Sherron v. Wood

Ewing, C. J. The questions in this case arise upon demurrers filed by the plaintiff to two of the defendant’s pleas. The action is brought on an arbitration bond, under which the arbitrator has made an award in favor of the plaintiff. In the fourth plea, the defendant says, that “ he was by the arbitrator denied the privilege of hearing and examining witnesses, relative to the accounts in controversy, and that the arbitrator heard the plaintiff and examined his witnesses, ex parte, in the absence of the defendant and without notice to him to be present and attend at such hearing and examination. In the fifth plea, he alleges that the arbitrator in restating and settling his accounts and making the award,, committed great errors and mistakes in law..and fact.” The demurrers to these pleas are well taken. Misconduct of an arbitrator cannot be pleaded or set up as a defence to an action at law upon an arbitration bond. The same rule prevails with respect. to error or mistake of law or fact, in making aa award which does not appear upon the face of it. How far these rules are the most jadicious which might have been devised, and why an injured party should be compelled to seek relief in such'cases, in a Court of Chancery, are not admissible.topics of inquiry; we are not to speculate, perhaps very erroneously, in such matters; we are to carry into effect the rules as we find them established. Periculosum est res novas et inusitatas inducere. In the case of Veale v. Harner, I Saund. 326, the action was in debt on a bond conditioned for the performance of an award. Saunders, who was the counsel for the defendant, and considered it a case of the greatest hardship on his client, compelled the plaintiff to discontinue his action by a very subtle plea, for which, as a trick in pleading, he was reprehended by the court, but did not plead or set up by way of defence “ bad practice of the plaintiff with the arbitrators.” Afterwards however, the defendant filed a bill on the equity side of the court of Exchequer, disclosing this bad practice and had relief against the award. Serjeant Williams in his note on this case, very justly says, “ Hence it seems to follow, that to an action of debt on bond for not performing an award or to an action on the award Itself, the defendant cannot plead collusion or other misconduct — 13 — of the arbitrators in avoidance of the award. For as such a plea would in the principal case, have been supported by the facts, it may be pronounced with absolute certainty, that so able a lawyer as Saunders is known to have been, would have stated the facts in a defence to the action and not had recourse to the unworthy trick, for which he was so justly censured, if the plea could have been supported in point of law. And there seems to be no case or doctrine where a plea of this sort has been held to he pleadable, or a precedent of such plea to be found in any of the books of entries.” In Wells v. Maccarmick, 2 Wils. 146, which was an action of debt on an award, the court said there never was an instance where evidence of partiality and corruption in the arbitrators was permitted to be given; that a jury in a special verdict cannot find any matter of fact dehors the award; and by parity of reasoning nothing dehors the award, as partiality is, can be given to them in evidence; that in a trial at •law this matter of partiality and corruption can never be got at; that there is no case where this matter has ever been pleaded, and that the remedy in this case is in equity, or by action at law, against the arbitrators, if they have been corrupt. It may be proper here to mention, that jn the chancery books are a multitude of cases in which awards have been relieved against by that court on the grounds of partiality, corruption and misconduct in the arbitrators. 2 Vern. 251. Ibid 157. 5 Vez. 70. 3 Wen’s 362. 2 Vern. 514. 1 Vez. jun. 369. In Braddick v. Thompson, 8 East. 344, to an action of debt on an arbitration bond, after oyer, the defendant pleaded that the arbitrators did not before making the award, appoint any lime for hearing the defendant or his witnesses or proofs; that the award was made without hearing any witness or proofs on behalf of the defendant, and without giving him an opportunity of producing any witnesses, or of examining or observing on the plaintiff’s witnesses and proofs; the plaintiff demurred. Upon the argument, the court suggested that this matter could not be pleaded in bar nor serve otherwise, than as ground on which to have applied to the equitable jurisdiction of the court, for the purpose of setting aside the award; the demurrers were susstained and judgment was given for the plaintiff. In Chicot v. Laqueene, 2 Vez. sen. 315, Lord Hardwicke said he knew no case of a defence at common law, in an action brought on as — 14 — award by corruption. In Swingford v. Burn, 1 Cow. 5, Dallas. C. J. held in action on an award that the defendant had no right to unravel the accounts exhibited to the arbitrator and dispute the validity ofhis award. In Newland v. Douglas, 2 John, Rep. 62, the court say ; a Court of Chancery may correct a