of section 7503 of the Civil Practice Law and Rules does not apply to authorize a stay of the arbitration proceeding here.
Furthermore, and without regard to the question of lack of statutory authority for the application now made to stay arbitration, basic principles bar court intervention here. Where, pursuant to the agreement of the parties, the arbitration of a controversy between them has been duly demanded, then any and all disputes which arise between them and having a bearing upon the right to relief at the hands of the arbitrator, and all questions of law and fact in connection therewith, must go to arbitration. (See Matter of Exercycle Corp. [Maratta], supra.) To this general policy, there are exceptions where the court may enjoin arbitration, but the petitioners here do not have a case within any of the recognized exceptions. (Matter of Exercycle Corp. [Mariatta], supra, p. 334.)
So, I would hold that, where arbitration has been duly agreed upon, and the proceeding therefor duly instituted by the service of a demand and an answering statement, then all matters bearing upon the right to maintain the proceeding and to relief by means thereof, including claims of waiver and estoppel, as well as defenses grounded in alléged accord and satisfaction, payment or release, are matters referable to the arbitrator. The questions of law and fact in connection therewith are for him. The court has no right to take over and determine such questions for the purpose of ousting the arbitrator of his jurisdiction in the premises.
In any event, where an arbitration proceeding has been instituted and the parties respondent have served an answering statement, no court has a right to interfere with the normal course of the proceeding. It is well settled that, then, all matters of procedure, except as otherwise specified by the statute or the contract of the parties are for the arbitrator. (See Matter of Katz [Burkin], 3 A D 2d 238, supra; Gutchen v. Dembitzer, 4 Misc 2d 650, affd. 285 App. Div. 928; Matter of Welsted & Son [Hawkins], 18 A D 2d 869; Matter of MV AIC [McCabe], 19 A D 2d 349.) Thus, the granting by the Supreme Court of a temporary stay of the arbitration pending the determination of another Supreme Court action, as a procedural device or matter, would constitute an undue usurpation of the powers of the arbitrator with relation to the course of the proceeding before him. If there is- to be a stay of a pending arbitration, then, absent statutory provisions to the contrary, this is a matter for determination by the arbitrator.
Finally, under the circumstances here, if any proceeding is to be stayed on motion, it should be the Supreme Court action *13which was brought subsequent to the institution of the arbitration proceeding (see Flash v. Goldman, 278 App. Div. 829; see same case sub nom. Matter of Goldman [Flash], 278 App. Div. 830; Bartley Bros. Constr. Corp. v. National Sur. Corp., 280 App. Div. 798); and those petitioners here, against whom the action is pending, are not precluded hereby from so moving.