Gansburg v. Blachman

• Decision Date: 30 January 2015
• Docket Number: No. 7431/12.,7431/12.
• Citation: 17 N.Y.S.3d 382 (Table)
• Parties: In the Matter of the Arbitration of Certain Controversies Between, Menachem GANSBURG (a/k/a Mendel Gansburg), Petitioner, v. Eli BLACHMAN (a/k/a Elias M. Blachman, Elias Blackman), Respondent.
• Court: New York Supreme Court

17 N.Y.S.3d 382 (Table)

In the Matter of the Arbitration of Certain Controversies Between, Menachem GANSBURG (a/k/a Mendel Gansburg), Petitioner
v.
Eli BLACHMAN (a/k/a Elias M. Blachman, Elias Blackman), Respondent.

No. 7431/12.

Supreme Court, Kings County, New York.

Jan. 30, 2015.

Sol Antar, Esq., Brooklyn, for Petitioner.

Law Offices of Mitchell Shapiro, Esq., NY, for Respondent.

Opinion

ARTHUR M. SCHACK, J.

In this CPLR Article 75 proceeding to confirm an arbitration award, respondent ELI BLACHMAN (BLACHMAN) cross-moves to: dismiss the first amended verified petition to confirm the arbitration award of petitioner MENACHEM GANSBURG (GANSBURG), pursuant to CPLR Rule 3211(a)(10), for failure to join a necessary part, Aaron Minkowitz (Minkowitz), as a petitioner; grant leave to respondent BLACHMAN to take discovery from petitioner GANSBURG and non-party Minkowitz, pursuant to CPLR § 408, relating to respondent BLACHMAN'S counterclaim against petitioner GANSBURG for alleged violations of Real Property Law (RPL) §§ 441 and 442–e (3) ; and, grant related relief. Petitioner GANSBURG opposes respondent BLACHMAN's cross-motion to dismiss the amended petition and the counterclaim of respondent BLACHMAN, as well as seeking confirmation of the February 13, 2012 arbitration award for $67,500.00, pursuant to CPLR § 7510, and directing the Kings County Clerk, pursuant to CPLR § 7514, to enter judgment for petitioner for $67,500.00, plus interest from the date of the award, costs and disbursements.

The Court, for the reasons to follow, denies respondent BLACHMAN's cross-motion in its entirety and grants petitioner GANSBURG confirmation of the February 13, 2012 arbitration award and judgment for $67,500.00, plus interest from the date of the award, costs and disbursements.

Background

This proceeding arises from the nonpayment of a real estate broker's commission to petitioner GANSBURG, a licensed New York State real estate broker, for the sale of the premises at 1460 Carroll Street, Brooklyn, New York. It is disputed whether non-party Minkowitz, who is not a licensed real estate broker, was a co-broker with GANSBURG or an employee of GANSBURG. On February 12, 2012, GANSBURG, BLACHMAN and Minkowitz submitted their broker's commission dispute to a Beth Din, the Rabbinical Court of Givas Hamorah, to resolve their dispute. The three rabbi panel of Rabbi Shia Gluck, Rabbi Efraim Goldstein and Rabbi Abraham Moshe Gold issued their ruling on February 13, 2012, which states, in the certified translation from the original Hebrew to English:

After much debate in terms of the facts of the case and Jewish law, the following Rabbinical Court ruling was issued by us:

1.Party B [BLACHMAN] must pay Party A[GANSBURG and MINKOWITZ] the sum of $67,500, for brokerage of Party A, and we made for him the following payment arrangement: beginning on March 1, 2012 until Feb. 1, 2015 inclusive, he shall pay the sum of $1875 on every first of the civil month; he has to give the entire aforementioned amount in head dated checks (i.e. 36 head checks) before March 1, 2012.

2.In the event Party B fails to pay in the aforementioned time, or he fails to give all the checks in the aforementioned time, Party B must pay the full debt immediately, and Party A may sue him in secular court for aforementioned sum plus the fees for his contempt, attorney, etcetera.

On April 6, 2012, Petitioner GANSBURG and then petitioner Minkowitz filed with the Kings County Clerk, their notice of petition, verified petition and request for judicial intervention, pursuant to CPLR § 7510, to confirm the February 13, 2012 arbitration award of the Beth Din. Respondent BLACHMAN, on May 14, 2012, filed with the Kings County Clerk, a pre-answer CPLR Rule 3211(a)(7) motion to dismiss. The motion alleged: petitioners failed to state a claim upon which relief can be granted; Minkowitz was not a real estate broker and was in violation of RPL § 442–d because he could not demonstrate that he was a licensed real estate broker or real estate salesman on the date of the alleged transaction; the arbitration award cannot be confirmed because it illegally split a real estate commission between a real estate broker and a non-broker; and, the Court should sanction petitioners and their counsel for filing a frivolous proceeding.

