Murtaugh v. American States Insurance

Brown, P. J. Plaintiff applied to the Common Pleas Court of Cuyahoga County, Ohio, for confirmation of an award of arbitration. It is not disputed that a contract of insurance existing between the parties contained this clause: “Arbitration — Part IY: Disagreement between any person making claim hereunder and the company as to either the legal liability of the owner or operator of the uninsured automobile or the amount of payment for damages owed by such owner or operator shall, upon written demand of either, be settled by arbitration in accordance with the rules of the American Arbitration Association. Judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof. Each party agrees to be bound by the decision of the arbitrators.” Defendant objected to confirmation of the award and petitioned to vacate the award stating that the arbitrators exceeded their powers; that the contract which provided for arbitration limited the subject matter for arbitration to: (1) Legal liability of the owner or operator of the uninsured automobile; and (2) extent of money damages owed by the uninsured motorist. Defendant states that the dispute or disagreement is not in either of these areas, thus admitting the legal liability of the uninsured motorist and the extent of money damages owed by the uninsured motorist. Defendant further states that the dispute arises because of language in its policy of insurance. This language is: ‘ ‘ Other insurance. If an insured is injured while occupying an automobile not owned by the named insured, this insurance shall be excess over any other similar insurance available to [269] him but only in an amount by which this insurance exceeds the sum of the limits of all other similar insurance available to him.” Defendant claimed and offered proof that the insured was injured while occupying an automobile not owned by the named insured, and that similar other insurance in amount of $5,000.00 was paid to insured under such other policy. Defendant further claims limit of this policy is $5,000.00, resulting in no excess, hence no coverage. The trial court confirmed the award thus concluding that the arbitrators had not exceeded their authority. Arbitration clauses are of two types: Unlimited clauses providing for arbitration of any kind and all disputes arising out of a contract; and limited clauses providing for the arbitration of specific type of dispute arising out of contract. Williston on Contracts, Revised Edition, Volume 6, page 5383. Such clauses are referred to as “particular” or “general.” Rosenbaum v. American Surety Co., 229 N. Y. S. (2d), 375. The clause in question is a limited type clause, a “particular” type clause. Obviously, if such a policy is lapsed, at the time of accident, the award made by the arbitrators is void. If such a policy provides limits of $5,000.00, an award in excess of that amount is void to the extent it exceeds limits. Likewise when such a policy provides that coverage is limited to the amount by which this insurance exceeds the sum of the limits of all other similar insurance available, and it does not, then there is no sum out of which an award may be made. An award would exceed the policy limits and would be void. Clearly, under the language of the contract, coverage questions are not arbitrable. The defendant proposed in good faith that such a defense exists. Whether it does was not left to arbitration by the policy, nor submitted to the trial court on these pleadings. Berman v. Travelers Indemnity Co., 171 N. Y. S. (2d), 869 (1958); Ross v. Hardware Mutual Casualty Co., 173 N. Y. S. (2d), 941 (1958); Rosenbaum v. American Surety Co., 11 N. Y. (2d), 310, 229 N. Y. S. (2d), 375. The arbitrators may decide only those matters submitted to them by the agreement of the parties. No one is under a duty to resort to arbitration unless by clear language he has [270] so agreed. Lehman v. Ostrovsky, 264 N. Y., 130; 190 N. E., 208. Only the two specific issues agreed to be arbitrated can be arbitrated. All other questions of law and fact were not submitted. In making an award in any amount against the defendant company the arbitrators exceeded their authority. The court of common pleas should have vacated the award under Section 2711.10 (D), Revised Code, which provides: “In any of the following cases, the court of common pleas in the county wherein an award was made in an arbitration proceeding shall make an order vacating the award upon the application of any party to the arbitration if: * * * “(D) The arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made. * * The finding that the arbitrators exceeded their authority merely vacates the award and does not under these pleadings determine the question of interpretation of the “other insurance clause” or its applicability to the facts in this case, or the defendant’s ultimate liability or non-liability thereunder. These questions must be otherwise determined since they were not submitted to arbitration by agreement of American States Insurance Company. Judgment reversed and final judgment for the defendant. Younger, J., concurs. Fess, J., dissents.