Bell v. Price

22 N.J.L. 578

Opinion

Carpenter, J.

This is a writ of error, directed to the Circuit Court of the county of Sussex. The object of the writ is to review the decision of the judge of that court in refusing to set aside an award of arbitrators, the submission having been made a rule of court under the statute. The affidavits taken in the court below, under the rule for the purpose of setting aside the award, have been brought up by certiorari on allegation of diminution, and used on the present argument as ground to sustain the assignment of errors. Such application of the writ of error seems to be a singular departure from the rules of the common law, and will give rise to no little embarrassment in practice. But the question as to its propriety has not been raised, and will not therefore be discussed.

The award was signed by two arbitrators, the third dissenting, and was accompanied by a paper entitled, “ General result,” which contained a sort of summary of the calculations by which the arbitrators ascertained the amount of indebtedness of Price to the estate of Stoll, the deceased partner. There were evidently other accounts and calculations, the results of which seem to have been drawn into this statement. This paper may be considered, for the purposes of the present inquiry, as part of the award.

Footnotes

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* Various grounds of error have been assigned, all except the first corresponding with the reasons filed below for setting aside the award.

The first error assigned was, that the Circuit Court, on the hearing of the rule, refused to receive and consider a paper, offered by the plaintiff in error, alleged by him to contain a statement of all the oral testimony given or offered to the arbitrators. The court was clearly right in the rejection of that paper. It was a mere ex parte document, purporting to contain the substance of the oral testimony before the arbitrators, compiled from the notes and memory of the plaintiff’s counsel, but under no authority derived from the rules and practice of the court or the consent of the opposite party. Such statement could not be made evidence because it was sworn to contain the substance of the oral testimony. Rules to take affidavits to be used on motion to set aside an award must be to substantiate some particular exception, not to bring up the whole case, in order to show that the award was against the -weight of evidence. It was therefore further not offered for any competent purpose. It was no part of the duty of the court to review the merits of the award by an examination of the evidence before the arbitrators. Under the rules of the common law, as here understood, the decision of the arbitrators upon the evidence is final, and not subject- to be reviewed by the courts by an examination of that evidence. That they have arrived at an| unreasonable judgment, is no ground to impugn their decision, unless, indeed, the error be such as to show corruption and misconduct.

The allegation, that the arbitrators were not sworn, also assigned for error, may be passed with slight remark, as we think the fact that they were duly sworn sufficiently appears by the affidavits read on the hearing of the rule in the Circuit Court. The ground chiefly relied on to impeach the award was, that the arbitrators, as alleged, made a plain and palpable mistake in allowing to Price certain specified items of credit, which items appear on the face of the statement accompanying the award.

Indeed the controversy, in regard to this point, may be narrowed down to the alleged mistake in the credit of $350.50 allowed to Price. The objection here taken, that one year’s interest on the bond was not allowed to the estate of Stoll, was not raised in the Circuit Court, and certainly is not sufficiently sustained by any thing which appears on the face of the award, or the accompanying calculation, nor even by any thing to be found in the depositions. It is a matter of the merest conjecture.

The credit allowed to Price for a note of $1000, payable at the Sussex Bank, may or may not have been properly allowed. There seems to be nothing to show that it was improperly allowed, either on the face of the documents just referred to or in the affidavits, supposing that we can look into those affidavits for such purpose.

To return to the alleged mistake, chiefly pressed on the argument. On the statement styled “ General result,” Price was credited by the following item: “ Then paid by House for Price to A. Coursen half $701 — $350.50.” A note of Price and Stoll to Coursen was produced, and made an exhibit in the Circuit Court, which after some prior payments, perhaps out of the partnership funds, appeared, by the affidavit of one House, to have been discharged by the payment of this $701 in behalf of Prise. Then the question seems to be, although not so presented, whether the estate of Stoll ought not to have been credited 'by .$400, paid by Stoll to Price, as appears by the receipt of Price, endorsed on the same Coarsen note. But it is very evident that if any error has been committed in regard to this note, and the allowance of the credit in question, the error does not appear on the face of the award or the accompanying paper, but is shown by affidavits, and is a matter of extrinsic evidence. The item certainly appears on the face of the calculation, but that it was improperly allowed to Price, if shown at all, is only made out by the affidavits taken and read on the hearing.

