Met Food Corp. v. M. Eisenberg & Bros., Inc.

• Decision Date: 23 April 1969
• Citation: 299 N.Y.S.2d 696,59 Misc.2d 498
• Parties: MET FOOD CORP., Petitioner, v. M. EISENBERG & BROS., INC., Respondent.
• Court: New York Supreme Court

Page 696

299 N.Y.S.2d 696

59 Misc.2d 498

MET FOOD CORP., Petitioner, v. M. EISENBERG & BROS., INC., Respondent.

Supreme Court, Special Term, Suffolk County, Part I.

April 23, 1969.

Blumberg, Fitzgibbons, Abramson, Lederberg & Blumberg, Amityville, for petitioner.

Epstein & Conway, New York City, for plaintiff, The Heyward-Robinson Company, Inc.

Sinsheimer, Sinsheimer & Dubin, New York City, for respondent.

MEMORANDUM

JACK STANISLAW, Justice.

Petitioner Met Food Corp. ('Met'), as owner, engaged The Heyward-Robinson Company, Inc. ('Heyward') as general contractor and respondent M. Eisenberg & Bros., Inc. ('Eisenberg') as electrical contractor for the construction of a large warehouse. Included in the contractual documents affecting the work of each contractor is a provision for the arbitration of all disputes, involving claims for damages sustained by one party by reason of any wrongful act or neglect of another. The arbitration clause outlines the procedure to be followed, including the method of service of notice to arbitrate, and provides for the appointment of one arbitrator by each party and for the selection of a third arbitrator by the two so appointed.

With respect to the owner's right to indemnification for any claims asserted against it by a contractor, the agreements provide: 'If such separate contractor sues the Owner on account of any damage alleged to have been so sustained (i.e. damage caused by one contractor to another contractor), the Owner shall notify the Contractor, who shall defend such proceedings at the Contractor's expense and, if any judgment against the Owner arises therefrom, the Contractor shall pay or satisfy it and pay all costs.'

For reasons not relevant to this application, petitioner terminated its engagement of Heyward as general contractor during the early stages of construction and about a month later, Heyward commenced an action against Met, grounded in breach of contract. The answer interposed by Met in that action contains affirmative defenses and counterclaims, including Met's right to reimbursement and indemnification by Heyward of sums paid by Met to others, for claims resulting from Heyward's violation and breaches of its contract with Met. That action is presently pending in the Supreme Court, Nassau County.

Eisenberg, apparently, continued its work as electrical contractor. But in May of 1968 (about a year after the commencement of Heyward's Supreme Court Action) Met was served with a notice of arbitration by Eisenberg for 'additional expenses incurred and loss of profit for work performed under (their) contract'. That notice was later withdrawn, but a subsequent notice to arbitrate was served by Eisenberg on Met in June of 1968. The parties have since appointed their respective arbitrators and a third was selected pursuant to the arbitration agreement. A date for the arbitration hearing had already been set when the instant application, brought on by order to show cause, was commenced.

Met now seeks an order enjoining Both the arbitration and the action at law, pending the joinder of Heyward as a party to, as well as the determination of, the arbitration commenced by Eisenberg. Met argues: (1) that it was not until the latter part of 1968, when it received a copy of Eisenberg's preliminary memorandum, particularizing its claims, that it learned, for the first time, that many of such claims are predicated upon 'omissions and misdeeds' of Heyward; and (2) that all such claims, affecting Met, Eisenberg and Heyward, should be heard and resolved at the same...