text:
    [ 846 NE2d 806, 813 NYS2d 361]
    In the Matter of the Judicial Settlement of the Final Account of the Chase Manhattan Bank (Successor by Merger to the Chase Manhattan Bank, N.A., Successor by Merger to Chase Lincoln First Bank, N.A., Successor in Interest to Lincoln First Bank, N.A., Successor by Consolidation to Lincoln First Bank of Rochester), as Trustee under the Agreement Dated December 20, 1973 of A. Charles Pioch, for the Benefit of Kathleen M. Pioch, Respondent. Catherine H. Hyman et al., Respondents; St. John Fisher College et al., Appellants.
    Argued February 14, 2006;
    decided March 30, 2006

      POINTS OF COUNSEL

      Harter, Secrest & Emery LLP, Rochester (A. Paul Britton, Robert G. Greene and Martin W. O’Toole of counsel), for appellants.
    I. The lower courts erred in approving the trustee’s arbitrary designation of deposits into the lifetime trust as income. (Matter of Grove, 86 AD2d 302; Mercury Bay Boating Club v San Diego Yacht Club, 76 NY2d 256; Matter of Fabbri, 2 NY2d 236; Hemingway v Hemingway Found., 193 AD2d 559; Matter of Malasky, 275 AD2d 500; Matter of Manning v Glens Falls Natl. Bank & Trust Co., 265 AD2d 743; Nau v Vulcan Rail & Constr. Co., 286 NY 188; Matter of Gagliardi, 55 NY2d 109; Liberty Mgt. & Constr. v Fifth Ave. & Sixty-Sixth St. Corp., 208 AD2d 73; Crabtree v Elizabeth Arden Sales Corp., 305 NY 48.) II. Even if the deposits from the charitable remainder annuity trust were properly deemed income, the lifetime trust included an implied directive that unexpended income be paid to the charities upon Kathleen Pioch’s death. (Matter of Friday, 148 Mise 899; Matter of Cheney, 85 Misc 2d 66; Matter of Outerbridge, 91 Misc 2d 686; Matter of Littman, 165 Misc 285; Matter of Dreicer, 155 Misc 817.)

      Woods Oviatt Gilman LLP, Rochester (William G. Bauer, Robert W. Croessman and Robert W. Kessler of counsel), for Chase Manhattan Bank, respondent.
    I. The funds received by the lifetime trust for Kathleen Pioch’s benefit should be classified as income. (Matter of Grove, 86 AD2d 302; Mercury Bay Boating Club v San Diego Yacht Club, 76 NY2d 256; Matter of Gagliardi, 55 NY2d 109; Matter of Glaser, 19 AD2d 354, 14 NY2d 895; Matter of Herzog, 301 NY 127; Matter of Bird, 69 Misc 2d 1015; Matter of Vail, 91 Misc 2d 398.) II. New York State law and the terms of the lifetime trust mandate that the undistributed income be paid to the estate of Kathleen Pioch. (Matter of Friday, 148 Misc 899; Matter of Cheney, 85 Misc 2d 66; Matter of Hopkins, 119 Misc 2d 218; Matter of Saxton, 219 AD2d 85.)

      Wiedman, Vazzana, Corcoran & Volta, P.C., Rochester (James G. Vazzana and Sandra E. Volta of counsel), for Frank B. Iacovangelo, respondent.
    I. As affirmed by the Appellate Division, the Surrogate’s Court properly determined that the funds received by the lifetime trust for Kathleen Pioch’s benefit should be classified as income. (Matter of Manning v Glens Falls Natl. Bank & Trust Co., 265 AD2d 743.) II. There is an important distinction between accrued income and accumulated income. (Matter of Juilliard, 238 NY 499; Matter of Dexter, 134 Misc 195; Matter of Balsamo, 136 Misc 113; Matter of Cheney, 85 Misc 2d 66.)
   OPINION OF THE COURT

Graffeo, J.

In this proceeding by a trustee seeking judicial settlement of a final account, we are asked whether the trustee’s distribution of trust assets comported with the settlor’s intent. We conclude that it did not and therefore reverse the order of the Appellate Division.

In December 1973, A. Charles Pioch (Charles) established two trusts designed to benefit himself, his daughter Kathleen and two charitable institutions. The first, a charitable remainder annuity trust (the CRAT), was funded with assets valued at $400,000. The second, a lifetime trust (the LTT), was created with assets worth approximately $121,000. Petitioner Chase Manhattan Bank and its predecessors served as the trustee of both trusts.

The CRAT directed the Bank to pay to the LTT an annual amount equal to 6% of the initial value of the assets deposited— about $24,000 per year paid in quarterly installments of $6,000—for the benefit of Charles. Upon Charles’s death, the CRAT instructed the Bank to continue making the quarterly payments to the LTT “for the benefit of [Charles’s] daughter, KATHLEEN PIOCH, during her lifetime.” After her death, the remainder of the CRAT would pass to St. John Fisher College.

The preamble of the LTT required the Bank to “hold, administer and distribute all of the aforesaid assets [i.e., the $121,000] (together with all additions thereto and all reinvestments thereof) as the principal of a trust estate, for the benefit of the Grantor, in accordance with the terms and provisions hereinafter set out.” The Bank was to “pay or apply the net income to the use of [Charles] . . . during his life,” and was authorized to invade the principal for his support, welfare and comfort. The LTT provided that, upon Charles’s death, assuming Kathleen survived him,

“the [LTT] shall continue for the benefit of [Kathleen], and the Trustee shall apply the income and so much of the principal as in its discretion it shall deem necessary, for the support, maintenance and general welfare of [Kathleen], during her life. The Trustee shall pay, so far as possible, all specific bills for [Kathleen’s] living expenses, thus making certain that her rent, her utilities, her food, clothing and medical expenses are paid by the Trustee directly. [Kathleen] shall not be given any large sums of money, but only a small allowance by the Trustee every week to meet her personal needs.”

At the time of Kathleen’s death, the LTT directed the Bank to pay the remaining principal, together with any accrued income, to St. John Fisher College and the Lutheran Church of the Incarnate Word (collectively objectants).

Charles died in 1975 shortly after creating the trusts. In accordance with the terms of the LTT, the Bank began paying Kathleen’s living expenses. The record reveals that Kathleen had limited mental capacity and for the next 25 years, until her death, the Bank paid her bills directly and regularly deposited modest sums into a checking account for her personal needs. Despite these expenditures, when she died in July 2000 the LTT contained assets exceeding $800,000. Of that amount, $526,533 represented the accumulation of the quarterly payments from the CRAT that had not been used to pay Kathleen’s expenses during her life.

Treating the $526,533 from the annuity payments as Kathleen’s income, the Bank distributed the full sum to her estate. Since Kathleen died without a will, the money passed through intestacy to respondents Catherine Hyman, Arlene La Bounty, Lois Carr, Mary Salyer, Paul Hasert and Linda Hallen, all blood relatives of Charles who had not been named as beneficiaries of either trust. In August 2001, the Bank filed an accounting for the LTT and initiated this judicial settlement proceeding.

Objectants filed objections to the Bank’s final account, asserting that Charles intended the charities to receive the remaining accumulated quarterly annuity payments—the $526,533—upon Kathleen’s death. Objectants argued that the quarterly payments from the CRAT to the LTT were more appropriately categorized as principal rather than income and, alternatively, even if the payments were considered income, the terms of the LTT manifested an intent by Charles that the charities receive any accumulation of such income. As a result, objectants requested the Surrogate to surcharge the Bank for $526,533, plus interest. The Attorney General appeared on objectants’ behalf and filed similar objections.

Surrogate’s Court dismissed all of the objections and granted the petition for judicial settlement of the final account of the LTT, thereby approving the disbursements by the Bank. The Appellate Division, with two Justices dissenting, affirmed. The majority held that the Bank’s characterization of the annuity payments as income to the LTT was consistent with the settlor’s intent. The majority also rejected objectants’ alternative argument that the LTT required the Bank to accumulate any excess income for their benefit. The dissenters, on the other hand, would have sustained the objections, reasoning that the annuity payments from the CRAT to the LTT constituted additions to the principal of the LTT rather than income. Objectants appeal as of right based on the two-Justice dissent.

In determining whether Kathleen’s estate or objectants are entitled to the amount in dispute, Charles’s intent is controlling (see Mercury Bay Boating Club v San Diego Yacht Club, 76 NY2d 256, 267 [1990]; Matter of Gilbert, 39 NY2d 663, 666 [1976]). It is well settled that “the trust instrument is to be construed as written and the settlor’s intention determined solely from the unambiguous language of the instrument itself’ (Mercury Bay Boating Club, 76 NY2d at 267; see also Central Union Trust Co. v Trimble, 255 NY 88, 93 [1930] [“We are to search, not for the probable intention of the settlor merely, but for the intention which the trust deed itself, either expressly or by implication, declares. We are to ascertain the intention from the words used and give effect to the legal consequences of that intention when ascertained”]).

Here, regardless of whether the quarterly annuity payments are classified as principal or income in the LTT, the terms of the LTT demonstrate Charles’s intent that any funds not expended on Kathleen’s behalf be distributed to objectants. If we characterize the CRAT payments as principal, objectants would be entitled to the disputed funds because the LTT expressly directed the Bank to distribute any remaining principal to them. But even if we adopt the contrary position and determine that the CRAT payments constituted income, it is clear Charles intended that Kathleen receive income from the LTT sufficient to satisfy her personal needs and no more. The LTT expressly prescribed that monies provided for Kathleen’s benefit during her lifetime be related to her “support, maintenance and general welfare.” Charles did not require that the full amount of the quarterly funds transferred to the LTT be paid to Kathleen herself. This contrasts with the provision of the LTT that entitled Charles to all of the income, without limitation, while he was alive. Instead, after Charles’s death, the Bank was to apply the income on Kathleen’s behalf by paying her bills directly and giving her “only a small allowance” for her personal needs. In addition, Charles instructed the Bank not to give Kathleen “any large sums of money” and she was not vested with a power of appointment over the trust assets.

By limiting the disbursement of income to Kathleen to a sum sufficient to cover her needs, Charles anticipated that the Bank might pay out less than all the income for his daughter’s benefit and therefore authorized the Bank to accumulate any income not expended (see EPTL 9-2.1; Turano, Practice Commentaries, McKinney’s Cons Laws of NY, Book 17B, EPTL 9-2.1). Generally, where a trust requires the trustee to apply only so much of the income as is necessary for the beneficiary’s needs, any unexpended income accumulated by the trustee passes to the remainder beneficiaries (see Matter of White, NYLJ, Jan. 19, 2001, at 30, col 3 [Sur Ct, Nassau County]; Matter of Cheney, 85 Misc 2d 66, 69-70 [Sur Ct, Nassau County 1976]; 3A Fratcher, Scott on Trusts § 235A [4th ed]; see generally Annotation, Disposition and rights in respect of surplus income from trust in excess of amount directed to be paid to, or required for support of, beneficiaries during trust period, 157 ALR 668).