Mr. Justice Whitehead, in the advisory opinion delivered by him in the Supreme Court, seems to assume it as very probable that an error was committed by the arbitrators in relation to this credit. We are far from being clear that the case, as presented to us, will warrant such supposition. We do not know what was before the arbitrators. The inspection of books, the admissions of parties, inferences from facts of which we have no knowledge, or other sources of information hidden from us, may have furnished sufficient ground for their action, even supposing that this .sum of $400 was not in fact carried to the credit of the estate. But it may have been allowed in some suitable mode. The statement referred to, as accompanying the award, was a calculation of the amount due from Price to the estate of Stoll, upon the bond and mortgage given by the former. The calculation states the indebtedness of Price on the bond down to the period of Stoll’s death, when a rest is made. Then occur items of credit, of which this is one: “ Then paid by balance of individual account $141.89.” This item of credit shows that other matters of account between Price and the estate of Stoll had been adjusted to this period, and the balance due him had been carried to his credit on the bond. The calculations which produced this credit are not before us ; but if the estate of Stoll was entitled to the credit of $400, it is quite possible, indeed quite probable, that it was there given. The whole argument, as to the alleged error or mistake, seems to rest upon the assumption that the credit should have been given in a particular mode or in a particular connection. But, if due to the estate of Stoll, it might naturally and properly have been allowed in the mode suggested, and we are unwilling to assume that there is even a prima faeie case shown by the affidavits, the arbitrators themselves not having been examined as to this point.

But the remarks just made upon the merits of the award are rather in answer to the arguments of the plaintiff’s counsel than in connection with the true grounds upon which awards can be set aside, when made a rule of court under the statute. The allegation of error rested for its support upon extrinsic evidence, and the alleged error did not appear either on the face of the award or the accompanying paper, or by the admissions of the arbitrators. To enter upon such a ease into the merits of the award, would be to turn the proceeding under the statute into an appeal from the judgment of the arbitrators. Courts have not been entirely consistent as to the grounds upon which they will set aside awards good upon their face, but we are not aware that any court lias gone to this length. Where there has been no corruption or partiality in the arbitrators, or fraud practised by the party, the award is conclusive, and the court will not take upon itself to inquire whether the arbitrators have judged right or wrong upon the facts; the court will not attempt to correct their judgment upon the facts. Underhill v. Van Cortland, 2 John. Ch. R. 361; Morgan v. Mather, 2 Ves. Jan. 15.

The view taken by the judge who delivered the opinion of the Supreme Court, as to the grounds of setting aside an award, seems to be substantially correct, confining his observations to the case before the court and to the proceedings under the statute. We are not called upon to make any inquiry as to the power of courts of equity, upon bill filed, to set aside an award. The inquiry hero relates to the power of the court under and by virtue of the statute, the submission having been made a rule of court; and iu such case it may be taken for granted that there is no difference whether it be made a rule of a court of law or a court of equity. The only authority in either case, where proceeding by rule, is under the statute, and the only mode of relief is by setting aside the award.

In regard to mistakes in law courts will not interfere, unless it appears that the arbitrators meant to decide according to the legal rule, and had mistaken it; and it must so appear on the face of the award or by the statement of the arbitrators. If arbitrators mean to decide according to law, but mistake the rule in some palpable and material point, in such case the award will be set aside, as not conformable to their real judgment and intention. But, unless they intend to be bound by the legal rule, courts will not withdraw the matter from the tribunal which the parties themselves have selected. The courts will not undertake to inquire whether the conclusion was right or not, unless they can see that, professing to decide according to law, the arbitrators had decided contrary to law. In a late case, in which ah objection, not apparent on the face of the award, was attempted ; to be shown by affidavits, other than of the arbitrator himself, 1 the court refused to interfere with his-decision. Fuller v. Fenwich, 3 C. B. 705.

