188 Misc. 796 | N.Y. Sup. Ct. | 1947
Samuel Goldwyn and Selzniek dealing through Vanguard Films, Inc. (hereinafter referred to as “ Selzniek ”), are moving-picture producers. The Astor is a “ first run ” theatre in New York. Seeking an outlet for their pictures, these parties entered into a contract with the owner of the
In deciding this motion the court must determine (1) whether the proceeding sought to be brought under the arbitration clauses is an “ action ” within the meaning of section 218 of the General Corporation Law, and (2) if it is such an “ action ” should Selznick be enjoined from proceeding with the arbitration.
A reading of section 218 of the General Corporation Law indicates that the section is mandatory and self enforcing and constitutes a complete bar to any actions instituted by unlicensed foreign corporations under its stated conditions. There are numerous decisions to the effect that the word “ action ” is generic and includes all legal remedies. (Bradford Co. v. Dunn,
It is clear therefore that if the respondent had instituted an action by serving a summons, or had begun any of the usual special proceedings growing out of the old common law by petition or writ, such action or proceeding would be dismissed at its inception. This arbitration proceeding was instituted by Selznick’s letter of demand (Matter of Grand Central Theatre, Inc., v. Moving Picture Machine Operators Union, N. Y. L. J., Nov. 5, 1941, p. 1366, col. 5, affd. 263 App. Div. 989).
The type of proceeding here instituted is an anomalous one. Arbitration is something of a “ step-child ” at our law. It has not the historical background of the ordinary action or the ordinary special proceeding. It came into being as an effort to substitute special knowledge and speed for the orderly procedure of law courts. Such proceedings have been brought into our Civil Practice Act, and section 1459 provides that they shall be deemed special proceedings. Some of the obvious differences between these proceedings and the usual court procedure are: An arbitration proceeding is not entitled in any court; it does not call for a hearing in any court or before any judge; no pleadings are used; it is not conducted under the usual evidentiary rules; the right to review is very limited, and the court is not usually aware of the existence of the proceeding until some application is made to enforce the agreement or award or to exercise the limited right of review provided in-section 1467 of the Civil Practice Act.
To' determine whether or not respondent has invoked the jurisdiction of our courts, it is necessary to consider the agreements and the actions of the parties. The arbitration agreement was made in the State of New York; the real property involved (the Astor Theatre) is located here; the agreement states that the law of this State is to be applicable; the demand for arbitration was served in this State; the proposed arbitrators are almost entirely residents of this State, and the respondent has indicated its preference to have the arbitration held here. All of this is strongly indicative of an intent to invoke the jurisdiction of our courts.
The recent case of Matter of Galban Lobo Co., etc. (Haytian Amer. Sugar Co.) (271 App. Div. 310) is not controlling on the statement of facts above set forth for the reason that neither of the unlicensed foreign corporations in that case was doing business in this State and the provisions of section 218 of the General Corporation Law did not become applicable.
Eespondent contends that under the rules of the American Arbitration Association, it may, at the end of the arbitration, apply in the courts of any of the forty-eight States for relief in the enforcement of the award and that the present application is therefore premature. In effect, this is to urge that the arbitration should proceed to the final award, and that if and when such an award is presented to a court of this State for its determination, its jurisdiction should then be determined, and any necessary action taken. This argument is fallacious, and is in conflict with orderly procedure. The legal forum must necessarily be determined at the beginning of an action or special proceeding, and not when it nears its termination. All parties are entitled to know from the beginning the forum in which the ultimate decision will be made.
The motion is accordingly granted to the extent of restraining the respondent from invoicing the jurisdiction of our court.