ContiChem LPG v. Parsons Shipping Co

In ContiChem LPG v. Parsons Shipping Co. (229 F3d 426 [2d Cir 2000]), the Second Circuit Court of Appeals also limited prearbitration attachment under CPLR 7502 to domestic arbitrations. ContiChem attempted to obtain security in New York for damages resulting from a breach of a "charter party." The issue before the court was whether ContiChem could avail itself of CPLR 7502 when no arbitration was pending in New York where the parties expressly agreed to arbitration in London. The court examined the Advisory Committee's comment on CPLR 7502 (c) which states that: "There is no inconsistency between the proposed amendment 7502 (c) and the decision of the Court of Appeals in Cooper v. Ateliers De La Motobecane, S.A., 57 NY2d 408, 456 NYS2d 728, 442 NE2d 1239 (1982), where a pre-arbitration attachment was disallowed in a matter involving international litigants governed by the UN Convention. The amendment would not affect proceedings governed by such international agreements i.e., the Convention." (ContiChem, 229 F3d at 432, quoting 1985 Report of Advisory Comm on Civ Prac, reprinted in 1985 McKinney's Session Laws of NY, at 3432.) The ContiChem court also noted that the Advisory Committee explicitly contemplated that CPLR 7502 (c) was "designed to make the domestic arbitration remedy more efficacious" (id. at 432 ). Therefore, it held that although the matter involved maritime attachment, and Cooper was not necessarily a bar to relief, ContiChem nevertheless was not entitled to provisional remedies under CPLR 7502 (c) "because this was not a domestic arbitration" (id. at 433). Continuing, the court stated (at 433): "The charter party in this case specifically provided for arbitration of disputes in London, and Rule 7502 by its terms applies only to domestic arbitrations." Therefore, the court refused to expand the scope of CPLR 7502 beyond the limits of its language. The court also noted (at 433) that having determined that ContiChem could not bring an application under CPLR 7502 "because it agreed to arbitration in London," it cannot seek attachment under CPLR 6210, 6 "because the court cannot entertain" the CPLR 7502 application. In other words, since CPLR 7502 is limited to domestic arbitrations, and the parties in ContiChem explicitly agreed to arbitration in London, CPLR 7502's provisional remedies were not available.