Arbitrators Should Determine Validity of Arbitration Agreement, Court Affirms

NEW YORK - Under the Federal Arbitration Act, arbitrators, not the court, should determine the scope and validity of an arbitration agreement in a contingency cost agreement that insured a life settlement company, a New York appellate court has affirmed. Life Receivables Trust v. Goshawk Syndicate 102 at Lloyd's, No. 601244/08 (N.Y. App., 1st Dept.).

On Oct. 13, the New York Appellate Division, 1st Department, ruled that the parties' agreement to arbitrate the validity of their arbitration agreement "is supported by clear and unmistakable evidence" and should be enforced.

Life Receivables Trust owns a portfolio of life insurance policies originally …