Summary
holding that proper standard of judicial review of third-party appraisal was same as arbitration: "An appraisal determination should be upheld in the absence of fraud, bias or bad faith."
Summary of this case from Salt Lake Tribune Publishing Co. v. Management Planning, Inc.Opinion
January 23, 1996
Appeal from the Supreme Court, New York County (Diane Lebedeff, J.).
The IAS Court applied the proper standard in determining the motion since CPLR 7601 provides an agreement to submit a valuation question to an independent appraiser may be enforced by a court in the same manner as would an arbitration agreement under CPLR article 75. An appraisal determination should be upheld in the absence of fraud, bias or bad faith ( see, Rice v Ritz Assocs., 88 A.D.2d 513, affd 58 N.Y.2d 923). Here, respondents' claim that petitioner fraudulently misrepresented the condition of the properties to the appraiser, causing the latter to significantly undervalue the property, is without merit, given that the appraiser itself examined each of the five properties prior to its determination. Moreover, the representations allegedly made were, with one exception, true, even if misunderstood by respondents; the other alleged representation, that one of the buildings was in "poor" condition, even if inaccurate, was insufficient to support a claim of fraud, especially in light of the on-site inspection. Thus, respondents were not entitled to either discovery or a hearing pursuant to CPLR 409 ( see, Matter of Bahar v Schwartzreich, 204 A.D.2d 441).
Concur — Sullivan, J.P., Wallach, Rubin, Kupferman and Mazzarelli, JJ.