S T A T E O F N E W Y O R K
________________________________________________________________________
3879
2025-2026 Regular Sessions
I N S E N A T E
January 30, 2025
___________
Introduced by Sen. HOYLMAN-SIGAL -- read twice and ordered printed, and
when printed to be committed to the Committee on Judiciary
AN ACT to amend the civil practice law and rules, in relation to arbi-
tration
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subdivision (a) of section 7502 of the civil practice law
and rules is amended by adding a new paragraph (v) to read as follows:
(V) IF THERE ARE MULTIPLE PARTIES SEEKING ARBITRATION AGAINST THE SAME
PARTY OR PARTIES, THE PROCEEDING MAY BE BROUGHT IN ANY COURT AND COUNTY
WHERE ANY OF THE PARTIES SEEKING ARBITRATION RESIDES OR IS DOING BUSI-
NESS OR WHERE THE ARBITRATION WAS HELD OR IS PENDING.
§ 2. Subdivision (c) of section 7503 of the civil practice law and
rules, as amended by chapter 1028 of the laws of 1973, is amended to
read as follows:
(c) Notice of intention to arbitrate. A party may serve upon another
party a demand for arbitration or a notice of intention to arbitrate,
specifying the agreement pursuant to which arbitration is sought and the
name and address of the party serving the notice, or of an officer or
agent thereof if such party is an association or corporation, and stat-
ing that unless the party served applies to stay the arbitration within
twenty days after such service [he] SUCH PARTY shall thereafter be
precluded from objecting that a valid agreement was not made or has not
been complied with and from asserting in court the bar of a limitation
of time. Such notice or demand shall be served in the same manner as a
summons or by registered or certified mail, return receipt requested. An
application to stay arbitration must be made by the party served within
twenty days after service upon [him] SUCH PARTY of the notice or demand,
or [he] SUCH PARTY shall be so precluded. Notice of such application
shall be served in the same manner as a summons or by registered or
certified mail, return receipt requested. Service of the application
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD05048-01-5
S. 3879 2
may be made upon the adverse party, or upon [his] SUCH PARTY'S attorney
if the attorney's name appears on the demand for arbitration or the
notice of intention to arbitrate. Service of the application by mail
shall be timely if such application is posted within the prescribed
period. Any provision in an arbitration agreement or arbitration rules
which waives the right to apply for a stay of arbitration OR PRESCRIBES
A MANNER OF NOTIFYING A PARTY OF AN INTENTION TO COMMENCE ARBITRATION
THAT IS MORE BURDENSOME THAN THAT DESCRIBED IN THIS SECTION is hereby
declared null and void.
§ 3. Subdivision (d) of section 7506 of the civil practice law and
rules is amended to read as follows:
(d) Representation by attorney. A party has the right to be repres-
ented by an attorney and may claim such right at any time as to any part
of the arbitration or hearings which have not 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] SUCH PARTY'S attorney.
ANY AGREEMENT WHICH DISCRIMINATES AGAINST OR PENALIZES A PARTY FOR
RETAINING THE SERVICES OF COUNSEL IN AN ARBITRATION IS NULL AND VOID.
§ 4. The civil practice law and rules is amended by adding three new
sections 7513-a, 7513-b and 7517 to read as follows:
§ 7513-A. FEES AND EXPENSES OF ARBITRATION INITIATION. (A) (I) IN AN
EMPLOYMENT OR CONSUMER ARBITRATION, EXCEPT AN ARBITRATION AGREEMENT
INCLUDED IN THE TERMS OF A COLLECTIVE BARGAINING AGREEMENT, THAT
REQUIRES, EITHER EXPRESSLY OR THROUGH APPLICATION OF STATE OR FEDERAL
LAW OR THE RULES OF THE ARBITRATION PROVIDER, THAT THE DRAFTING PARTY
SHALL PAY CERTAIN FEES AND COSTS BEFORE THE ARBITRATION CAN PROCEED, IF
THE FEES OR COSTS TO INITIATE AN ARBITRATION PROCEEDING ARE NOT PAID
WITHIN THIRTY DAYS AFTER THE DUE DATE, THE DRAFTING PARTY IS IN MATERIAL
BREACH OF THE ARBITRATION AGREEMENT, IS IN DEFAULT OF THE ARBITRATION,
AND WAIVES ITS RIGHT TO COMPEL ARBITRATION.