On July 30, 2012, I heard oral arguments by both sides and issued a short-form order denying respondent's motion to dismiss and confirming the arbitration award. I held in my order, in relevant part:

The parties dispute whether or not Minkowitz is a licensed real estate broker was raised at the arbitration. This is irrelevant to the findings of the Beth Din.

“Judicial review of arbitration awards is extremely limited.” (Wien & Malkin, LLP v. Helmsly–Spear, Inc. 6 N.Y.3d 471, 479 [2006] ). An arbitration award may be vacated if “it is clearly violative of a strong public policy, if it is totally or completely irrational, or if it manifestly exceeds a specific, enumerated limitation on the arbitrator's power.” (Matter of Erin Constr. & Dev. Corp. v. Meltzer, 58 A.D.2d 729, 729, [2d Dept 2009] ).

An “arbitrator's award should not be vacated for errors of law and fact committed by the arbitrator and the courts should not assume the role of overseers to mold the award to conform to their sense of justice” (Wien & Malkin at 479–480, 813 N.Y.S.2d 691, 846 N.E.2d 1201 ).

Therefore, even if Minkowitz is unlicensed as a real estate broker and the arbitrators overlooked this, the Court is powerless to set aside the arbitration award because the parties freely entered into their arbitration agreement and the Beth Din is “not bound by principles of substantive law” and “may do justice as he sees fit, applying his own sense of law and equity to the facts and he finds them to be.” (Matter of Silverman [Benmor Coats ], 61 N.Y.2d 299 at 308 [1984] ).

With respect to the branch of the motion to sanction Petitioners and their counsel, it is clear that their motion and action are not frivolous....

The Court grants Petitioner's request to file and serve an amended petition. Respondent has 30 days to answer the amended petition.

Subsequently, petitioner GANSBURG filed and served an amended petition without Minkowitz as a petitioner. Then, respondent BLACHMAN answered.

Also, respondent BLACHMAN appealed my July 30, 2012 order. On October 8, 2013, the Appellate Division, Second Department, in Matter of Gansburg v. Blachman (111 A.D.3d 935, 977 N.Y.S.2d 43 ), unanimously affirmed my July 30, 2012 order, holding in part, at 935–936:

The parties voluntarily proceeded to arbitration by agreement. The evidence before the arbitrators indicated that, although the petitioner Menachem Gansburg was a licensed real estate broker, the petitioner Aaron Minkowitz was not. However, the question of whether Gansburg should be denied a real estate broker's commission because Minkowitz was not licensed was not raised at the arbitration proceeding. The arbitration award directed the appellant to pay Gansburg and Minkowitz a real estate commission in the sum of $67,500.... A proceeding to enforce an arbitration award may be denied on the ground that the arbitration award is “violative of a strong public policy, or is totally irrational, or exceeds a specifically enumerated limitation” of power (Matter of Silverman [Benmor Coats ], 61 N.Y.2d 299, 308, 473 N.Y.S.2d 774, 461 N.E.2d 1261 ). In order to find that an arbitration award may not be enforced because it violates public policy, “the courts must be able to examine an arbitration agreement or an award on its face without engaging in extended factfinding or legal analysis, and conclude that public policy precludes its enforcement' “ (Matter of New York City Tr. Auth. v. Transport Workers Union of Am., Local 100, AFL–CIO, 99 N.Y.2d 1, 7, 750 N.Y.S.2d 805, 780 N.E.2d 490, quoting Matter of Sprinzen [Nomberg ], 46 N.Y.2d 623, 631, 415 N.Y.S.2d 974, 389 N.E.2d 456 [emphasis in original]; see Matter of Estate of Baron v. Harley–Davidson of Suffolk, Inc., 94 A.D.3d 885, 941 N.Y.S.2d 855 ; Matter of DiNapoli v. Park Automotive, Inc., 34 A.D.3d 674, 675, 824 N.Y.S.2d 424 ; Matter of Kuchar v. Baker, 261 A.D.2d 402, 402, 689 N.Y.S.2d 213 ).

There is no indication that the appellant's allegation of an illegal fee-splitting agreement between Gandburg [sic] and Minkowitz was supported by evidence submitted to the arbitrators (see Matter of Hirsch Constr. Corp. [Cooper ], 181 A.D.2d 52, 585 N.Y.S.2d 418 ). Further, the arbitration award does not violate public policy on its face.

The appellant's remaining contentions are without merit.

Accordingly, the Supreme Court properly denied the appellant's motion to dismiss the proceeding and impose a sanction on the petitioners, and properly granted the petitioners' application for leave to serve and file an amended petition deleting Aaron Minkowitz as a petitioner and instead demanding a judgment in favor of the petitioner Menachem Gansburg only.

Respondent BLACHMAN, on March 25, 2014, filed the instant cross-motion to dismiss the first amended verified petition to confirm the...