July 12, 2007

101 Acupuncture, P.C. v Utica Mut. Ins. Co. (2007 NY Slip Op 51488(U))


The court considered the scope of a master arbitrator's powers in reviewing an arbitrator's decision and determined that the master arbitrator is limited to reviewing the decision based on specific grounds enumerated in article 75. The main issue decided was whether the master arbitrator's determination upholding the arbitrator's award, which denied the petitioner's claims for first-party no-fault benefits, was rational. The holding of the case was that upon review, the court found that there was a rational basis for the master arbitrator's determination, and therefore affirmed the denial of the petition to vacate the award. The court also confirmed the master arbitrator's award and noted that the petition was timely filed.

Reported in New York Official Reports at 101 Acupuncture, P.C. v Utica Mut. Ins. Co. (2007 NY Slip Op 51488(U))

101 Acupuncture, P.C. v Utica Mut. Ins. Co. (2007 NY Slip Op 51488(U)) [*1]
101 Acupuncture, P.C. v Utica Mut. Ins. Co.
2007 NY Slip Op 51488(U) [16 Misc 3d 132(A)]
Decided on July 12, 2007
Appellate Term, Second Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and will not be published in the printed Official Reports.
Decided on July 12, 2007



2006-902 K C.
101 Acupuncture, P.C. a/a/o Julio Mejia-Tejada, Appellant,


Utica Mutual Insurance Company, Respondent.

Appeal from a judgment of the Civil Court of the City of New York, Kings County (Arlene Bluth, J.), entered March 2, 2006. The judgment denied the petition to vacate the master arbitrator’s award and dismissed the proceeding.

Judgment modified by adding thereto a provision confirming the master arbitrator’s award; as so modified, affirmed without costs.

In Matter of Petrofsky (Allstate Ins. Co.) (54 NY2d 207, 211 [1981]), the Court of Appeals examined the scope of a master arbitrator’s powers in reviewing the decision of an arbitrator and stated that the master arbitrator was “limited to reviewing on the
basis of the limited grounds enumerated by article 75 (CPLR 7511; Siegel, New York Practice, § 602, pp 865-866) and to reviewing whether the arbitrator acted in a manner that was arbitrary and capricious, irrational or without a plausible basis.” Moreover, while the regulations broadened the master arbitrator’s review to include questions of law which were not normally reviewable under CPLR article 75, the master arbitrator was “expressly precluded from reviewing factual or procedural errors” (id.).

The Appellate Division, Second Department, in applying Petrofsky, has held that if the arbitrator’s determination is challenged based upon an alleged factual error, the master arbitrator must uphold the determination if it has a rational basis. Similarly, if a master arbitrator determines that the arbitrator incorrectly applied substantive law, that determination may not be set aside unless it is irrational. The master arbitrator’s determination of the law need not be correct; mere errors of law are insufficient to warrant setting aside the master arbitrator’s award, and on questions of substantive law, the determination should be upheld if there is a rational [*2]basis for it (see Matter of Liberty Mut. Ins. Co. v Spine Americare Med., 294 AD2d 574, 576-577 [2002]). The court has recently stated that an award will be upheld where it was “not arbitrary, capricious or irrational (see CPLR 7511 [b] [1] [iii])” and where it has not been shown that the arbitrator acted so impartially or improperly as to prejudice the rights of one of
the parties or the integrity of the arbitration process (Matter of Mounier v American Tr. Ins. Co., 36 AD3d 617 [2007]).

Upon a review of the record, we find that there was a rational basis for the determination of the master arbitrator upholding the arbitrator’s award which denied petitioner’s claims for first-party no-fault benefits. Accordingly, the court below properly denied the petition to vacate the master arbitrator’s award. However, upon denying the petition, the court was required, pursuant to CPLR 7511 (e), to confirm the award (see Matter of Exclusive Med. & Diagnostic v Government Empls. Ins. Co., 306 AD2d 476 [2003]).

We further note that the record reveals that the petition was timely filed (CPLR
7511 [a]).

Weston Patterson, J.P., Golia and Belen, JJ., concur.
Decision Date: July 12, 2007