19 F. 5 | U.S. Circuit Court for the District of Minnesota | 1883
We will first consider the question whether the powers of the arbitrator had ceased prior to the time when he undertook to act. The agreement is silent as to the time within which the award was to be made. In such a case the arbitrator must act within a reasonable time. What is a reasonable time must be determined in each case upon its own peculiar facts and circumstances. If the property to be sold is situated in or near a growing and prosperous city, and in a place where the value of real estate may be expected to increase rapidly, it would be fair to presume that the parties contemplated promptness. A delay in fixing the price for a period of five or six months, under such circumstances, would be unreasonable, because the value of the property within that time would be very materially changed. Much would depend, in such a case, upon the question whether the agreement contemplates the fixing of the price according to the value at the date of the contract or at the date of the award. If the former, then the seller would certainly be entitled to a prompt appraisement, and a delay of five or six months would, as to him, be unreasonable, because it would require him to sell at a price which might and probably would be much below the value of the land at the time of the conveyance and at the time of the payment of the purchase money.
The contract in the present case is silent as to the question whether the value at date of contract or at date of award shall constitute the price to be paid for the land; but the arbitrator evidently considered it his duty to ascertain the-value at the former period, and to fix the price accordingly, as he expressly states in his award that he fixes the value of the property at the time when the agreement was entered into, which was the twenty-first day of April, 1879, while the award is dated October 1, 1879. The delay was for more than five months, and the arbitrator acted in the end against the pro
Nothing appears on the face of the agreement or in the evidence to show that the parties to the contract contemplated any unnecessary delay in making the award as to the value of the land, and it is plain that no great delay was necessary. Wo do not, of course, mean to say that the arbitrator was hound to act immediately. He was at liberty to take a reasonable time in which to determine as to his acceptance of the trust, and thereafter a further reasonable time in which to investigate the question of value and make his award. But it is manifest that no great length of time was needed in which to determine the question submitted to the arbitrator in this case. Under the circumstances of the case, we do not think the delay of over five months was contemplated by the parties when they entered into the contract, nor do we think it reasonable. We should, therefore, in the exorcise of the discretion which belongs to courts of equity, decline to decree a specific performance of the award, even if this were the only objection to its validity.
It is, however, further insisted that the arbitrator excluded from consideration, in making his appraisement, the quantity of land included in certain streets, or supposed streets, being a part of the land to he conveyed, and of which complainant now asks a conveyance by warranty deed. Whether there were any streets or highways constituting easements upon the land was not a question for the arbitrator to determine. The contract called for a deed of general warranty against all adverse claims, except a lease mentioned therein, and it was provided that the arbitrator should appraise the entire tract. The arbitrator was not authorized to go into an inquiry as to the effect upon the value of the land of the supposed public ease
Upon consideration of the proof \we find that it clearly appears that the arbitrator took into .account at least one street in fixing the price of the land, and reduced th,e price by the sum of $150, on account of the same. In his own testimony he distinctly says: “If I had known certain that that road did not come out, the award would have been $3,500, instead of $3,350.” And again: “If I had known certain that no road would cross there, $3,500 was the net sum.” And still further: “The ¿ward would have been $3,500 instead of $3,350 for the tract, as the papers show that I had seen, if I had known that there wasn’t any road there to be taken off. That I say.”
It is clear that the duty pf the arbitrator was to appraise the whole tract without inquiry as to the incumbrances or easements. • These were to be removed by the grantor. It is also clear that in deducting $150 from the value of the tract on account of easements, he departed from or varied the contract. In order to enforce a contract by specific performance, the court must be enabled to specifically perform every part of it. We cannot decree a specific performance with a variation. 1 Sugd. Vend. 221; Jordan v. Sawkins, 4 Brown, Ch. 477; Nurse v. Seymour, 13 Beav. 254; Carnochan v. Christie, 11 Wheat. 446. The award is also bad for the reason that it does not cover the entire matter submitted, to-wit, the value of the whole tract without reference to easement.
It is well settled that a failure to include in the appraisement any part of the property is fatal to the award. Morse, Arb. 361; Emery v. Wase, 5 Ves. 846; S. C. on appeal, 8 Ves. 505; Nickels v. Hancock, 7 De Gex, M. & G. 300, 318. It matters not that the portion of the property which was omitted from the appraisement was small in comparison with that which was appraised. It, is enough if it was a substantial and material portion of the property, and whether in the present case it was worth only $150, or more or less than that sum, is immaterial. Nor can the award be now amended by adding to the appraisement the value of the property omitted. The parties agreed to be bound,-not by a price to be fixed by any court, but by the judgment of the arbitrator named, upon the entire matter submitted. Should the court now attempt to add anything to the award it would violate the agreement, instead of enforcing it specifically. Nickels v.
