Muldrow v. Norris

Field, J., delivered the opinion of the Court—Baldwin, J., concurring. The submission of the parties embraces all matters of controversy existing between them, previous to December, 1850. What those matters were the submission does not state ; it only recites that they were various, and that the agreement was entered into “ for the purpose of having the same speedily and properly adjusted.” From its language it must be inferred that the parties stipulated to withdraw their several matters of difference from the consideration of the ordinary tribunals, upon the condition that they should be all adjusted and — 339 — settled by Judges of their own selection, and full peace be thus obtained, and not mere partial freedom from litigation. The rule is general, that arbitrators must pass upon all matters submitted, or their award will be invalid. If several matters are specified in the submission, and the award does not disclose that each is determined, it is defective on its face, and can be set aside on motion. But if the submission is general, of all matters in controversy, without specification it is not necessary that the award should embrace any matters except those which are laid before the arbitrators. These last, however, must be passed upon, or the award will be void in toto, and be set aside upon a proper showing of the omission. The authorities to this effect are numerous and decisive. Thus, in Randall v. Randall, 7 East. 81, the submission embracéd three subjects : one to determine all actions between the parties ; another to fix the value to be put upon hop poles and potatoes in certain land; and the third, to ascertain the rent to be paid for other land. The arbitrators made their award upon the first two subjects, but omitted to notice the last, and the Court held that the whole award was vitiated by the omission. “ The authority,” said Ellenborough, C. J., given to the arbitrators, was conditioned, ita quad they should arbitrate upon these matters by a certain day. If, then, they fail as to one of them, the condition has not been performed upon which the award was to have its obligatory effect; and here they have stopped short, and have omitted to settle one of the subjects of difference which was stipulated for. This is not like the case where an award, being good in part and bad in part, the good part shall not be vitiated by the arbitrator having also directed something to be done which is superfluous and bad. But here the very condition on which the parties submitted to the award has failed.” And in the same case, Le Blanc, J., said : “ The contract of the parties is in effect this—One says that he will submit to the arbitrators to ascertain what he is to pay for the hop poles, etc., upon condition that it shall also be referred to them to decide what rent is to be paid for certain land. And he may fairly have said that unless both those matters of difference were referred he would not refer either of them singly. If, then, the arbitrators omit to decide one of them, the condition fails on which the reference was agreed to.” — 340 — In Mitchell v. Stavely, 16 East. 58, to the action on an arbitration bond the defendant pleaded, among other things, that a certain matter of difference between the parties was laid before the arbitrators, but was not included in their award, and the Court held the plea good. The submission was of all matters in difference, and Ellenborough, C. J., said : “ The award, therefore, is not only not final, but there is no award at all respecting one of the matters in difference referred, which is stated to have been notified to the arbitrators. It was a condition of the submission that they were to award upon all matters in difference between the parties. That is an important difficulty, against which the plaintiff has to contend, and it would be to no purpose to amend the pleadings.” To the same effect is the case of Wright v. Wright, 5 Cowen, 197. That was an action upon an arbitration bond conditioned to abide the award of certain arbitrators, upon the usual general submission, with the ita quad clause. The defendants pleaded that the arbitrators left undetermined a controversy between the parties which was brought to their notice; and, on demurrer to the replication to the plea, the Court, per Sutherland, J., said : “ It is a general rule, that where the bond of submission contains an ita quad clause, the award will be void, unless it comprehend ah the matters submitted. This rule is invariable where the particular matters submitted are specified in the bond. But where the submission is general, and an award concerning one or more things is made, it will be presumed, until the contrary is shown, that nothing else was referred to the arbitrators, or brought before them by the parties. But if the arbitrators award in relation to one or more things, and say that they will not meddle with the rest, the whole is void, because they have not pursued their authority; and in such a case it is immaterial whether the submission was general or special, for, if general, it appears on the face of the award that the arbitrators had notice of the matters which they refuse to decide.” The submission or bond in the several cases cited contained an ita quad clause; and this fact is considered as distinguishing those cases from the one at bar. The ita quad clause, so called, is only a condition that the award should be rendered upon the matters submitted by a specified day. The designation