Wallis v. Carpenter

95 Mass. 19

Opinion

Chapman, J.

Footnotes

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The plaintiff declares on two contracts. That which Reuben Carpenter signed is a sealed contract, and that which Simon Carpenter signed is not under seal. Moreover, the terms of the two contracts differ. Reuben Carpenter’s contract binds him and the plaintiff mutually to submit the controversy therein mentioned to the award of certain arbitrators, and contains several stipulations in regard to the hearing. Simon Carpenter’s contract omits these stipulations, and is a mere guaranty of performance of the award. It would be a strained construction of Gen. Sts. c. 129, § 4, to hold that they authorize the joinder, in one action, of parties to contracts so different in their nature and their terms. The court are of opinion that these defendants are improperly joined, and that the plaintiff must discontinue as to one of them.

But the defendants contend that their submission was revoked, and that therefore neither of them is liable to perform the award. A submission to arbitrators is a power; and it is generally true that a power may be revoked at any time before execution. It has always been held that a submission of this character may be revoked. Milne v. Gratrix, 7 East, 607. Green v. Pole, 6 Bing. 443. Allen v. Watson, 16 Johns. 205. Frets v. Frets, 1 Cow. 335. But when the submission is under seal, the revocation must also be under seal. Van Antwerp v. Stewart, 8 Johns. 125. Brown v. Leavitt, 26 Maine, 251. The same rule applies to it in this respect as to any other power of attorney. In this case the revocation was not under seal, and therefore it was ineffectual.

The defendants also object that one of the arbitrators was a creditor of the plaintiff, and therefore was not impartial. But for aught that appears the debt may have been very inconsiderable ; or it may have been well secured; or the plaintiff may be in such circumstances that the decision of this case may not appreciably affect his ability to pay the debt; and therefore there is no established fact which authorizes the suggestion that the existence of the debt creates partiality.

A further objection to the award is made on the alleged ground that the proceedings of the arbitrators were irregular in respect to the submission and award between these parties and Drury. On a careful examination of these proceedings, they appear to be regular and proper. Carpenter and Wallis made their agreement of submission June 1st 1864. Its object was to settle all matters growing out of the partnership which had existed between them. But in the course of the hearing it was found that this could not be done without first settling certain matters of dealing that had taken place between them and Drury. Accordingly, on the 15th of June they and Drury referred those matters to the same arbitrators, who heard them and made an award which merely settled the balance due from them to Drury. This being done, the arbitrators proceeded to determine which of these parties should pay that balance; and their award, which was made the next August, covers the whole subject. It accomplishes the whole object of the original submission, and nothing more.

The court are of opinion that the plaintiff is not entitled to recover more than the amount of the award, even as against Reuben Carpenter. In his agreement the sum of fifteen hundred dollars is mentioned as liquidated damages. But in Shute v. Taylor, 5 Met. 61, the court say, “ It is not always the calling of a sum, to be paid for the breach of contract, liquidated damages, which makes it so. In general, it is the tendency and preference of the law to regard a sum, stated to be payable if a contract is not fulfilled, as a penalty, and not as liquidated damages ; because then it may be apportioned to the loss actually sustained.” See also Fisk v. Gray, 11 Allen, 132. In this case the contract of Simon Carpenter calls it “ the penalty of fifteen hundred dollars; ” so that as to him there is no ground to call it liquidated damages; and in Reuben Carpenter’s contract it is stipulated that the party neglecting or refusing to perform the award “ shall forfeit to the other party ” that sum. Forfeiture is in the nature of penalty ; and, looking at both contracts and the object to be secured by them, we think a penalty was intended. It would be extremely harsh to regard it as liquidated damages, because there are a variety of things to be done under the award, especially by the defendants; and it would be difficult to perform all of them without such delay as might be held to amount to negligence.

Upon amending his writ, the plaintiff may have such judgment upon the award as ne is entitled to by the principles herein -stated.

Wells, J., did not sit in this case.