Motion to Compel Arbitration in New York

What Is a Motion to Compel Arbitration?

Background

New York public policy strongly favors arbitration as an alternative to litigation. (Board of Educ. of Bloomfield Cent. Sch. Dist. v. Christa Constr., Inc., 80 N.Y.2d 1031, 1032 [1992].) The court “has repeatedly held that arbitration is a favored method of dispute resolution in New York.” (Id.)

If an arbitration agreement exists, then a party to an action may move the court for an order compelling arbitration. (Civ. Prac. Law & Rules, § 7503(a).) Subsequently, if a motion to compel arbitration is granted, the order compelling arbitration “shall operate to stay a pending or subsequent action.” (Civ. Prac. Law & Rules, § 7503(a); American Reserve Ins. Co. v. China Ins. Co. Ltd., 297 N.Y. 322, 326-27 [1948].)

How to Structure the Motion

Parties are subject to arbitration if there is evidence of a “clear, explicit and unequivocal” agreement that “affirmatively establishes that the parties agreed to arbitrate their disputes.” (Sozzi v. Moishe’s Moving Sys., Inc., 847 N.Y.S.2d 905, 905 [Sup. Ct. N.Y. Cty. 2007].)

Whether a plaintiff’s claims fall within the scope of an agreement to arbitrate depends on the contractual language at issue. (EEOC v. Waffle House, Inc., 534 U.S. 279, 280 [2002].) Pursuant to New York law, in the absence of fraud or other wrongful conduct, a binding contract is formed where the parties agree to its terms and it “is supported by consideration on both sides.” (Sablosky v. Edward S. Gordon Co., 73 N.Y.2d 133, 135-37 [1989].) A broad arbitration provision that covers “any dispute, controversy or claim” related to an agreement is “precisely the kind… that justifies a presumption of arbitrability.” (Oldroyd v. Elmira Sav. Bank, FSB, 134 F.3d 72, 76 [2nd Cir. 1998].)

Response

Absent an express intention to be so bound, a litigant “ought not to be forced into arbitration and, thus, denied the procedural and substantive rights otherwise available in a judicial forum.” (Schubtex, Inc. v. Allen Snyder, Inc., 49 N.Y.2d 1, 10 [1979].)

It has long been the rule in New York that the parties to a commercial transaction “will not be held to have chosen arbitration as the forum for the resolution of their disputes in the absence of an express, unequivocal agreement to that effect; absent such an explicit commitment neither party may be compelled to arbitrate.” (Marlene Indus. Corp. v. Carnac Textiles, Inc., 45 N.Y.2d 327, 333 [1978].)

“No party is bound to arbitrate unless by clear language he has so agreed… nor should parties be inveigled into arbitration.” (Kahn v. Biernbaum, 55 A.D.2d 589 [1st Dept. 1976].) “An agreement to arbitrate must be clear and direct, and must not depend upon implication, inveiglement or subtlety.” (Application of Doughboy Industries, Inc., 17 A.D.2d 216, 220 [1st Dept. 1962].) Parties are not to be led into arbitration unwittingly through subtlety. (Riverdale Fabrics Corp. v. Tillinghast-Stiles Co., 306 N.Y. 288, 291 [1954].)

The party resisting arbitration bears the burden of demonstrating that the arbitration agreement is invalid or does not encompass the claims at issue. (Green Tree Fin. Corp. v. Randolph, 531 U.S. 79, 92 [2000].) Where a claim is outside the scope of an agreement to arbitrate, an application to compel arbitration should be denied. (New York State Office of Children & Family Servs. V. Lanterman, 14 N.Y.3d 275 [2010].)

The Court’s Decision

New York courts must compel arbitration so long as they are satisfied “from the totality of circumstances that the parties intended to be bound by documents containing arbitration obligations.” (Flores v. Lower E. Side Serv. Ctr., Inc., 4 N.Y.3d 363, 370 [2005].) Any doubts the court may have must be resolved in favor of arbitrability. (Moses H. Cone Mem. Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25 [1983].)

When deciding a motion to compel, the court must first “determine whether the parties have agreed to submit their disputes to arbitration and, if so,whether the disputes generally come within the scope of their arbitration agreement.” (Sisters of St. John the Baptist, Providence Rest Convent v. Phillips R. Geraghty Constructor, Inc., 67 N.Y.2d 997, 998 [1996].) “The court’s inquiry ends, however, where the requisite relationship is established between the subject matter of the dispute and the subject matter of the underlying agreement to arbitrate.” (Id.) At that point, the action is exclusively within the province of the arbitral forum, and the court must compel arbitration. (Id.)

The court’s role is limited to that of a gatekeeper in determining whether arbitration should be compelled. (Cooper v. Bruckner, 21 A.D.3d 758, 758-59 [1st Dept. 2005].) Courts should refrain from interpreting agreements in a manner which implies something not specifically included by the parties, and courts may not by construction add or excise terms, nor distort the meaning of those used and thereby make a new contract for the parties under the guise of interpreting the writing. (Vermont Teddy Bear Co., Inc. v. 583 Madison Realty Company, 1 N.Y.3d 470, 475 [2004]; Gilbert v. Burnstine, 255 N.Y. 348 [1931].)

Documents for Motion to Compel Arbitration in New York

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Regions Bank As Successor By Merger To Enerbank Usa v. Bernard President Other Matters - Consumer Credit (Non-Card) Transaction document preview

EXHIBIT(S) - A - Exhibit A

6 pages

FILED: ORANGE COUNTY CLERK 05/31/2024 04:28 PM INDEX NO. EF004379-2024 NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 05/31/2024 Exhibit "A" Filed in Orange County 05/31/2024 04:28:00 PM$0.00 Bk: 5158 Pg: 179 Index: # EF004379-2024 Clerk: DK FILED: ORANGE COUNTY CLERK …

Case Name Regions Bank As Successor By Merger To Enerbank Usa v. Bernard President