Arbitrators generally permitted independent recourse to third-party sources when necessary to confirm technical information
Matter of Watt v Roberts, 2010 NY Slip Op 09171, decided on December 14, 2010, Appellate Division, First Department
An arbitration panel selected by the Transport Workers Union of America, Local 100 and the New York City Transit Authority and the Manhattan and Bronx Surface Transit Operating Authority granted a 3% wage increase to employees of the Authorities and capped the formula for employees' contributions toward health insurance costs.
The award was subsequently confirmed by Supreme Court, which denied the Authorities’ Article 75 motion to vacate the award. The Appellate Division affirmed the lower court’s ruling.
The Authorities had objected to the arbitration panel's references to certain matters outside the hearing record, including the MTA's 2010 Preliminary Budget and July Financial Plan and matters reported in newspaper articles. The Appellate Division, however, ruled that this did not constitute "corruption, fraud, or misconduct in procuring the award" prejudicing the rights of either party and warranting vacatur.
The court noted that arbitrators "often are chosen because of their expertise in a particular area and are generally permitted independent recourse to third-party sources when necessary to confirm technical information." In this instance, said the Appellate Division, the arbitrators did not purport to rely on matters outside the record in setting the award, but acknowledged and referred to developments known to the parties and widely reported.
In effect, the court appears to have equated the arbitration panel’s consideration of “third-party sources” equivalent to it taking “judicial notice” in a legal action. West's Encyclopedia of American Law defines “judicial notice” as “A doctrine of evidence applied by a court that allows the court to recognize and accept the existence of a particular fact commonly known by persons of average intelligence without establishing its existence by admitting evidence in a civil or criminal action.”
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