S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   10393
 
                           I N  A S S E M B L Y
 
                              April 18, 2018
                                ___________
 
 Introduced  by  M.  of  A.  WEINSTEIN  --  read once and referred to the
   Committee on Judiciary
 
 AN ACT to amend the civil practice law and rules,  in  relation  to  the
   appointment of an arbitrator
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 7504 of the civil practice law and rules is amended
 to read as follows:
   § 7504. [Court appointment] APPOINTMENT of  arbitrator.    (A)  IF  AN
 ARBITRATION AGREEMENT PROVIDES FOR THE METHOD OF APPOINTMENT OF AN ARBI-
 TRATOR,  SUCH  ARBITRATOR  MUST  BE  A  NEUTRAL  THIRD-PARTY ARBITRATOR;
 PROVIDED, HOWEVER, THAT ANY PORTION OF AN AGREEMENT OR CONTRACT  REQUIR-
 ING  THE CONTROVERSY CONCERNING EMPLOYMENT BE SUBMITTED TO AN ARBITRATOR
 OR ARBITRATION ORGANIZATION THAT IS NOT A NEUTRAL  THIRD-PARTY  ARBITRA-
 TOR,  SHALL  BE  DEEMED  VOID.   THE REQUIREMENT THAT THE CONTROVERSY BE
 HEARD BY A NEUTRAL THIRD-PARTY ARBITRATOR MAY NOT BE WAIVED BY  A  PARTY
 PRIOR TO THE SERVICE ON SUCH PARTY OF A DEMAND FOR ARBITRATION.
   (B)  If  the  arbitration  agreement  does not provide for a method of
 appointment of an arbitrator, or if the agreed method fails or  for  any
 reason  is not followed, or if an arbitrator fails to act and his OR HER
 successor has not been appointed, the court, on application of a  party,
 shall appoint [an] A NEUTRAL THIRD-PARTY arbitrator.  APPOINTMENT OF ANY
 ARBITRATOR SHALL REASONABLY ENSURE THE PERSONAL OBJECTIVITY OF THE ARBI-
 TRATOR.
   (C)  1.  BEFORE  THE  APPOINTMENT OF AN INDIVIDUAL WHO IS REQUESTED TO
 SERVE AS AN ARBITRATOR, AND AFTER  MAKING  A  REASONABLE  INQUIRY,  SUCH
 INDIVIDUAL  SHALL  DISCLOSE TO ALL PARTIES TO THE AGREEMENT TO ARBITRATE
 AND THE ARBITRATION PROCEEDING, AND TO ANY OTHER ARBITRATORS, ANY  KNOWN
 FACTS  THAT  A  REASONABLE  PERSON  WOULD  CONSIDER LIKELY TO AFFECT THE
 IMPARTIALITY OF THE ARBITRATOR IN THE ARBITRATION PROCEEDING, INCLUDING:
   (I) A FINANCIAL OR PERSONAL INTEREST IN THE OUTCOME OF THE ARBITRATION
 PROCEEDING; OR
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD15381-05-8
              