palpable mistake or miscalculation made by the arbitrators, or relieve against their partiality or corruption. But, there is no such remedy at law in a case of submission, not within the statute. In Barlow v. Todd, 3 John. 368, Spencer, 3. deliver» ing the opinion of the court said: it is now well established,, that at law nothing dehors the award invalidating, it can be pleaded or given in evidence to the jury. The arbitrators are judges chosen by the parties themselves, and their awards are not examinable in a court of law, unless the condition is to be made a rule of court,' and then only for corruption or gross partiality. Courts of law cannot listen to suggestions contradicting' the award or impeaching the conduct of the abitrators. In Cortlandt v. Underhill, 2 John. Ch. Rep. 366, Chancellor Kent, says: the courts of law have always been averse to grant any relief in these cases, and the injured party was obliged to resort to equity. In an action at law on an award, even the corruption or misconduct of the arbitrator is no defence. In Mitchel v. Bush, 7 Cowen, 187, it was held, that where a matter is submitted to arbitrators by the more act of the parties without being made .a rule of court, it is no ground of objection to their award in atl ■ action to enforce it, that it is against law. Kyd, in his treatise on awards, 226, says: when the submission is by the mere act of the parties, ’«he defendant caniiot make extrinsic circumstances a defence to an action on the award or submission bond. In this respect he says, the Roman law is somewhat different from ours; for though it provides no direct method, by which the party against whom the award is made, can impeach the con» duct of the arbitrators, yet by a rescript of Antoninus it is provided, that the enmity of the arbitrators to the defendant, may be set up as a defence against the plaintiff’s action for the penalty expressed in the submission. With us, in such a case, the only relief is in equity, which often sets aside awards and gives that, kind of relief that seems naturally to arise out of the circumstances, as by directing accounts or granting injunctions to stay ,all legal proceedings which had been pursued on the — 15 — foundation of the award being good. Caldwell says, the tiefendant .cannot plead to an action on the submission bond, partiality or improper conduct .of the arbitrator. Cald. on arbit. 203. 177. Chitty says: partiality or improper conduct in an arbitrator in making the award without hearing the defendant and his witnesses, cannot be pleaded at bar to an action on the bond conditioned for the performance of the award, but is only matter of application to the equitable jurisdiction of the court to set aside the award. 2 Chitty 477. The case of Harker v. Hough, 2 Halst. 428, does not at all conflict with these cases and principles. There the arbitrators had refused to consider one of the matters submitted to them, and of which they had notice ; and the court hold that the award was anuUity, and that the defendant had availed himself of it in a legal manner. It was in effect a plea of no award 5 for the arbitrators had not pursued their authority, and had not made the award contemplated in the submission. The same principle was pursued in the case of Mitchell v. Stavely, 16 East 58. it was held a good plea in bar to an action on ea submission bond of ail matters in difference, that there was a particular matter in difference at the time of making the bond, of which the arbitrators had notice, but had omitted to' make any decision thereon. Lord Ellenborough said: the award, therefore, is not only not final, but there is no award at all respecting ono of the matters in difference referred. It was a condition of the submission that they were to award upon all matters in difference between the parties.. The ground on which these eases stand is, not that the award was bad fur misbehaviour of the arbitrators, but there was actually no award within the terms of the submission. On the argument it was insisted by the counsel of the defendant, that a wider scope of pleading is admissible and even necessary here than in England, because there the courts always exercise jurisdiction over the award ant! bond 5 and that misconduct in the arbitrators may not be set up by way of plea, because the party aggrieved, tnoy always apply io the equitable side or jurisdiction of the Court of King’s Bench or Common Pleas. But tbs first and second sections of our statute respecting arbitration, Rev. Laws, 150, are copied without any variance, scarcely even a verbal one, from the Stat. 9 and 10th W. 3; and Jhe geaoral jurisdiction of the courts — 16 — being tbe ¡same, it follows that the same powers over the subjecE ~ matter are common to this and to those courts ; any power may be exercised here which may be lawfully exerted there % and it is an error to suppose that the English Courts of common law, always exercise jurisdiction over awards, or that a party may in all cases apply to them for relief; for they never do, nor can, in a summary way, interfere with or set aside an award when the parties have not agreed that