IN RE: the Application of Ean Holdings (2026)

The following e-filed documents, listed by NYSCEF document number (Motion 001) 1, 2, 13, 14, 15, 16, 17, 18, 19, 20 were read on this motion to/for STAY.

Upon the foregoing documents, this petition to stay arbitration is determined as follows:

Petitioner EAN Holdings, LLC (EAN), incorrectly named on the Notice of Intention to Arbitrate as Enterprise Insurance Company, commenced this proceeding to stay an uninsured motorist (UM) arbitration demanded by respondents Christina M. Samuels and Justin A. Batson Kirk (together, respondents). Respondents allege that on September 26, 2025, they were injured in a motor vehicle accident at or near 155th and 115th Streets, in Queens County, while passengers in a Nissan rental vehicle bearing Ohio license plate number "KRN XXXX," which EAN owned. No police report was prepared. The MV-104 submitted with respondents' demand reflects that the adverse vehicle was a 2008 Lexus bearing New York license plate number "LXJ XXXX," which is registered to proposed additional respondent Awadram Rambali (Rambali) and insured by proposed additional respondent LM General Insurance Company (LM General) under policy number XXXX.

Respondents contacted LM General to open a claim. By letter dated November 17, 2025, LM General denied the claim upon the ground that its insured did not have legal responsibility for the accident, and further advised that photographs of its insured's vehicle reflect no damage, that an event data recorder report demonstrated no impact to its insured's vehicle on said date, and that its insured and his wife each provided affidavits of non-involvement. On March 2, 2026, respondents served, by certified mail, a Notice of Intention to Arbitrate naming "Enterprise Insurance Company" as the respondent, addressed to a post office box in Lexington, Kentucky maintained by non-party Rental Claims Services, the third-party claims administrator for EAN. The notice identifies the operative policy as "policy # ?" and does not set forth the location of the accident, the amount claimed, the claimants' addresses, or the identity or address of the self-insured owner of the rental vehicle. On April 7, 2026, petitioner commenced this proceeding seeking a stay of arbitration.

As an initial matter, respondents contend that the petition is untimely because petitioner commenced this proceeding more than twenty days after service of the Notice of Intention to Arbitrate (CPLR 7503 [c]). An insurer that fails to seek a stay of arbitration within twenty days after service of a notice of intention to arbitrate is generally precluded from objecting to the arbitration thereafter, and an untimely application will be rejected regardless of proof that the offending vehicle actually had insurance coverage (see Matter of State Farm Ins. Co. v Williams, 50 AD3d 807, 808 [2d Dept 2008]). Upon review of the record presented, the petition is not precluded on two grounds. First, where the application for a stay is made upon the ground that no agreement to arbitrate exists, the court may entertain the application notwithstanding the fact that the stay was sought after the twenty-day period elapsed (see Matarasso v Continental Cas. Co., 56 NY2d 264, 267 [1982]; Matter of Progressive Specialty Ins. Co. v Louis, 122 AD3d 637 [2d Dept 2014]; Matter of Allstate Ins. Co. v Marke, 121 AD3d 1107 [2d Dept 2014]). Here, petitioner attests, through the sworn petition of Charles Lauer, its senior liability administrator, that neither EAN nor its affiliate ELRAC, LLC d/b/a Enterprise Rent-A-Car has any affiliation with an entity named "Enterprise Insurance Company," that no such entity issued coverage to respondents, and that no such entity entered into any agreement to arbitrate with respondents. Respondents do not refute these averments. As such, the petition falls within the Matarasso exception. Second, a notice of intention to arbitrate that contains material inaccuracies is defective and insufficient to trigger the running of the twenty-day period (see Matter of State Farm Ins. Co. v Williams, 50 AD3d at 809; Matter of Allstate Ins. Co. v Lichtenstein, 24 AD3d 662, 663 [2d Dept 2005]; Matter of Northern Assur. Co. of Am. v Bollinger, 256 AD2d 580, 581 [2d Dept 1998]). Here, the notice names a different entity than the rental agreement, identifies the operative policy as "policy # ?", and omits the location of the accident, the amount claimed, the claimants' addresses, and the identity and address of the self-insured owner of the rental vehicle. Respondents acknowledge the defect and misnomer in the notice and, as such, provide another reason to deny preclusion (Matter of Allstate Ins. Co. v Lichtenstein, 24 AD3d at 663; Matter of Northern Assur. Co. of Am. v Bollinger, 256 AD2d at 581). Respondents' contention that petitioner received actual notice is unavailing, as proper delivery does not remedy the inaccuracies in the notice (see Matter of Northern Assur. Co. of Am. v Bollinger, 256 AD2d at 581).

