Opinion
80106/10.
Decided July 20, 2010.
Upon the foregoing papers, petitioner's application to vacate the underlying arbitration award dated March 10, 2010 (Motion No. 1370-001) is denied; the cross motion to confirm (Motion No. 1525-001) is granted.
An application for the consolidation of these two proceedings (Motion Nos 1730-002 and 1827-003) was granted over respondent's objection in an Order by the Honorable Joseph J. Maltese on April 21, 2010, and are of no further relevance.
This action arises out of a dispute over legal fees between petitioner Susan D. Settenbrino, P.C. (hereinafter "petitioner"), and a former client, pro se respondent Florentina Barroga-Hayes (hereinafter "respondent"). To the extent relevant, on December 6, 2007, the respondent filed a request for fee dispute arbitration with the Richmond County Bar Association (hereinafter "RCBA") in accordance with Part 137 of the Rules of the Chief Administrative Judge ( 22 NYCRR §§ 137.0 et seq.). The arbitration was conducted on September 11, 2008, and petitioner was directed to refund the amount of $25,000 to respondent.
Petitioner had represented the respondent in a custody dispute entitled Hayes v. Hayes (Index No. 5539/97), and the legal fees in question (approximately $80,000) were purportedly incurred in that proceeding.
To the extent that petitioner claims that the panel lacked jurisdiction, the Court notes that since the respondent's letter of termination was issued to the petitioner on May 4, 2006, her application dated December 6, 2007 was timely under 22 NYCRR § 137.1(b)(6).
Petitioner subsequently moved to vacate that award on the ground that her rights had been prejudiced by the actions of the arbitrators who handled the fee dispute. More particularly, it was alleged that prior to the hearing, petitioner had advised the arbitrators that she would be out of the country on a pre-planned vacation, and requested an adjournment. However, her request was denied and the hearing was conducted in her absence. In its decision, the panel noted petitioner's failure to appear, but stated that its determination took into consideration all of the documents which had been submitted by each party. According to the petitioner, both the dispute program administrator and the panel of arbitrators were politically motivated, tainting those proceedings with the appearance of impropriety. The motion to vacate was granted, and the case was referred to a new arbitration panel. The second arbitration hearing was scheduled to begin on January 13, 2010.
Petitioner's motion was granted in a Decision and Order by Honorable Joseph J. Maltese on March 11, 2009. Notwithstanding this success, petitioner subsequently moved for leave to reargue, seeking vacatur of the portion of the Decision and Order which directed a hearing de novo. Petitioner requested that the arbitration be stayed until the Board of Governors of the Attorney Client Fee Dispute Resolution Program was able to resolve certain grievances. This motion was denied in a Decision and Order by Honorable Joseph J. Maltese on August 3, 2009.
Presently before the Court are copies of the copious correspondence among the parties and the arbitration panel, including multiple letters by petitioner to the panel seeking adjournments of the re-scheduled arbitration. Of particular note is a letter dated January 7, 2010, in which petitioner provides alternate dates in February and March of 2010 (Petitioner's Part 1, Exhibit "G"). As a result, while some of the testimony was heard on January 13, 2010, the hearing was continued to March 10, 2010. Nevertheless, petitioner requested further adjournments, e.g., due to the death of an alleged family friend and the need to provide care for a family member purportedly in ill-health ( id.). These additional requests were denied.
Following the conclusion of the hearing on March 10, 2010, the second panel directed petitioner to refund the amount of $44,350 to the respondent by April 10, 2010. Petitioner now moves to vacate this award, and respondent cross-moves for its confirmation.
In support of vacatur, petitioner alleges, inter alia, that the denial of her various requests for adjournments was the product of bias, abuse, and misconduct on the part of the arbitrators. Petitioner further maintains that the members of the new panel were too "entrenched in Staten Island politics" to be fair (April 7, 2010 Affirmation of Susan D. Settenbrino, Esq at paras 36, 83); that the lead arbitrator was friendly with an attorney who was associated socially with the respondent ( id. at paras 87-90); and that a third panelist failed to disclose that her spouse was a Justice of this Court ( id. at para 36, 188). Accordingly, petitioner contends that the integrity of the arbitration process and the neutrality of the panel members was again impaired. Based on the foregoing, petitioner seeks to vacate the award in favor of a hearing de novo before a third panel.
