Court Opinion

ID: 5395160
Source: CourtListenerOpinion
Date Created: 2022-01-08 10:11:36.588966+00
Date Added: 2024-06-11T08:30:21.647956
License: Public Domain

Breitel, J.
(dissenting). The issues tendered in arbitration in this case include whether in fact the partnership has been dissolved, conceding that the partners went through the form of a purported dissolution. This is solely a question of fact to be determined in the arbitration, as the parties by solemn agreement had provided. The situation was different in Matter of Kosoff (“ Jones ”) (276 App. Div. 621, affd. 303 N. Y. 663) for there the principal corporation had dissolved. As a matter of law, and as a matter of public policy, an incorporated body may not survive its dissolution, except for limited purposes. That is because the corporation is a strictly statutory artificial entity. But here the claim is that the partnership has never ceased to do business, and there is no legal bar to its continuance. The purported dissolution may well be, as claimed by the union, a form of convenience adopted to deceive but not to effect what it appears to accomplish.
The facts here make this a particularly substantial contention, since the partnership, b'efore the purported dissolution, used the very same corporations for the contracting of its merchandise that it is claimed are still being used by the same individuals constituting the partnership.
*249Moreover, the agreement provisions relied on by the majority opinion specifically provided that if the firm “ be continued by one or more partners, the new firm should assume the obligations of this agreement.” The union is seeking arbitration against the partners either as the old firm, unchanged, or against the new firm with the same partners. The dissolution then resolves itself down to a fine metaphysical line without difference in effect. In Matter of Kosoff (“ Jones ”) (supra) none of this was possible, because a corporation dissolved is a corporation dissolved, statute law and public policy not permitting it to survive its formal dissolution or continue its existence without formal reconstitution.
It should be emphasized too that the filing of a certificate of dissolution by a partnership does not accomplish a dissolution. It constitutes simply the filing of information for public record. (Penal Law, § 440-b, subd. 7.)
The issue may be put in another and perhaps simpler way. The issues in this arbitration turn not on whether a successor firm has violated an undertaking, but whether in fact the firm which bound itself carries on or not.
Section 1450 of the Civil Practice Act authorizes trial of the issue of the making of a contract of arbitration. That involves nothing more than whether there is a valid agreement to arbitrate on the part of the partnership. About that there is no question. There is concededly an agreement to arbitrate on the part of this partnership with reference to acts charged to the partnership, and not to any other entity or entities. The effect of the majority view is to submit to a court for trial, in violation of the arbitration agreement, the issues whether in fact the partnership dissolved and whether it is doing the acts charged or whether some one else is doing the acts charged.
It is notable that the issue on which the case now turns was not directly raised or briefed. A question-begging point was made on whether the partnership having gone through the form of dissolution had terminated the agreement to arbitrate.
The order should be affirmed and the parties directed to proceed to arbitration.
Dore, J. P., and Cohn, J., concur with Callahan, J.; Breitel, J., dissents and votes to affirm in opinion, in which Bergan, J., concurs. ;'
Order modified in accordance with the opinion herein and, as so modified, affirmed. Settle order on notice.