Criteria for Provisional Remedies in Aid of Arbitration

In New York, parties to an arbitration may petition the state court for the provisional remedies of orders of attachment and preliminary injunctions in aid of arbitration. Such remedies provide valuable tools for parties seeking to preserve during the arbitration process the ability to enforce an arbitral award once obtained. Section 7502(c) of the New York Civil Practice Law and Rules (CPLR) provides that, to obtain such relief, a petitioner must demonstrate that “the award to which the applicant may be entitled may be rendered ineffectual without such provisional relief.” Although Section 7502(c) provides that the CPLR provisions applicable to orders of attachment (Article 62) and preliminary injunctions (Article 63) outside the arbitration context apply to the procedural aspects of an application for such provisional remedy in aid of arbitration, including “those relating to undertakings and to the time for commencement of an action,”¹ Section 7502(c) provides that a showing of an ineffectual award is the “sole ground for the granting of the remedy.”²

With no precedent from the New York Court of Appeals, the Appellate Division and trial courts have applied, over time, evolving standards to determine whether such provisional remedies in aid of arbitration are authorized. Earlier courts focused on whether the ultimate arbitration award may be ineffective if the remedy is not granted,³ whereas more recent courts have fashioned a stricter test, incorporating an “equitable criteria” analysis for preliminary injunction motions—specifically likelihood of success on the merits, irreparable harm and the balance of equities in movant’s favor—into the standard for establishing provisional relief under Section 7502(c).