(II) AFTER AN EMPLOYEE OR CONSUMER MEETS THE FILING REQUIREMENTS
NECESSARY TO INITIATE AN ARBITRATION, THE ARBITRATION PROVIDER SHALL
IMMEDIATELY PROVIDE AN INVOICE FOR ANY FEES AND COSTS REQUIRED BEFORE
THE ARBITRATION CAN PROCEED TO ALL OF THE PARTIES TO THE ARBITRATION.
THE INVOICE SHALL BE PROVIDED IN ITS ENTIRETY, SHALL STATE THE FULL
AMOUNT OWED AND THE DATE THAT PAYMENT IS DUE, AND SHALL BE SENT TO ALL
PARTIES BY THE SAME MEANS ON THE SAME DAY. TO AVOID DELAY, ABSENT AN
EXPRESS PROVISION IN THE ARBITRATION AGREEMENT STATING THE NUMBER OF
DAYS IN WHICH THE PARTIES TO THE ARBITRATION MUST PAY ANY REQUIRED FEES
OR COSTS, THE ARBITRATION PROVIDER SHALL ISSUE ALL INVOICES TO THE
PARTIES AS DUE UPON RECEIPT.
(B) IF THE DRAFTING PARTY MATERIALLY BREACHES THE ARBITRATION AGREE-
MENT AND IS IN DEFAULT UNDER SUBDIVISION (A) OF THIS SECTION, THE
EMPLOYEE OR CONSUMER MAY DO EITHER OF THE FOLLOWING:
(I) WITHDRAW THE CLAIM FROM ARBITRATION AND PROCEED IN A COURT OF
APPROPRIATE JURISDICTION; OR
(II) COMPEL ARBITRATION IN WHICH THE DRAFTING PARTY SHALL PAY REASON-
ABLE ATTORNEYS' FEES AND COSTS RELATED TO THE ARBITRATION.
(C) IF THE EMPLOYEE OR CONSUMER WITHDRAWS THE CLAIM FROM ARBITRATION
AND PROCEEDS WITH AN ACTION IN A COURT OF COMPETENT JURISDICTION UNDER
PARAGRAPH (I) OF SUBDIVISION (B) OF THIS SECTION, THE STATUTE OF LIMITA-
TIONS WITH REGARD TO ALL CLAIMS BROUGHT OR THAT RELATE BACK TO ANY CLAIM
BROUGHT IN ARBITRATION SHALL BE TOLLED AS OF THE DATE OF THE FIRST
FILING OF A CLAIM IN A COURT, ARBITRATION FORUM, OR OTHER DISPUTE RESOL-
UTION FORUM.
S. 3879 3
(D) IF THE EMPLOYEE OR CONSUMER PROCEEDS WITH AN ACTION IN A COURT OF
COMPETENT JURISDICTION, THE COURT SHALL IMPOSE SANCTIONS ON THE DRAFTING
PARTY IN ACCORDANCE WITH THIS CHAPTER.
§ 7513-B. FEES AND EXPENSES OF ARBITRATION CONTINUANCE. (A) (I) IN AN
EMPLOYMENT OR CONSUMER ARBITRATION, EXCEPT AN ARBITRATION AGREEMENT
INCLUDED IN THE TERMS OF A COLLECTIVE BARGAINING AGREEMENT, THAT
REQUIRES, EITHER EXPRESSLY OR THROUGH APPLICATION OF STATE OR FEDERAL
LAW OR THE RULES OF THE ARBITRATION PROVIDER, THAT THE DRAFTING PARTY
SHALL PAY CERTAIN FEES AND COSTS DURING THE PENDENCY OF AN ARBITRATION
PROCEEDING, IF THE FEES OR COSTS REQUIRED TO CONTINUE THE ARBITRATION
PROCEEDING ARE NOT PAID WITHIN THIRTY DAYS AFTER THE DUE DATE, THE
DRAFTING PARTY IS IN MATERIAL BREACH OF THE ARBITRATION AGREEMENT, IS IN
DEFAULT OF THE ARBITRATION, AND WAIVES ITS RIGHT TO COMPEL THE EMPLOYEE
OR CONSUMER TO PROCEED WITH THAT ARBITRATION AS A RESULT OF THE MATERIAL
BREACH.
