S T A T E O F N E W Y O R K
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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
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(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.
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[(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.