Such a result is appropriate in this case where Charles specified that Kathleen receive only income sufficient to satisfy her needs and granted her neither the power to control nor the power to alienate the trust’s funds. Under these circumstances, it would be incongruous to hold that Kathleen’s estate could dispose of $526,533 upon her death when she had not been allocated such funds during her life and the settlor explicitly directed in the LTT that she not be given any substantial sums of money. We therefore conclude that the Bank should have distributed the disputed amount to objectants, not to Kathleen’s estate.

Accordingly, the order of the Appellate Division should be reversed, with costs, the objections sustained and the matter remitted to Surrogate’s Court for further proceedings in accordance with this opinion.

Chief Judge Kaye and Judges G.B. Smith, Ciparick, Rosenblatt, Read and R.S. Smith concur.

Order reversed, etc.

      . We note that this proceeding is governed by the law applicable before the enactment of the New York Uniform Principal and Income Act (EPTL art 11-A), which became effective in 2002. We express no view regarding the application of that Act to the facts of this case.

      . Indeed, the Bank accumulated $526,533 over a 25-year period.

      . The Appellate Division majority relied on Matter of Hopkins (119 Misc 2d 218 [Sur Ct, Nassau County 1983]) for the proposition that accumulated income in a “needs trust” belongs to the income beneficiary’s estate upon his or her death. Hopkins, however, involved the interpretation of a trust under legal principles applicable before the Legislature largely eliminated the “rule against accumulations” (see L 1959, ch 454; L 1961, ch 866; see also EPTL 9-2.1). Under current New York law, a direction to accumulate income is valid if it “is to begin and terminate within the time allowed by the rule against perpetuities” (EPTL 9-2.1 [b]).


source: Caselaw Access Project

author: G.B. Smith, J.

license: Public Domain

text:
    [ 847 NE2d 367, 814 NYS2d 70]
    The People of the State of New York, Respondent, v Matthew Waldron, Appellant.
    Argued January 12, 2006;
    decided February 14, 2006

      POINTS OF COUNSEL

      McNamee, Lochner, Titus & Williams, EC., Albany (David J. Wukitsch of counsel), for appellant.
    I. Matthew Waldron’s statutory and constitutional speedy trial rights were violated. (Klopfer v North Carolina, 386 US 213; People v Prosser, 309 NY 353; People v Cortes, 80 NY2d 201; People v Berkowitz, 50 NY2d 333; People v Soluri, 300 AD2d 988; People v Coxon, 242 AD2d 962; People v Correa, 77 NY2d 930; People v Liotta, 79 NY2d 841; People v Hamilton, 46 NY2d 932; People v Collins, 82 NY2d 177.) II. Matthew Waldron was denied effective assistance of counsel when his trial counsel failed to object to the prosecutor’s highly prejudicial opening statement and summation. (People v Ellis, 81 NY2d 854; People v Rivera, 71 NY2d 705; People v Baldi, 54 NY2d 137; People v Kurtz, 51 NY2d 380; People v Benham, 160 NY 402; People v Levine, 297 NY 144; People v Bennett, 29 NY2d 462; People v Ashwal, 39 NY2d 105; People v Mayrant, 43 NY2d 236; People v Russell, 307 AD2d 385.)

      John H. Crandall, Sr., District Attorney, Herkimer (Jeffrey S. Carpenter of counsel), for respondent.
    I. Matthew Waldron’s
    statutory and constitutional speedy trial rights were not violated. (People v Hudson, 167 AD2d 950; People v Sharpe, 115 AD2d 996; People v Jenkins, 302 AD2d 978; People v Chevalier, 226 AD2d 925; People v Liotta, 79 NY2d 841; People v Smith, 82 NY2d 676; People v Cortes, 80 NY2d 201; People v Trepasso, 197 AD2d 891; People v Rodriguez, 50 NY2d 553; People v Taranov

      ich, 37 NY2d 442.) II. Matthew Waldron was not denied effective assistance of counsel when his trial counsel failed to object to the prosecutor’s opening statement and summation. (People v Baldi, 54 NY2d 137; People v Garcia, 75 NY2d 973; People v Rivera, 71 NY2d 705; People v Kurtz, 51 NY2d 380; People v Dennee, 291 AD2d 888; People v Troy, 209 AD2d 943; People v Greene, 151 AD2d 1033; People v Cardenas, 191 AD2d 231; People v Powers, 262 AD2d 713; People v Ford, 86 NY2d 397.)
   OPINION OF THE COURT

G.B. Smith, J.

The issue in this case is whether a preindictment delay from July 11, 2000 to November 30, 2000 was properly excluded from time charged against the People when defense counsel engaged in plea negotiations during that period and sent a letter expressly waiving defendant’s speedy trial rights. We conclude that defendant waived his statutory speedy trial rights and that his constitutional speedy trial rights were not violated. The order of the Appellate Division should, therefore, be affirmed.

Defendant Matthew Waldron was arrested in the Village of Herkimer on January 23, 2000 after police obtained surveillance evidence showing he had engaged in several obscene acts with children. On February 1, 2000, the Herkimer Village Court ordered a psychiatric and competency exam pursuant to article 730 of the Criminal Procedure Law. The report was filed February 24, 2000.

On March 20, 2000, defendant’s assigned counsel was replaced by retained counsel, George Aney, who soon thereafter initiated negotiations with the prosecutor. At the outset, the District Attorney, Michael Daley, told Aney that if the children had to testify at a grand jury proceeding, the minimum offer would be a 20-year determinate sentence. According to Aney, he then began a deliberate strategy of delay, hoping that the District Attorney’s offer would improve with time, a tactic that Aney communicated to his client. Aney later testified that “[o]n more than one occasion,” he had conversations with District Attorney Daley indicating that he wished to waive the statutory time period in order to reserve the possibility of negotiating a better sentence for his client. In a letter dated July 11, 2000, Aney wrote to the District Attorney:

“In connection with the above captioned matter, I have been meeting with the defendant and his father for the past few months regarding a possible disposition of this case without the necessity of requiring the children to testify before the Grand Jury. . . .
“In light of these undertakings, I would request, therefore, on behalf of the defendant who joins in this request, that we schedule a dispositional hearing date on or before September 15, 2000, and the defendant does hereby waive any speedy trial or other rights that he may have by your concurring with this request.”

Between July and November, Daley and Aney spoke frequently and, eventually, the District Attorney reduced the offer by eight years.

Defendant Waldron, nevertheless, sought and paid for the legal advice of another inmate, and on November 30, 2000, filed a pro se speedy trial motion and discharged Aney. In his pro se motion, he contended that he had been in custody 317 days without the commencement of a trial, in violation of CPL 30.30 (1) (a). Defendant was indicted on December 14, 2000 and arraigned on December 20, 2000, at which time the prosecutor announced his readiness for trial. The Herkimer County Court conducted a hearing on February 28, 2001 pursuant to the pro se CPL 30.30 motion. At the hearing, defendant contradicted Aney’s claims that he knew of the intentional delay strategy. The court denied defendant’s speedy trial motion.

On July 12, 2001, following a jury trial, defendant was convicted of sodomy in the first degree (three counts) (Penal Law former § 130.50 [3]), use of a child in a sexual performance (Penal Law § 263.05), promoting an obscene sexual performance by a child (Penal Law § 263.10) and possessing an obscene sexual performance by a child (Penal Law § 263.11). On August 30, 2001, he was sentenced to 17 years for each count of sodomy, with sentences to run consecutively. The sentence for promoting an obscene sexual performance by a child was V-fs to 4 years; for use of a child in a sexual performance, he received 3 to 9 years; and for possessing an obscene sexual performance by a child he received lVs to 4 years, which were to run concurrently with each other, but consecutive to the sentences imposed on the sodomy convictions.

The Appellate Division modified the sentence but affirmed the conviction. The Court reasoned that the sentence was unduly harsh and modified the judgment by ordering the determinate terms of 17 years imposed on the second and third counts of the indictment to run consecutively, but all of the other terms to run concurrently with one another (13 AD3d 1074 [2004]).

The Appellate Division declined, however, to dismiss the indictment for a violation of speedy trial rights. The Court reasoned that defendant was not denied his statutory or constitutional rights to a speedy trial because between July 11 and November 30, 2000, Aney explicitly requested that the prosecution postpone the presentation of defendant’s case to the grand jury and expressly waived defendant’s speedy trial rights, “all for the purpose of pursuing a favorable plea bargain for defendant” (id. at 1075). The Court reasoned that this 142-day period, along with the 24 days needed for the psychiatric examination, rendered timely the People’s declaration of readiness. Additionally, the Court held Aney had the authority to bind defendant to the waiver, and the record established that defendant did consent to the delay. Two Justices dissented, reasoning that it was the People’s burden to show defendant waived his rights and these periods were excludable under CPL 30.30 (4). Furthermore, the dissenting Justices stated there was no contemporaneous record made “and absent such a record, the delay is chargeable to the People and the purported waiver of defendant’s speedy trial rights is ineffective” (id. at 1077). A Justice of the Appellate Division granted defendant permission to appeal. We now affirm.

On this record, where defendant’s counsel explicitly waived speedy trial rights in order to complete ongoing plea negotiations, such time is excludable. CPL 30.30 (1) (a) states that the People must be ready for trial within six months of the commencement of a criminal action, exclusive of the days chargeable to the defense. It is undisputed by both parties that the 24 days between February 1 and February 24, 2000 are excludable pursuant to CPL 30.30 (4) (a). The record shows that the delay worked in defendant’s favor, as it resulted in a reduced sentence offer. It is also within the record that defendant knew of and consented to his lawyer’s strategy. Defendant claims that, at most, the People established the excludable period requested in the letter ended September 15, the date Aney requested a dispositional hearing. We disagree. The July letter could have been clearer, and prosecutors would be well advised to obtain unambiguous written waivers in situations like these, but the letter, read in light of the negotiations that preceded and followed it, as described in Aney’s testimony, was a waiver of the delay between July 11 and November 30 because that was the time used by the defendant to negotiate with the District Attorney. Although he did request a hearing for September 15, 2000, the record indicates that Aney and Daley remained in negotiations through November. Therefore, we hold that there was sufficient excludable time not chargeable to the People— the 24 days in February 2000 and the period between July 11 and November 30, 2000, the date defendant explicitly rejected Aney’s strategy of delay.

Defendant maintains that the People should have shown a contemporaneous record of consent to the delay (citing CPL 30.30 [4] [b]). But CPL 30.30 (4) (b) speaks only to the question of when continuances granted by the court may be excluded from section 30.30’s time limitations. It does not prevent a defendant from making, through a letter from his counsel, a valid waiver of his statutory speedy trial right, and there is no requirement that such a letter be filed contemporaneously at the courthouse.

Finally, we hold there was no constitutional violation of defendant’s right to a speedy trial. In People v Taranovich (37 NY2d 442 [1975]), this Court stated the following factors should be examined when a defendant claims there has been a denial of his right to a speedy trial: (1) the extent of the delay; (2) the reason for the delay; (3) the nature of the underlying charge; (4) whether or not there has been an extended period of pretrial incarceration; and (5) whether or not there is any indication that the defense has been impaired by reason of the delay.

