Court Compels Non-Signatory Affiliates, But Not Broker, To Arbitrate Premium Payment Dispute

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National Union Fire Insurance Company of Pittsburgh brought a petition in a New York federal court, to compel nine related companies to arbitrate a payment dispute relating to certain policies of insurance issued to the Beelman Truck Company. In connection with the insurance, Beelman Truck Company entered into premium payment agreements with National Union that contained an arbitration provision. The agreements were signed by Frank J. Beelman, III, on behalf of the Beelman Truck Company. The payment agreements (and the policies to which they related) defined the signatory, Beelman Truck Company, to include its subsidiaries and affiliates. National Union sought to compel not only Beelman Truck Company, but eight of its affiliates, to arbitrate the payment dispute. Beelman Truck Company conceded it must arbitrate, but the eight affiliates challenged the petition, arguing they were not signatories and should not be bound the agreements’ arbitration provisions. In addition, Beelman Truck Company brought a counter-petition to compel the broker who placed the policies to be included in the arbitration. The Court granted National Union’s petition, finding the payment agreements unambiguously included affiliates. However, it denied the counter-petition, finding no evidence that the broker was a signatory, or could otherwise be bound by the arbitration clause in the payment agreements under principles of estoppel. National Union Fire Insurance Company of Pittsburgh v. Beelman Truck Company, Case No. 15-cv-8799 (USDC S.D.N.Y. Aug. 24, 2016).

 


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