The other questions discussed by counsel need not be considered. Wo deem it proper, however, to say that the proof does not, in our judgment, sustain the charge of defendant that the arbitrator was guilty of improper conduct or of partiality. His errors were simply errors of judgment, but they were nevertheless such as to preclude us from decreeing a specific performance of the contract and award. It is therefore ordered that the bill be dismissed.
Nelson, J., concurs.
Specific Enforcement of Awards and Contracts to Arbitrate.
A party to an award has several remedies at his disposal in case the person against whom the award is made refuses to abide by or to perform it. If both parties are in court, the award may be made an oider of court, and performance may be compelled by the usual means resorted to by a court to compel obedience to its orders. If the parties are not in court, an action for damages will lie upon the award. In this note it is proposed to discuss the equitable remedy of specific enforcement, and its application to awards and arbitration contracts.
1. Awards—General Rule. A party is entitled to come into equity io compel the specific performance of an award whenever he cannot obtain, by proceeding at law, all that was intended to be given him by the award. Inadequacy of the remedy at law is the basis of the jurisdiction in equity.
Illustrations. A partner can, as against his copartner, enforce the specific performance of an award that the partnership stock on hand and accounts be equally divided.
Exceptions. In the following instances specific enforcement of the award was refused: The parties to a submission bound themselves to perform the award which certain arbitrators should “make and publish in writing under their hands, ” concerning a boundary line in dispute. The arbitrators executed a paper as an award, read it to the parties, and delivered copies to them, with an oral statement of' the actual decision, and that it was uncertain whether the award expressed it, but that, if it did not, it should be afterwards amended when the mistake should be ascertained. The chairman afterwards learned that the line actually agreed upon was not correctly stated, and he accordingly amended the original award, which he had retained, but which was not again presented to the other arbitrators for signature, nor republished. Held, that equity would not enforce either the amended or original award.
2. Contracts to Arbitrate—General Bule. Contracts to arbitrate are not specifically enforceable. The reasons upon which this rule rests are several, and seemingly good ones. At common law (however it maybe by statute) arbitrators cannot compel the attendance of witnesses or administer an oath. They cannot compel the production of documents, books of account, and papers, or insist upon a discovery of facts from the parties under oath. One reason, therefore, of the refusal of equity to specifically enforce contracts to arbitrate is this: Equity will not compel a party to submit the decision of his rights to a tribunal which confessedly does not possess full, adequate, and complete moans within itself to investigate the merits of the case and to administer justice. Another reason is that equity will not make a vain decree, incapable of enforcement. Suppose it decrees specific enforcement. How can it compel the parties to name the arbitrators ? How can it compel them to agree upon the arbitrators? The court has no authority to select arbitrators for the parties. This subject is elaborately discussed by Mr. Justice Story in Tobey v. Bristol Co.,
Illustrations. Among the cases which illustrate the refusal of the courts to compel an arbitration are the following: A statute authorized county commissioners to submit certain claims of A. to arbitration. They ordered a reference of part of the claims. Hold, that A. could not present a schedule of names of persons who would be acceptable as arbitrators, and compel, by decree in equity, the selection of some of them by the commissioners, and a reference of all the claims to them.
Insurance Policies. It is not infrequently provided in policies of insurance that any dispute arising under the policy shall be referred to arbitrators. Such agreements to arbitrate, it has been decided, do not oust the courts of their jurisdiction.
Valuations—Renewal of Leases. ' It is not uncommon to insert in leases stipulations for a renewal upon a rent to be a percentage of a valuation by appraisers or arbitrators. The parties to such a lease do not waive the jurisdiction of the ordinary tribunals.
Valuation in Contracts of Sale. Nor will courts of equity decree specific enforcement of contracts of sale upon a valuation to bo made by arbitrators.
Partnership Contracts to Arbitrate. A. and B., partners, agreed that A. should withdraw, and that, if afterwards B. should desire to retire, A. should have the privilege of purchasing the good-will, stock, etc., to be valued “in the usual way” by two valuers, one to bo named by A. and another by B., or by an umpire. B. refused to allow Ms valuer to proceed. Held, that there -was no contract that a court of equity would enforce.
Contracts for Work. In contracts with railway and other companies it is usual to stipulate that a reference to the engineer or to some other officer shall be made a condition precedent to recovery in case of dispute under the contract. In such case neither party can sustain an action on the contract
Exceptions. Although a court of equity will not in general decree specific performance of an agreement to refer to arbitration, or, on the death of an arbitrator, substitute the master for the arbitrator, yet the party who refuses to supply the deficiency by naming a new arbitrator may be denied relief from a court of equity except upon the terms of liis doing equity, which may consist in his consenting to the accounts being taken by the master.