Under the first factor, the extent or duration of the delay, we have a delay of almost a year. Although “the greater the delay the more probable it is that the accused will be harmed” (id. at 445), here it appears the delay helped defendant. Analysis of the second factor, the reason for the delay, shows defendant and his former lawyer were primarily responsible and also falls in the People’s favor. The third factor, the nature of the underlying charge, also falls in the People’s favor as the grand jury ultimately indicted defendant on seven felony counts involving the sexual abuse of minors. This matter required delicate handling by the District Attorney, who sought to minimize further harm to the victims by making them testify.

The fourth factor, whether or not there has been an extended period of pretrial incarceration, falls in the defendant’s favor, although we note that he chose to extend this pretrial incarceration by agreeing to a waiver. Analysis of the fifth factor, whether or not there is any indication that the defense has been impaired by reason of the delay, again shows that defendant was not impaired because he received a better offer from the prosecutor as a result of waiting. Balancing these factors, we hold that defendant was not deprived of his constitutional right to a speedy tried.

Accordingly, the order of the Appellate Division should be affirmed.

Chief Judge Kaye and Judges Ciparick, Rosenblatt, Graffeo, Read and R.S. Smith concur.

Order affirmed.

      . CPL 30.30 (1) (a) states:
      “1. Except as otherwise provided in subdivision three, a motion made pursuant to paragraph (e) of subdivision one of section 170.30 or paragraph (g) of subdivision one of section 210.20 must be granted where the people are not ready for trial within:
      “(a) six months of the commencement of a criminal action wherein a defendant is accused of one or more offenses, at least one of which is a felony.”

      . The mandatory state surcharge of $210 was also imposed, as well as defendant’s entry into the sex offender registry and permanent orders of protection.

      . CPL 30.30 (4) (a) states:
      “In computing the time within which the people must be ready for trial pursuant to subdivisions one and two, the following periods must be excluded:
      “(a) a reasonable period of delay resulting from other proceedings concerning the defendant, including but not limited to: proceedings for the determination of competency and the period during which defendant is incompetent to stand trial; demand to produce; request for a bill of particulars; pre-trial motions; appeals; trial of other charges; and the period during which such matters are under consideration by the court.”

      . CPL 30.30 (4) (b) states:
      “In computing the time within which the people must be ready for trial pursuant to subdivisions one and two, the following periods must be excluded: . . .
      “(b) the period of delay resulting from a continuance granted by the court at the request of, or with the consent of, the defendant or his counsel. The court must grant such a continuance only if it is satisfied that postponement is in the interest of justice, taking into account the public interest in the prompt dispositions of criminal charges. A defendant without counsel must not be deemed to have consented to a continuance unless he has been advised by the court of his rights under these rules and the effect of his consent.”


text:
    [ 846 NE2d 1201, 813 NYS2d 691]
    Wien & Malkin LLP et al., Respondents, v Helmsley-Spear, Inc., Appellant.
    Argued January 5, 2006;
    decided February 21, 2006

      POINTS OF COUNSEL

      Dickstein Shapiro Morin & Oshinsky LLP, New York City (Howard Graff, Deborah A. Skakel and Judith R. Cohen of counsel), for appellant.
    I. The award should not be vacated under the Federal Arbitration Act after it was properly confirmed under the CPLR (Matter of Sprinzen [Nomberg], 46 NY2d 623; Matter of New York State Correctional Officers & Police Benevolent Assn. v State of New York, 94 NY2d 321; Matter of Silverman [Benmor Coats], 61 NY2d 299; Matter of Dowleyne v New York City Tr. Auth., 3 NY3d 633; Duferco Inti. Steel Trading v T. Klaveness Shipping A/S, 333 F3d 383; Wallace v Buttar, 378 F3d 182; Burchett v Marsh, 17 How [58 US] 344; Wilko v Swan, 346 US 427; Rodriguez de Quijas v Shearson/American Express, Inc., 490 US 477; Saxis S.S. Co. v Multifacs Inti. Traders, Inc., 375 F2d 577.) II. The decision of the Appellate Division after remand misapplies the Second Circuit’s manifest disregard standard. (Wallace v Buttar, 378 F3d 182; Halligan v Piper Jaffray, Inc., 148 F3d 197; Westerbeke Corp. v Daihatsu Motor Co., Ltd., 304 F3d 200; Hoeft v MVL Group, Inc., 343 F3d 57; Matter of Lipman [Haeuser Shellac Co.], 289 NY 76; Matter of Vann v Kreindler, Relkin & Goldberg, 78 AD2d 255, 54 NY2d 936; Matter of Andros Cia. Marítima, S.A. [Marc Rich & Co., A.G.], 579 F2d 691; Blue Tee Corp. v Koehring Co., 808 F Supp 343; Maross Constr. v Central N.Y. Regional Transp. Auth., 66 NY2d 341; Matter of Albany County Sheriffs Local 775 of Council 82, AFSCME, AFL-CIO [County of Albany], 63 NY2d 654.) III. The “well-settled legal principle” relied upon by the Appellate Division in finding manifest disregard is neither clear nor applicable. (Wallace v Buttar, 378 F3d 182; Westerbeke Corp. v Daihatsu Motor Co., Ltd., 304 F3d 200; Security Pac. Mtge. & Real Estate Servs., Inc. v Canadian Land Co. of Am,., N.V., 690 F Supp 1214, 891 F2d 447; Matter of Lovece [Local 32B, Bldg. Serv. Empls. Intl. Union, AFL-CIO], 37 Misc 2d 709; Quinn v Whitney, 204 NY 363; New England Iron Co. v Gilbert [Metropolitan] El. R.R. Co., 91 NY 153; Paige v Faure, 229 NY 114; Nassau Hotel Co. v Barnett & Barse Corp., 162 App Div 381, 212 NY 568; Devlin v Mayor, Aldermen & Commonalty of City of N.Y., 63 NY 8; Canister Co. v National Can Corp., 71 F Supp 45.) IV The decision of the Appellate Division after remand reached and improperly reversed an issue abandoned by Wien & Malkin LLP: the propriety of the arbitration panel’s remedy on partnership voting protocols. (Matter of Sprinzen [Nomberg], 46 NY2d 623; Matter of SCM Corp. [Fisher Park Lane Co.], 40 NY2d 788; Lentine v Fundaro, 29 NY2d 382; Matter of Paver & Wildfoerster [Catholic High School Assn.], 38 NY2d 669; Konkar Mar. Enters., S.A. v Compagnie Beige D’Affretement, 668 F Supp 267; Matter of Antique Rug Dealers Assn. [Hakimian], 210 AD2d 111; Matter of Sims v Siegelson, 246 AD2d 374; Matter of Silverman [Benmor Coats], 61 NY2d 299; Matter of Infosafe Sys. [International Dev. Partners], 228 AD2d 272; Matter ofBarzilay [Siegman], 161 AD2d 427.) V The waiver of the Federal Arbitration Act (FAA) by Wien & Malkin LLP precluded its reliance on the FAA. (Matter of Smith Barney Shear son v Sacharow, 91 NY2d 39.) VI. The Federal Arbitration Act standards do not and should not preempt the CPLR. (Volt Information Sciences, Inc. v Board of Trustees ofLeland Stanford Junior Univ., 489 US 468; Dean Witter Reynolds Inc. v Byrd, 470 US 213; Matter of Ball [SFX Broadcasting], 236 AD2d 158; Matter of Smith Barney, Harris Upham & Co. v Luckie, 85 NY2d 193; New York Inst, of Tech, v State Div. of Human Rights, 40 NY2d 316; Matter of Sprinzen [Nomberg], 46 NY2d 623; Local 1199, Drug, Hosp. & Health Care Empls. Union, RWDSU, AFL-CIO v Brooks Drug Co., 956 F2d 22; Duferco Inti. Steel Trading v T. Klaveness Shipping A/S, 333 F3d 383.)

      Dewey Pegno & Kramarsky LLP, New York City (Thomas E.L. Dewey of counsel), and Thelen Reid & Priest LLP for respondents.
    I. The First Department correctly ruled that the arbitration panel’s affirmance of the covert assignment of the management contract was in manifest disregard of the law. (Security Pac. Mtge. & Real Estate Servs., Inc. v Canadian Land Co. of Am., N.V., 690 F Supp 1214, 891 F2d 447; Government Guar. Fund v Hyatt Corp., 95 F3d 291; Paige v Faure, 229 NY 114; Cristallina v Christie, Manson & Woods Intl., 117 AD2d 284; Hardy v Walsh Manning Sec., L.L.C., 341 F3d 126; Matter of Lovece [Local 32B, Bldg. Serv. Empls. Intl. Union, AFL-CIO], 37 Misc 2d 709; Westerbeke Corp. v Daihatsu Motor Co., Ltd., 304 F3d 200; Cargo Partner AG v Albatrans, Inc., 352 F3d 41; Tripi v Prudential Sec., Inc., 303 F Supp 2d 349; Matter of UBS Warburg [Auerbach, Pollack & Richardson], 294 AD2d 245.) II. The First Department correctly set aside the nullification of the without cause termination and the associated vote protocol. (Winchell v Caron, 260 AD2d 888; In re Mid-Island Hosp., Inc., 276 F3d 123, 537 US 882; Zolotar v New York Life Ins. Co., 172 AD2d 27; Feinberg v Saks & Co., 56 NY2d 206; Matter of Civil Serv. Empls. Assn., Steuben County Ch. v County of Steuben, 50 AD2d 421; Sweeney v Herman Mgt, 85 AD2d 34; Matter of Oset v Can/Am Youth Servs., 212 AD2d 887; Kings Park Classroom Teachers Assn, v Kings Park Cent. School Dist., 100 AD2d 929; Inter-City Gas Corp. v Boise Cascade Corp., 845 F2d 184; Schwartz v Fortune Mag., 89 F Supp 2d 429.) III. The Leona Helmsley voting agreement transferring management rights to a nonpartner is unlawful. (Rapoport v 55 Perry Co., 50 AD2d 54; Kanarek v Gadlex Assoc., 115 AD2d 592; Whalen v Gerzof, 154 AD2d 843, 76 NY2d 914; Matter of Hunsinger v Minns, 197 AD2d 871; Schwartz v Public Adm’r of County of Bronx, 24 NY2d 65; Color By Pergament v O’Henry’s Film Works, 278 AD2d 92; Neary v Prudential Ins. Co., 63 F Supp 2d 208; Asturiana De Zinc Mktg., Inc. v LaSalle Rolling Mills, Inc., 20 F Supp 2d 670.) IV The First Department properly applied the Federal Arbitration Act to review of the award, and HelmsleySpear, Inc. waived all arguments to the contrary. (Citizens Bank v Alafabco, Inc., 539 US 52; St. Lawrence Explosives Corp. v Worthy Bros. Pipeline Corp., 916 F Supp 187; Matter of Diamond Waterproofing Sys., Inc. v 55 Liberty Owners Corp., 4 NY3d 247; State of N.Y. Higher Educ. Servs. Corp. v Upshur, 252 AD2d 333; Bingham v New York City Tr. Auth., 99 NY2d 355; S.E.B. Holding Corp. v State of New York, 9 NY2d 235; Matter of Ball [SFX Broadcasting], 236 AD2d 158; Credit Suisse First Boston Corp. v Pitofsky, 4 NY3d 149; Allen & Co. v Shearson Loeb Rhoades, 111 AD2d 122, 67 NY2d 709; Halikias v Warburg Dillon Read, 195 Misc 2d 447.)
   OPINION OF THE COURT

G.B. Smith, J.

