Washburne v. Lufkin

| Minn. | Dec 15, 1860

AtWaíer, J.

By the Court. Lufkin and "West were sureties on a bond executed by Thomas Chase as principal, conditioned to abide by an award to be made by arbitrators, in regard to certain matters of difference existing between Chase, Kimball and Washburne, (the Plaintiff’ below). The complaint sets forth the instrument of submission, executed by the parties, the bonds, the making of the award, &c., by the arbitrators, and alleges that the said Chase was required by the same to pay the, Plaintiff the sum of $1600. Default was alleged in. payment of the amount, and judgment demanded against the Defendants for the same. A demurrer was interposed to the complaint, which was sustained, and the Plaintiff brings the cause to this court by writ of error.

The principal question arising in this case upon the liability of the Defendants, .Lufkin and "West, occurs upon the construction to be given to the language used in the condition of the bond, which is as follows :

“ The condition of the above written obligation is such, that if the above bounden Thomas Chase shall well and truly submit, and stand to, and abide by the decision and award of the arbitrators, provided for by a certain agreement in writing, bearing even date herewith, entered into by and between, &c., submitting to arbitrators therein named, all matters in dispute between said last named parties, said award to be made as therein provided, then this obligation to be void; otherwise,” &c.

It is contended on the part of the Pl&intiff in Error, that the language here used, “ submit, and stand to, and abide by the decision of the arbitrators,” does not mean or require a performance of the award, or payment of any sum of money, when suoh is the award, but only to abide by the submission of the case to arbitrators. That the meaning and intent of the bond only is, that the parties shall not withdraw the case from the consideration and decision of the tribunal to which they have agreed to submit it. Such a construction is not in accordance with the import of the literal terms used, nor does it seem to be justified by the object to be attained; or rather, to allow such a construction to obtain, would render the instrument of little of no practical value. This .bond is in the usual form of an arbitration bond, and the language used expressly mentions the “ decision,” or “ award,” of the arbitrators, showing that that was the subject in the minds of the obligors, and not merely the submission on which the arbitrators were to act. Nor can there be much room for doubt, as to the meaning intended to be conveyed by the terms, “ submit and stand to, and abide by.” It might, perhaps, have been rendered more explicit, had the word, perform, been used in addition thereto, though the sense would not be materially changed. To speak of submitting to and abiding by a law, an order, a decision, means in common parlance, to obey it, to comply with it, to act in accordance with it, and perform its requirements. If the terms have not such force, it is difficult to perceive how any meaning can be given to them.

That this was the meaning attached by the obligors themselves to the terms above referred to, we think is farther evident from the instrument of submission, which is recited in the complaint. This instrument is expressly mentioned in the condition of the bond, and it is reasonable to infer that the sureties were acquainted with the contents of the same. In regard to what was to be done in pursuance of the award therein provided for, the language is a little different, and perhaps more explicit. The parties thereto “ mutually agree to and with each other, that the award so made by said arbitrators, or any two of them, shall in all things by us and each of us be well and faithfully kept and observed, whether it be for payment of money, conveyance of real estate, or performance of any other act or thing found by said arbitrators, justly required to be done by any one or more of the parties hereto, to any one or more of the parties hereto.” Such is the agreement entered into by the instrument of submission, on the part of Chase, the principal in the bond, with direct reference to the award to be made thereupon, and as it is the only agreement in that instrument, directly bearing upon the award or decision itself, the irresistible inference to my mind is, that it was the performance of this agreement which the bond was given .to secure, and which the sureties undertook on behalf of the principal. That an award for the payment of money by a party to the submission, is “ faithfully kept and observed,” by a neglect and refusal to pay the same, will scarcely be contended. Such neglect and refusal on the part of the principal is a breach of his agreement, and must render his sureties on the bond liable to an action.

To give the construction to this bond claimed for it by the Plaintiff in Error, would seem to render such bonds of little practical utility. Eor in an action brought on such bond, for a revocation of the submission, the penalty would not be the measure of damages sustained, and to show the actual damage would probably render it necessary to try the merits of the case. And a submission to arbitration would in such case, place the parties in no better position than they would have occupied, had an action at law been commenced in the first instance. "Were the proper construction, therefore, a matter of doubt, that should be adopted which would prove of most practical advantage, and encourage the settlement of differences by arbitration.

The only authority cited bearing-directly upon the point here raised, is that in 1 Bac. Abridg. 346, where it is stated, that “ if there be an obligation to stand to an award, each ought to perform on his own part at the peril of his obligation.” Entertaining these views of the question presented by the demurrer, the Court erred in sustaining it, and the judgment below must be reversed.

CMef Justice Emmett dissents.