Chicago.
Jones v. Blalock, 31 Ala. 180.
Kirksey v. Fike, 27 Ala. 383.
Horton v. Mascall, 2 Vern. 24. See, also, Cook v. Vick, 2 How. (Miss.) 882; Viele v. T. & B. Ry. Co. 21 Barb. 381; Hall v. Hardy, 3 P. Wms. 187.
Whitney v. Stone, 23 Cal. 275.
Caldwell v. Dickinson, 13 Gray, 365.
M. & O. R. Co. v. Scruggs, 50 Miss. 284.
Marsh v. Packer, 20 Vt. 198.
Caldwell v. Dickinson, supra.
Whitney v. Stone, 23 Cal. 275.
Jones v. Blalock, supra.
Viele v. T. & B. Ry. Co., supra.
Id.
Story v. N. & W. R. Co. 24 Conn. 94.
McNeill v. Magee, 5 Mason, 245.
Caldwell v. Dickinson, 13 Gray, 365.
Ives v. Medcalfe, 1 Atk. 64.
Buys v. Eberhardt, 3 Mich. 524.
Turn. & R. 366.
Wood v. Shepard, 2 Pat. & H. (Va.) 442.
Howe v. Nickerson, 14 Allen, 400.
McNeill v. Magee, 5 Mason, 244.
Emory v. Wise, 5 Ves. Jr. 846.
3 Story, 826.
Greason v. Keteltas, 17 N. Y. 491.
Tobey v. Bristol Co. 3 Story, 800.
Coutee v. Dawson, 2 Bland, (Md.) 264.
Noyes v. Marsh, 123 Mass. 286.
Hill v. More, 40 Me. 515.
2 Ves. Jr. 129.
6 Ves. Jr. 814.
Allegre v. Maryland Ins. Co. 6 Har. & J. 408; Robinson v. George’s Ins. Co. 17 Me. 131; Kill v. Hollister, 1 Wils. 129; Amesbury v. Bowditch Ins. Co. 6 Gray, 596.
Allegre v. Maryland Ins. Co., supra.
Robinson v. George’s Ins. Co. 17 Me. 131.
Kill v. Hollister, 1 Wils. 129.
8 W., H. & G. 497.
2 Car. & P. 550.
Cobb v. N. E. M. Ins. Co. 6 Gray, 193.
Gray v. Wilson, 4 Watts, 39.
Johnson v. Conger, 14 Abb. Pr. 195; Kelso v. Kelly, 1 Daly, 419; Biddle v. Ramsey, 52 Mo. 153; Hopkins v. Gilman, 22 Wis. 476; Greason v. Keteltas, 17 N. Y. 491; Gourlay v. Duke of Somerset, 19 Ves. Jr. 429; Agar v. Macklew, 2 Sim. & Stu. 418; Strohmeir v. Zeppenfeld, 3 Mo. App. 429; Chichester v. McIntire, 4 Bligh, (N. S.) 78.
Biddle v. Ramsey, 52 Mo. 153. See, also, Strohmeir v. Zeppenfold, 23 Mo. App. 429.
Johnson v. Conger, 14 Abb. Pr. 195.
Kelso v. Kelly, 1 Daly, 419.
Agar v. Macklew, 2 Sim. & Stu. 418.
Gourlay v. Duke of Somerset, 19 Ves. Jr. 429.
Chichester v. McIntire, 4 Bligh, (N. S.) 78.
Milners v. Gery, 14 Ves. Jr. 400; Blundell v. Brettargh, 17 Ves. Jr. 231; Griffith v. Frederick Co. Bank, 6 Gill & J. 424; Richardson v. Smith, L. R. 5 Ch. 648; Morse v. Merest, 6 Mad. 25; Smith v. Peters, L. R. 20 Eq. 511.
Backus’ Appeal, 58 Pa. St. 186.
Vickers v. Vickers, L. R. 4 Eq. 523.
Wellington v. McIntosh, 2 Atk. 569; Tattersal v. Groot, 2 B. & P. 131.
Dinham v. Bradford, L. R. 5 Ch 519.
See Monongahela Nav. Co. v. Fenlon, 4 Watts. & S. 205.
Faunce v. Burke, 4 Harris, 469.
Firth v. Midland Ry. Co. L. R. 20 Eq. 100.
Haggart v. Morgan, 4 Sandf. 198; Haggart v. Morgan, 1 Seld. 422; Gibbons v. Edwards, 2 Dru. & War. 80.
Chislyn v. Dalby, 2 Younge & C. Exch. 170.
Conner v. Drake, 1 Ohio St. 166.