In re the Arbitration between the Board of Education, Union Free School District No. 7 & Heckler Electric Co.

166 N.E.2d 666, 7 N.Y.2d 476, 199 N.Y.S.2d 649, 1960 N.Y. LEXIS 1372
CourtNew York Court of Appeals
DecidedMarch 31, 1960
StatusPublished
Cited by23 cases

This text of 166 N.E.2d 666 (In re the Arbitration between the Board of Education, Union Free School District No. 7 & Heckler Electric Co.) is published on Counsel Stack Legal Research, covering New York Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re the Arbitration between the Board of Education, Union Free School District No. 7 & Heckler Electric Co., 166 N.E.2d 666, 7 N.Y.2d 476, 199 N.Y.S.2d 649, 1960 N.Y. LEXIS 1372 (N.Y. 1960).

Opinions

Fuld, J.

On January 3,1956, the respondent Board of Education entered into a contract with Heckler Electric Company for the electrical work in the Junior and Senior High Schools which were to be constructed at Great Neck, New York. This contract was made ‘ ‘ pursuant to the provisions of the Education Law” and subject to annexed “General Conditions”. These “ General Conditions” provide that “the Architect shall, within a reasonable time, make decisions on all claims of the Owner or Contractor and on all other matters relating to the execution and progress of the work or the interpretation of the Contract Documents ” and that arbitration may be had either upon the architect’s decision or upon his failure to make a decision within 10 days after the parties have presented their evidence. Notice of the demand for arbitration must be made within 10 days after receipt of the architect’s decision, or, if the architect fails to make a decision, within a reasonable time after the dispute has arisen.

According to its contract, Heckler was required to perform its work “ as construction progresses and not later than — in accordance with the progress of the General Contractor ”. And under the general construction contract, reference to which is made in Heckler’s contract, July 31, 1957 was established as the completion date. Furthermore, Heckler’s contract, as well as [480]*480those of all the other contractors, requires that the contractor for general construction and all other contractors and subcontractors “ coordinate their work with adjacent work and coordinate with other trades so as to facilitate general progress of work”; it also provides that, “ in event of any dispute arising as to possible or alleged interference among various Contractors which may retard progress of work, same shall be adjusted by Architects whose decision as to parties at fault and as to manner in which matter may be adjusted shall be binding and conclusive on all parties ”, The final relevant contractual provision bind ing on all of the contractors is that under which the Board of Education is empowered to compel progress toward timely completion through the exercise of a termination clause against any contractor who fails “to prosecute the work or any part thereof with [sufficient] * * * diligence ” or otherwise substantially violates any of its contractual obligations.

In April of 1957, Heckler wrote a letter to the board in which it complained that the work of the general contractors was “ slow, sporadic and lax” and had been “ permitted [by the Board of Education] to lag” and requested an extension of time under their contract. In July of 1958, and again in August of 1958, Heckler wrote letters, this time addressed to the Board of Education as well as to the contract architects, claiming that it had ‘ been substantially delayed in the performance and completion” of its work as a result of “the failure of [the board] to coordinate the work of the several contractors and by acts of the other contractors ”; it estimated its damages as a result of this delay as $312,477.28 and made a claim against the board in that amount invoking the contractual provision for a determination of its claim by the architects.

No decision having been made by the architects, Heckler, in early September, 1958, made a demand for arbitration in which it advanced two claims: (1) $312,477.28 as damages sustained by reason of “ delays of and interferences in the performance of work * * * by reason of acts of the Board of Education, the failure of the Board of Education to coordinate the work of the several contractors performing work at the site of the project involved and the acts óf the other contractors ” and (2) $11,979.67 for extra work. About two weeks later, the board moved for a stay of arbitration, alleging that, first, there had not [481]*481been compliance with the notice provisions of section 3813 of the Education Law;1 second, the primary claim set forth in the demand for arbitration is not arbitrable under the contract between the board and Heckler; and, third, the primary claim in the demand for arbitration is “so indefinite, uncertain and vague as to make it an improper submission for arbitration The court at Special Term denied the requested stay, but the Appellate Division, two justices dissenting, reversed and granted it, assigning as the primary ground for reversal Heckler’s failure to comply with section 3813.

Before considering whether section 3813 is applicable to arbitration proceedings and, if it is, whether it bars Heckler’s right to arbitration in this case, we must determine whether the applicability of the section is to bo decided by the court or by the arbitrators. In our opinion, it is clearly the kind of issue for the court to pass upon, involving as it does a condition precedent to Heckler’s very right to arbitration and the arbitrator’s very jurisdiction.

Although, on occasion, this court has used very broad language to the effect that “ the only issues a court may deal with on * * * [an application for a stay of arbitration] are as to ‘ the making of the contract or submission or the failure to comply therewith’” (Matter of Paloma Frocks [Shamokin Sportswear Corp.], 3 N Y 2d 572, 574; see, also, Matter of Lipman [Haeuser Shellac Co.], 289 N. Y. 76, 80), we did not mean thereby to suggest that the arbitrator possesses the power to decide whether the conditions precedent to the institution of the arbitration proceeding itself had been fulfilled. In fact, in Matter of Lipman (Haeuser Shellac Co.) (289 N. Y. 76, supra), where the matter of the cancellation of a contract of arbitration [482]*482was held to be an issue for the arbitrators rather than the court, we expressly noted that a different question would be here * * * if there were any conditions precedent ” (p. 79). And in Matter of Cauldwell-Wingate Co. (New York City Housing Auth.) (287 N. Y. 853), in which an application to compel arbitration was denied on the ground that the petitioner had failed to demand arbitration within the time prescribed by the contract, it was this court’s view that the contract itself made compliance with its “ time ” provisions a condition precedent to arbitration, with the consequence that failure to act within the specified time deprived the petitioner of its right to arbitration. (See, also, Matter of Levine Bros. Iron Works Corp. [Constitution Sg.], 279 App. Div. 912, motion for leave to appeal denied 304 N. Y. 986; Matter of Ketchum & Co. [Allied Trades Council], 20 Misc 2d 736; Matter of Shine’s Restaurant [Waiters & Waitresses Union], 20 Misc 2d 737; Matter of Mark Cross Co. [Ellis], 15 Misc 2d 947, 949-950; Boston Mut. Life Ins. Co. v. Insurance Agents’ Int. Union, 258 F. 2d 516, 522.)

Section 3813 of the Education Law provides, in effect, that no action or special proceeding may be maintained against a school district or board of education ‘ ‘ unless it shall appear * * * that a written verified claim upon which such action or special proceeding is founded was presented” to the district’s governing body “ within three months after the accrual of such claim ”. This unquestionably constitutes the making of a claim to the school district within three months after its accrual a condition precedent to an action or special proceeding.

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Bluebook (online)
166 N.E.2d 666, 7 N.Y.2d 476, 199 N.Y.S.2d 649, 1960 N.Y. LEXIS 1372, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-the-arbitration-between-the-board-of-education-union-free-school-ny-1960.