The appellant, James Crawford, was employed for two years as a securities salesman by respondent Merrill Lynch, Pierce, Fenner & Smith, Inc. (Merrill Lynch) in an office managed by respondent Pierson. He claims respondent owes him $8,850 for commissions he earned working for them and commenced an action seeking recovery. Respondent moved to dismiss the complaint and to compel arbitration under CPLR 7502 (subd. [a]) before the New York Stock Exchange claiming that such was provided by an alleged contract between the parties dated July 16, 1967. While this motion was pending, appellant served on respondent a notice of intention to arbitrate under CPLR 7503 (subd. [c]) naming the American Arbitration Association as arbitrator.
The matter came on to be heard before Special Term which vacated arbitration before the American Arbitration Association (AAA) and directed appellant, Crawford, to arbitrate his claim before the New York Stock Exchange (NYSE), and dismissed appellant’s complaint without prejudice pending the availability of arbitration. In our view, this was error.
On July 16, 1967 the appellant signed an application to the NYSE to be registered with the Exchange. Such application *114signed .solely by appellant could not be construed to be a contract between appellant and respondent, Merrill Lynch. It did provide, however, that any controversy between Crawford and any member of the Exchange shall be settled by arbitration at the instance of any such party ‘ ‘ In accordance with the arbitration procedure prescribed in the Constitution and Eules then obtaining of the New York 'Stock Exchange.” An examination of section 1 of article VIII of the constitution of the New York Stock Exchange and the rules of the Exchange reveals that controversies between members shall ‘ ‘ at the instance "of any such party ” and controversies between a non-member and a member shall “ at the instance of such non-member ” be submitted for arbitration in accordance with the constitution and rules of the board of governors. It appears clear from a reading of this provision that arbitration before the NYSE between a member and nonmember, the case here, may be compelled only at the instance of the nonmember. The constitution and rules contain no provision permitting respondent member of the NYSE to compel appellant, a nonmember, to arbitrate his claim before the NYSE. Appellant had the option of arbitrating before the NYSE or not, as he chose.
In this case appellant chose to arbitrate before the AAA. The mailing receipt shows that appellant’s demand for arbitration before the AAA was received by respondent on November 25,1970. Thereafter, respondent had 10 days from the date of receipt of the demand to move to stay the demanded arbitration (Matter of Knickerbocker Ins. Co. v. Gilbert, 28 N Y 2d 57; Matter of Jonathan Logan, Inc. [Stillwater Worsted Mills], 31 AD 2d 208, affd. 24 N Y 2d 898). Eespondent’s order to show cause dated and served upon appellant on December 9, 1970 (14 days after receipt of the demand), was not timely and precludes respondent from “ objecting that a valid agreement was not made or has "not been, complied with ”. (CPLR 7503, subd. [c].)
To say that by their failure to move to stay the demanded arbitration within 10 days respondent conceded only “ that there was an arbitrable dispute under a valid contract ’ ’ flies in .the face of the statute. The statute precludes an objection that the arbitration agreement “ has not been complied with ” — the very objection respondent raises by its claim that arbitration before the AAA as sought by appellant’s demand is not in accordance with the ‘obligation to arbitrate.
Were we to reach the question of whether the arbitration demanded by appellant is in compliance with the agreement, we *115would conclude that it is. The dissent asserts that appellant waived his rights in the July 16, 1967 application and agreed to arbitrate before the NYSE. We cannot agree that paragraph J of the application so provides. The constitution of the NYSE contains no provision which allows a member of the NYSE to compel a nonmember to arbitrate a claim before the Exchange.
In short, appellant never agreed to arbitrate before the NYSE but merely to comply with the constitution and rules of the NYSE. These gave 'him, as a nonmémber of the Exchange, the option of seeking or not seeking arbitration before that body. Thus, the right appellant chose to exercise was one granted him by the rules of the organization of which respondent was a member and of which appellant was not. Furthermore, regardless of respondent’s claimed right to demand arbitration before the NYSE by the terms of the July 16, 1967 application signed by appellant, respondent is precluded from objecting to appellant’s failure to comply with that alleged agreement because of its failure to move timely against appellant’s demand for arbitration before the AAA (CPLR 7503, subd. [c]).
The orders should be reversed and the motions denied.