In this appeal we review the Appellate Division’s vacatur of an arbitration award after a remand from the Supreme Court of the United States with an instruction to reconsider in light of Citizens Bank v Alafabco, Inc. (539 US 52 [2003]). Since arbitral judgments are owed substantial deference and there was no showing that the arbitration panel manifestly disregarded the law, the award should be reinstated. The order of the Appellate Division should, therefore, be reversed.

In 1997, Wien & Malkin LLP (Wien & Malkin) attempted to oust Helmsley-Spear, Inc. (Helmsley-Spear) as managing agent of 11 New York City properties. Wien & Malkin served as the representative and designee of ownership interests in these buildings, provided legal services such as drafting leases and performed administrative tasks. Helmsley-Spear was owned by Irving Schneider and Alvin Schwartz, both former executives in the former Helmsley-Spear Corporation. The partnerships began as a result of the late Harry Helmsley’s efforts to find valuable properties and offer opportunities to others, like the late Lawrence A. Wien, to syndicate interests in the properties to passive investors.

In 1997, Peter Malkin, the current chairman of Wien & Malkin and son-in-law of the late Lawrence A. Wien, sent a request to the partners in 200 Fifth Avenue Associates (Toy Center Joint Venture), Fisk Building Associates, and Lincoln Building Associates asking that they authorize him to terminate Helmsley-Spear without cause and retain a new managing agent. In August 1997, three of the partnerships voted to remove Helmsley-Spear without cause by votes of 60% or more. Helmsley-Spear obtained a stay and on September 8, 1997, Supreme Court granted Helmsley-Spear’s motion to compel arbitration.

Later in September 1997, Leona Helmsley entered into a series of agreements with Irving Schneider and Alvin Schwartz, who owned one-tenth percent (.1%) of Helmsley-Spear. Both Schneider and Schwartz held an option to purchase all of Helmsley-Spear’s share from Helmsley Enterprises. Schneider and Schwartz formed a new corporation called “HS Acquisition Corporation” or “Newco” which purchased substantially all of the assets of the original Helmsley-Spear and renamed itself “Helmsley-Spear, Inc.” Newco possessed the right to manage the 11 properties. Leona Helmsley granted the new corporation her irrevocable proxy to vote in favor of Helmsley-Spear’s retention as managing agent of the properties, as long as Messrs. Schneider and Schwartz remained as managers of HelmsleySpear.

During arbitration, Wien & Malkin and Peter Malkin (collectively, Wien & Malkin) sought termination of Helmsley-Spear as managing agent on both “for cause” and “without cause” grounds. The matters were consolidated by the New York City office of the American Arbitration Association under its Commercial Arbitration Rules, and the panel was comprised of three distinguished arbitrators. The proceedings began in June 1998. Evidentiary hearings occurred between April 1999 and June 2000, during which the parties offered approximately 1,000 exhibits each. Over 50 witnesses testified during more than 60 days of hearings.

On March 30, 2001, the arbitration panel issued a 134-page decision that denied Wien & Malkin’s request to remove Helmsley-Spear as managing agent for cause and without cause. Helmsley-Spear was declared the legal and valid successor in interest to the former Helmsley-Spear Corporation and to have validly exercised the option agreement of 1970; Wien & Malkin was enjoined from contesting the validity or in any way interfering with the voting agreement between Leona Helmsley and Helmsley-Spear; and Wien & Malkin was enjoined from calling or holding a partnership meeting for the purpose of removing Helmsley-Spear as managing agent unless it followed an outlined 11-step procedure.

Helmsley-Spear then moved to confirm the award while Wien & Malkin moved to vacate it, claiming that there were many areas in which the decision was “legally in error.” Supreme Court disagreed and confirmed the award on July 23, 2001. The Appellate Division concluded that since the dispute involved buildings within New York City and did not have a substantial effect on interstate commerce, the Federal Arbitration Act did not apply. It unanimously affirmed the confirmation under CPLR 7511 stating:

“[T]he award must stand unless shown to be utterly arbitrary or violative of public policy. We are not empowered to vacate an award merely for errors of law or fact committed by the arbitrators .... [W]e conclude that the arbitration panel’s findings . . . were not so arbitrary as to warrant vacatur” (300 AD2d 32, 33 [2002] [citations omitted]).

The United States Supreme Court granted certiorari and, on October 6, 2003, vacated the Appellate Division’s judgment and remanded the matter for further consideration in light of the Court’s holding in Citizens Bank v Alafabco, Inc. (539 US 52 [2003] ) (Wien & Malkin LLP v Helmsley-Spear, Inc., 540 US 801 [2003]).

Upon remand, Wien & Malkin argued that the FAA was applicable to this matter, the award should be vacated because the panel incorrectly recognized the new Helmsley-Spear as a valid successor, and the voting agreement between Leona Helmsley and Messrs. Schwartz and Schneider was unenforceable. The Appellate Division reversed Supreme Court’s order and vacated the challenged portion of the arbitration award (12 AD3d 65 [2004] ). The Court reasoned that under the FAA, the issue was whether the award exhibited a “manifest disregard of the law” such that vacatur was warranted (id. at 66, citing Matter of Spear, Leeds & Kellogg v Bullseye Sec., 291 AD2d 255, 256 [1st Dept 2002]; Halligan v Piper Jaffray, Inc., 148 F3d 197, 204 [2d Cir 1998], cert denied 526 US 1034 [1999]). The Appellate Division relied on its own jurisprudence in Sawtelle v Waddell & Reed (304 AD2d 103, 108 [2003]), and held that the arbitration panel committed clear legal error and manifestly disregarded both contract law and the applicable agreements. It reasoned that the “conduct of Leona Helmsley and defendant’s principals in entering an agreement assigning Helmsley-Spear’s personal services contracts to defendant was a clear violation of the well-settled legal principle that personal services contracts . . . may not be assigned without the consent of the principal” (12 AD3d at 71 [citations omitted]). It determined that the new HelmsleySpear was not a mere “change of form” and that the panel “ignored the facts that Helmsley-Spear, Inc. had different officers, directors, shareholders, management personnel, financial structure and fewer properties under management than Helmsley-Spear” (id. at 72).

The Court also found that the arbitrators manifestly disregarded the applicable agreements by finding that Wien & Malkin was bound to retain Helmsley-Spear as managing agent due to defects in the proxy voting procedure. The Court reasoned that:

“Contrary to the findings of the arbitration panel, the partnership agreements did not provide for a particular method of solicitation of proxies for a vote to terminate the managing agents and did not establish a fiduciary duty to them. Nor was there any showing that Peter Malkin fraudulently induced the partners to give him their proxies” (id.).

Finally, the Court concluded that the arbitrators did not err by upholding Leona Helmsley’s voting agreement with the new Helmsley-Spear but noted that this issue was academic in light of its conclusions that the arbitrators erred in finding the proxy solicitation process defective.

The Appellate Division granted Helmsley-Spear leave to appeal to this Court, and certified the following question: “Was the order of this Court, which reversed the judgment of Supreme Court, properly made?” For the reasons that follow, we conclude that it was not.

It is well settled that judicial review of arbitration awards is extremely limited (see Paperworkers v Misco, Inc., 484 US 29 [1987]). An arbitration award must be upheld when the arbitrator “offer[s] even a barely colorable justification for the outcome reached” (Matter of Andros Cia. Maritima, S.A. [Marc Rich & Co., A.G.], 579 F2d 691, 704 [2d Cir 1978]). Indeed, we have stated time and again that an arbitrator’s award should not be vacated for errors of law and fact committed by the arbitrator and. the courts should not assume the role of overseers to mold the award to conform to their sense of justice (see Matter of Sprinzen [Nomberg], 46 NY2d 623, 629 [1979]; Matter of New York State Correctional Officers & Police Benevolent Assn. v State of New York, 94 NY2d 321, 326 [1999] [“A court cannot examine the merits of an arbitration award and substitute its judgment for that of the arbitrator simply because it believes its interpretation would be the better one”]).

The FAA permits vacatur of an arbitration award on four grounds which all involve fraud, corruption or misconduct on the part of arbitrators, grounds which are inapplicable to the present matter. In addition to these four grounds, an award may be vacated under federal law if it exhibits a “manifest disregard of law” (Duferco Intl. Steel Trading v T. Klaveness Shipping A/S, 333 F3d 383, 388 [2d Cir 2003]; Goldman v Architectural Iron Co., 306 F3d 1214, 1216 [2d Cir 2002], citing DiRussa v Dean Witter Reynolds Inc., 121 F3d 818, 821 [2d Cir 1997]). But manifest disregard of law is a “severely limited” doctrine (Matter of Arbitration No. AAA13-161-0511-85 Under Grain Arbitration Rules, 867 F2d 130, 133 [2d Cir 1989]). It is a doctrine of last resort limited to the rare occurrences of apparent “egregious impropriety” on the part of the arbitrators, “where none of the provisions of the FAA apply” (Duferco, 333 F3d at 389). The doctrine of manifest disregard, therefore, “gives extreme deference to arbitrators” (DiRussa, 121 F3d at 821). The Second Circuit has also indicated that the doctrine requires “more than a simple error in law or a failure by the arbitrators to understand or apply it; and, it is more than an erroneous interpretation of the law” (Duferco, 333 F3d at 389). We agree with that premise. To modify or vacate an award on the ground of manifest disregard of the law, a court must find “both that (1) the arbitrators knew of a governing legal principle yet refused to apply it or ignored it altogether, and (2) the law ignored by the arbitrators was well defined, explicit, and clearly applicable to the case” (Wallace v Buttar, 378 F3d 182, 189 [2d Cir 2004], quoting Banco de Seguros del Estado v Mutual Mar. Off., Inc., 344 F3d 255, 263 [2d Cir 2003]).

The Appellate Division considered three issues when it reviewed the 2001 panel award. Specifically, the Court considered whether the panel manifestly disregarded the law when it (1) concluded that Helmsley-Spear was a valid successor in interest to the former Helmsley-Spear by virtue of the 1997 agreements; (2) annulled the purported prosy vote taken by Peter Malkin to terminate Helmsley-Spear without cause at three of the buildings; and (3) upheld the voting agreement between Leona Helmsley and Messrs. Schneider and Schwartz. We address each issue in turn.

First, the Appellate Division found that the arbitrators manifestly disregarded the law in concluding that the new Helmsley-Spear should be the managing agent for the 11 properties. The arbitrators found that the new Helmsley-Spear was the valid successor in interest to the former Helmsley-Spear because it deemed Messrs. Schneider and Schwartz to have exercised the 1970 option agreement in 1997. The Appellate Division, however, found that Messrs. Schneider and Schwartz did not exercise the 1970 option agreement, and that under the 1997 transactions, the new Helmsley-Spear was not a successor, but an assignee. Thus, the Appellate Division reasoned, the assignment of the 11 management contracts to the new HelmsleySpear was invalid because those 11 contracts were contracts for personal services, which may not be assigned absent the principal’s consent.