 A. 10393                            2
 
   (II) AN EXISTING OR PAST RELATIONSHIP WITH ANY OF THE PARTIES  TO  THE
 AGREEMENT TO ARBITRATE OR THE ARBITRATION PROCEEDING, HIS OR HER COUNSEL
 OR REPRESENTATIVES, A WITNESS, OR ANOTHER ARBITRATOR.
   2.  AN  ARBITRATOR  HAS  A  CONTINUING  OBLIGATION  TO DISCLOSE TO ALL
 PARTIES TO THE AGREEMENT TO ARBITRATE AND  ANY  ARBITRATION  PROCEEDING,
 AND  TO ANY OTHER ARBITRATORS ANY FACTS THAT THE ARBITRATOR LEARNS AFTER
 ACCEPTING APPOINTMENT WHICH A REASONABLE PERSON WOULD CONSIDER LIKELY TO
 AFFECT THE IMPARTIALITY OF THE ARBITRATOR.
   3. IF AN ARBITRATOR DISCLOSES A FACT REQUIRED BY PARAGRAPH ONE OR  TWO
 OF  THIS  SUBDIVISION  AND  A PARTY TIMELY OBJECTS TO THE APPOINTMENT OR
 CONTINUED SERVICE OF THE ARBITRATOR BASED UPON THE FACT  DISCLOSED,  THE
 OBJECTION  MAY  BE A GROUND FOR VACATING AN AWARD MADE BY THE ARBITRATOR
 PURSUANT TO SUBPARAGRAPH (II) OF PARAGRAPH ONE  OF  SUBDIVISION  (B)  OF
 SECTION SEVENTY-FIVE HUNDRED ELEVEN OF THIS CHAPTER.
   4.  IF THE ARBITRATOR DID NOT DISCLOSE A FACT AS REQUIRED BY PARAGRAPH
 ONE OR TWO OF THIS SUBDIVISION, UPON TIMELY OBJECTION BY  A  PARTY,  THE
 COURT  MAY  VACATE  AN  AWARD  BASED  ON SUCH NON-DISCLOSURE PURSUANT TO
 SECTION SEVENTY-FIVE HUNDRED ELEVEN OF THIS CHAPTER.
   5. AN ARBITRATOR APPOINTED  AS  A  NEUTRAL  ARBITRATOR  WHO  DOES  NOT
 DISCLOSE  A  KNOWN,  DIRECT  AND MATERIAL INTEREST IN THE OUTCOME OF THE
 ARBITRATION PROCEEDING OR A KNOWN, EXISTING AND SUBSTANTIAL RELATIONSHIP
 WITH A PARTY IS PRESUMED TO ACT WITH EVIDENT PARTIALITY IN RENDERING  AN
 AWARD.
   (D)  UPON  DISCLOSURE  PURSUANT  TO SUBDIVISION (C) OF THIS SECTION, A
 PARTY SHALL BE DEEMED TO HAVE WAIVED ANY OBJECTION TO THE ARBITRATOR  OR
 COMPOSITION  OF ANY ARBITRATION PANEL, BY FAILING TO RAISE SAME PRIOR TO
 THE COMMENCEMENT OF THE ARBITRATION HEARING.
   § 2. Section 7506 of the civil practice law and rules  is  amended  to
 read as follows:
   § 7506. Hearing. (a) Oath of arbitrator. Before hearing any testimony,
 an  arbitrator  shall be sworn to hear and decide the controversy faith-
 fully and fairly by an officer authorized to administer an oath.
   (b) Time and place. The arbitrator shall appoint a time and place  for
 the  hearing  and  notify the parties in writing personally or by regis-
 tered or certified mail not less than eight days before the hearing. The
 arbitrator may adjourn or postpone the hearing. The court, upon applica-
 tion of any party, may direct the arbitrator to  proceed  promptly  with
 the hearing and determination of the controversy.
   (c)  Evidence.  The  parties  are  entitled  to  be  heard, to present
 evidence and to cross-examine witnesses.
   (D) POSTPONEMENTS AND ADJOURNMENTS. THE ARBITRATOR MAY FOR GOOD  CAUSE
 POSTPONE  OR  ADJOURN  THE  HEARING  UPON REQUEST OF A PARTY OR UPON THE
 ARBITRATOR'S OWN INITIATIVE. Notwithstanding the failure of a party duly
 notified to appear, the arbitrator may hear and determine the controver-
 sy upon the evidence produced. IF A PARTY TO AN ARBITRATION  INTENDS  TO
 PRESENT  TESTIMONY  FROM  A  WITNESS  AT  THE HEARING, ABSENT GOOD CAUSE
 SHOWN, THE IDENTITY OF SUCH WITNESS MUST BE PROVIDED TO ALL  PARTIES  AT
 LEAST SEVEN CALENDAR DAYS PRIOR TO THE HEARING.
   [(d)]  (E)  Representation  by  attorney.  A party has the right to be
 PRESENT, AND BE represented by an attorney and may claim such  right  at
 any  time  as  to any part of the arbitration or hearings which have not
 YET taken place. This right may not be waived. If a party is represented
 by an attorney, papers to be served on the party shall  be  served  upon
 his  OR  HER attorney. IT SHALL BE WITHIN THE ARBITRATOR'S DISCRETION TO
 PERMIT THE ATTENDANCE OF ANY OTHER PERSONS.

 A. 10393                            3
 
   [(e)] (F) Determination by majority. The hearing shall be conducted by
 all the arbitrators, but a  majority  may  determine  any  question  and
 render an award.
   [(f)]  (G) Waiver. Except as provided in subdivision [(d)] (E) OF THIS
 SECTION, a requirement of this section may be waived by written  consent
 of  the  parties and it is waived if the parties continue with the arbi-
 tration without objection.
   § 3. Section 7507 of the civil practice law and rules, as  amended  by
 chapter 952 of the laws of 1981, is amended to read as follows:
   § 7507. Award; form; time; delivery. (A) Except as provided in section
 7508,  the  award  shall  be  in  writing, AND SHALL STATE THE ISSUES IN
 DISPUTE AND CONTAIN THE ARBITRATOR'S FINDINGS OF FACT AND CONCLUSIONS OF
 LAW. SUCH AWARD SHALL CONTAIN A DECISION ON ALL ISSUES SUBMITTED TO  THE
 ARBITRATOR,  AND  SHALL  BE [signed and affirmed] EXECUTED UNDER OATH OR
 AFFIRMED PURSUANT TO RULE TWENTY-ONE HUNDRED  SIX  OF  THIS  CHAPTER  IF
 APPLICABLE  by  the  arbitrator  making  it within the time fixed by the
 agreement, or, if the time is not fixed, within such time as  the  court
 orders.
   (B)  The parties may in writing extend the time either before or after
 its expiration. A party waives the objection that an award was not  made
 within  the  time  required  unless he OR SHE notifies the arbitrator in
 writing of his OR HER objection prior to the delivery of  the  award  to
 him OR HER.
   (C)  The arbitrator shall deliver a copy of the award to each party in
 the manner provided in the agreement, or, if no provision  is  so  made,
 personally or by registered or certified mail, return receipt requested.
   §  4.  Subparagraph  (iv) of paragraph 1 of subdivision (b) of section
 7511 of the civil practice law and rules is amended and a  new  subpara-
 graph (v) is added to read as follows:
   (iv) failure to follow the procedure of this article, unless the party
 applying  to vacate the award continued with the arbitration with notice
 of the defect and without objection[.]; OR
   (V) THE ARBITRATOR EVIDENCED  A  MANIFEST  DISREGARD  OF  THE  LAW  IN
 RENDERING THE AWARD.
   §  5.  This  act  shall take effect immediately and shall apply to all
 arbitration proceedings held on or after such effective date.