of the day is one part of the condi — 341 — tian essential to be complied with, but not more so than the other part, that the award should be upon the matters submitted. In the cases of Mitchell v. Stavely, 16 East., and Wright v. Wright, 5 Cowen, the award was rendered within the time designated, and the decisions were made upon the omission of the arbitrators to pass upon all the items specified in thé submission, or laid before them under its general terms. The same was evidently the case with the award in Randall v. Randall, 7 East., as the objection taken was not to the time the award was rendered, but that one of the three subjects submitted was left undetermined. See, also, Brown v. Merrill, 4 Eliz., Dryer, 216; Bisden v. Inglet, 2 Croke, Eliz., 838; Ormelade v. Coke, 4 Croke, Jac., 354 ; Bradford v. Bryan, 7 Mod. 349. The point, then, of the decisions, so far as that part of the ita quad clause is concerned which affects the present case, is this : that if the submission provide that an award upon the matters submitted be made, or the condition of the bond be that the parties are bound, provided the award of such matters be made, then such proviso extends to all the matters submitted, and operates to render the submission conditional, and the award binding only in case the arbitrators pass upon every subject, either specifically referred to them, or brought to their notice under the general terms of the submission. The language of the submission of the parties in the case at bar, is much stronger that the award must embrace all the matters in controversy, than the usual formal ita quad clause, “ so that the award be made of the premises,” etc. It recites that there are “ various matters of differencethat for the purpose of “ having the same speedily and properly adjusted,” the parties have agreed to submit “ all matters of difference, suits, actions,” etc., to the arbitrators “ to determine ths same;” that the award “upon the matters heretofore submitted,” shall be final and conclusive, and that they will “ abide the same,” and that they authorize a confession of judgment “ upon said award; and, as if to avoid any misconstruction, the parties further declare that “ the submission is intended to embrace all actions or suits upon which judgments may have heretofore been entered, as well as suits or actions now pending, and causes of action and other matters of difference,” etc. Nothing can be clearer than that the parties contemplated an — 342 — award upon all the matters submitted ; and not an award upon a portion only of such matters. We have noticed the objections of counsel to the absence of the ita quad clause, because the old authorities give force to its presence. We do not think its absence or presence of any moment, or that its presence would, in any respect, vary the construction of the submission. The distinctions drawn by the old cases upon this point, are more subtle than just. See Bisden v. Inglet, 2 Croke Eliz. 838, and, as far back as 1741, Chief Justice Willis observed, in Bradford v. Bryan, 1 Willis, 270, that if it were not for the cases he should be of opinion that, when all matters are submitted, though without the condition of the ita quad clause, all matters must be determined ; assigning as the reason that it was plainly not the intent of the parties that some matters only should be determined, and that they should be left at liberty to go to law for the rest. At the present day the distinctions are not regarded, and the construction given to a general submission is not controlled by the ita quad clause. “ These nice distinctions,” says Sergeant Williams, in a note to case 6 of Saunders, ££ are now disregarded; Courts of justice being at present more liberal in the construction of awards than formerly. And, therefore, an award may be good, though made of less than is contained in the submission; as if the submission be of all actions, trespasses, demands and controversies, and the award be made of same only, the award is good ; for no more shall be presumed to have been, made known to the arbitrator. But if, in fact, other causes of action in being were made known to the arbitrator, then such award would be had, as well where the submission is conditional with an ita quad, as where it is absolute.” 1 Barr, 277 ; Hawkins v. Colclough, 1 Bac. Abr. 141. “ Usually, in submission,” says Watson on Arb. 17, “ to arbitration, there is introduced a condition—‘ so as the award be made of and upon the premises ’—which, from the first words, is called the ‘ ita quad.’ Where the submission is made with an ‘ita quad,’ it has always been holden that, if the arbitrator do not make his award of all the matters submitted to him, and whereof he had notice, the award is entirely void. But, where the submission is without an £ ita quad,’ an award of one of several matters submitted to the arbitrator — 343 — was formerly considered good. This distinction between general and conditional submissions runs through all the old authorities. This distinction does not now prevail to that extent; indeed, it has been considered by high authority, that it would not now be holden that, where all matters in difference are submitted, though without an ‘ ita quad,’ the arbitrator must make his award of all matters submitted to him, and whereof he has notice, otherwise the award would be entirely void. The effect of this condition has, in a modern case, been much considered by the Court of Exchequer. That Court there laid it down that