The Appellate Division is correct that personal services contracts generally may not be assigned absent the principal’s consent (see 9 Corbin, Contracts § 865 [interim ed]; 3 Farnsworth, Contracts §§ 11.4, 11.10 [3d ed]). Unlike the Appellate Division, however, we do not believe that this rule is clearly applicable to the facts of this case.

In relevant part, the panel determined:
“The parties to the 1997 transaction cast it as a purchase of the assets of the existing HelmsleySpear corporation rather than a purchase of its stock. We are persuaded this change was merely one of form, done for tax reasons having to do with certain ‘parked’ properties that are unrelated to the issues of this case. [Wien & Malkin has] not persuaded us that the change of form had any other consequence to the parties, to the partnerships or to Wien & Malkin.”

The Appellate Division stated that the panel “erroneously conclud[ed] that Helmsley-Spear[ ] was a mere ‘change of form’ ” and “ignored the facts that Helmsley-Spear[ ] had different officers, directors, shareholders, management personnel, financial structure and fewer properties under management than [the former] Helmsley-Spear” (12 AD3d at 72). Manifest disregard of the facts is not a permissible ground for vacatur of an award (Wallace v Buttar, 378 F3d at 193; Westerbeke Corp. v Daihatsu Motor Co., Ltd., 304 F3d 200, 213 [2002], citing ConnTech Dev. Co. v University of Conn. Educ. Props., Inc., 102 F3d 677, 687 [2d Cir 1996] [“holding that an erroneous factual determination is not a ground for vacating an arbitration award”]).

Whether the 1970 option agreement was exercised was a factual determination by the panel and its findings should remain undisturbed. In Paperworkers v Misco, Inc., the Supreme Court stated:

“[W]here it is contemplated that the arbitrator will determine remedies for contract violations that he finds, courts have no authority to disagree with his honest judgment in that respect. If the courts were free to intervene on these grounds, the speedy resolution of grievances by private mechanisms would be greatly undermined. . . . But as long as the arbitrator is even arguably construing or applying the contract and acting within the scope of his authority, that a court is convinced he committed serious error does not suffice to overturn his decision” (484 US 29, 38 [1987] [emphasis added]; see also Matter of Dowleyne v New York City Tr. Auth., 3 NY3d 633, 634 [2004] [reversing the Appellate Division’s vacatur of an arbitration award “because it improperly substituted its factual finding for that of a majority of the arbitration panel”]).

The arbitration panel did not manifestly disregard the law when it concluded that Helmsley-Spear remained the valid managing agent after the 1997 transaction. There were several underlying contracts between Helmsley-Spear, Wien & Malkin, and their previous incarnations that would understandably lead the panel to conclude that the parties contemplated an ongoing contractual relationship with successors of Helmsley-Spear. In addition, Wien & Malkin specifically contemplated that Messrs. Schneider and Schwartz would one day control Helmsley-Spear because the firm drafted the 1970 option. The 1997 acquisition agreement stated, “[t]he parties acknowledge and agree that they have entered into this Agreement in implementation of the exercise of the option granted in 1970 by Harry B. Helmsley to Schneider and Schwartz to acquire the balance of the outstanding shares of [Helmsley-Spear] upon his death.” While the Appellate Division indicated that the panel “ignored” the fact that the new Helmsley-Spear’s characteristics differed from the former Helmsley-Spear, the panel found that the change in the company’s form was merely a “technical matter” and that Wien & Malkin failed to prove that “the change of form had any other consequence to the parties.” In this regard, the Appellate Division improperly disturbed the panel’s finding that the change in form was not consequential (see Wallace, 378 F3d at 193; Westerbeke, 304 F3d at 213 [“Under the manifest disregard standard . . . the governing law must clearly apply to the facts of the case, as those facts have been determined by the arbitrator•”]).

Accordingly, even if the property management agreements constituted unassignable personal services contracts, the arbitration panel did not manifestly disregard the law because its conclusion, that Helmsley-Spear remained the managing agent as the valid successor in interest to the former HelmsleySpear, was more than “barely colorable” (Wallace, 378 F3d at 190 [emphasis deleted]).

Even if the law of assignment of personal services contracts was clearly applicable, there was no showing that the arbitrators knew they were disregarding the law by naming HelmsleySpear a valid successor in interest. The Appellate Division did not address the other half of the manifest disregard standard: that “the arbitrators knew of a governing legal principle yet refused to apply it or ignored it altogether” (Wallace, 378 F3d at 189). “Explicit rejection of governing law provides the strongest evidentiary basis for a finding that the arbitrator acted with the requisite intent” (Westerbeke, 304 F3d at 217). There is no explicit evidence in the record that any of the arbitrators believed that contractual assignment law applied. Nor is there any deliberateness or willfulness exhibited within the award that shows the arbitrators’ intent to flout the law. The arbitrators’ reasoning—that the option agreement was exercised—does not “strain[ ] credulity” (id. at 218). Therefore, the panel’s conclusion regarding the 1997 transaction between Leona Helmsley and Messrs. Schneider and Schwartz was not a manifest disregard of law. Thus, the Appellate Division erred in vacating that portion of the award.

Next, the Appellate Division held that the arbitration panel manifestly disregarded the law by voiding the purported proxy vote conducted by Peter Malkin to terminate Helmsley-Spear’s services without cause at three of the partnerships. As the Appellate Division explained:

“Contrary to the findings of the arbitration panel, the partnership agreements did not provide for a particular method of solicitation of proxies for a vote to terminate the managing agents and did not establish a fiduciary duty to them. Nor was there any showing that Peter Malkin fraudulently induced the partners to give him their proxies” (12 AD3d at 72).

In Westerbeke, the Second Circuit stated that vacatur on the basis of manifest disregard of a contract is appropriate only where “the arbitral award contradicts an express and unambiguous term of the contract or if the award so far departs from the terms of the agreement that it is not even arguably derived from the contract” (304 F3d at 222). Here, the arbitral award does not contradict any express and unambiguous terms of the contracts. The partnership agreements provided that the partners could terminate Helmsley-Spear without cause “by the written vote of parties representing at least [50% or 60%] of the ownership of the assets of the joint venture.” In annulling the proxy vote, the arbitration panel found that Malkin’s solicitation of the proxies “was not preceded or accompanied by any disclosure at all” and that he failed to obtain “an informed vote of the general partners.” It was within the panel’s discretion to conclude that certain procedures needed to be put in place to ensure an informed vote. The panel, therefore, did not manifestly disregard the law in annulling the proxy votes.

The final issue is whether the voting agreement between Leona Helmsley and Messrs. Schneider and Schwartz was valid. The Appellate Division reasoned that the voting agreement did not transfer Leona Helmsley’s partnership interest, “but merely made an agreement to vote for the retention of Newco as managing agent, a vote she was entitled to cast with or without the agreement” (12 AD3d at 73). Ultimately, the Appellate Division termed this issue “academic” (id.).

Wien & Malkin argues that the transfer of a partner’s management rights to a nonpartner is unlawful because it interferes with administration of the partnership (citing Rapoport v 55 Perry Co., 50 AD2d 54, 57 [1st Dept 1975]). Wien & Malkin posits that the clearly applicable laws are Partnership Law § 40 (7) and § 53 (l). While it is clear that the affairs of partners should be managed by partners, Leona Helmsley’s agreement involved “a vote she was entitled to cast” in whatever manner she chose. Therefore, we agree with the lower court’s reasoning that the arbitrators did not manifestly disregard the law by concluding Mrs. Helmsley’s actions did not violate state partnership law. The panel reasoned that there was no claim that Helmsley-Spear sought to become a partner, only that a partner agreed to vote on a specific limited issue, and that invalidating the voting agreement would undermine the option agreement, which “further[ed] the interests of the partnership and the continuity of its business.” This analysis shows no evidence of the panel’s intent to disregard the law. Therefore, its award on this matter will also stand.

Accordingly, the order of the Appellate Division should be reversed, with costs, and the judgment of Supreme Court, New York County, reinstated. The certified question should not be answered upon the ground that it is unnecessary.

Judges Ciparick, Rosenblatt, Graffeo and R.S. Smith concur; Chief Judge Kaye and Judge Read taking no part.

Order reversed, etc.

      . This case involves the operating entity tier of eight properties and three partnerships with single tiers which control three other properties within Manhattan. The buildings are the Empire State Building, the Lincoln Building at 60 East 42nd Street, the Fisk Building at 250 West 57th Street, the Toy Building at 200 Fifth Avenue and 1107 Broadway, 112 West 34th Street, 1333 Broadway, 1350 Broadway, 1359 Broadway, 1400 Broadway, and 501 Seventh Avenue. 500-512 Seventh Avenue was sold during the course of arbitration.

      . Leona Helmsley was originally a party in this matter until December 1997 when she settled with Wien & Malkin. Mrs. Helmsley was a principal of Helmsley-Spear and the sole beneficiary of her husband’s interests in the partnerships at issue. Alvin Schwartz died in 2001.

      . Partners representing a 69.16667% interest in the Toy Center Joint Venture, 60% interest in Fisk Building Associates, and 69.653417% interest in Lincoln Building Associates granted Mr. Malkin the authority to vote their interests and terminate Helmsley-Spear as managing agent.

        . At the time, Leona Helmsley’s company, Helmsley Enterprises, owned 99.9% of Helmsley-Spear.

      . The option, originated in 1970, provided:
      “This agreement shall be binding upon the heirs and legal representatives of the individual parties and upon the successors and assigns of HELMSLEY ENTERPRISES, INC. and HELMSLEY-SPEAR, INC. The rights of SCHWARTZ and SCHNEIDER hereunder are personal to each of them and to the survivor of them, and are not transferable by both or either by operation of law or otherwise.”

      . Wien & Malkin originally commenced two separate arbitrations: one, on behalf of all 11 partnerships to terminate Helmsley-Spear as the exclusive managing and leasing agent for cause and two, on behalf of three partnerships (Lincoln Building Associates, Fisk Building Associates, and 200 Fifth Avenue Associates) to terminate Helmsley-Spear without cause. These actions were ultimately consolidated.

      . The arbitrators were Nicholas deB. Katzenbach, a former United States Attorney General and Under Secretary of State, William L.D. Barrett and John M. Wilkinson.

      . In Citizens Bank v Alafabco, Inc., the Supreme Court held that the Federal Arbitration Act (FAA) encompasses a wider range of transactions than those actually “in commerce” (539 US at 56). The FAA states, in part:
      “A written provision in any maritime transaction or contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction, or the refhsal to perform the whole or any part thereof, or an agreement in writing to submit to arbitration an existing controversy arising out of such a contract, transaction, or refusal, shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” (9 USC § 2.)
      The Supreme Court’s remand, therefore, meant that if the subject matter of an arbitration merely affected interstate commerce, the FAA would apply.

      . The FAA states, in part:
      “In any of the following cases the United States court in and for the district wherein the award was made may make an order vacating the award upon the application of any party to the arbitration—
      “(1) where the award was procured by corruption, fraud, or undue means;
      “(2) where there was evident partiality or corruption in the arbitrators, or either of them;
      “(3) where the arbitrators were guilty of misconduct in refusing to postpone the hearing, upon sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy; or of any other misbehavior by which the rights of any party have been prejudiced; or
      “(4) where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made” (9 USC § 10 M).

