Westinghouse Elec. Corp. v. New York City Tr. Auth – Case Brief Summary (New York)

In Westinghouse Elec. Corp. v. New York City Tr. Auth. (82 NY2d 47, 623 NE2d 531, 603 NYS2d 404 [1993]), responding to a certified question from the Second Circuit, the State Court of Appeals expressly determined that a contractual provision mandating alternative dispute resolution by an employee of one of the parties was enforceable and not contrary to public policy, noting:

"It is firmly established that the public policy of New York State favors and encourages arbitration and alternative dispute resolutions" (id. at 53).

The Court held that the provision in the agreement for judicial review pursuant to CPLR article 78 brought the arbitration provision within the public policy of the State, finding that, by executing the contract, the contracting plaintiff had accepted the terms of the contract "with its business eyes open" and, although the terms were clearly one-sided, the agreement was not one of adhesion (id at 54-55.)