their submission to arbitration, should be made a rule of court. Where such agreement is wanting, no application can be made to what was called the equitable side- or jurisdiction of the court. I am not aware that the question now before us has heretofore been directly decided in this court. In the year 1800, an action was brought here by Peter Hickman, administrator of Thomas Jean, deceased, against William Brick, administrator, cum testamento annexo, of Thomas Carney, deceased, upon an arbitration bond. No defence at law was made ; but Brick, filed a bill in the Court of Chancery, alleging mistakes of law and fact, and misbehaviour of the arbitrators, and praying that the award might be set aside, and for relief against the proceedings in this court upon the arbitration bond. Chancellor Bloomfield, upon the hearing, being of opinion that some of the grounds were not available and others not sustained;1 dismissed the bill; the complainant appealed. The Court of Appeals reversed the Chancellor’s decree, ordered the award .to be set aside, and decreed a perpetual injunction against the proceedings at law to enforce the award. To this.case the remarks of Sergt. Wilson, before alluded to, may with great propriety he renewed. The counsel of Brick, would not have imposed'on their client, the expense and inconvenience of a re - sort to the Court of Chancery, if in their opinion they could have resisted the award, in the action at law. With learning equal to Saunders, they could not have overlooked, and would not have forgone an available defence, although unlike him they would not have stooped to a subterfuge even to wear the laurel of success. And the eminent and distinguished counsel on the other side, would not have failed if they had supposed such resistance legal, to have sought on that ground to have closed the doors of the Court of Chancery. This case has not, it is true, tbe weight of judicial decision. It demands,' however, all the attention due to the justly respected opinions of the counsel who were concerned in it. — 17 — From this examination of the subject it clearly results, that the matters contained in the 4th and 5th pleas, are not available on the part of the defendant. To avoid misunderstanding, it may he proper here to observe, that this opinion extends no farther than the case before us, and nothing is intended to be said in respect to the powers of the court on the proper grounds, to exercise them qver a submission, made, or agreed to be made, a rule or a reference, properly so called, of a pending suit. Although not necessary to the condemnation of the plea, yet it ought not to pass unnoticed because fully discussed at the bar; that the 5th plea is liable to some of the objections assigned as special cause of demurrer. It is entirely too vague and general, and wants the point, precision and certainty, in which so much consist the beauty and essence and utility of special pleading. Ford J. To debt for the penalty of an arbitration bond, the defendant prayed oyer of the conddon, and then pleaded six pleas. The plaintiff demurred specially to the 4th and 5th, which was as follows : 4th plea, actio non, because the said defendant was, by the said arbitrator, denied the privilege of hearing and examining witnesses relative to said accounts ; and that the said arbitrator heard the said William Sherron, and examined his witnesses in part, in the absence of the defendant, and without notice to him to be present and attend at sucb hearing and examination, 5th plea, actio non, because the said arbitrator, in re-stating and settling the said accounts, and making the said award, committed great errors and mistakes in law and fact. The first question is, whether extrinsic matters, not appearing on the face of the award, are pleadable in bar of the action. 1 apprehend the law concerning submissions and awards to be perfectly settled. By the common law, a submission to arbitration could not be made a rule of court, unless there was an action depending in court. In that case either party, not performing the award of the arbitrator, was in disobedience of a rule of court, and punishable for the contempt in a summary manner, by way of attachment. But a court, proceeding in this summary way, on motion, and without writ, always considers itself in the exercise of an equitable jurisdiction % and therefore if an award be obtained under their rule, illegal on the face of it, they will set it aside if complaint be made of >t before the last day ©1 the — 18 — next term ensuing the award. They haye a right to do so, because it is proceding under one of their rules. But it is at the same time an equitable jurisdiction, and therefore they will listen to every ground of relief that may be shewn for cause in a court of equity. This equitable jurisdiction over awards made in pursuance of a rule of court, upon motion, in a summary way, either to set them aside for just cause, or to enforce them when regular, by attachment, became so easy, cheap, • expeditious, and desirable, that the legislature saw fit to extend it to cases not otherwise within the power of the courts. For where no action was depending, there were no parties in court, nor any came in which a rule could be entered. The statute of 9 3. 