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Malawista v. Westchester Vo. BOR: Court Holds Membership Requires Arbitration of Disputes

Note: This case is not published in a reporter or Westlaw and may not constitute current law. Consult with counsel before relying on this case.

Malawista filed suit against Preferred Realty, Inc., seeking to recover a broker's commission and additional damages for intentional infliction of humiliation and embarrassment. The Board informed Malawista that this was an arbitrable matter and that, although the Board had no jurisdiction over the damages portion of the lawsuit, Malawista should withdraw the portions of the suit which could be arbitrated according to the manual. The alternative was suspension from the Westchester County Board of REALTORS®. Malawista then sought to prohibit the Board from taking any action with regard to his membership.

Malawista contended that the Board's arbitration procedure was inadequate and inapplicable to this dispute. The court found that the Board's bylaws provided for arbitration to settle conflicting demands among members, and that Malawista, by becoming a member, assented to that method of resolving disputes.

A Board may insist upon compliance with the arbitration requirement, and Malawista's refusal to do so constituted a proper ground for suspension from membership. (See The Matter of Gerseta Corp. v. The Silk Assoc. of America, 200 A.D. 890, 192 N.Y.S. 370, appeal dismissed, 233 N.Y. 544, 135 N.E. 911 (1922)).

Malawista v. Westchester County Board of REALTORS®, Inc., Index No. 23310/80 (1981). [Note: This opinion was not published in an official reporter and therefore should not be cited as authority. Please consult counsel before relying on this opinion.]