| Matter of Jalas v Halperin |
| 2011 NY Slip Op 05710 [85 AD3d 1178] |
| June 28, 2011 |
| Appellate Division, Second Department |
| In the Matter of Shimson Jalas et al.,Respondents-Appellants, v Israel Halperin et al.,Appellants-Respondents. |
—[*1] Seth Rubenstein, P.C., Brooklyn, N.Y. (Leo D. Beitner of counsel), for appellant-respondentEstate of Rae Ricky Halperin. Thomas N. Rothschild, Brooklyn, N.Y., for respondents-appellants.
Motion by the respondents-appellants for leave to reargue appeals and cross appeals fromtwo orders of the Supreme Court, Kings County, dated November 25, 2008, and November 6,2009, respectively, which were determined by decision and order of this Court dated December28, 2010, or, in the alternative, for leave to appeal to the Court of Appeals from the decision andorder of this Court.
Upon the papers filed in support of the motion and the papers filed in opposition thereto, itis,
Ordered that the branch of the motion which is for leave to reargue is granted and the motionis otherwise denied; and it is further,
Ordered that, upon reargument, the decision and order of this Court dated December 28,2010 (Matter of Jalas v Halperin, 79AD3d 1126 [2010]), is recalled and vacated, and the following decision and order issubstituted therefor:
In a proceeding, inter alia, pursuant to CPLR article 75 to confirm an arbitration award, (1)Israel Halperin, H.B. International, Ltd., and the Estate of Rae Ricky Halperin appeal from anorder of the Supreme Court, Kings County (Knipel, J.), dated November 25, 2008, which grantedthe petitioners' motion to confirm an order of attachment of the same court dated February 11,2008, and to confirm an arbitration award by a rabbinical court dated August 27, 2007, whichwas in favor of the petitioners and against them in the sum of $993,210.82, (2) Israel Halperinand H.B. International, Ltd., appeal, as limited by their brief, from so much of an order of thesame court dated November 6, 2009, as denied their cross motion, in effect, to vacate thearbitration award and the [*2]attachment insofar as it applies tothem and to continue the matter before another arbitration body or the Supreme Court, New YorkCounty, and granted that branch of their separate cross motion which was to vacate the orderdated November 25, 2008, only to the extent of holding the order dated November 25, 2008, inabeyance, in effect, pending a new determination by the rabbinical court concerning the Estate ofRae Ricky Halperin, (3) the Estate of Rae Ricky Halperin separately appeals, as limited by itsnotice of appeal and brief, from stated portions of the order dated November 6, 2009, which,inter alia, granted that branch of the petitioners' motion which was to remit the matter to therabbinical court for further proceedings upon notice to Adina S. Halperin, as administrator of theestate of Rae Ricky Halperin, and its distributees, and (4) the petitioners cross-appeal from somuch of the order dated November 6, 2009, as granted the cross motion of Adina S. Halperin, asadministrator of the estate of Rae Ricky Halperin, in effect, to vacate the arbitration awardinsofar as it applies to the Estate of Rae Ricky Halperin.
Ordered that the order dated November 6, 2009, is modified, on the law, (1) by deleting theprovision thereof granting that branch of the petitioners' motion which was to remit the matter tothe rabbinical court for further proceedings upon notice to Adina S. Halperin, as administrator ofthe estate of Rae Ricky Halperin, and the distributees of that estate, and substituting therefor aprovision granting that branch of the motion to the extent of remitting the matter to the rabbinicalcourt to issue a new award against Israel Halperin and H.B. International, Ltd., and otherwisedenying that branch of the motion, (2) by deleting the provision thereof denying that branch ofthe cross motion of Israel Halperin and H.B. International, Ltd., which was, in effect, to vacatethe attachment insofar as it applies to them, and substituting therefor a provision granting thatbranch of the cross motion, and (3) by deleting the provision thereof granting that branch of thecross motion of Israel Halperin and H.B. International, Ltd., which was to vacate the order datedNovember 25, 2008, only to the extent of holding the order dated November 25, 2008, inabeyance, in effect, pending a new determination by the rabbinical court concerning the Estate ofRae Ricky Halperin, and substituting therefor a provision granting that branch of the crossmotion in its entirety; as so modified, the order dated November 6, 2009, is affirmed insofar asappealed and cross-appealed from; and it is further,
Ordered that the appeal from the order dated November 25, 2008, is dismissed as academicin light of our determination on the appeal from the order dated November 6, 2009; and it isfurther,
Ordered that one bill of costs is awarded to the Estate of Rae Ricky Halperin, payable by thepetitioners.
In September 2005, the petitioner Goldmark, Inc. (hereinafter Goldmark), commenced anaction against Israel Halperin (hereinafter Israel) and H.B. International Ltd. (hereinafter H.B.International). The petitioner Shimson Jalas is the principal of Goldmark. The partiessubsequently agreed to submit the matter to arbitration before the rabbinical court MechonL'Hoyroa. On July 13, 2006, Israel signed an agreement to arbitrate, individually, on behalf ofH.B. International, and "as agent" for his wife, Rae Ricky Halperin (hereinafter the decedent). OnJuly 30, 2006, the decedent signed a power of attorney authorizing Israel to appear for her. Thedecedent died intestate on April 18, 2007, without having appeared before the rabbinical court orotherwise participating in the proceedings.
In June 2007, Israel executed a renunciation and disclaimer with respect to the decedent'sestate, consisting solely of their home, which he had previously transferred to her. In August2007, the rabbinical court rendered an award in favor of Jalas and Goldmark. Jalas and Goldmark(hereinafter together the petitioners) subsequently commenced this proceeding to confirm theaward, and for a prejudgment attachment of the assets of Israel, H.B. International, and thedecedent's estate (hereinafter the Estate). In an order dated February 11, 2008, the Supreme Courtgranted the attachment. The petitioners then moved to confirm the order of attachment and thearbitration award.
