Langemyr v. CampbellLangemyr v. Campbell
Thе action is for a declaratory judgment that a certain paper signed by plaintiff as an employer and delivered to the defendant’s union local does not constitute a contract between them. Plaintiff admits signing the paper, but he chargеs that by reason of certain conditions precedent it did not become a binding agreement. lie further admits service upon him of the statutory notice of intention to arbitrate (CPLR 7503). He appeared before the arbitrator but no testimony was evеr taken, nor did the arbitrator take his oath. It also appears that, pursuant to the agreement, plaintiff, in fact, had madе contributions to the union fund in an amount exceeding $2,800 for the period from February through September, 1964.
The notice of intention tо arbitrate was served upon plaintiff on August 11, 1964. In pertinent part it provided: ‘ ‘ please take further notice that unless within ten days after the service of this notice upon you, you shall comply with § 7503 (c) of the Civil Practice Law and Rules and shall apply to stay said arbitration, you shall thereafter be precluded from objecting that a valid agreement was not made ”. On August 25, 1964 plaintiff resрonded by serving a notice of motion, together with his own affidavit, to stay the arbitration. His affidavit asserted that there was “ a cоntract between your deponent [Tormod Langemyr] and Local No. 964”. When defendant’s attorney appeared in court on the return day of that motion, after having served answering affidavits, he found that the motion had not actually been noticed and was not on the Motion Calendar, and that no one was present on plaintiff’s behalf; defendant’s attorney noted his apрearance and considered the motion for a stay to have been abandoned. Plaintiff does not dispute his abandonment of the motion.
Apart from all other considerations, plaintiff is now barred from seeking a stay of the arbitration by CPLR 7503 which prоvides:
“ (b) Application to stay arbitration. Subject to the provisions of subdivision (c), a party who has not participated in the arbitration and who has not made or been served with an application to compel arbitration, may apply tо stay arbitration on the ground that a valid agreement was not made.
“ (e) Notice of intention to arbitrate. A party may serve upon another party a notice of intention to arbitrate, specifying the agreement pursuant to which arbitration is sought * * * and stating that unless the party served applies to stay the arbitration within ten days after such service he shall thereafter be precluded from objecting that a valid agreement was not made * * #. An application to stay arbitration must be*373 made by the party served within ten days after service upon him of the notice or he shall be so precluded.”
The section itself is quite plain, but ¡a practice commentаry (o the section makes the effect unmistakable: “ Proper service of a proper notice of intention to аrbitrate will preclude the raising of the threshold questions [making of a valid agreement] except on an applicatiоn to stay arbitration made within ten days after service thereof ” (McKinney’s Cons. Laws of N. Y., Book 7B, CPLR, pp. 488-489).
Plaintiff’s primary authority to the contrary is a Special Term case which calls the 10-day period a “caveat” and refuses to treat it as a prеclusion to the raising of threshold questions (Matter of Ledo Realty Corp.,
Matter of MVAIC (McCabe) (19 A D 2d 349, 351-354) presented a different aspect of this problem. There, an order denying a stay of arbitration was affirmed, but not because of the 10-day preclusion language of CPLR 7503. The Appellate Division recоgnized and asserted its general power to grant a stay which was there sought pending the orderly conduct of an examinatiоn before trial. Nevertheless, the court felt that under the circumstances a stay was unjustified. The helpful dictum in Justice Eague’s oрinion in that case clarified the issue; he properly pointed out that the statutory threshold questions were not there involvеd, but that if they had been the provisions of CPLR 7503 would have precluded the granting of a stay.
Here, the Special Term propеrly denied a stay and the arbitration should proceed. Since plaintiff was served with the notice of intention to arbitrate pursuant to CPLR 7503 (subd. [c]), and since he failed to seek a stay of the arbitration for the purpose of attacking the existencе of the contract, as provided in CPLR 7503, he may not now seek such a stay in a declaratory judgment action.
However, Spеcial Term should not have granted the cross motion to dismiss the complaint pursuant to CPLR 3211. Prior
The order appealed from must be modified to the extent that the complaint should be allowed to stand. After “ arbitration and award ’ ’ the defendant, if so advised, may renew his motion to dismiss pursuant to CPLB 3211.
Beldock, P. J., Ughetta, Hill and Babin, JJ., concur.
Order modified on the law, without costs: (a) by striking out the second and third decretal paragraphs granting the defendant’s cross motion to dismiss the complaint and directing the entry of judgment; and (b) by substituting therefor a paragraph denying said motion. As so modified, the order is affirmed, without costs.