The Court now turns to address the petition. "The party seeking a stay of arbitration has the burden of showing the existence of sufficient evidentiary facts to establish a preliminary issue which would justify the stay" (Matter of Am. Protection Ins. Co. v DeFalco, 61 AD3d 970, 972 [2d Dept 2009], quoting Matter of Liberty Mut. Ins. Co. v Morgan, 11 AD3d 615, 616 [2d Dept 2004]). "Thereafter, the burden is on the party opposing the stay to rebut the prima facie showing" (Matter of Hertz Corp. v Holmes, 106 AD3d 1001, 1002 [2d Dept 2013]). "Where a triable issue of fact is raised, the Supreme Court, not the arbitrator, must determine it in a framed-issue hearing, and the appropriate procedure under such circumstances is to temporarily stay arbitration pending a determination of the issue" (Matter of Hertz Corp. v Holmes, 106 AD3d at 1002; see Matter of Allstate Ins. Co. v Aizin, 102 AD3d 679, 681 [2d Dept 2013]; Matter of Utica Mut. Ins. Co. v Leconte, 3 AD3d 534, 535 [2d Dept 2004]).

In support of its petition, petitioner submits, among other things, respondents' Notice of Intention to Arbitrate with the annexed MV-104, the title and registration for the rental vehicle, the rental agreement summary, its New York State Certificate of Self-Insurance, search results of records maintained by the New York State Department of Motor Vehicles (DMV) for license plate "LXJ XXXX," and pre-arbitration discovery demands. Petitioner avers, through its petition, that the accident does not involve an uninsured motor vehicle, as the rental vehicle was owned by EAN, a self-insured entity, and the adverse vehicle is both identified and insured by LM General. Petitioner's Certificate of Self-Insurance, issued by the DMV, establishes EAN's self-insured status. The DMV search results reflect that the adverse vehicle was registered to Rambali and that LM General covered the vehicle on the date of the accident. Respondents interpose no objection to the form of the DMV search results. Respondents' own submission independently establishes the coverage at issue. The LM General letter annexed to the opposition recites the date of incident of September 26, 2025, identifies Rambali as its insured, and identifies policy number XXXX, consistent with the DMV search results.

Upon these submissions, petitioner has set forth evidentiary facts sufficient to establish a preliminary issue as to whether there was insurance coverage for the vehicle involved in the accident, and the burden then shifted to respondents to rebut that prima facie showing. Neither respondents nor LM General asserts that the adverse vehicle was never insured or that its coverage was canceled prior to the accident date (see Matter of Govt. Empls. Ins. Co. v O'Neil, 74 AD3d 1068, 1069 [2d Dept 2010]; Matter of State Farm Mut. Auto. Ins. Co. v Yeglinski, 79 AD2d 1029, 1029 [2d Dept 1981]).

In opposition, respondents contend that UM arbitration is warranted because LM General denied the claim after its insured attested, by affidavits of non-involvement, that the Lexus was not involved in the accident. Petitioner, in reply, contends that involvement and coverage present distinct questions, that the Lexus undisputedly carried coverage on said date, and that a question of fact necessitates a hearing on the issue of involvement of the vehicle owned by Rambali and insured by LM General. Upon this record, LM General's denial, premised upon non-involvement rather than upon cancellation or non-renewal, raises a triable issue of fact as to whether the identified, insured adverse vehicle was involved in the accident. Under the circumstances, a temporary stay of arbitration is appropriate pending a determination of the issue of involvement.

For all the foregoing reasons, it is hereby

ORDERED that the petition is granted to the extent that arbitration is temporarily stayed pending a framed issue hearing; and it is further

ORDERED that Awadram Rambali and LM General Insurance Company are joined as additional respondents; and it is further

ORDERED that upon filing a Note of Issue by petitioner, this matter will be referred to Part 24 for an in-person hearing in courtroom 44A at the courthouse located at 88-11 Sutphin Boulevard, Jamaica, New York 11435, on the issue of whether the adverse vehicle, owned by Rambali and insured by LM General, was involved in the September 26, 2025 accident; and it is further

ORDERED that petitioner shall notify chambers, with proof of filing, of such compliance with the above decretal paragraph in order to schedule a date for the framed issue hearing; and it is further

ORDERED that all requests for an interpreter must be made at least five (5) business days prior to the scheduled hearing; and it is further

ORDERED that petitioner is directed to serve a copy of this Order upon all parties within twenty (20) days from the date of entry; and it is further

ORDERED that proof of service shall be filed on or before the date of the hearing; and it is further

ORDERED that, if it is determined that the parties are to proceed to arbitration, respondents shall comply with all discovery required by petitioner's insurance policy, including the submission of all relevant medical records and authorizations and submission to examinations under oath and physical examinations.

This constitutes the Decision and Order of the Court.

Dated: September 22, 2026

Jamaica, New York

Hon. Karen Lin

Justice of the Supreme Court

Karen Lin, J.