So as to mistakes in fact, those which can be taken advantage of in this mode are comprised within very narrow limits, and must appear on the face of the award itself or in some authentic shape. They must be such as the arbitrators would admit, as miscalculation in an account, or the like, and certainly unless they appear on the face of the award, or the accompanying paper, must be made out to their satisfaction. In such case, also, the award is not what the arbitrator intended it to be, viz: the result of his judgment. The safe rule seems to be that acted upon by Lord Thurlow, who always required the oath of the arbitrator himself to establish or admit the alleged’mistake.

In a loose sense, the arbitrators may be said to have fallen into an error or mistake when they have judged wrong upon the evidence before'them. But this is not the kind of error or mistake intended, because so far as they have exercised their judgment it is conclusive, though to other minds the result might seem palpably erroneous. The mistake must be of a different character, something which has deceived or misled them, and not a mere mistake in drawing conclusions of fact from observation or evidence. Hall v. Hinds (2 M. & G. 847) was a case of miscalculation made to appear to the satisfaction of the arbitrators, and established by their affidavits, the mistake, though gross, not being apparent on the face of the award. It was considered as a case of mere clerical mistake, by which the arbitrators expressed on the award not the intention of their own minds, but one widely different. But the carelessness was so gross, and the mistake so great, as, according to the opinion of the court, to merit the epithet of misconduct on the part of the arbitrators. The award was set aside. But the courts in England have expressed their disposition to go no farther. In Phillips v. Evans (3 M. & W. 309), the arbitrator made a mistake in not allowing a proper credit, which lie admitted to the party on the error being pointed out to him, and wished the matter referred back to him that he might correct it, though to this the opposite, party objected. The court refused to set aside the award, as the error did not appear on the face of the award, and the arbitrator had not made any affidavit himself admitting the mistake. The court refused to interfere without the oath of the arbitrator. See Pussell on Arb. 295, et seq. (Law Lib. 1849); Watson 281 (Law Lib. 1848); Ward v. American Bank, 7 Metc. 489 ; Boston Water Power Co. v. Gray, 6 Ib. 131, 181; Kleine v. Catara, 2 Gallison 61, 69.

In this case the arbitrators were examined and their depositions taken by the plaintiff in error, but no question was put to them as to the alleged mistake. Under the sound and admission of the error, the court was right in refusing to set aside the award. The whole case is obviously an attempt to review, in this mode, the decision of the arbitrators, and to correct an alleged error in their judgment, without calling upon them to admit or explain the alleged error. To admit such proceeding would be to rehear the merits of the award, and, as before said, it would be in effect an appeal from the judgment of the arbitrators. This the settled decisions of the courts, founded in policy and justice, will never permit. principles to which I have referred, we think, without

One word only remains to be said upon the single remaining point. We see no difficulty as to the final character of the award. The arbitrator, among other things, awarded that Price should pay off and discharge the balance due on a certain bond given by Stoll & Price, and save harmless and indemnify the representatives of Stoll from the same. The award is direct and explicit as to the duty, and the remedy clear in case it was not performed.

Judgment affirmed.

For affirmance — Carpenter and Ogden, Justices Speer, Porter, Sinnickson, and Wall, Judges — 6.

For reversal■ — The Chancellor, Nevius, Justice, and Schenck, Judge — 3. ■

The Chief Justice, Randolph, J., and Judge McCarter did not sit on the argument of the cause.

Cited in Taylor v. Sayre, 4 Zab, 650; Eames v. Stiles, 2 Vr. 495.

See Kent v. Elstob, 3 East 18 acc. Still the rale does not appear to be very clearly settled as to how far extrinsic statements by arbitrators shall be received to impeach their award. See Russell on Arb. 301 (Law Lib. 1849); Ward v. American Bank, 7 Metc, 490 ; Jones v. Boston Mill Co., 6 Pick. 154.