Arbitration - Award - Capacity to Understand Arbitration Agreement

Arbitration - Award - Prejudgment Interest from Date on Which Payment Period Expired

In a proceeding pursuant to CPLR article 75 to confirm an arbitration award dated August 15, 2019, Rafe Friedman appeals from a judgment of the Supreme Court, Queens County (Leonard Livote, J.), entered June 3, 2021. The judgment, upon an order of the same court dated May 4, 2021, granting the petition and denying the cross-motion of Rafe Friedman to vacate or modify the arbitration award and to seal documents referencing psychiatric information, confirmed the arbitration award and awarded the petitioner prejudgment interest from August 15, 2019.

Ordered that the judgment is modified, on the law, by deleting the provision thereof awarding the petitioner prejudgment interest from August 15, 2019, and substituting therefor a provision awarding the petitioner prejudgment interest from September 14, 2019; as so modified, the judgment is affirmed, with costs to the petitioner, and the matter is remitted to the Supreme Court, Queens County, for calculation of the prejudgment interest due in accordance herewith and the entry of an appropriate amended judgment thereafter.

The petitioner and Rafe Friedman were long-time acquaintances, both of whom struggled with mental health disorders. According to the petitioner, Friedman convinced the petitioner to withdraw his retirement savings and invest in Friedman's corporations, claiming that Friedman could manage the investments more effectively. Additionally, Friedman requested to be added as an authorized user on the petitioner's credit card. In total, Friedman received $356,277.75 from the petitioner. A dispute arose when the petitioner requested an accounting and Friedman could not provide the accounting.

In December 2018, the parties agreed to submit their dispute regarding the investments to binding arbitration before the Beth Din of America, a religious tribunal that resolves disputes according to Jewish law. The Beth Din of America issued an award dated August 15, 2019, finding that Friedman breached his fiduciary duty and was liable to the petitioner in the principal sum of $356,277.75.

Subsequently, the petitioner commenced this proceeding to confirm the arbitration award. Friedman cross-moved to vacate or modify the arbitration award and to seal documents referencing psychiatric information. In an order dated May 4, 2021, the Supreme Court granted the petition and denied the cross-motion. On June 3, 2021, the court entered a judgment confirming the [*2]arbitration award and awarding the petitioner prejudgment interest from August 15, 2019. Friedman appeals.

Judicial review of an arbitration award is extremely limited (see Matter of Tauber v Gross, 216 AD3d 1066, 1068 [2023]). "CPLR article 75 codifies a limited role for the judiciary in arbitration" (Matter of Nofal v MAS-UNY, 234 AD3d 970, 971 [2025] [internal quotation marks omitted]; see Matter of Tauber v Gross, 216 AD3d at 1068). "A party seeking to overturn an arbitration award bears a heavy burden and must establish a ground for vacatur by clear and convincing evidence" (Matter of Hussaini v Hussaini, 237 AD3d 1095, 1096 [2025]).

Contrary to Friedman's assertion that the award should be vacated because he did not fully comprehend or understand the nature of the arbitration agreement, the Supreme Court providently exercised its discretion in determining that he was competent. As a general rule, a party's competence is presumed (see Matter of Moore, 204 AD3d 1014, 1015 [2022]; Matter of Gold, 170 AD3d 1174, 1175 [2019]). "[T]he party asserting incapacity bears the burden of proving incompetence" (Crawn v Sayah, 31 AD3d 367, 368 [2006] [internal quotation marks omitted]; see Weissman v Weissman, 42 AD3d 448, 450 [2007]). Here, Friedman failed to show that he lacked the mental capacity to comprehend and understand the nature of the arbitration agreement (see Crawford v Smith, 219 AD3d 691, 692 [2023]; Matter of Dinnerstein v New York State Div. of Hous. & Community Renewal, 257 AD2d 444, 444 [1999]).

Friedman also failed to demonstrate, by clear and convincing evidence, any basis for vacating the arbitration award pursuant to CPLR 7511 (see Matter of Dluhy v Sive, Paget & Riesel, P.C., 220 AD3d 659, 660 [2023]; Matter of Denaro v Cruz, 115 AD3d 742, 743 [2014]).

"Upon confirmation of an arbitrator's award, interest should be awarded from the date of the award or, where an arbitration award provides for payment within a certain time period, interest should be awarded from the expiration of that period" (Matter of Shimon v Silberman, 92 AD3d 789, 790-791 [2012] [citations and internal quotation marks omitted]; see Matter of Meehan v Nassau Community Coll., 242 AD2d 155, 159-160 [1998]). Accordingly, we modify the judgment to award the petitioner prejudgment interest from September 14, 2019, the date on which the payment period expired (see Matter of Shimon v Silberman, 92 AD3d at 790-791).

Further, the Supreme Court providently exercised its discretion in denying that branch of Friedman's cross-motion which was to seal documents referencing psychiatric information (see 22 NYCRR 202.5-b [k]; 216.1; Lurie v Lurie, 226 AD3d 1001, 1003 [2024]).

Friedman's remaining contentions are without merit. Connolly, J.P., Christopher, Voutsinas and Hom, JJ., concur.