Rosenblum v. Steiner
| Citation | 403 N.Y.S.2d 716,374 N.E.2d 610,43 N.Y.2d 896 |
| Parties | , 374 N.E.2d 610 Dora ROSENBLUM, as Executrix of Jacques Rosenblum, Deceased, Appellant-Respondent, v. Herman C. STEINER, Respondent-Appellant. |
| Decision Date | 14 February 1978 |
| Court | New York Court of Appeals Court of Appeals |
The order of the Appellate Division should be modified, without costs, in accordance with the following memorandum. The plaintiff executrix made this CPLR 3213 motion for summary judgment by service of a summons, notice of motion for summary judgment and affidavit in support of the motion seeking to collect on two promissory notes. The papers alleged that on or about December 1, 1971 the defendant executed and delivered to the deceased a series of five promissory notes which were given in consideration for the purchase of an interest in certain real property. The first three notes were apparently paid but defendant defaulted on the fourth note, which activated an acceleration clause causing the fifth note to also become due. The defendant served an affidavit in opposition which alleged, inter alia, that the notes were unenforceable because they exacted an usurious rate of interest, and by counterclaim sought payment for excessive interest previously paid. Plaintiff then served a reply affidavit challenging the usury allegation. At this point defendant countered with a supplemental affidavit asserting that the written agreement between the parties included a broad arbitration clause. In his supplemental affidavit defendant demanded arbitration and sought to withdraw his usury counterclaim without prejudice to raise it in the arbitration proceedings.
Although defendant did not immediately assert his demand for arbitration, his delay was explained by an illness and absence from the State where the documents were located. Since all the affidavits in this CPLR 3213 motion were reviewed by Special Term at one time, it cannot be said that defendant's degree of participation in the action constituted a waiver of his right to demand arbitration (see De Sapio v. Kohlmeyer, 35 N.Y.2d 402, 405, 362 N.Y.S.2d 843, 846, 321 N.E.2d 770, 772).
The demand for arbitration commenced the arbitration proceedings (cf. City Trade & Inds. v. New Cent. Jute Mills Co., 25 N.Y.2d 49, 55, 302 N.Y.S.2d 557, 561, 250 N.E.2d 52, 55) and the Appellate Division properly directed that arbitration proceed and that the present proceedi be stayed pending the outcome of the arbitration (CPLR 7503). However, the Appellate Division erred when it restricted the scope of the arbitration by declaring that ...
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...will it be necessary to decide whether plaintiffs have also pleaded a nonarbitrable usury claim. Rosenblum v. Steiner, 43 N.Y.2d 896, 403 N.Y.S.2d 716, 374 N.E.2d 610 (1978), cited by plaintiffs is hardly to the contrary, for there the Court of Appeals held that public policy does not precl......
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