Baram v Marcus & Millichap Real Estate Inv. Brokerage Co.
Annotate this CaseDecided on May 18, 2005
Supreme Court, New York County
Noam Baram, Petitioner,
against
Marcus & Millichap Real Estate Investment Brokerage Co., Respondent.
114646/04
Charles J. Tejada, J.
An exclusive right to sell real property located at 9 Minetta Street agreement ("agreement") was entered into and executed between Michael Yanko and Marcus & Millichap. Mr. Yanko, signed and initialed the agreement in his own name. There was no mention of the petitioner in any portion of the agreement. The petitioner did not sign nor negotiate any portion of the agreement nor did the agreement make mention of Eilat Development Corp, the corporation in which the petitioner and Michael Yanko, the signatory of the agreement, were equal partners.
It is a well settled principle that "a party will not be compelled to arbitrate and, thereby, to surrender the right to resort to the courts, absent evidence which affirmatively establishes that the parties expressly agreed to arbitrate their disputes." Schubtex, Inc. v Allen Snyder, Inc., 49 NY2d 1, 6; see, also, In the Matter of Marlene Inds. Corp.v. Carnac Textiles, 45 NY2d 327, 333-334; In the Matter of Acting Supt. of Schools United Liverpool Faculty Assn., 42 NY2d 509, 512 ("The agreement must be clear, explicit and unequivocal")
It is undisputed that the agreement contained an arbitration clause and that there was a business relationship between the petitioner and the signatory to the agreement. However, there is no agreement between the petitioner and the respondent. Instead, respondent appears to rely upon the assumption that since the petitioner and the signatory were equal shareholders in a corporation that owned the property in question, that the petitioner therefore was bound by the agreement despite his never having signed the agreement nor agreed to submit to arbitration. The record before this court does not provide an adequate basis on which to compel the petitioner to submit to arbitration and relinquish his rights to resort to the courts. "Interrelatedness, standing alone, is not enough to subject a non-signatory to arbitration." World Business Center Inc. V. Euro American Lodging Corporation, 309 AD2d 166 citing TNS Holdings v MKI Sec. Corp. [citations omitted]. [*2]
Moreover, not only does the petitioner's name not appear on any portion of the agreement, but the respondent does not even argue that the petitioner was present during the signing of the agreement or that Michael Yanko represented to respondent that the petitioner was a principal represented by Mr. Yanko at the time the agreement was executed. Additionally, there is no contention that the petitioner contacted the respondent to state that Mr. Yanko was acting on his behalf or on behalf of Eilat Development Corporation. Consequently, the rule that, "When a principal places its agent in such a position that a person of ordinary prudence is led to believe that the agent has authority to perform a particular act, the principal will be estopped from denying the agent's authority to do that act upon which a third party has relied to his or her detriment. See, Clarke v. Montgo Realty Inc., 2 Misc 3d 135(A) citing Matter of Enright v Asplundh Tree Expert Co., 271 App Div 847, 65 N.Y.S.2d 871 [1946], affd 297 NY 452, 74 N.E.2d 170 [1947]" is not applicable.
Given that the arbitration clause is limited to the parties to the agreement and that Mr. Yanko signed the agreement in his individual capacity, not as agent for the petitioner or in his general corporate capacity under Eilat Development Corporation, the petitioner cannot be compelled to arbitrate this matter and this motion must be denied.
Dated: May 18, 2005
______________________________
J.S.C.
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