Ehrlich v. Giminez , 148 A.D.3d 657 ( 2017 )

Ehrlich v Giminez (2017 NY Slip Op 02521)

Ehrlich v Giminez

2017 NY Slip Op 02521

Decided on March 30, 2017

Appellate Division, First Department

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

This opinion is uncorrected and subject to revision before publication in the Official Reports.

Decided on March 30, 2017
Tom, J.P., Moskowitz, Feinman, Gische, Kapnick, JJ.

3585N 162389/15

[*1] Dan Ehrlich, Petitioner-Appellant,

v

Henry Giminez, et al., Respondents-Respondents.

Edward H. Odesser, LLC, White Plains (Edward H. Odesser of counsel), for appellant.

Thomas Stanziale, Mineola, for respondents.

Order and judgment (one paper), Supreme Court, New York County (Robert R. Reed, J.), entered on or about March 17, 2016, which denied petitioner's motion and dismissed the petition to permanently stay arbitration, unanimously reversed, on the law and the facts, without costs, the denial of petitioner's motion vacated, the petition reinstated, the matter remanded for a hearing, pursuant to CPLR 7503(a), to determine whether there was an agreement to arbitrate the disputed issues, and the motion to stay the arbitration held in abeyance pending the outcome of this hearing.

Petitioner notes that the limited liability company (LLC) to which the parties belong, Powerhouse Beverage Company LLC, has an LLC agreement dated January 28, 2014, which contains no agreement to arbitrate, and which states, at section 14.7, that it supersedes all prior agreements between the parties. Respondents, however, note the existence of a December 10, 2012 LLC agreement, apparently executed four days after the formation of the LLC, which contains a mandatory arbitration clause. Section 14.5 of the 2014 agreement states that, in the event of any conflicts between the 2014 agreement and the "Certificate" or the Delaware Limited Liability Act, the provisions of the Certificate or the Act will control. It is clear that the Delaware Limited Liability Act is not the 2012 agreement. However, it is not clear whether the 2012 agreement is the "Certificate of formation" filed at the time of the LLC's creation. If it is, then the arbitration clause in the 2012 agreement would control, assuming the 2012 agreement was properly executed. If it is not, then the 2014 agreement would supersede the 2012 agreement, and there would be no agreement to arbitrate. Given this dispute, the matter should be "tried forthwith" (CPLR 7503[a]).

We have considered the parties' remaining contentions and find them unavailing.

THIS CONSTITUTES THE DECISION AND ORDER

OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: MARCH 30, 2017

CLERK