10 W. 3 c. 15, removed this difficulty by authorising the entry of a rule wherever the parties in their submission should agree to have it done; which provision is incorporated in our code. R. Z>. 158, sec. 1 and 2. Hence the equitable jurisdiction of the court over awards, arises out of the rule, and where'the submission is not a rule of court, there is no jurisdiction. Thus in the case of Lucas v. Wilson, 2 Burr 701, Lord Mansfield says, the statute was made to put submissions to arbitration, where no cause was depending, on the same foot as those where there was a cause depending. That the statute is only declaratory of what the law is, in actions depending, that are submitted by rule of court. In Brodwick v. Thompson, 8 East 344, the court said they had an equitable jurisdiction wherever the submission is made a rule of court. Now, in the present case, the court has no.summary power or equitable jurisdiction over the award, because the submission is not by rule of court. It does not come before us on motion, either to set aside the award or to enforce it by attachment, but in the form of a special plea in bar, and we have no power over it, if the award be legal on the face of it. So it is laid down in Kyd on awards, 327. When the submission is by the mere act of the parties, then, in order to he relieved against the award, on account of any extrinsic circumstances, the defendant cannot make them a defence to the action, nor give in evidence any thing to impeach the conduct of the arbitrators ; the award is a determination of judges chosen by the party himself, and nothing extrinsic to that judgment can be offered in evidence to overturn it. The only relief is in equity. In 1 Saund. 327, note 3, — 19 — si is laid down, that the defendant cannot plead in avoidance of the award, collusion or misconduct of the arbitrators. There seems 10 be no case or dictum, where a plea of this sort has been held to be pleadable, nor is a precedent of such plea to be found in books of entries. In the case of Wills v. Maccarmick, 2 Wils. 148, the court says : there is no case where this matter hath been pleaded; the remedy is in equity. In Newland v. Douglass, 2 Johns. 62, the court says : a court of equity may relieve against the partiality or corruption of arbitrators, but there is no such remedy at law, unless the submission is by rule of court. The same was ruled again in 3 Johns. 212, Cranston v. Kinney; and 2 Vez. 315, Lord Hardwick said, he knew of no case at law where it had been done. Tiie court would be glad to relieve the party without sending him to a court of equity, if it had the power of doing so ; but to assume that power against such a stream of decisions, without a solitary precedent to countenance it, would set afloat what has been established for years. If the parties wish to give this court jurisdiction over their awards, the law has provided an easy way for them to do it, by agreeing to make their submission a rule of court. But they cannot be compelled. The statute gives them an option not to do so, and we cannot take it away. It becomes unnecessary to inquire in the second place, whether these pleas are sufficient in point of form, there being no form in which the ¡matters therein contained, can be offered in bar of the action on the award. Judgment therefore must be rendered for the plaintiff on each of the demurrers. Drake, J. The action of the plaintiff is brought on an arbitration bond. The controverted questions arise upon demurrers filed to the fourth and fifth pleas. The fourth plea alleges, in bar of the action, that the defendant was, by the said arbitrator denied tile privilege of hearing and examining witnesses relative to the matters submitted, and that the said arbitrator heard the said William Sherron, and examined his witnesses ex partes in the absence of the defendant, and without notice to him, &c. If this be so, it is ground for relief by bill in equity ; or, in cases where the submission has been made a rule of court, the award may be set aside on motion ; but it cannot be set up as a defence to an action on the arbitration bond. The cases are uni — 20 — form on this subject. 2 Wilson 149. 8 East 344, &c. The cases in 2 Halsted 430, and 16 East 58, where the arbitrators refused to consider of a part of the matters submitted to them, are decided upon the ground that the award is void, from the arbitrators never having taken upon themselves the burthen of the arbitrament, conformably to the submission. The fifth plea alleges, in bar of the action, that the arbitrators committed great errors and mistakes in law and fact, without pointing out what errors or mistakes. It is justly objected to tbis plea, that it is too uncertain, that it is double, and that it is incapable of trial, embracing the peculiar subjects of attention for both court'and jury See Com. dig. title pleader, E 2, 5, and 34. I am of opinion therefore, that upon both of the above pleas, judgment should be rendered in favor of the plaintiff. Judgment for plainti.fi: