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PURPORTED RISK OF WAIVER OF RIGHT TO COMPEL ARBITRATION WAS NOT A REASONABLE EXCUSE FOR A DELAY IN ANSWERING THE COMPLAINT; MOTION TO VACATE DEFAULT SHOULD NOT HAVE BEEN GRANTED.

The Second Department, reversing Supreme Court, determined defendants’ motion to vacate a default judgment should not have been granted. The defendants failed to offer a reasonable excuse for the six-month delay in answering. The court rejected the argument that a timely answer would have risked waiver of the right to compel arbitration:

The defendants asserted that they did not serve a timely answer because, “[h]ad [they] served an answer, they risked waiving the right to compel arbitration.” This excuse was not reasonable given the procedural means that were available to the defendants to avoid default while preserving their right to demand arbitration of the dispute (see CPLR 7503[a]; see also CPLR 3211[a], [f]…). Duprat v BMW Fin. Servs., NA, LLC, 2016 NY Slip Op 05970, 2nd Dept 9-14-16

CIVIL PROCEDURE (PURPORTED RISK OF WAIVER OF RIGHT TO COMPEL ARBITRATION WAS NOT A REASONABLE EXCUSE FOR A DELAY IN ANSWERING THE COMPLAINT; MOTION TO VACATE DEFAULT SHOULD NOT HAVE BEEN GRANTED)/ARBITRATION (PURPORTED RISK OF WAIVER OF RIGHT TO COMPEL ARBITRATION WAS NOT A REASONABLE EXCUSE FOR A DELAY IN ANSWERING THE COMPLAINT; MOTION TO VACATE DEFAULT SHOULD NOT HAVE BEEN GRANTED)/DEFAULT JUDGMENT (PURPORTED RISK OF WAIVER OF RIGHT TO COMPEL ARBITRATION WAS NOT A REASONABLE EXCUSE FOR A DELAY IN ANSWERING THE COMPLAINT; MOTION TO VACATE DEFAULT SHOULD NOT HAVE BEEN GRANTED)

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