In re Curtis & Castle Arbitration

30 A. 769, 64 Conn. 501, 1894 Conn. LEXIS 50

• Court: Supreme Court of Connecticut
• Decided: July 9, 1894
• Status: Published

Opinion

Andrews, C. J.

Section 1203 of the General Statutes provides that when any persons have submitted any controversy existing between them to the arbitrament of certain persons by them named, on their desiring such submission to be made a rule of court, the same may be entered of record, and a rule made that the parties shall submit to and be finally bound by such arbitration. And it is further provided that “ the award of the arbitrators being returned to and accepted by the court, judgment shall be rendered thereon for the party in whose favor the award is made, to recover the sum awarded to be paid to him, with costs ; and execution shall be granted,” etc.

The acceptance of an award by the court to which it is ■returned, in order that it may become the basis of a judgment, undoubtedly requires an exercise of the judicial will of the court in its favor. To accept, means to receive with approval, to adopt, to agree to. Unless the award does receive such favorable action from the court, no judgment upon it can be rendered and no execution can issue. In cases where there is no objection such favorable action would be given almost as a matter of course. The duty imposed on a court in the acceptance of the award of arbitrators is closely similar to the duty in the acceptance of the report of a committee, or of an auditor, or of a referee. The same word is used by the statutes, and the duties imposed must be substantially the same. That arbitrators are not ofíieers of the court as;are committees, does not change the power or the duty of the court in this respect. The purpose of the acceptance in either case is the same—to establish the award in the one case and the report in the other, as the judgment of the court. In most of the cases where courts are authorized to accept the report of a committee, or other like board, the powerds expressly given to reject it for cause ■—as in the case of a highway committee, § 2715. But the power to accept would seem to carry with it the power to refuse to accept. The former implies the latter. In re Clinton Oyster Ground Committee, 52 Conn., 8; Stebbins v. Waterhouse, 58 id., 370. “Where a submission is made by rule of court, it is competent for the party aggrieved by it, when it is returned to court, and before acceptance, to impeach it, not only for apparent defects, but extrinsic causes. In the case of defects apparent on the award, he can only question it before the acceptance; but if he should not object to it for extrinsic causes before acceptance, especially if he had no knowledge of their existence, he may, after acceptance, file his bill in equity to be relieved against it, on the same ground as where the submission is not by rule of court.” 1 Swift’s Dig., top p. 480. The rule so stated has been followed in this State for many years. Parker v. Avery, Kirby, 353; Lewis v. Wildman, 1 Day, 153; Halsey v. Fanning, 2 Root, 101; Belton v. Halsey, 1 id., 221; Bray v. English, 1 Conn., 498; Fisher v. Towner, 14 id., 26.

This rule requires that for defects apparent on the award the parties can obtain relief only before the acceptance, unless they are such as absolutely to deprive the court of jurisdiction. But for extrinsic causes it permitted a party to obtain relief after the acceptance. As, since the Practice Act, parties are enabled to obtain equitable and legal relief in the same action, there is no reason why a party who seeks to impeach an award for any cause, whether it be apparent on the award or not, should not do so by way of remonstrance to the acceptance. We think this is the better practice and the one which now ought to be followed.

Arbitration is an arrangement for taking and abiding by the judgment of selected persons in some disputed matter, instead of carrying it to the established tribunals of justice; and is intended to avoid the formalities, the delay, the expense and vexation of ordinary litigation. When the submission is made a rule of court, the arbitrators are not officers of the court, but are the appointees of the parties, as in cases where there is no rule of court. In either case the submission names the disputed matter upon which the arbitrators are to adjudge, and often prescribes the principles according to which they are to proceed, and the rules they are to follow in their decision. The submission in the present case does this in an ample manner. It provides that the arbitrators “ shall proceed upon the principle of equity, in hearing the matters in dispute and making their award, it being the desire of both parties that, the matters in dispute between them shall be equitably settled and adjusted so each may have all that is equitably due to him from the other.” Counsel for the appellant, in their brief, speak of this designation of the authority given to the arbitrators as a limitation. We do not so read it. To us it seems rather a liberal and highly’ creditable grant of power. In hearing the matter committed to them and in making their award, the arbitrators are commanded to act upon the principles of equity to the end that each of the parties may have from the other all that he is equitably entitled to. This is not equity in any narrow or limited meaning. It is equity in its broadest and most generous sense. It means good conscience, fair dealing, justice. It is in the spirit of the precept “to live honestly, to injure no man, and to render to eyery man his due.” It is the golden rule, to do by others as we would that others should do by us. It is in the light of this direction to the arbitrators that we are to inquire whether their award should have been set aside for any of the reasons alleged in the remonstrance.