      . The term “manifest disregard of law” originated in dicta within Wilko v Swan (346 US 427, 436-437 [1953]), where Justice Reed wrote, “the interpretations of the law by the arbitrators in contrast to manifest disregard are not subject, in the federal courts, to judicial review for error in interpretation.”

      . Vacatur on the ground of manifest disregard of law is rare (see Duferco, 333 F3d at 389 [stating that since 1960 the Second Circuit has vacated some part or all of an arbitral award for manifest disregard in only four out of 48 cases: Halligan v Piper Jaffray, Inc., 148 F3d 197 (2d Cir 1998); New York Tel. Co. v Communications Workers of Am. Local 1100, AFL-CIO Dist. One, 256 F3d 89 (2d Cir 2001); Fahnestock & Co., Inc. v Waltman, 935 F2d 512 (2d Cir 1991); and Perma-Line Corp. of Am. v Sign Pictorial & Display Union, Local 230, Intl. Bhd. of Painters & Allied Trades, AFL-CIO, 639 F2d 890 (2d Cir 1981)]). These cases, excepting Halligan, all “involve! ] . . . arbitral decision^] that exceed! ] the legal powers of the arbitrators” (id.), an issue not presented in the current case.

      . A successor in interest is “[o]ne who follows another in ownership or control of property” and “retains the same rights as the original owner, with no change in substance” (Black’s Law Dictionary 1446 [7th ed 1999]). An assignee is “[o]ne to whom property rights or powers are transferred by another” and “[c]ourts recognize the protean nature of the term and are therefore often forced to look to the intent of the assignor and assignee in making the assignment” (Black’s Law Dictionary 114 [7th ed 1999]).

      . Helmsley-Spear argues that these were not personal services contracts, and that even if they were, New York law provides an exception to that general rule where there are no words restraining assignment and “[t]he matter of the contract involved no personal relation or confidence between the parties, or exercise of personal skill or science, for the contractor was a corporation and its work was necessarily to be done through agents or servants” (New England Iron Co. v Gilbert [Metropolitan] El. R.R. Co., 91 NY 153, 167 [1883]). Because we hold that the arbitration panel was justified in reaching its conclusion based on the grounds it stated, we do not need to reach this issue.

      . For example, the partnership agreement for the Empire State Building Company stated, “Helmsley-Spear, Inc. or its successor is named as the managing agent” and the 1960 modification agreement for 1359 Broadway Associates provided for voting to terminate Helmsley-Spear “in the event of the death of Harry B. Helmsley or his retirement from active participation in the conduct of the business of Helmsley-Spear, Inc. or its successors.”

      . Partnership Law § 40 (7) states, “No person can become a member of a partnership without the consent of all the partners.” Partnership Law § 53 (1) states:
      “A conveyance by a partner of his interest in the partnership does not of itself dissolve the partnership, nor, as against the other partners in the absence of agreement, entitle the assignee, during the continuance of the partnership, to interfere in the management or administration of the partnership business or affairs, or to require any information or account of partnership transactions, or to inspect the partnership books; but it merely entitles the assignee to receive in accordance with his contract the profits to which the assigning partner would otherwise be entitled.”


author: ClPARICK, J. R.S. Smith, J. (dissenting).

text:
    [ 846 NE2d 1211, 813 NYS2d 701]
    Juan Alejandro Soto, Respondent, v New York City Transit Authority, Appellant, et al., Defendant.
    Argued February 9, 2006;
    decided March 23, 2006

      POINTS OF COUNSEL

      Lawrence Heisler, Brooklyn, and Wallace D. Gossett for appellant.
    I. Plaintiffs testimony that he’d been running seven miles per hour on the catwalk was not credible. The comparison between his jog on a treadmill did not provide a reliable comparison to his speed on the catwalk. Nor did plaintiff provide reliable evidence that the train operator could have spotted the group on the catwalk when the train was 150 feet away. (Platto v Stier, 282 App Div 242, 308 NY 699; Weinstein v Daman, 132 AD2d 547; Hoover v Durkee, 212 AD2d 839; CNA Ins. Co. v Cacioppo Elec. Contrs., 206 AD2d 399; People v Walker, 274 AD2d 600; Romano v Stanley, 90 NY2d 444; Franchini v Palmieri, 1 NY3d 536; Diaz v New York Downtown Hosp., 99 NY2d 542.) II. Plaintiffs reckless actions in entering the catwalk after a night of drinking, recklessness compounded by his decision to circle around the signal post as the train roared by, bar him from maintaining this suit. (Barker v Kallash, 63 NY2d 19; Riggs v Palmer, 115 NY 506; Maddox v City of New York, 66 NY2d 270; Turcotte v Fell, 68 NY2d 432; Morgan v State of New York, 90 NY2d 471; Marcano v City of New York, 99 NY2d 548; Benitez v New York City Bd. of Educ., 73 NY2d 650; Fintzi v New Jersey YMHA-YWHA Camps, 97 NY2d 669; Lionarons v General Elec. Co., 215 AD2d 851, 86 NY2d 832; Olsen v Town of Richfield, 81 NY2d 1024.)

      Pollack, Pollack, Isaac & De Cicco, New York City (Brian J. Isaac and Julie T Mark of counsel), and Lipsig, Shapey, Manus & Moverman, P.C., Fulton (Alan M. Shapey of counsel), for respondent.
    I. Plaintiffs estimate of running speed was properly admitted into evidence and relied upon by plaintiffs expert in reconstructing the accident. (Wragge v Lizza Asphalt Constr. Co., 17 NY2d 313; Swensson v New York, Albany Despatch Co., 309 NY 497; People v Olsen, 22 NY2d 230; People v Dusing, 5 NY2d 126; Senecal v Drollette, 304 NY 446; Salter v Utica & Black Riv. R.R. Co., 59 NY 631; Swoboda v We Try Harder, 128 AD2d 862; Larsen v Vigliarolo Bros., 77 AD2d 562; Pieniewski v Benbenek, 56 AD2d 710; Beechey v De Sorbo, 53 AD2d 727.) II. The New York City Transit Authority’s superseding cause argument is without merit. (Coleman v New York City Tr. Auth., 37 NY2d 137; Noseworthy v City of New York, 298 NY 76; Clarke v City of New York, 295 NY 861; Ellison v New York City Tr. Auth., 63 NY2d 1029; Silva v Penn Cent. Transp. Co., 79 AD2d 632; Matter of DES Mkt. Share Litig., 79 NY2d 299; Matter of Sylvestri, 44 NY2d 260; Bichler v Eli Lilly & Co., 55 NY2d 571; Knobloch v Royal Globe Ins. Co., 38 NY2d 471; Up-Front Indus, v U.S. Indus., 63 NY2d 1004.)
   OPINION OF THE COURT

ClPARICK, J.

The question presented by this appeal is whether plaintiffs reckless behavior was of such a nature as to constitute the sole legal cause of his injuries, vitiating the duty of care of a train operator. We conclude under the circumstances of this case that it was not, and that the evidence was sufficient to support the verdict. We further conclude that plaintiffs estimate of his own running speed at the time of the accident was admissible and sufficient to lay a proper foundation for plaintiff’s accident reconstruction expert to use in forming his opinion.

Plaintiff—then 18 years old—and three of his friends spent the evening of January 24, 1997 in Manhattan and, over the course of about five hours, each consumed a quantity of alcohol. In the early hours of January 25, plaintiff and his friends attempted to return home to Queens. They waited some time for the number 7 train at Queensboro Plaza—an elevated subway station—where red tape indicating track work extended across the platform. The group eventually decided that the train was not running and walked along the “catwalk”—a three-foot wide path abutting the track—to the next station (33rd Street). They made it safely to 33rd Street and, after again waiting for a while, decided to walk along the catwalk to the next station (40th Street). As they proceeded along the northbound route, the tracks were to the left of the catwalk and to the right was a short railing.

Before they reached the 40th Street station, the group became aware of a train approaching from behind and began running along the catwalk in an attempt to reach the station before the train. Their intent was to board the train to continue their trip home. The four teens ran in single file, with plaintiff third in line. The train struck plaintiff in the vicinity of a signal box located on the catwalk, resulting in bilateral below-the-knee amputation. Plaintiff was the only one of the four hit by the train.

At trial, plaintiff was permitted to testify to an estimate of his running speed at the time of the accident. Plaintiff established that he was familiar with his running speed because he had been a member of a gym for about two years prior to the accident and would frequently run on a treadmill calibrated in terms of miles per hour. He would usually run at seven or eight miles per hour and, based on that experience, estimated that he was running about seven or eight miles per hour at the time of the accident.

Plaintiffs expert then used that estimate in making his calculations. Computing the train’s stopping distance assuming the train operator perceived the boys on the catwalk from 151.5 feet away—the distance allegedly illuminated by the train’s headlights—and factoring in reaction time, the expert determined that the train could have stopped 51 feet before it reached plaintiff if he had been running eight miles per hour and 37 feet before it reached plaintiff if he had been running seven miles per hour.

The train operator offered several inconsistent versions of his conduct at the time of the accident. The police report taken at the scene indicates that the train operator stated he did not see the boys “until he was passing them because they were hidden from his view by a signal device” and that the train stopped as a result of its own emergency devices before he was able to apply the brake. However, later that night, the train operator also filled out a report for NYCTA, this time stating that he saw an object behind the signal device and then placed the train into emergency mode. At trial he gave a third account, testifying that his first reports were inaccurate in that he saw a person on the catwalk in front of the signal box from about a train car’s length away. He also testified that he placed the train into emergency stopping mode when he saw the person. The road car inspector for NYCTA who examined the train at the scene, however, only found blood on the train’s “trip cock.” The trip cock hangs in front of the train’s wheels as an emergency device that automatically stops the train if it comes into contact with an obstruction.

At the close of plaintiffs case, NYCTA moved to dismiss the complaint for plaintiffs failure to establish a prima facie case of negligence. NYCTA also moved for a directed verdict on the issue of liability at the close of proof. The trial judge reserved decision on both motions. The jury returned a verdict finding NYCTA negligent, determining that its negligence was a substantial factor in causing the accident and assigning it 25% of the fault. The jury allocated the remaining 75% of liability to plaintiff. NYCTA moved to set aside the verdict and Supreme Court denied all motions.

A majority of the Appellate Division affirmed, finding legally sufficient evidence to support the jury verdict as against NYCTA. Two Justices dissented in part and voted to reverse. They would have dismissed the complaint for failure to establish a prima facie case because they believed “plaintiffs own reckless conduct constituted an intervening and unforeseeable act which broke any causal connection between his injury and any alleged negligence” by NYCTA (19 AD3d at 581-582). The dissent also stated that plaintiff should not have been permitted to testify as to an estimate of his running speed, nor should the accident reconstruction expert have been allowed to use plaintiffs testimony as a basis for his opinion, since no foundation was properly laid and thus the testimony was “pure speculation and conjecture” (19 AD3d at 582). NYCTA appeals as of right, and we affirm.