Once parties have participated in an arbitration, their ability to have the courts vacate or modify the award is limited by CPLR 7511(b) ( see Matter of Wicks Constr [Green], 295 AD2d 527 [2nd Dept 2002]). Pursuant to same, an arbitration award may be vacated only upon proof that the underlying dispute was not arbitrable; that a party's rights were prejudiced by fraud or partiality on the part of the arbitrator or that the arbitrator exceeded a specifically enumerated limitation on his or her power. In addition, an award may be vacated on the ground that it is violative of some strong public policy, or that the award is totally irrational ( see Matter of IBK Enters, Inc v. Onekey, LLC , 70 AD3d 948 , 949 [2nd Dept 2010]). "An arbitrator is not bound by principles of substantive law or [the] rules of evidence, and may do justice and apply his or her own sense of law and equity to the facts as he or she finds them to be" ( Shnitkin v. Healthplex IPA, Inc , 71 AD3d 979 , 981 [2nd Dept 2010][internal quotation marks and citations omitted]). Here, the petitioner has failed to demonstrate any basis for vacatur.
It has been held repeatedly that the mere occasional association between an arbitrator and a party or a witness does not warrant the disqualification of an arbitrator on the ground of the appearance of bias or partiality ( see Matter of IBK Enters, Inc v. Onekey, LLC, 70 AD3d at 949; Matter of Chernuchin v. Liberty Mut Ins Co, 268 AD2d 521 [2nd Dept 2000]; Matter of Henry Quentzel Plumbing Supply Co v. Quentzel, 193 AD2d 678 [2nd Dept 1993]). Rather, it must be shown that the arbitrator and the party or witness have some ongoing relationship ( Matter of Henry Quentzel Plumbing Supply Co v. Quentzel, 193 AD2d at 679). "The very purpose of arbitration is to have a dispute resolved by persons knowledgeable in a given area [citation omitted]. Therefore, if the courts were to disqualify every arbitrator who has had professional contacts with a party or witness, it would be difficult to maintain the arbitration system" ( id.). As for the denial of petitioner's seemingly endless requests for adjournments, the decision of whether or not to grant an adjournment is a matter generally committed to the discretion of the arbitrator, and will support a finding of misconduct only if an abuse can be demonstrated ( see Matter of MTM Beverages Corp v. Pepsi Cola Bottling Co of NY, 262 AD2d 414 [2nd Dept 1999]).
In this case, petitioner has failed to meet her burden of proof by clear and convincing evidence that any impropriety or misconduct on the part of the arbitrators either prejudiced her rights or operated to impair the integrity of the arbitral process and award ( see Matter of Balis v. Chubb Group of Ins Cos , 50 AD3d 682 [2nd Dept 2008]; Matter of Progressive Northeastern Ins Co v. Gigi , 47 AD3d 822 [2nd Dept 2008]; see also Elias Eleni Rest Corp v. 8430 New Utrecht Corp, 282 AD2d 705 [2nd Dept 2001]).
Accordingly, it is
ORDERED that the petition to vacate the arbitration award is denied; and it is further
ORDERED that the petition to confirm the arbitration award is granted; and it is further
ORDERED that these proceedings be consolidated under the caption and index no. of the first entitled petition; and it is further
ORDERED that the petitioner, Susan D. Settenbrino, P.C., make payment of the confirmed monetary award of $44,350.00 to respondent Florentina Barroga-Hayes within thirty (30) days of the service upon it of a copy of this decision and order with notice of entry; and it is further
ORDERED that upon failure of petitioner Susan D. Settenbrino, PC. to satisfy this award, the respondent may serve and file a judgment for any outstanding amount, with interest from April 10, 2010 plus costs and disbursements.