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IN RE UNITED STATES LINES

September 20, 1993

In the Matter of the Arbitration between UNITED STATES LINES, INC. and UNITED STATES LINES (S.A.), INC. REORGANIZATION TRUST as successor in interest to Moore-McCormack Lines, Inc., Petitioner, - and - LIVERPOOL AND LONDON STEAMSHIP PROTECTION AND INDEMNITY ASSOCIATION, LTD., Respondent.

Wood


The opinion of the court was delivered by: KIMBA M. WOOD

WOOD D.J.

 Background

 Petitioner moves for an order directing that the parties proceed to arbitration, and specifically, that the arbitration be conducted in New York City. This dispute arises out of respondent's refusal to pay a judgment entered against petitioner's predecessor in interest in an action brought by a longshoreman for injuries suffered in 1977 aboard the MORMACARGO. Both sides agree that arbitration is required under the 1977 Rules of the Liverpool and London Steamship Protection and Indemnity Association (the "Association"), under which the Association provided protection and indemnity coverage for the MORMACARGO at the time that the acts the City of New York.

 Discussion

 I. Arbitration Agreement

 The Association's 1977 Rules do not address the venue of any arbitration proceedings. The 1977 Rules state in pertinent part:

 
If and whenever any difference or dispute arises between the Association and any member touching any loss, claim, or contribution, such difference or dispute shall be referred to the decision of an arbitrator to be appointed by the parties in difference, or, if they cannot agree, to be appointed by the President for the time being of the Law Society of England. The provisions of the Arbitration Acts for the time being in force shall apply to any such arbitration.

 Pet. Ex. A at 41, P 88 (emphasis added). The contract of insurance between petitioner's predecessor and the Association contains a "New York Suable Clause," pursuant to which the Association consents to the personal jurisdiction of this court over it. The "New York Suable Clause" also provides that the "contractual or other substantive rights and obligations of the Association or of the Member . . . shall all be determined in accordance with English law." Id. at 7.

 Petitioner served a demand for arbitration on respondent, specifically demanding that the arbitration be conducted in New York. Eisenstein Aff. Ex. A at 2. Respondent rejected the demand to arbitrate in New York City, id. Ex. B at 2, but acknowledged that arbitration was required. Resp. Ex. C. Pursuant to Rule 88 of the 1977 Rules, respondent proposed four candidates to serve as arbitrator, all of whom are attorneys or judges working in London. Id.

 II. Legal Standards

 This court's subject matter jurisdiction over this admiralty and maritime case is predicated upon 28 U.S.C. § 1333. Petitioner brings this action to compel arbitration pursuant to 9 U.S.C. § 4, which provides in pertinent part that the court must issue an order directing that arbitration "proceed in the manner provided for" in the agreement to arbitrate. 9 U.S.C. § 4 (1970). In both domestic and international cases, if the agreement between the parties to arbitrate does not specify the location of the arbitration, the court may order that the arbitration be conducted only within the boundaries of the district. See Oil Basins Ltd. v. Broken Hill Proprietary Co., 613 F. Supp. 483, 486-87 (S.D.N.Y. 1985); Bauhinia Corp. v. China Nat'l Machinery & Equipment Import & Export Corp., 819 F.2d 247, 250 (9th Cir. 1987); Schulze and Burch Biscuit Co. v. Tree Top, Inc., 642 F. Supp. 1155, 1157 (N.D.Ill. 1986), aff'd 831 F.2d 709 (7th Cir. 1987).

 Petitioner asks this court to order that arbitration be held within this district, because (1) the location of the arbitration is not provided for in the agreement to arbitrate, and (2) this court has no authority to order the parties to arbitrate outside the district, unless the arbitration agreement clearly expresses a contrary intent. Petitioner argues that the selection of the arbitrator and the venue for the arbitration are two distinct issues, only the former of which is provided for by the arbitration agreement.

 Respondent argues that any judicial determination of where the arbitration should be held is premature in that the President of the Law Society of England has not yet resolved the parties' dispute over the identity of the arbitrator. Thus, respondent argues, the location of the arbitration should be left up to the arbitrator named by the President of the Law Society of England. Alternatively, respondent argues that the contract between the parties implies that the arbitration must be conducted ...


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