(II) THE ARBITRATION PROVIDER SHALL PROVIDE AN INVOICE FOR ANY FEES
AND COSTS REQUIRED FOR THE ARBITRATION PROCEEDING TO CONTINUE TO ALL OF
THE PARTIES TO THE ARBITRATION. THE INVOICE SHALL BE PROVIDED IN ITS
ENTIRETY, SHALL STATE THE FULL AMOUNT OWED AND THE DATE THAT PAYMENT IS
DUE, AND SHALL BE SENT TO ALL PARTIES BY THE SAME MEANS ON THE SAME DAY.
TO AVOID DELAY, ABSENT AN EXPRESS PROVISION IN THE ARBITRATION AGREEMENT
STATING THE NUMBER OF DAYS IN WHICH THE PARTIES TO THE ARBITRATION MUST
PAY ANY REQUIRED FEES OR COSTS, THE ARBITRATION PROVIDER SHALL ISSUE ALL
INVOICES TO THE PARTIES AS DUE UPON RECEIPT. ANY EXTENSION OF TIME FOR
THE DUE DATE SHALL BE AGREED UPON BY ALL PARTIES.
(B) IF THE DRAFTING PARTY MATERIALLY BREACHES THE ARBITRATION AGREE-
MENT AND IS IN DEFAULT UNDER SUBDIVISION (A) OF THIS SECTION, THE
EMPLOYEE OR CONSUMER MAY UNILATERALLY ELECT TO DO ANY OF THE FOLLOWING:
(I) WITHDRAW THE CLAIM FROM ARBITRATION AND PROCEED IN A COURT OF
APPROPRIATE JURISDICTION. IF THE EMPLOYEE OR CONSUMER WITHDRAWS THE
CLAIM FROM ARBITRATION AND PROCEEDS WITH AN ACTION IN A COURT OF APPRO-
PRIATE JURISDICTION, THE STATUTE OF LIMITATIONS WITH REGARD TO ALL
CLAIMS BROUGHT OR THAT RELATE BACK TO ANY CLAIM BROUGHT IN ARBITRATION
SHALL BE TOLLED AS OF THE DATE OF THE FIRST FILING OF A CLAIM IN ANY
COURT, ARBITRATION FORUM, OR OTHER DISPUTE RESOLUTION FORUM;
(II) CONTINUE THE ARBITRATION PROCEEDING, IF THE ARBITRATION PROVIDER
AGREES TO CONTINUE ADMINISTERING THE PROCEEDING, NOTWITHSTANDING THE
DRAFTING PARTY'S FAILURE TO PAY FEES OR COSTS. THE NEUTRAL ARBITRATOR OR
ARBITRATION PROVIDER MAY INSTITUTE A COLLECTION ACTION AT THE CONCLUSION
OF THE ARBITRATION PROCEEDING AGAINST THE DRAFTING PARTY THAT IS IN
DEFAULT OF THE ARBITRATION FOR PAYMENT OF ALL FEES ASSOCIATED WITH THE
EMPLOYMENT OR CONSUMER ARBITRATION PROCEEDING, INCLUDING THE COST OF
ADMINISTERING ANY PROCEEDINGS AFTER THE DEFAULT;
(III) PETITION THE COURT FOR AN ORDER COMPELLING THE DRAFTING PARTY TO
PAY ALL ARBITRATION FEES THAT THE DRAFTING PARTY IS OBLIGATED TO PAY
UNDER THE ARBITRATION AGREEMENT OR THE RULES OF THE ARBITRATION PROVID-
ER; OR
(IV) PAY THE DRAFTING PARTY'S FEES AND PROCEED WITH THE ARBITRATION
PROCEEDING. AS PART OF THE AWARD, THE EMPLOYEE OR CONSUMER SHALL RECOVER
ALL ARBITRATION FEES PAID ON BEHALF OF THE DRAFTING PARTY WITHOUT REGARD
TO ANY FINDINGS ON THE MERITS IN THE UNDERLYING ARBITRATION.
