297 N.Y. 433 | NY | 1948
Petitioner Gantt is a North Carolina lumber dealer, using the business name of Southland Supply Company. Respondent Hurtado Cia., Ltda., is a Nicaraguan partnership (or corporation) doing business in that Republic. In July, 1946, at High Point, North Carolina, an authorized representative of Hurtado made two written agreements with "Southland Supply Company", the signatures of the latter being by W.O. Carter, who, in one of those agreements, styled himself "Manager" but whose authority to contract for petitioner Gantt is now disputed by the latter. Each of these July, 1946, writings called for the sale and delivery by Hurtado to "Southland Supply Company", of large quantities of various kinds of tropical woods to be shipped from Nicaraguan ports, at prices f.o.b. those ports, to High Point. Each of those agreements called for the opening by the buyer, for the seller, of an irrevocable letter of credit, the place where such letter of credit was to be obtained not being stated. Both those July, 1946, agreements were modified in various respects by a third document, signed at High Point in September of that year by a representative of Hurtado and by "Southland Supply Company, W.O. Carter". The September pact contained the first mention of arbitration, the language being: "Any controversy or claims arising out of or relating to this contract or the breach thereof shall be settled by arbitration in accordance with the rules of the Inter-American Commercial Arbitration Commission. This agreement shall be enforceable and judgment upon any award rendered by the arbitrators or a majority of them may be entered in any Court having jurisdiction. The arbitration shall be held in New York, N.Y." *437
Later in September, 1946, respondent Hurtado, asserting that there had been a violation of contract by Southland Supply Company (or Gantt), in the latter's alleged failure to set up the promised letter of credit, served on Southland a demand for arbitration before the Inter-American Commercial Arbitration Commission. Gantt did not reply to that demand, but commenced in Supreme Court, New York County, the present proceeding to restrain the proposed arbitration, alleging in his petition that Carter had signed the September, 1946, agreement without authority from him (Gantt). Petitioner first applied for a temporary order to restrain the arbitration pending a jury trial, which petitioner requested, of the preliminary question as to Carter's authority (see Civ. Prac. Act, § 1458). That motion was granted at Special Term but immediately afterwards, and before the jury trial could be held (it has not yet been held, we are informed) petitioner Gantt made a further motion, this time for a permanent stay of arbitration, on the ground that the arbitration clause was wholly void by the laws of North Carolina, where the paper in which it appears was signed, and that therefore, according to petitioner, he could not be compelled to enter into any arbitration, anywhere. Special Term denied that second motion, holding that the arbitration clause, in its specific declaration that any arbitration was to "be held in New York, N Y" amounted to an unconditional consent by the parties to submit their contests to arbitration in New York State under New York arbitration procedures, and that, whether or not such an arbitration covenant could be enforced in North Carolina, it was enforcible under the law of the forum, i.e., New York. The Appellate Division, First Department, unanimously affirmed without opinion but granted petitioner Gantt leave to appeal to this court, certifying to us a question as to whether the order denying petitioner a permanent stay, was properly made.
We deal first with the question of the legality of the arbitration clause, since if it be entirely void, as petitioner argues, the case ends there. North Carolina has an arbitration statute (General Statutes of North Carolina, 1943, div. II, ch. 1, art. 45), but unlike our New York article 84 of the Civil Practice Act, the North Carolina enactment covers and enforces only agreements to submit existing controversies to arbitration. It does not mention at all the kind of arbitration covenant we have before us — *438
a covenant to arbitrate controversies thereafter arising — and so we turn (see Tarpley v. Arnold,
Petitioner insists that all this has been changed by Order ofTravelers v. Wolfe (
What we have said herein will, we think, serve as an answer to petitioner's contention that the refusal of the permanent stay of this arbitration deprives him of the privileges and immunities he is entitled to under section 2 of article IV of the United States Constitution and his further contention that to allow the arbitration to proceed in New York will be to refuse full faith and credit to the laws of North Carolina. The pertinent North Carolina law, as we have seen, goes only so far as to deny enforcibility in its courts to such an arbitration clause, while these parties covenanted that they would, in case of dispute, go into New York State and there submit to an arbitration under the New York statutes; the New York statutes fully enforce such agreements and provide court machinery for compelling the parties to go through with their own arrangements for the settlement of their differences in a private tribunal of their own selection, rather than in a court of law.
The other objection in point of law (briefly referred to at the beginning of this opinion) which petitioner enters against the maintenance of this arbitration, is based on the fact that the agreements were, at least in form, not signed by petitioner but by W.O. Carter, styling himself the "Manager" of "South land Supply Company". The dispute of fact as to whether Carter was authorized so to contract, was, as we have said, set down, on petitioner's application, for a jury trial. But petitioner goes further and says that a New York statute (Civ. Prac. Act, § 1449) makes entirely illegal in New York an arbitration agreement not signed by the parties themselves. Section 1449 says, in part: "A contract to arbitrate a controversy thereafter arising between the parties must be in writing." Obviously, this contract was in writing. There is no statutory prohibition, *441 in our statute, of signature by an agent, nor any command that, if an agent sign, his authority must be shown in the agreement. We think petitioner's rights are fully protected by the Special Term order sending to a jury trial the question of whether or not Carter was in fact authorized to commit petitioner to the arbitration of such differences as might arise. Much is said in the briefs concerning the second sentence, not applicable here, of section 1449, which second sentence reads: "Every submission to arbitrate an existing controversy is void, unless it or some note or memorandum thereof be in writing, and subscribed by the party to be charged therewith, or by his lawful agent." The case here under review does not justify us in construing that second sentence of section 1449, or analyzing the differences in language as between the first and second sentences. We see no reason for thinking that the requirement in the first sentence of "writing" means anything more than the similar requirement in the Federal Arbitration Act (U.S. Code, tit. 9, § 2) of "a written provision * * * to settle by arbitration a controversy thereafter arising".
The order should be affirmed, with costs and the certified question answered in the affirmative.
LOUGHRAN, Ch. J., LEWIS, CONWAY, THACHER, DYE and FULD, JJ., concur.
Order affirmed, etc.