In an order dated November 25, 2008, the Supreme Court granted the petitioners' motion toconfirm the order of attachment and the arbitration award. Israel and H.B. International [*3]cross-moved, inter alia, to vacate the order dated November 25,2008. The petitioners moved, among other things, to remit the matter to the rabbinical court forfurther proceedings if the court determined that the award was defective under CPLR 7512.
After Adina S. Halperin (hereinafter the Administrator) was appointed as Administrator ofthe Estate, she cross-moved, in effect, to vacate the arbitration award insofar as it applies to theEstate pursuant to CPLR 7511 (b) (1) (iv) and (2) (ii). Israel and H.B. International thencross-moved, in effect, to vacate the arbitration award and the attachment insofar as it applies tothem on the grounds of misconduct or prejudice by the arbitrators, and, to the extent the awardwas vacated, to direct the parties to complete the litigation of the action in arbitration before theAmerican Arbitration Association, or, in the alternative, in the Supreme Court, New YorkCounty.
In an order dated November 6, 2009, the Supreme Court, inter alia, granted theAdministrator's cross motion, in effect, to vacate the arbitration award insofar as it applies to theEstate. However, the court also granted that branch of the petitioners' motion which was to remitthe matter to the rabbinical court to issue a new arbitration award upon notice to theAdministrator and the distributees of the Estate. Additionally, the court granted that branch of thecross motion of Israel and H.B. International which was to vacate the order dated November 25,2008, but only to the extent of holding that order in abeyance, in effect, pending a newdetermination by the rabbinical court concerning the Estate. The court denied the separate crossmotion of Israel and H.B. International, in effect, to vacate the arbitration award and theattachment insofar as it applies to them, and to continue the matter before another arbitrationpanel or the Supreme Court.
The Supreme Court erred in granting the branch of the petitioners' motion which was to remitthe matter to the rabbinical court to issue a new arbitration award against the Estate. In doing so,the Supreme Court "assum[ed] that a valid written agreement [to arbitrate] was made on behalfof [the decedent]," and declined to address the Administrator's contention that the decedent wasnever a party to the arbitration agreement. The court noted that the rabbinical court found that thedecedent was a signatory to the agreement, and declined to interfere with that determination. Thiswas error. The issue of whether there is a clear, unequivocal, and extant agreement to arbitrate isfor the court and not the arbitrator to determine (see Matter of Primex Intl. Corp. v Wal-MartStores, 89 NY2d 594, 598 [1997]; Matter of County of Rockland [Primiano Constr.Co.], 51 NY2d 1, 6-8 [1980]; Matter of Perciballi Assoc., LP v Corporate Natl. Realty, LLC, 74AD3d 976 [2010]; Matter of O'Donnell v Arrow Elecs., 294 AD2d 581 [2002]).Accordingly, in the first instance, the Supreme Court should have addressed the parties'contentions regarding the existence of a valid agreement to arbitrate.
Since the record herein allows this Court to make a determination as to the validity of theagreement to arbitrate, we make such a determination in the interest of judicial economy, ratherthan remitting the matter to the Supreme Court (cf. Weiss v Kozupsky, 237 AD2d 514[1997]). We find that the decedent was not a signatory to the arbitration agreement and,therefore, was not a proper party to the arbitration. "A party to an agreement may not becompelled to arbitrate its dispute with another unless the evidence establishes the parties' 'clear,explicit and unequivocal' agreement to arbitrate" (God's Battalion of Prayer Pentecostal Church, Inc. v Miele Assoc., LLP,6 NY3d 371, 374 [2006], quoting Matter of Waldron [Goddess], 61 NY2d 181, 183[1984]; see Matter of Fiveco, Inc. vHaber, 11 NY3d 140, 144 [2008]; Schubtex, Inc. v Allen Snyder, Inc., 49 NY2d1, 6 [1979]; Matter of State Farm Mut.Auto. Ins. Co. v Juma, 44 AD3d 963 [2007]). Here, it is undisputed that the subjectarbitration agreement was signed by Israel "as agent" for the decedent. The Estate correctlyargues, however, that Israel was not empowered to sign "as agent" for the decedent, since thepower of attorney dated July 30, 2006, was signed 17 days after the date of the arbitrationagreement. While the petitioners submitted an additional power of attorney, dated July 12, 2006,bearing the decedent's signature, the record does not support their contention that the power ofattorney dated July 12, 2006, was submitted to, or considered valid by, the rabbinical court. ThisCourt also credits as uncontroverted Israel's affidavit, submitted in support of the cross motion ofIsrael and H.P. International, inter alia, in effect, to vacate the arbitration award and theattachment insofar as it applies to them, wherein Israel averred that he did not have a power ofattorney from his wife when he signed the arbitration agreement dated July 13, 2006.[*4]
We note that the Supreme Court was without jurisdictionto issue the order dated November 25, 2008, insofar as it applied to the Estate before anadministrator was appointed to represent the Estate. Moreover, since the decedent was not aproper party to the arbitration, the Supreme Court was without jurisdiction over the Estate toissue the order dated November 25, 2008, granting the petitioners' motion to confirm thearbitration award and the attachment. Accordingly, the Supreme Court properly granted theAdministrator's cross motion to vacate the arbitration award. However, the Supreme Court erredin denying that branch of the cross motion of Israel and H.B. International, which was, in effect,to vacate the attachment insofar as it applies to them, and the Supreme Court also should havegranted that branch of their separate cross motion which was to vacate the order dated November25, 2008.
The parties' remaining contentions either are without merit or have been rendered academic.Florio, J.P., Dickerson, Belen and Austin, JJ., concur.