it always depends on the true construction of the submission whether it is necessary to the validity of an award that it should embrace all matters referred. Where the submission is with an ‘ ita quad,’ it is requisite that all matters should be disposed of by the award; but, if the submission is without such a condition, then the whole submission is to be looked to in order to ascertain whether it was the intention of the parties that all matters should be embraced by one award.” Regarding, then, the submission of the parties as conditional, and their agreement as one to abide an award upon all the matters submitted, and not an award upon a part, only, of such matters, we proceed to consider the consequence to the case at bar. The award rendered shows that three matters were laid before the arbitrators, and passed upon by them. Other matters in dispute may also have been considered, but whether so or not is immaterial. Three were passed upon— one a claim for damages growing out of a breach of a lease ; another a claim for damages for the refusal of the defendant to furnish thirty head of cows and calves; and the third, the claim for damages for interference with a certain ferry on the American river. Upon the first claim the arbitrators allowed $13,500; upon the second $6,000; and upon the third $4,000; making in all $23,500. For this sum judgment was confessed by the arbitrators under a provision in the submission in favor of Muldrow, and against Norris, in the District Court. This judgment the defendant moved to set aside; the District Court denied the motion, but this Court, on appeal, held the ruling of the District Court erroneous, and reversed the judgment. Upon its reversal, the present action was brought upon the award. The reversal was ordered for the error committed by the arbitrators, and — 344 — apparent upon the face of the award in estimating the amount of damages for the breach of the lease. The calculation was based upon the fact that the product of twenty acres of land was worth $9,000, from which the arbitrators inferred the product of two hundred .acres would have been worth $90,000. The damages thus estimated, said the Court, were too remote and speculative, and involved too many contingencies ; that the rule adopted was clearly illegal, and an award rendered upon such a basis was unconscionable. It is to be observed that the Court did not decide that Muldrow was not entitled to any damages for the violation of the lease, but only that the rule adopted by the arbitrators for the estimation was illegal. The award then stood precisely as though one and the main item submitted had never been passed upon. The award had not effected the purposes of the submission—settled all matters of controversy between the parties. Muldrow’s claim for damages was still left undetermined, and the only consideration which could have moved Norris to enter into the submission and to stipulate to abide the award had failed. Muldrow could still have sued for the damages for the violation of the terms of the lease. His release does not affect the question. That was executed upon the direction of the arbitrators, and was based upon the supposition that the award was to stand, the judgment confessed thereon to be enforced, and a release from Norris to be given. It could not avail in any respect as a defense to an action for the breach of the lease. The case, then, stands precisely as though the arbitrators had never considered the item, and in this view there is no question that the whole award is vitiated. See cases cited above, and particularly Bradford v. Bryan, 1 Willis, 268. An useless and invalid determination upon one item properly presented within the general terms of the submission, must, on principle, be as fatal to the entire action of the arbitrators as an omission intentional, or unintentional, to notice the item at all. This is not a case within the doctrine that an award may be good in part and bad in part. That doctrine only applies to instances where there has been an excess of power in the arbitrators by their attempting to determine matters not submitted, or where there is uncertainty or illegality in an independent and distinct matter forming no consideration for other parts of — 345 — the award, and the settlement of which could not have contributed to induce the arbitration. It is not, and never has been law, that in any other instance upon a submission of several matters, or in a general submission upon the proper presentation to the arbitrators of several matters, an award upon a part was good. “In aE cases,” says Watson on Arb. 243, “when an award, void in part, maybe supported for the residue, it must always be understood that it does not appear that the arbitrator has omitted to make his award of some matters submitted to him; for in that case, if the void part were one of the matters in controversy, and that was bad for uncertainty or otherwise, the award would be void in toto, as the arbitrator had not made his award upon all matters referred to him. The principle upon which it is so held, is, that the consideration for which the party submitted was, that the arbitrator should make an award of all matters in difference, and which consideration has failed.” It follows, from the views we have taken, that the award, as left after the decision of this Court reported in 7 Cal. 74, was insufficient to support the present action, and the bond of the defendant to abide such award falls with it. Judgment reversed.