A jury verdict rests on legally insufficient evidence where there is “simply no valid line of reasoning and permissible inferences which could possibly lead rational [individuals] to the conclusion reached by the jury on the basis of the evidence presented at trial” (Cohen v Hallmark Cards, 45 NY2d 493, 499 [1978]). We have held that this inquiry is similar to that of a trial judge determining whether to direct a verdict (see Cohen, 45 NY2d at 499). If there is a question of fact and “it would not be utterly irrational for a jury to reach the result it has determined upon . . . the court may not conclude that the verdict is as a matter of law not supported by the evidence” (Cohen, 45 NY2d at 499; Campbell v City of Elmira, 84 NY2d 505, 510 [1994]).

NYCTA argues that plaintiffs own reckless conduct—entering the catwalk after consuming several alcoholic beverages and attempting to catch the train—was the sole proximate cause of his injuries. Significantly, NYCTA did not request any instruction that the jury consider whether plaintiffs conduct was the sole proximate cause of his injuries. Neither did defendant request a jury charge on superseding or intervening cause. Rather, the jury was instructed that plaintiffs “negligence was a substantial factor in causing the accident,” and was asked to determine further whether NYCTA was also negligent, whether that negligence was a contributing factor to plaintiffs accident and the percentage of fault attributable to each party.

Plaintiffs conduct was undeniably reckless, but the jury appropriately considered plaintiffs actions and determined that he bore a far greater share of the fault. This is in keeping with the doctrine of comparative negligence {see CPLR 1411). Contrary to NYCTA’s argument and the dissent, plaintiffs conduct, although a substantial factor in causing the accident, was not so egregious or unforeseeable that it must be deemed a superseding cause of the accident absolving defendant of liability.

This case does not involve the type of dangerous, illegal conduct presented in Barker v Kallash (63 NY2d 19 [1984]) where the plaintiff was severely injured while constructing a pipe bomb. There, the Court denied plaintiff recovery for injuries sustained as a direct result of a serious violation of law, “not because the plaintiff contributed to his injury, but because the public policy of this State generally denies judicial relief to those injured in the course of committing a serious criminal act” (Barker, 63 NY2d at 24). Here, plaintiff surely and very substantially contributed to his injury, but did not engage in the type of dangerous criminal conduct that prohibited recovery in Barker. Nor can it be said that his conduct was such as to vitiate the duty of reasonable care owed to him by the train operator to see what there was to be seen through the proper use of his senses and to bring the train to a safe stop.

We have held that a train operator may be found negligent if he or she sees a person on the tracks “from such a distance and under such other circumstances as to permit him [or her], in the exercise of reasonable care, to stop before striking the person” (Coleman v New York City Tr. Auth., 37 NY2d 137, 140 [1975]; see Noseworthy v City of New York, 298 NY 76, 79 [1948]). The train operator’s duty certainly is not vitiated because plaintiff was voluntarily walking or running along the tracks or because of any reckless conduct on plaintiffs part.

Thus, it was not irrational for the jury to find NYCTA negligent. There is a reasonable view of the evidence that the train operator failed to see the teenagers from a distance from which he should have seen them, and that he failed to employ emergency braking measures. The jury’s determination that the operator could have avoided this accident is an affirmed finding of fact with support in the record and is beyond our further review. Plaintiffs conduct did not constitute such an unforeseeable or superseding event as to break the causal connection between his injury and defendant’s negligence.

The trial court also properly permitted plaintiff to testify regarding an estimate of his running speed. Plaintiff established a sufficient foundation demonstrating the basis of his knowledge—two years’ experience running on a treadmill calibrated to measure miles per hour. In comparable situations, both police and civilian witnesses with an appropriate basis for knowledge have been permitted to give testimony estimating the speed of moving motor vehicles (see People v Olsen, 22 NY2d 230, 231-232 [1968]; Senecal v Drollette, 304 NY 446, 448 [1952]). The reliability of plaintiffs testimony and the weight it should have been accorded were issues for the finders of fact. The jury, which was best able to observe plaintiffs testimony and evaluate his credibility, resolved the question of reliability in plaintiffs favor. It cannot be said that the jury’s conclusion was utterly irrational.

Additionally, the jury was entitled to credit the testimony of plaintiffs expert who used the estimated running speed in making his calculations. The expert did not express an opinion as to how fast plaintiff was running, but used plaintiffs own estimate to determine where the train could have come to rest if plaintiff was running at the speeds he asserted. As a result, it was not “pure speculation and conjecture,” but admissible and reliable evidence from which the jury properly concluded that the train could have stopped before striking plaintiff.

Accordingly, the order of the Appellate Division should be affirmed, with costs.

R.S. Smith, J. (dissenting).

Since the enactment of CPLR 1411 in 1975, it has been the general rule that plaintiffs own culpability will not bar his claim, but will only be grounds for apportioning fault. In several cases, however, we have recognized that a plaintiffs fault may be so egregious in comparison to the defendant’s that it “supersede^] defendants’ conduct” (Egan v A.J. Constr. Corp., 94 NY2d 839, 841 [1999]) and becomes the “sole legal cause” (Olsen v Town of Richfield, 81 NY2d 1024, 1026 [1993]) or “sole proximate cause” (Howard v Poseidon Pools, 72 NY2d 972, 975 [1988]) of the plaintiff’s injuries. I believe the facts of this case bring it within the superseding cause doctrine.

Plaintiff here was reckless twice. It was, of course, very foolish for him and his companions to choose a narrow catwalk next to the subway tracks for pedestrian travel. But plaintiff would have escaped unharmed if he and the others, when they heard a train coming, had done what minimal common sense would require—stand still, as far as they could get from the tracks, and let the train pass by. Instead, they chose to race the train to the next station. On these facts, I think it is fair to say that plaintiffs injuries were entirely his own fault, even if a nonnegligent motorman might have been able to stop the train in time to avoid the accident.

While no two cases are identical, precedents support the view that this plaintiffs recklessness was serious enough to be a “superseding cause.” In Merino v New York City Tr. Auth. (89 NY2d 824, 825 [1996]) we refused recovery to a plaintiff who had fallen onto the subway tracks as a result of his own intoxication, holding, as an alternative ground for dismissal, that plaintiff “failed to show that the defendant’s alleged negligence was a substantial factor in causing his injury.” Several Appellate Division cases also deny recovery on superseding cause grounds to plaintiffs who put themselves in the paths of trains (e.g., Wadhwa v Long Is. R.R., 13 AD3d 615 [2d Dept 2004]; Lassalle v New York City Tr. Auth., 11 AD3d 661 [2d Dept 2004]; Snyder v New York City Tr. Auth., 2 AD3d 162 [1st Dept 2003], lv denied 2 NY3d 707 [2004]; Gao Yi Feng v Metropolitan Transp. Auth., 285 AD2d 447 [2d Dept 2001]). Gao Yi Feng is perhaps the closest to this case on its facts: the plaintiff there was struck while standing “directly adjacent to the train tracks with his back to oncoming trains” (285 AD2d at 447).

Cases denying recovery, even under a comparative negligence regime, to highly reckless plaintiffs speak of causation in defending their results, but in each case it is clear that the extraordinary degree of the plaintiffs fault—not just the foreseeability of the plaintiffs conduct—has been decisive. A pure foreseeability analysis does not explain the cases. For example, I would not hesitate to uphold an award if this plaintiff had been pushed by someone else into the path of the train, rather than recklessly placing himself there, though there is not much difference in the foreseeability of the two events.

The principle we have applied in previous cases, and should apply here, is that people whose failure to take care of themselves is extreme may not shift any of the consequences to others. Anyone of normal human compassion will sympathize with plaintiff; he is not the only 18 year old who ever acted recklessly, and he has paid a much higher price for it than most. But I do not think it consistent with law or wise policy to hold, as the majority does, that the New York City Transit Authority must compensate him in part for his loss. The Transit Authority moved, before the case was submitted to the jury, for a directed verdict, asserting that plaintiffs reckless conduct was the sole legal cause of the accident. I think that motion should have been granted.

Chief Judge Kaye and Judges G.B. Smith and Read concur with Judge Ciparick; Judge R.S. Smith dissents and votes to reverse in a separate opinion in which Judges Rosenblatt and Graffeo concur.

Order affirmed, with costs.

      . New York City Transit Authority (NYCTA) argues that plaintiff was struck when he attempted to circumvent the signal box and came too close to the train. At trial, plaintiff testified that he did not recall whether he had passed any signal boxes between 33rd and 40th Streets, or his position in relation to the signal box when he was struck. However, the road car inspector from NYCTA testified that plaintiff was found “[u]p against the signal [box]” on the 33rd Street side—closer to the station he was coming from.

      . This was the second trial of this matter. The first trial resulted in a jury verdict in plaintiff’s favor—finding defendant and the Metropolitan Transportation Authority (MTA) 100% liable—but was reversed by the Appellate Division (295 AD2d 419 [2002]). That Court granted a new trial, finding the jury’s determination that plaintiff’s conduct was not a proximate cause of the accident against the weight of the evidence, and that plaintiffs expert’s opinion testimony about plaintiffs running speed at the time of the accident was speculative.

      . The jury actually found both NYCTA and MTA liable, but the Appellate Division dismissed the complaint as against defendant MTA, finding that it could not be held liable for the conduct of NYCTA’s employees (19 AD3d 579, 581 [2005]). That finding is not challenged here.


author: Chief Judge Kaye. R.S. Smith, J. (dissenting).

text:
    [ 847 NE2d 1141, 814 NYS2d 567]
    The People of the State of New York, Respondent, v Calvin Moore, Appellant.
    Argued January 3, 2006;
    decided February 21, 2006

      POINTS OF COUNSEL

      Appellate Advocates, New York City (Sarah J. Berger and Lynn W.L. Fahey), for appellant.
    An anonymous tip describing appellant, together with appellant’s walking away when the police approached the area, did not provide reasonable suspicion of criminal activity justifying a gunpoint seizure where the tip’s allegation of criminal activity was wholly uncorroborated and appellant walked away before the police made any inquiry of appellant or made clear that they wanted to speak with him. (Florida v J.L., 529 US 266; People v William II, 98 NY2d 93; People v Holmes, 81 NY2d 1056; People v Bora, 83 NY2d 531; People v Martinez, 80 NY2d 444; People v Chestnut, 51 NY2d 14; People v De Bour, 40 NY2d 210; People v May, 81 NY2d 725; Illinois v Wardlow, 528 US 119.)

      Charles J. Hynes, District Attorney, Brooklyn (Diana Villanueva and Leonard Joblove of counsel), for respondent.
    The hearing court properly denied suppression of the gun because the police had reasonable suspicion to stop and frisk defendant. (Maryland v Wilson, 519 US 408; People v Batista, 88 NY2d 650; People v De Bour, 40 NY2d 210; People v Cantor, 36 NY2d 106; People v Celaj, 1 NY3d 588; People v Pines, 99 NY2d 525; People v Oeller, 82 NY2d 774; Florida v J.L., 529 US 266; Alabama v White, 496 US 325; People v Holmes, 81 NY2d 1056.)
   OPINION OF THE COURT

Chief Judge Kaye.

On November 12, 1997, at approximately 9:35 a.m., Police Officers Racioppo and Molinaro were on a routine patrol in their marked police car when they received a radio call of a dispute involving a male Black with a gun, described as approximately 18 years of age, wearing a gray jacket and red hat—information that came from an anonymous phone tip. The officers drove to the scene without their lights flashing and arrived within approximately one minute of receiving the radio call. No dispute was taking place. They did, however, see a male Black on the corner—defendant—wearing a gray jacket and red hat, with no similar individuals in the vicinity.

