IN RE: Application of 64 FULTON ST. DEVELOPMENT

Reset A A Font size: Print

Supreme Court, Appellate Division, First Department, New York.

IN RE: Application of 64 FULTON ST. DEVELOPMENT, etc., et al., Petitioners-Respondents, For a Judgment, etc., Marinelli Associates, Respondent-Appellant.

Decided: June 12, 1997

Before MURPHY, P.J., and MILONAS, TOM, ANDRIAS and COLABELLA, JJ. Michael S. Devorkin, for Petitioners-Respondents. Andrew L. Morrison, for Respondent-Appellant.

Judgment, Supreme Court, New York County (Ira Gammerman, J.), entered January 28, 1997, which granted petitioners' application to stay arbitration of any of respondent's claims other than for an accounting, and denied respondent's cross-motion to dismiss the petition, unanimously affirmed, with costs.

 There is no merit to respondent's claim that the petition was untimely as it was not made within 20 days of respondent's November 27, 1995 letter.   Even if that letter had been recognized by the arbitrator as an American Arbitration Association rule 8 amendment of respondent's original demand for an accounting to include claims of fraud and breach of fiduciary duty, it did not contain the 20-day notice required by CPLR 7503(c), and was therefore ineffective to commence the 20-day period for seeking a stay (Matter of Filippazzo v. Garden State Brickface Co., 120 A.D.2d 663, 665, 502 N.Y.S.2d 258).   In any event, the 20-day period did not commence to run until July 18, 1996, when the arbitrator directed the parties to serve a formal amended notice of claim and answer (see, Matter of Board of Educ. [Merritt Meridian Constr. Corp.], 210 A.D.2d 854, 854-855, 621 N.Y.S.2d 139).   Nor did petitioners' participation in the already ongoing arbitrable accounting estop them from seeking to stay arbitration of the newly added fraud claims (see, Matter of SCM Corp. [Fisher Park Lane Co.], 40 N.Y.2d 788, 792, 390 N.Y.S.2d 398, 358 N.E.2d 1024), with respect to which their actions were directed toward requiring respondent to serve a proper amended notice of claim, and were not inconsistent with an intent to preserve the right to litigate the Statute of Limitations issues, which were properly determined by the IAS court without need of an answer from respondent (CPLR 404[a] ).   We have considered respondent's other arguments and find them to be without merit.

Motion and cross-motion to enlarge the record on appeal are granted.

MEMORANDUM DECISION.