Rand v. Redington

Upham, J. In all cases of fraud, mistake, or accident, courts of equity may, in virtue of their general jurisdiction, ■interfere to set aside awards. 2 Story’s Eq. 675. This power is sometimes exercised by courts of common ’law, in cases of corruption and gross partiality of the arbitrators, where the submission is by rule of court. 3 Johns. 367, Barlow vs. Todd; 9 Ditto 212, Cranston vs. Kelly; 5 Cow. 425, McKinney vs. Newcomb; and in Massachusetts, corruption or gross mistake of arbitrators may be shown in defence against an action on an award. 4 Pick. 192, Brown vs. Bellows; 6 Pick. 269, Bean vs. Farnam. In courts of law, excessive damage is also a good ground to set aside a verdict, where, from its exorbitancy, the court may reasonably presume that the jury in assessing the damage 'did not exercise a sound discretion, but were influenced by passion, partiality, prejudice or corruption. 4 Mass. 41, Coffin vs. Coffin; 5 Ditto 435, Commonwealth vs. Justices of Norfolk; 15 Mass. 365, Sampson vs. Smith; 5 Cow. [77] 106, Sargeanfs Case. And the same ground which will induce a court to set aside a verdict of a jury, and grant a new trial, will induce them to vacate an award. 1 Dall. 315, Williams vs. Craig; 2 Cow. 458, Bassett's Case; 1 Wash. 56, Hurst vs. Hurst. Excessive damage is conclusive either of fraud or mistake ; but the damages must be so exorbitant as to be accounted for in no other manner. 17 Johns. 405, Cortlandt vs. Underhill. In this case we do not hold that the award is so excessive as, of itself, necessarily to show mistake or corruption. It is, however, an award of such an extraordinary character as requires us to scrutinize closely the proceedings of the arbitrators, and the relation in which they stand to the parties. The matter submitted to the arbitrators was a claim of damage for the detention of a pension certificate, which bad been pledged with Rand as security for cash and goods advanced upon it, amounting to one hundred and six dollars. Eaton demanded the certificate without proffering payment of any part of the debt; and Rand refused to deliver it without payment of at least twenty dollars. The refusal to deliver the certificate cannot be sustained in point of law ; but it was no more unjustifiable, as regards equity betwixt the parties, than the refusal of Eaton to pay the small amount asked towards Rand’s claim. The wrong began with Eaton, and it was owing to his persisting in this wrong that he incurred the expense of which he complained. From this expense he should, injustice, on an adjustment betwixt the parties, deduct Rand’s claim, and a reasonable allowance for his gross breach of faith in refusing payment of any portion of the amount against him, at the time the certificate was demanded. Such was the state of the controversy betwixt the parties, and the course we should expect the arbitrators to take in relation to it; but the proceedings show an entirely different view of the subject. Eaton, on the hearing before them, submitted a large claim, in round numbers, for damage. — • [78] There is no reason to doubt that he asked all he had any just ground to recover; but the board of arbitrators, as is apparent from the specification of Eaton’s claim, as filed by him, allowed him one hundred dollars more than he asked. This alone has been deemed sufficient to vacate an award. In Biggs vs. Funk, 5 Watts 478, it is held that a judgment on an award that exceeds the party’s claim, as set out in his statement, is erroneous, and'will be reversed unless the excess be remitted. The arbitrators not only made this allowance, but in their haste to make up their award, they also allowed the interest on a charge for money, the principal of which they rejected as having never been received by Rand. Still further, they took no notice whatever of Rand’s claim,. This claim was unquestionably submitted to the action of the board, because “ the suit relative to the detention of the certificate, and all other matters and things connected therewith,” were referred to their determination ; and on the hearing, evidence was offered, without objection, to sustain it. But an award was made to the defendant of $434.14 damage, and costs, without any mention of this claim. It was clearly the duty of the arbitrators to find the balance only on the claims of the parties. If they did this, Rand’s claim was cancelled, and an award was thus in fact rendered for the sum of $559.46 ; an amount more than two hundred dollars larger than Eaton asked to be allowed him. The arbitrators either intended to do this, or they were guilty of gross neglect, in so forming their award as to subject the plaintiff to the hazard of a full payment to Eaton, or to abide the contingency of a defence by set-off of his claim, which they themselves should have adjusted, and thus terminated the controversy betwixt the parties. There is no accounting for such an award, except on the ground of corrupt intention on the part of the arbitrators, or gross carelessness, or indifference to the rights of the plaintiff. The fact that Eaton was indebted to the arbi [79] trators and their friends, and that the award, when rendered, was immediately pledged for the payment of their claims, strongly fortifies us in this conviction. The arbitrators say they were not present at the time this arrangement was made, and did not participate in it; but there is reason to believe that such a result was expected by them, and that the award wo-uld be at once appropriated for the benefit of the creditors named. The award is exorbitant, if not excessive. There was an interest on the part of the arbitrators to make it so, — it was for an amount greater than the party claimed, — was rendered without the proper protection to the claims of the opposite party, and was immediately applied in part to the benefit of the arbitrators. We are satisfied, from the evidence on these points, that the arbitrators were not actuated by the proper spirit to determine the rights of these parties, and that their award was influenced by such partiality, prejudice, and interest, or such culpable carelessness, as to avoid their proceedings. We shall, therefore, direct an injunction to be served on the defendant against enforcing the award.