Summary
holding that nearly identical New York statutory provisions, 74 N.Y. CPLR §§ 7502(b) 7503(c), were preempted by the FAA
Summary of this case from Lefkowitz v. HWF HoldingsOpinion
June 23, 1994
Appeal from the Supreme Court, New York County (Leland DeGrasse, J.).
The IAS Court properly exercised personal jurisdiction over the non-domiciliary appellant in this action to stay arbitration, where here, appellant, a signatory to a Uniform Application for Securities Industry Registration and Transfer (a "U-4 Form"), consented, by filing her Demand for Arbitration and Statement of Claim with the National Association of Securities Dealers, Inc.'s New York office and by including the 20-day preclusion notice prescribed by CPLR 7503 (c) in the Demand for Arbitration, and where petitioner served the notice of petition to stay arbitration upon appellant's New York City and Washington attorneys in accordance with the express terms of CPLR 7503 (c) (Merrill Lynch, Pierce, Fenner Smith v. Shaddock, 822 F. Supp. 125, 130; Matter of Knickerbocker Ins. Co. [Gilbert], 28 N.Y.2d 57, 65).
However, the court committed reversible error in determining that the Federal Arbitration Act ("FAA") did not preempt a New York court's jurisdiction to determine the timeliness of the appellant's claims. The FAA governs, and supplants all State law inconsistent with its express provisions, in proceedings involving interstate commerce, such as the case at bar, where a registered securities dealer has executed a U-4 Form which includes an arbitration clause (Fletcher v. Kidder, Peabody Co., 81 N.Y.2d 623, cert denied ___ US ___, 114 S Ct 554; see, Societe Generale de Surveillance v. Raytheon European Mgt. Sys. Co., 643 F.2d 863, 867). Statute of Limitations and choice of law questions arising in such a dispute must be determined by the arbitrators, rather than a court (Smith Barney Harris Upham Co. v. Luckie, 198 A.D.2d 87; Matter of Merrill Lynch, Pierce, Fenner Smith [Manhard], 201 A.D.2d 347).
Concur — Carro, J.P., Wallach, Asch, Nardelli and Williams, JJ.