34 A.D.2d 748 | N.Y. App. Div. | 1970
Order entered October 22, 1969, denying petitioner’s motion to vacate arbitrator’s award affirmed, with ,$50 costs and disbursements to the respondent. The arbitration was held pursuant to a clause in an insurance policy under which petitioner was the insured. An award was made unfavorable to petitioner. After the award petitioner brought on the instant motion on the ground that the arbitrator should have made certain disclosures. It appears that the arbitrator is an attorney. His practice consists of the representation of insurance companies, though in what particular aspect does not appear, and he also has an interest in a company which provides an investigatory service for insurance companies. It is not claimed that the arbitrator ever represented or had any dealings with the respondent company or that the respondent ever subscribed to the services which the investigatory company provided. In short, there is no claim of disqualification by virtue of interest or connection. What is claimed is that the arbitrator’s practice and experience would tend to make him partial to insurance companies and that, regardless of whether this predilection did in fact influence the arbitrator, his failure to make disclosure vitiates the award. The rules of the American Arbitration Association under which the arbitration was held state what disclosures must be made (§ 13). They consist of two factors: relationship with any party, and any circumstance likely to create a presumption of bias. Practically ever since arbitration has come to be an approved method of determining controversies it has been recognized that familiarity with the field in which the dispute lies is a highly desirable qualification for an arbitrator. “ Knowledge of a business and the methods used therein may be of great value in reaching a just result because of the ability of an arbitrator to apply such knowledge to the facts ” (Matter of Newbm-ger [Nose], 228 App. Div. 526, 529). In no other way except by activity in the particular field can such knowledge be gained. So it has been recognized that occasional contacts even with one of the parties to the arbitration are neither grounds for disqualification nor dictate a necessity for disclosure (Matter of Cross Props. [Gimbel Bros.], 15 A D' 2d 913, affd. 12 N Y 2d 806). This has special emphasis in regard to an attorney who practices in a certain field and represents clients in the same category as one of the parties to the arbitration (Matter of Kessler [MVAIC], 49 Mise 2d 547). The dissent would remand the matter for a hearing. Nothing is alleged or even suggested to indicate that a hearing would reveal anything that would in any way change the situation. Concur — Stevens, P. J., Steuer and Tilzer, JJ.; Eager and Nunez, JJ., dissent in the following memorandum by Eager, J.: The concealment or failure to disclose a personal interest or a relationship having a tendency to influence an arbitrator in his determination of the controversy submitted to him is a matter quite different from the actual existence of a disqualifying interest or relationship. (See Breitel, J., dissenting in Matter of Astoria Med. Group [Health Ins. Plan], 13 A D 2d 288, revd. 11 N Y 2d 128.) Where an arbitrator appointed as a neutral possesses knowledge at the time of his appointment of any interest or relationship on his part that could reasonably raise an inference of bias, he is bound
