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Current Developments in the Commercial Divisions of the
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Posted: May 16, 2015

Plaintiff Bound by Agreement to Arbitrate Even Though He did not Sign It

On April 28, 2015, Justice Kornreich of the New York County Commercial Division issued a decision in Gibbs v. Holland & Knight LLP, 2015 NY Slip Op. 30705(U), granting a motion to compel arbitration even though the party opposing arbitration had not signed the agreement requiring arbitration.

In Gibbs, the plaintiff brought an action for a declaration of his rights under a partnership agreement. The defendant moved to compel arbitration. The plaintiff opposed, arguing that he was not bound by the arbitration clause in the partnership agreement because he had not signed it. The court disagreed, explaining:

Here, the 2012 Partnership Agreement provides that any controversy or claim arising out of or relating to this Agreement shall be resolved in arbitration in accordance with [Article XXII of the agreement]. Every year, [the plaintiff] acknowledged that his relationship with [the defendant] was governed by the partnership agreement in effect for that year. Tellingly, when the subject controversy first arose in late 2013, it was [the plaintiff] who acknowledged the requirement to follow the dispute resolution mechanism in Article XXII and demanded that [the defendant] commence negotiations. That [the plaintiff] now prefers litigation is to no avail. He contractually agreed to arbitrate, and has unambiguously recognized this fact, in writing, on numerous occasions.

. . .

[It does not] matter that [the plaintiff] did not sign the 2012 Partnership Agreement. There is no signature requirement under the FAA (nor is there one under the CPLR). Here, while [the plaintiff] never signed the 2012 Partnership Agreement, he indisputably agreed to be bound by it and unequivocally expressed that understanding in the discussed letters.

(Internal quotations and citations omitted).

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