First Montauk Securities Corp. v. Chiulli

—In a proceeding pursuant to CPLR article 75 to permanently stay arbitration, the appeal is from an order of the Supreme Court, Nassau County (Lockman, J.), entered November 20, 1996, which granted the application. Ordered that the order is affirmed, with costs. “Preemptive judicial intervention in the arbitration process is warranted where the arbitrator [can] not grant any relief without violating public policy” (Matter of Imperial House [Local 32B-32J], 154 AD2d 534, 535). The decisional law clearly indicates that a discharged debtor cannot pursue a claim which it failed to disclose in its schedule of assets filed with the bankruptcy court (see, Dynamics Corp. v Marine Midland Bank-N. Y., 69 NY2d 191; Robinson v Wiertel Constr., 185 AD2d 664; In re Drexel Burnham Lambert Group, 160 Bankr 508). Here, the appellant, who failed to list his claim against the petitioner on a timely basis, is seeking to pursue that claim. Since the appellant’s pursuit of his claim is against public policy, any remedy fashioned by the arbitrator would be violative of that policy. Thus, the application for a stay of arbitration was properly granted. Bracken, J. P., Thompson, Goldstein and Lerner, JJ., concur.