An arbitrator has ruled in your favor. What do you do now? In a perfect world, the other side would just pay you and be done with it, but we all know that this world is less than perfect, and you may find yourself having to enforce your arbitration award. Before you can avail yourself of the enforcement techniques that are provided by New York law, you’re going to have to follow some formalities. The followingelements may be necessary for have your arbitration award 'confirmed' and seek collections.
- THE ARBITRATION AWARD MUST BE CONFIRMED BY THE COURT
At the end of the arbitration, the arbitrator issues a written decision and delivers a copy to each party. At this point, the arbitration award does not have the same effect as a judgment issued by a court and cannot be enforced in the same manner, but it can become a judgment. In order to do that, you must first have the award confirmed by a court.
Whenever you ask a court to step into a dispute involving an arbitration, you have to file a type of suit called a special proceeding. The court will schedule a hearing on your request and, unless circumstances warrant a court’s refusing to confirm the award, the court will issue a judgment confirming the award. (Without going too far into it, a court might refuse to confirm an award if the other party is in bankruptcy, if the terms of the award are illegal, or if the arbitrator committed some form of misconduct such as refusing to hear relevant witnesses or evidence.) Assuming that the court confirms the arbitration award, the court will issue a judgment.
A word of caution is in order: New York law requires that an application to confirm an award be made within one year of the arbitrator’s delivery of the award to the parties. A failure to seek confirmation is one of the grounds for denying a petition to confirm an award, so you would do well to seek legal counsel regarding confirming and enforcing the award promptly after receiving it.
2. THE JUDGMENT CONFIRMING THE ARBITRATION AWARD MUST BE FILED
Once the award has been confirmed and a judgment issued, the judgment must be entered, which is done by filing it with the county clerk in the county where the judgment was issued. Other documents which must be filed with the county clerk as part of this process are copies of the arbitration agreement, the arbitration award, and each paper that was served by the parties in connection with the special proceeding or motion to confirm the award (these are called the “judgment-roll”). This filing puts your judgment on record and allows you to begin enforcement proceedings.
3. THE JUDGMENT CREDITOR LOCATES AND FREEZES THE JUDGEMENT DEBTOR'S ASSETS
Now that your arbitration award has been converted into a judgment, you can take advantage of the numerous enforcement techniques that are available under New York’s Civil Practice Law and Rules. At this point, you have become a judgment creditor, and the person who owes you has become a judgment debtor. Your enforcement effort has three steps: identifying assets that belong to the judgment debtor; freezing those assets; and getting them turned over to you.
Possibly the most important factor in enforcing your award is locating assets that might satisfy the judgment. To do this, the Civil Practice Law and Rules allow a court or a judgment creditor’s attorney to issue subpoenas requiring judgment debtors and others in possession of a judgment debtor’s assets, such as banks, to be questioned under oath, to produce documents, or to produce information. Typically, your attorney issues information subpoenas to the judgment debtor and any banks at which you have reason to believe the judgment debtor has accounts; the judgment debtor and banks are required to respond with information regarding the judgment debtor and its assets. Another way for your attorney to attempt to locate the judgment debtor’s property is to question him under oath. If the judgment debtor refuses to respond to your information subpoena or appear to be questioned, you may be able to ask the court to fine and arrest the judgment debtor for contempt.
To prevent the judgment debtor from hiding or doing away with assets once you locate them, the Civil Practice Law and Rules allow a court or a judgment creditor’s attorney to issue restraining notices. Once a restraining notice has been served on a judgment debtor—or anyone in possession of the judgment debtor’s assets, such as a bank—that person is forbidden to move those assets unless directed to do so by a sheriff or court order until the judgment is satisfied.
Once assets have been located and restrained, the final step is to release those assets into your hands to satisfy the judgment. The judgment creditor may ask the court to order that the judgment creditor or his bank (or other person in possession of his property) give money or property to the judgment creditor to put toward the judgment. The judgment creditor’s attorney can also submit an income execution to the county sheriff to garnish the judgment debtor’s wages until the judgment is satisfied, in which case the sheriff’s office collects periodic payments from the judgment debtor’s wages and forwards them to the judgment creditor’s attorney. Finally, the judgment creditor can place a levy on the judgment debtor’s real estate or personal property (i.e. cars, televisions, etc.) by submitting a property execution to the sheriff’s office and, in some cases, can have the judgment debtor’s property sold to satisfy the judgment.
There are, of course, exceptions to your ability to freeze and obtain the judgment debtor’s assets. The Civil Practice Law and Rules forbid the restraint of certain types of funds in a judgment debtor’s account, including most kinds of public assistance money and 90% of wages earned in the last sixty days; they prohibit the sheriff’s office from taking more than a certain amount of the judgment debtor’s disposable income through an income execution; and they allow a judgment debtor to claim exemptions for certain property so that it cannot be seized to satisfy a judgment, including the judgment debtor’s own home. Your attorney can discuss these in more detail with you. Basically, the judgment debtor is entitled to have a certain amount to live on, and your enforcement efforts can only reach the surplus.
New York law allows the winner of an arbitration to collect on it in the same manner as a judgment issued in connection with a court case. Although there is no guarantee that the other party will have assets from which the award can be satisfied, New York law provides an array of techniques which, in the hands of an experienced attorney, may help you satisfy that debt.
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The author, John Caravella Esq
., is a construction attorney and formerly practicing project architect at The Law Office of John Caravella, P.C.
, representing architects, engineers, contractors, subcontractors, and owners in all phases of contract preparation, litigation, and arbitration across New York and Florida. He also serves as an arbitrator to the American Arbitration Association Construction Industry Panel. Mr. Caravella can be reached by email: John@LIConstructionLaw.com or (631) 608–1356 or (516) 462-7051.
This is a general information article and should not be construed as legal advice or a legal opinion. Readers are encouraged to seek counsel from a construction lawyer for advice on a particular circumstance.
 Taylor v. Brodt, 90 Misc. 2d 793, 396 N.Y.S.2d 143 (Sup. Ct. N.Y. Co. 1977).
 Meyers v. Kinney Motors, Inc., 32 A.D.2d 266, 301 N.Y.S.2d 171 (1st Dep’t 1969).
 Katz v. Uvegi, 18 Misc. 2d 576, 187 N.Y.S.2d 511 (Sup. Ct. Queens Co. 1959) aff'd, 11 A.D.2d 773, 205 N.Y.S.2d 972 (2nd Dep’t 1960).
 Salamon v. Friedman, 11 A.D.3d 700, 783 N.Y.S.2d 651 (2nd Dep’t 2004).
 N.Y. C.P.L.R. 7514(a).
 N.Y. C.P.L.R. 7514(b).
 N.Y. C.P.L.R. § 5222(b).
 N.Y. C.P.L.R. §§ 5233, 6236.