Boehme v. Traina

In a proceeding pursuant to CPLR 7511 to vacate an arbitration award on the ground that the arbitrator failed to follow the procedures set forth in the statute, Gregory Rizzo Traína appeals from (1) so much of an order of the Supreme Court, Nassau County (Winick, J.), dated June 17, 1993, as granted the petitioners’ motion to set aside the arbitration award in favor of the respondents and directed that a new arbitration be held against Gregory Rizzo Traína, Chester James Padgett, and Stuart Warren Graff, and (2) an order of the same court dated September 22, 1993, which, upon reargument, modified the order dated June 17, 1993, by granting the motion only with respect to Gregory Rizzo Traína. Ordered that the appeal from the order dated June 17, 1993, is dismissed, as that order was superseded by the order dated September 22, 1993, made upon reargument; and it is further, Ordered that the order dated September 22, 1993, is reversed, on the law, the order dated June 17, 1993, is vacated, [785] the motion is denied, and the proceeding is dismissed; and it is further, Ordered that the appellant is awarded one bill of costs. The petitioners filed a claim with the National Association of Securities Dealers, alleging that the respondents had, inter alia, "engaged in excessive transactions to generate income for themselves”. After an arbitration hearing on the claim was conducted, the arbitrator ordered the dismissal of the claims against each of the respondents. The petitioners thereafter moved to vacate the award pursuant to CPLR 7511 on the ground that they had been deprived of their right to cross-examine the respondent Gregory Rizzo Traína pursuant to CPLR 7506 (c). The petitioners contended that upon his examination by the petitioners on their direct case, Traína was improperly allowed to consult with counsel "after virtually each and every question was put to him”. In his answer, Traína maintained that the questions put to him by the petitioners’ counsel had made no sense to him and that accordingly, he consulted with his attorney. A supplemental affirmation submitted by the petitioners’ counsel revealed that the court reporter the petitioners’ counsel had retained to transcribe the tape recording of the hearing had found the recording to be inaudible and that accordingly, a transcript could not be made. By order dated June 17, 1993, the Supreme Court vacated the award and directed a new hearing against all three respondents. Upon reargument, the Supreme Court took cognizance that the case had already been dismissed against the other two respondents, and vacated the award and directed that a new arbitration proceed against Traína only. Even assuming arguendo that the factual assertions raised by the petitioners were accurate, we conclude that they have failed to establish by clear and convincing evidence that the arbitration award should be vacated (see generally, Matter of Goldfinger v Lisker, 68 NY2d 225). An arbitrator’s conduct is not governed by the substantive or evidentiary rules which commonly prevail in courts of law and he has wide latitude to control the cross-examination of a witness (see, Medivix, Inc. v Shnayer, 160 AD2d 911). Moreover, in this case, the petitioners failed to establish that the consultations between Traína and his counsel constituted an improper attempt to circumvent the purpose of cross-examination. Finally, Matter of Goldfinger v Lisker (68 NY2d 225, supra), [786] the case upon which the petitioners primarily rely, is inapposite. There, the vacatur of the arbitrator’s award was based on the occurrence of a private communication between the arbitrator and one party, which took place without the consent of the other party. Sullivan, J. P., Rosenblatt and Altman, JJ., concur.