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Who cares
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Sponsors
No co-sponsors yet.
History
- Referred to judiciary
- Referred to rules
Full text
The text isn't available here yet. Check nysenate.gov.
Sponsor's memo
BILL NUMBER:S5798
Title of bill
An act to amend the civil practice law and rules, in relation to grounds for vacating an arbitration award on the basis of partiality of the arbitrator
Purpose
To clarify the intent and protect the purpose of the existing laws regarding arbitration by creating a definition of the term arbitration.
Summary of provisions
Amends Article 75 Civil Practice Law and Rules by adding a provision to subdivision (b) (ii) of Section 7511 which adds the fact that an arbitrator has been affiliated with any party or has a direct or indirect financial interest in any party or in the outcome of the arbitration, as grounds to vacate an arbitration award.
Existing law
Requires an arbitrator to be neutral.
Justification
The public policy in favor of arbitration which is codified in Section 7501 of the Civil Practice Law and Rules, is based upon the fact that arbitration can be a more efficient and cost-effective method for parties to resolve disputes. The presumption that an arbitration clause is enforceable has, however, become a sword to wield against parties of lesser means rather than a shield to protect against unnecessary litigation.
Currently, a party must prove, either during the course of misconduct by the arbitrator or after an award by an arbitrator is perceived to be unfair, that the arbitrator was biased - even if the arbitrator clearly has an economic stake in the outcome of the dispute. This outcome is in direct opposition to the reasons (efficiency and fairness) why arbitration is favored. As arbitration is commonly thought to be a dispute resolution procedure that occurs in front of a neutral third party, codifying it as such will enforce the original intent of the law.
Legislative history
New bill.
Fiscal implications
None.
Local fiscal implications
None.
Effective date
Immediate.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.