It is to be observed that in the remonstrance the appellant does not charge any willful or intentional misconduct to the arbitrators. Nothing in the nature of fraud, or corruption, or of partiality. He seems rather to have studiously avoided any such charge. He asks the court not to accept the award for the reasons stated “ in respect to which said arbitrators erred and acted improperly in a legal sense.” The reasons of remonstrance are not entirely harmonious. In some respects, indeed, they are inconsistent. And they do not admit of any very accurate classification. But in a general way they may all be brought into these three classes:—

First: That the arbitrators did not make—and refused to make—a finding of the facts on which they based their judgment. If within the term “ finding of facts ” is included a statement of the amounts found due on each of the several claims of the parties, then to this class may be referred the first, second, third, fourth, fifth, sixth, seventh, tenth and eleventh reasons of the remonstrance.

Second: That the arbitrators erred in admitting parol testimony to vary a writing. To this class may be referred the eighth, ninth, twelfth, thirteenth and fifteenth reasons.

Third: That the majority of the arbitrators did not consult with the minority in coming to their conclusion as to some parts of the award. Under this head fall the sixteenth and seventeenth reasons. The fourteenth reason does not come into either of these classes.

There is no rule of law that requires arbitrators to make a finding of facts in the case on which they decide; nor does the submission in this case require them to do so. It seems to indicate the contrary. It directs the arbitrators to award to either party the amount that shall be found due to him in excess of the amount that shall be found owing from him ; not the several sums due to, or owing from each on the separate claims. The court certainly ought not to hold that the arbitrators had acted improperly in a legal sense, and refuse to accept their award, if nothing more was charged against them than that they had omitted some detail which neither the law nor the submission had made it their duty to observe. The award must of course contain that actual decision of the arbitrators which is the result of their consideration of the various matters submitted to them. But it need contain nothing else. The means by which they have come to this conclusion, the reasoning or the principles on which they base it are, unless the submission otherwise requires, needless and superfluous. Morse on Arbitration and Award, 26fi.

The largest claim, measured by the amount of monejq that existed between these parties, was the one made by Castle against Curtis for damages because, as Castle insisted, Curtis had not worked certain new streets, just laid out in Bridgeport, in the manner he had agreed to work them. There was a written contract between them. The controversy turned on the meaning to be given to the expression “ to work a street,” as used in that contract. Curtis claimed that it was a business or a trade term, and that the arbitrators should take judicial notice of its meaning; or, if they were not able to do so, that only expert testimony was admissible to inform them of its meaning. Castle, on the other hand, claimed that the expression was not a trade or business term, but was an expression used by them in the contract with a special meaning, perfectly understood by the parties, and agreed upon by them at the time the contract was made; and offered parol testimony of what that special meaning was. To this Curtis objected, but the arbitrators admitted it.

We understand that there are eases in which parol testimony is admissible to show the contemporaneous understanding of the parties to a contract, of the meaning of the terms used by them in the contract. Thus in Thorington v. Smith, 8 Wallace, 1, it was held competent to show that the parties to a written contract by the word “dollars”’ intended Confederate dollars and not lawful dollars of the United States. This decision was applied and extended in “ The Confederate Note Case,” 19 Wall. 548. In Excelsior Needle Co. v. Smith, 61 Conn., 56-64, it is clearly implied that if the term “needle business ” had been used in a special sense by the parties in their contract, such sense might have been shown by parol. In Macdonald v. Longbottom, 1 Ellis & Ellis, (102 E. C. L.), 978, 'the defendant by a written contract had purchased of the plaintiffs, who were farmers, a quantity of wool which was described in the contract simply as “your wool.” Some time previously a conversation had taken place in which the plaintiffs stated that they had a quantity of wool consisting partly of their own clip and partly of wool they had contracted to buy of other farmers. In an action for not accepting the wool, this conversation was held admissible in evidence for the purpose of explaining what the parties meant by the term “ your wool.” In Shore v. Wilson, 9 Cl. & Fin., 566, the Chief Justice, Tindal, in giving the opinion says :— “ The true interpretation, however, of every instrument being manifestly that which will make the instrument speak the intention of the party at the time it was made, it has always been considered as an exception, or perhaps, to speak more precisely, not so much an exception from, as a corollary to, the general .rule above stated, that where any doubt arises upon the true sense and meaning of the words themselves, or any difficulty as to their application under the surrounding circumstances, the sense and meaning of the language may be investigated and ascertained by evidence dehors the instrument itself; for both reason and common sense agree that by no other means can the language of the .instrument be made to speak the real mind of the .party.” See also Hotchkiss v. Barnes, 34 Conn., 27; Avery v. Stewart, 2 Conn., 69. Cases of this kind are analogous to latent ambiguities. But they are something more than such ambiguities. In these cases the parol testimony is used not only to explain the surrounding circumstances, but also to enable the court to look in upon the mind of the contracting parties and to read the written words of their contract in that very sense in which they wrote them. •

