Korein v. Rabin

29 A.D.2d 351, 287 N.Y.S.2d 975, 1968 N.Y. App. Div. LEXIS 4425
CourtAppellate Division of the Supreme Court of the State of New York
DecidedMarch 12, 1968
StatusPublished
Cited by22 cases

This text of 29 A.D.2d 351 (Korein v. Rabin) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Korein v. Rabin, 29 A.D.2d 351, 287 N.Y.S.2d 975, 1968 N.Y. App. Div. LEXIS 4425 (N.Y. Ct. App. 1968).

Opinion

Stevens, J. P.

Respondent appeals from an order entered April 12, 1967 which granted petitioner’s motion for an order vacating and setting aside an arbitration award, and denied respondent’s cross motion to confirm the award.

The question to be resolved is whether there was such statutory misconduct by appellant’s counsel as warranted vacating the award. Petitioner-respondent Korein (Korein) and Ely Rabin, appellant’s testator and father, were brother and sister. They participated jointly in a number of real estate ventures, one of which was 665 Realty Company, known also as the Jensen Building, which was established in June, 1960. Ely Rabin died in August, 1964. In December, 1965 the respondent served a demand for arbitration pursuant to the rules of the American [353]*353Arbitration Association seeking a determination that Ely Rabin had not contributed his full share of capital to 665 Realty Company. In the demand for arbitration it was charged that the under-contributions were the result of Ely Rabin’s using as his own, funds belonging to Korein which came from accounts belonging to her and from other partnerships in which the respondent and Ely Rabin were the sole partners. The demand for arbitration was served pursuant to a provision in the contract between respondent Korein and Rabin which in brief provided that any controversy or claim arising out of or relating to the contract or the breach thereof shall be settled by arbitration in accordance with the rules, then obtaining, of the American Arbitration Association.”

Three arbitrators were appointed, two of whom were accountants, and the parties proceeded to arbitration. Testimony was taken on seven days in October, November and December of 1966, after which the arbitrators made an award to the respondent in the sum of $16,105.05, that being the sum which was determined to be the deficiency in Ely Rabin’s initial investment in 665 Realty Company. During the course of the hearings there was testimony about a journal book in the handwriting of the deceased Ely Rabin (hereinafter called the Rabin book). This book was produced at the hearing and certain pages were offered and received in evidence. Korein ?s counsel objected at the outset to not being permitted to examine the book in its entirety. Appellant’s counsel took the position that since there was other litigation involved between the parties, to permit examination of the entire book would prejudice the appellant’s cause and, moreover, the entire book was not relevant to the issue then before the arbitrators. Certain pages, pages 81 and 71, were shown to the arbitrators. Since the appellant Rabin objected to the full contents of those pages being made available to Korein, it was suggested by the arbitrators that copies of the pages be made available to Korein with deletion by appellant’s attorney of matters which did not relate to any of the ventures which were then being considered by the arbitrators. The pages, with such deletions, were introduced in evidence. At the termination of the last hearing it was agreed that Korein’s accountant, Mr. Engelman, would submit by December 30,1966 an analysis of the evidence presented at the hearing and that Rabin might submit a response to such analysis by January 6, 1967, following which there would be an exchange of main briefs and reply briefs on January 16 and January 23, 1967. December 30, 1966 the analysis of Korein’s accountant was served and filed. January 6, 1967 an analysis prepared [354]*354by Babin’s accountant, Mr. Feinblatt, was served and filed. A copy of the full page 81 of the Babin account book, without deletions, was appended to the Feinblatt analysis submitted to the arbitrators. A copy of the analysis served on Korein contained page 81 in the form in which it had been marked as an exhibit during the hearing, and a statement that the full text was being submitted to the arbitrators. A copy of page 71 of the Babin book was submitted in full text to the arbitrators with the appellant’s reply brief, and Korein also received a copy of the full text with service of the reply brief. The respondent during the hearings had received a copy of page 71 as marked in evidence. It might be observed that page 81 and page 71 had previously been examined by the arbitrators in the full text and, as a result of the position taken by appellant and suggestions by the arbitrators, certain deletions were made. The Feinblatt analysis submitted to the arbitrators contained page 69 of the Babin book. This was a page which had not been offered in evidence at the hearing. This page contained a single entry which apparently indicated a credit of $46,650 which the appellant conceded was due Mrs. Korein.

Petitioner-respondent Korein, in her application at Special Term to vacate the award, relied on the submission by the present appellant of the full text of pages 81, 71 and 69 to the arbitrators after the last hearing day, and also a fourth ground which had to do with matter contained in the appellant’s final brief. In that brief the appellant urged the arbitrators to review certain items identified as relating to 65th Street which appeared on the uncensored page 81 of the Babin book. In brief, Korein was provided with complete copies of pages 69 and 71 at the same time they were submitted to the arbitrators, and she was given notice that the complete text of page 81 was being submitted to the arbitrators.

Petitioner-respondent moved to vacate the award on the ground of misconduct by appellant’s counsel in procuring the award (CPLB 7511, subd. [b], par. 1), and Special Term granted the motion.

The record reveals that the hearing was closed as of January 24, 1967 and the award was issued February 24, 1967. The reply briefs were all served and filed before the arbitrators by January 24, 1967, almost a full month before the award was rendered. While the demand for arbitration merely sought a money judgment on account of the under-contributions, it appears that at the hearing the petitioner-respondent made claim for a sum in excess of $100,000 as the alleged under-con[355]*355tribution. Examination of the exhibits in the record seems to indicate that both accountants reached about the identical figure which was awarded as the deficiency or under payment on the part of the respondent-appellant.

The agreement to arbitrate, as set forth in the demand, expressly provided that "any controversy or claim * * * shall be settled by arbitration in accordance with the rules, then obtaining, of the American Arbitration Association.” The parties, therefore, are .subject to the procedures established by the rules of the association which, in effect, were incorporated in the demand (see Matter of Rosenthal, Inc. [Tannhauser], 279 App. Div. 902, affd. 304 N. Y. 812; Matter of Katz [Burkin], 3 A D 2d 238, 239). Buie 35 of the Commercial Arbitration Buies of the association provides " [t]he hearings may be reopened by the Arbitrator on his own motion, or upon application of a party for good cause shown, at any time before the award is made.” Korein was advised of the submission of the pages in question almost 30 days prior to the making of the award. If she felt aggrieved or disadvantaged she had ample time to make known her objection and seek a reopening of the hearing. Korein had chosen the forum. Korein elected to take a calculated risk, if risk there was, that the award would not or could not be affected. She should not now be heard to complain that the award, in amount, did not equal the claim advanced by her. (Fudickar v. Guardian Mut. Life Ins. Co., 62 N. Y. 392, 406.)

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Bluebook (online)
29 A.D.2d 351, 287 N.Y.S.2d 975, 1968 N.Y. App. Div. LEXIS 4425, Counsel Stack Legal Research, https://law.counselstack.com/opinion/korein-v-rabin-nyappdiv-1968.