Fee Arbitration Award Upheld

The New York Appellate Division for the First Judicial Department rejected an appeal of a fee arbitration award

Respondent failed to establish any grounds for vacating the arbitration award (see CPLR 7511[b]; Matter of Brown & Williamson Tobacco Corp. v Chesley, 7 AD3d 368, 372 [1st Dept 2004]). Respondent contends that the arbitration panel exceeded its power by determining the parties’ fee dispute because it was “inextricably intertwined” with her allegations of malpractice, which could not properly have been considered by the arbitrators under the Rules of the Chief Administrator of the Courts (22 NYCRR) part 137. However, respondent did not assert any “claim” of malpractice in arbitration. Indeed, the fee dispute was the only claim that was heard and resolved by the arbitration panel, which did not address respondent’s conclusory malpractice allegations. Further, neither the plain terms of 22 NYCRR part 137 (e.g. 22 NYCRR 137.1[b][3]) nor the parties’ engagement letter precluded the arbitration panel from hearing or determining petitioner’s claim for unpaid fees.

Respondent’s reliance on Filemyr v Hall (186 AD3d 117 [1st Dept 2020]) is misplaced, because in Filemyr we addressed whether a lawyer’s service on a client of an untimely notice to arbitrate barred the lawyer’s contract action for unpaid fees, an issue not raised in this action.

(Mike Frisch)