HERE THE ARBITRATOR’S AWARD BECAME DORMANT WHEN DE NOVO PROCEEDINGS WERE STARTED BUT WAS REVIVED WHEN THE DE NOVO PROCEEDINGS WERE DISMISSED FOR FAILURE TO COMPLY WITH DISCOVERY DEMANDS (SECOND DEPT).

The Second Department, reversing Supreme Court, determined that the arbitration award remained dormant when the de novo proceedings were brought but revived when the de novo proceedings were dismissed for failure to comply with discovery demands:

… [T]he commencement of the de novo action did not eliminate the master arbitration award but only placed it in a dormant state. An award by an arbitrator shall be binding, except for the grounds for review set forth in CPLR article 75, and except where a de novo review is sought (see Insurance Law § 5106[c]). Under certain circumstances, an arbitration award is presumed to be dormant while the de novo action is pending … . An arbitration award is revived when that action is dismissed for failure to prosecute or other similar basis not on the merits … . Here, the dismissal of the complaint in the instant action due to the plaintiff’s failure to comply with discovery demands revived the master arbitration award and made it binding on the parties. Thus, under the circumstances, the Supreme Court should have granted that branch of the defendant’s motion which was to confirm the master arbitration award … . American Tr. Ins. Co. v Bliss Acupuncture, P.C., 2026 NY Slip Op 06081, Second Dept 10-21-26

Practice Point: Here the arbitrator’s award became dormant when de novo proceedings were brought but was revived when the de novo proceedings were dismissed for failure to comply with discovery demands.