(C) IF THE EMPLOYEE OR CONSUMER WITHDRAWS THE CLAIM FROM ARBITRATION
AND PROCEEDS IN A COURT OF COMPETENT JURISDICTION PURSUANT TO PARAGRAPH
(I) OF SUBDIVISION (B) OF THIS SECTION, BOTH OF THE FOLLOWING SHALL
APPLY:
S. 3879 4
(I) THE EMPLOYEE OR CONSUMER MAY BRING A MOTION, OR A SEPARATE ACTION,
TO RECOVER ALL ATTORNEYS' FEES AND ALL COSTS ASSOCIATED WITH THE ABAN-
DONED ARBITRATION PROCEEDING. THE RECOVERY OF ARBITRATION FEES, INTER-
EST, AND RELATED ATTORNEYS' FEES SHALL BE WITHOUT REGARD TO ANY FINDINGS
ON THE MERITS IN THE UNDERLYING ACTION OR ARBITRATION; AND
(II) THE COURT SHALL IMPOSE SANCTIONS ON THE DRAFTING PARTY IN ACCORD-
ANCE WITH THIS CHAPTER.
(D) IF THE EMPLOYEE OR CONSUMER CONTINUES IN ARBITRATION PURSUANT TO
PARAGRAPH (II), (III) OR (IV) OF SUBDIVISION (B) OF THIS SECTION, THE
ARBITRATOR SHALL IMPOSE APPROPRIATE SANCTIONS ON THE DRAFTING PARTY,
INCLUDING MONETARY SANCTIONS, ISSUE SANCTIONS, EVIDENCE SANCTIONS, OR
TERMINATING SANCTIONS.
§ 7517. BREACH OF ARBITRATION AGREEMENT; SANCTIONS. (A) THE COURT
SHALL IMPOSE A MONETARY SANCTION AGAINST A DRAFTING PARTY THAT MATE-
RIALLY BREACHES AN ARBITRATION AGREEMENT, EXCEPT AN ARBITRATION AGREE-
MENT INCLUDED IN THE TERMS OF A COLLECTIVE BARGAINING AGREEMENT, BY
ORDERING THE DRAFTING PARTY TO PAY THE REASONABLE EXPENSES, INCLUDING
ATTORNEYS' FEES AND COSTS, INCURRED BY THE EMPLOYEE OR CONSUMER AS A
RESULT OF THE MATERIAL BREACH.
(B) IN ADDITION TO THE MONETARY SANCTION DESCRIBED IN SUBDIVISION (A)
OF THIS SECTION, THE COURT MAY ORDER ANY OF THE FOLLOWING SANCTIONS
AGAINST A DRAFTING PARTY THAT MATERIALLY BREACHES AN ARBITRATION AGREE-
MENT, UNLESS THE COURT FINDS THAT THE PARTY SUBJECT TO THE SANCTION
ACTED WITH SUBSTANTIAL JUSTIFICATION OR THAT OTHER CIRCUMSTANCES MAKE
THE IMPOSITION OF THE SANCTION UNJUST:
(I) AN EVIDENCE SANCTION BY AN ORDER PROHIBITING THE DRAFTING PARTY
FROM CONDUCTING DISCOVERY IN THE CIVIL ACTION;
(II) A TERMINATING SANCTION BY ONE OF THE FOLLOWING ORDERS:
(1) AN ORDER STRIKING OUT THE PLEADINGS OR PARTS OF THE PLEADINGS OF
THE DRAFTING PARTY; OR
(2) AN ORDER RENDERING A JUDGMENT BY DEFAULT AGAINST THE DRAFTING
PARTY; OR
(III) A CONTEMPT SANCTION BY AN ORDER TREATING THE DRAFTING PARTY AS
IN CONTEMPT OF COURT.
§ 5. This act shall take effect immediately.