The officers exited their vehicle and walked toward defendant, who began to walk away. Without attempting any verbal inquiry, the officers immediately drew their guns and yelled “police, don’t move.” The defendant then turned and continued to walk a short distance toward a closed gate before stopping. When the officers told defendant to put up his hands, he made a movement toward his waistband as he raised his arms. Officer Racioppo patted down defendant, felt a hard object in his left jacket pocket and recovered a gun.

Defendant was arrested and charged with criminal possession of a weapon. He moved to suppress the gun, and Supreme Court held a hearing at which Officer Racioppo was the sole witness. After the hearing, based on the foregoing description of the incident, Supreme Court denied defendant’s motion to suppress. The Appellate Division affirmed, holding that

“[t]he detailed anonymous tip authorized the officers to exercise their common-law right of inquiry only and did not provide reasonable suspicion to stop and frisk the defendant. Nevertheless, a frisk was justified by the defendant’s conduct thereafter. Specifically, upon finding his path blocked, the defendant reached toward his waistband, whereupon the officers possessed reasonable suspicion for the forceable stop and frisk that revealed the defendant’s possession of a .25 caliber handgun” (People v Moore, 13 AD3d 395, 396-397 [2004] [citations omitted]).

Although we agree with the Appellate Division that the anonymous tip authorized only an inquiry, the police here failed to simply exercise their common-law right to inquire. Instead—in ordering him at gunpoint to remain where he was—the police forcibly stopped defendant as soon as they arrived on the scene. Because the officers did not possess reasonable suspicion until after defendant reached for his waistband, however—by which time defendant had already been unlawfully stopped—the gun should have been suppressed. Defendant’s later conduct cannot validate an encounter that was not justified at its inception (see People v De Bour, 40 NY2d 210, 215 [1976]; People v William II, 98 NY2d 93, 98 [2002]).

In De Bour, we set forth a graduated four-level test for evaluating street encounters initiated by the police: level one permits a police officer to request information from an individual and merely requires that the request be supported by an objective, credible reason, not necessarily indicative of criminality; level two, the common-law right of inquiry, permits a somewhat greater intrusion and requires a founded suspicion that criminal activity is afoot; level three authorizes an officer to forcibly stop and detain an individual, and requires a reasonable suspicion that the particular individual was involved in a felony or misdemeanor; level four, arrest, requires probable cause to believe that the person to be arrested has committed a crime (De Bour, 40 NY2d at 223; see also People v Hollman, 79 NY2d 181, 184-185 [1992]). The Court’s purpose in De Bour was to provide clear guidance for police officers seeking to act lawfully in what may be fast-moving street encounters and a cohesive framework for courts reviewing the propriety of police conduct in these situations. Having been the basis for decisions in likely thousands of cases over the past 30 years, De Bour has become an integral part of our jurisprudence.

Here, the gunpoint stop unquestionably constituted a seizure of defendant’s person—De Bour’s level three—and required reasonable suspicion (see People v Chestnut, 51 NY2d 14 [1980] [where police draw their firearms and order a suspect to “freeze,” this is a seizure, the propriety of which is measured by the reasonable suspicion standard]; People v Townes, 41 NY2d 97 [1976] [ordering a suspect to “freeze” with guns drawn amounts to a seizure of the suspect by police]).

An anonymous tip cannot provide reasonable suspicion to justify a seizure, except where that tip contains predictive information—such as information suggestive of criminal behavior—so that the police can test the reliability of the tip (see Florida v J.L., 529 US 266 [2000]; William II, 98 NY2d at 99). Indeed, in J.L., a unanimous United States Supreme Court held that an anonymous tip regarding a young Black male standing at a particular bus stop, wearing a plaid shirt and carrying a gun, was insufficient to provide the requisite reasonable suspicion to authorize a stop and frisk of the defendant.

The State argued in J.L. that the tip was sufficient to justify the police intrusion because the defendant matched the detailed description provided by the tipster. The Supreme Court held, however, that reasonable suspicion “requires that a tip be reliable in its assertion of illegality, not just in its tendency to identify a determinate person” (529 US at 272). The Court further explained that an anonymous tip could demonstrate the tipster’s reliability and thus provide reasonable suspicion of criminal activity only if it predicted actions subsequently engaged in by the suspect.

Here, the tip did not provide any predictive information, nor did it accurately portray the alleged criminal activity. The tipster reported a dispute involving a man with a gun, but when the police arrived within a minute of receiving the radio call, they did not find a dispute in progress. Under J.L. and William II, such a tip was insufficient to afford the police reasonable suspicion of criminal activity, and thus did not support the gunpoint stop.

That defendant began walking away from the scene when the police arrived does not render the gunpoint stop permissible. As the Appellate Division recognized, the anonymous tip triggered only the police officers’ common-law right of inquiry. This right authorized the police to ask questions of defendant—and to follow defendant while attempting to engage him—but not to seize him in order to do so. Thus, defendant remained free to continue about his business without risk of forcible detention (see People v May, 81 NY2d 725, 728 [1992] [“The police may not forcibly detain civilians in order to question them . . . without a reasonable suspicion of criminal activity and once defendant indicated . . . that he did not wish to speak with the officers, they should not have forced him to stop without legal grounds to do so. Any other rule would permit police seizures solely if circumstances existed presenting a potential for danger” (citation omitted)]).

Indeed, the very right to be let alone—the right of citizens not to be stopped at gunpoint by police, based on anonymous tips—is the distinguishing factor between the level of intrusion permissible under the common-law right of inquiry and the right to stop forcibly. If merely walking away from the police were sufficient to raise the level of suspicion to reasonable suspicion—and a suspect who attempted to move could be required to remain in place at the risk of forcible detention— the common-law right of inquiry would be tantamount to the right to conduct a forcible stop and the suspect would be effectively seized whenever only a common-law right of inquiry was justified (see People v Holmes, 81 NY2d 1056, 1058 [1993] [“If these circumstances (observing defendant standing in an area known for drug trafficking with an unidentified bulge in his jacket pocket) could combine with flight to justify pursuit, then in essence the right to inquire would be tantamount to the right to seize, and there would, in fact, be no right to be let alone” (internal quotation marks omitted)]).

This simply is not the law. Under our settled De Bour jurisprudence, to elevate the right of inquiry to the right to forcibly stop and detain, the police must obtain additional information or make additional observations of suspicious conduct sufficient to provide reasonable suspicion of criminal behavior. Had defendant, for example, reached for his waistband prior to the gunpoint stop or actively fled from the police, such conduct, when added to the anonymous tip, would have raised the level of suspicion. However, “[w]e have frequently rejected the notion that behavior which is susceptible of innocent as well as culpable interpretation, will constitute probable cause. It is equally true that innocuous behavior alone will not generate a founded or reasonable suspicion that a crime is at hand” (Be Bour, 40 NY2d at 216 (citations omitted]).

Finally, addressing the dissent, the Court’s decision today is wholly in line with our precedent: a forcible stop requires reasonable suspicion that the suspect has committed a crime, not merely the founded suspicion—triggering the officers’ common-law right of inquiry—present here. Surely the possibility that defendant had a gun merited investigation by the police, just not immediately at gunpoint.

Accordingly, the order of the Appellate Division should be reversed, defendant’s motion to suppress granted and the indictment dismissed.

R.S. Smith, J. (dissenting).

It is settled that neither an anonymous tip unconfirmed by subsequent events (Florida v J.L., 529 US 266 [2000]; People v William II, 98 NY2d 93 [2002]) nor a person’s evident wish to avoid contact with the police (People v May, 81 NY2d 725 [1992]) is alone enough to justify “a reasonable suspicion that a particular person has committed, is committing or is about to commit a felony or misdemeanor,” and thus to permit “a forcible stop and detention of that person” (People v De Bour, 40 NY2d 210, 223 [1976]). Today, the Court goes a step further, holding that a combination of the two—an anonymous tip and avoidance of contact with the police—is not enough. I would not take this step, because I think it limits too strictly the ability of police officers to make the common sense, spur-of-the-moment judgments that street encounters demand and that are essential to achieving a proper balance between individual rights and law enforcement.

The rules that neither an anonymous tip nor the avoidance of police officers can alone create reasonable suspicion are not intuitively self-evident. Indeed, they are a departure—justified, the courts have decided, by valid policy reasons—from a simple, commonsense interpretation of “reasonable suspicion.” In common sense, of course it is reasonable for a police officer to suspect that a person who an anonymous caller says is committing a crime may indeed be committing one; it would be unreasonable to conclude, or to assume, that the anonymous caller was telling the truth, but it is not unreasonable to want to look into the possibility. Equally clearly, any reasonable police officer will become suspicious when a person, on seeing the police officer, promptly decides to travel in the opposite direction; there are no doubt many perfectly legitimate reasons for wanting to shun contact with the police, but it is still reasonable to suspect the existence of a reason that is not legitimate.

Nevertheless, the courts do not allow police officers to detain someone with no more basis than an anonymous tip or avoidance of the police, and have artificially defined “reasonable suspicion” in a way that prohibits such detentions. I imply no criticism of the decisions that establish these rules. They are based on important interests that compete with society’s interest in efficient law enforcement. In the case of the anonymous tip, if reasonable suspicion could be founded on that alone, it “would enable any person seeking to harass another to set in motion an intrusive, embarrassing police search” or detention, while concealing his or her identity (Florida v J.L., 529 US at 272). In the case of a person who avoids the police, to make that without more a basis for “reasonable suspicion” would unacceptably abridge that person’s “right ‘to be let alone’ and refuse to respond to police inquiry” (People v Holmes, 81 NY2d 1056, 1058 [1993] [citation omitted]).

While I accept the reasons that have led courts to hold that a police officer’s suspicion based on either of these two grounds is not reasonable, it does not logically follow that suspicion is unreasonable when both grounds exist together. At that point, it seems to me, the reasons to be suspicious are powerful enough that society’s interest in efficient law enforcement should prevail. Thus, in this case, when Officers Racioppo and Molinaro observed both that defendant matched the description the anonymous caller had given of a man with a gun, and that he began to walk away at the sight of the police, the possibility that he did indeed have a gun deserved to be investigated, even at the cost of a temporary interference with his liberty. It was possible, of course, based on what the officers knew, that defendant was the innocent victim of a spiteful caller trying to harass him, and that he was also among those innocent people who prefer to exercise their “right to be let alone” rather than talk to the police, but I cannot bring myself to blame the officers for suspecting that the truth might be otherwise.

Accordingly, I would affirm the order of the Appellate Division.

Judges G.B. Smith, Ciparick, Graffeo and Read concur with Chief Judge Kaye; Judge R.S. Smith dissents and votes to affirm in a separate opinion in which Judge Rosenblatt concurs.

Order reversed, etc.

       Although defendant reached a gate that prevented him from continuing to walk in the direction he had been walking, he could have continued to walk away from the officers in a different direction had he wanted to flee. Indeed, there was no finding that defendant’s conduct constituted flight.