In the sixteenth and seventeenth reasons of remonstrance it is alleged that a majority of- the arbitrators did not consult with the minority in coming to some of the conclusions reached. If these reasons are compared with the eighth, the eleventh, the twelfth and the fifteenth reasons, to all of which reference is made in one or both of them, and with the award which is signed by all three of the arbitrators, :it will appear not only that the majority did consult with the minority, but that the minority had a large share of success in shaping the award.

The fourteenth reason avers only that the arbitrators held certain damages claimed by Castle as not too.remote. This was a matter clearly within their province to decide.

In considering all these reasons of remonstrance, we have not failed to be impressed with the fact that the real grounds of objection are several times repeated, with changed, circumstances and with varying language, and that they are urged with a minute and technical insistence which differs widely from the confident and liberal tone used by the parties when they committed the controversy to their own chosen tribunal. If we have not given attention to all of them and in detail, it is because we think that so far as they are not a.nswered by what we have said they fall clearly within the authority conferred by the submission on the arbitrators, and that the decision of the arbitrators is final.

None of the reasons of the remonstrance assert that the award is not within the submission. It is not pretended that the arbitrators failed to act on all the claims submitted to them, or that they undertook to act on any matter not submitted. The uniform rule of decision has been in this State that in such eases a court of equity will not set aside an award except for partiality and corruption in the arbitrators, mistakes on their own principles, or fraud or misbehavior in -the parties. Allen v. Ranney, 1 Conn., 569; Brown v. Green, 7 Conn., 586; Fisher v. Towner, 14 Conn., 30; Bridgeport v. Eisenman, 47 Conn., 37.

“ In general, arbitrators have full power" to decide upon questions of law and fact, which directly or incidentally arise in considering and deciding the questions embraced in the submission. As incident to the decision of the questions of fact, they have power to decide all questions as to the admission and rejection of evidence, as well as the credit due to evidence, and the inferences of fact to be drawn from it. So, when not limited by the terms of the submission, they have authority to decide questions of law, necessary to the decision of the matter submitted; because they are judges of the parties’ own choosing. Their decision upon matters of fact and law, thus acting within the scope of their authority, is conclusive, upon the same principle that a final judgment of a court of last resort is conclusive ; which is, that the party against whom it is rendered can no longer be heard to question it. It is within the principle of res judicata; it is the final judgment for that case, and between those parties. It is amongst the rudiments of the law, that a party cannot, when a judgment is relied on to support or to bar an action, avoid the effect of it by proving, even if he could prove to perfect demonstration, that there was a mistake ot' the facts or of the law. * * * But when parties have, expressly or by reasonable implication, submitted the questions of law, as well as'the questions of fact, arising out of the matter of controversy, the decision of the arbitrators on both subjects is final. It is upon the principle of res judicata, on the ground that the matter has been adjudged by a tribunal which the parties have agreed to make final, and a tribunal of last resort for that controversy ; and therefore it would be as contrary to principle, for a court of law or equity to re-judge the same question, as for an inferior court to re-judge the decisions of a superior, or for one court to overrule the judgment of another, where the law has not given an appellate jurisdiction, or a revising power acting directly upon the judgment alleged to be erroneous.” Shaw, Ch. J., in Boston Water Power Co. v. Gray, 6 Met., 165, 166.

There is no error in the judgment complained of.

In this opinion the other judges concurred.