Morrell & Co. v. Lehr Construction Corp.

287 A.D.2d 257, 730 N.Y.S.2d 709, 2001 N.Y. App. Div. LEXIS 9283

Opinion

—Order, Supreme Court, New York County (Barbara Kapnick, J.), entered on or about June 6, 2001, denying plaintiff’s motion to stay the arbitration of defendant’s claim set forth in its amended demand for arbitration and referring the issue of the claim’s arbitrability to the arbitrators, unanimously affirmed, with costs.

The court notes the breadth of the arbitration clause in the parties’ contract and their agreement that arbitration of disputes arising under their contract would be governed by the rules of the American Arbitration Association. They provide for the arbitrator’s application and interpretation of American Arbitration Association rules insofar as they relate to the arbitrator’s powers and duties. Accordingly, the motion court properly declined to stay arbitration of defendant’s amended demand for arbitration, leaving the arbitrability of the claim contained therein, one for attorney’s fees, to be decided by the arbitrator (see, PaineWebber Inc. v Bybyk, 81 F3d 1193; see also, Matter of Smith Barney Shearson v Sacharow, 91 NY2d 39). While it is true that absent agreement or legal rule to the contrary, attorneys’ fees incurred in the course of an arbitration itself are not recoverable by a party; here, the claim is for legal fees incurred by defendant in resisting alleged breaches of the underlying agreement by plaintiffs previous recourse to litigation instead of the arbitration remedy provided by the contract. Concur — Williams, J. P., Andrias, Wallach, Lerner and Marlow, JJ.