70 S.E. 290 | N.C. | 1911
This case was before the Court at the last term (206)
It has generally been held that an agreement to arbitrate controversies which may arise in the course of executing a contract is void, as its effect is to oust the urisdiction [jurisdiction] of the courts. It was held in Kinney v. B. and O. E. Assn. (W.Va.), 15 L.R.A., 142, and note, that a provision in a contract that all differences arising under it shall (207) be submitted to arbitrators, thereafter to be chosen, will not prevent a party from maintaining a suit, in the first instance, in a court to enforce his rights under it. The Court, in Ins. Co. v. Morse, 87 U.S. (20 Wall.), 445, relying upon the authority of Judge Story (Equity Jurisprudence, sec. 670), and Stephenson v. Ins. Co.,
This Court, by Justice Manning, in Kelly v. Trimont Lodge, at last term,ante, 97, adopted the principle as stated in Stephenson v. Ins. Co., *164 supra, in the following words: "The law, and not the contract, prescribes the remedy, and parties have no more right to enter into stipulations against a resort to the courts for their remedy in a given case than they have to provide a remedy prohibited by law." The learned justice then proceeds to state the result of the decisions in this Court upon the subject: "Our Court has uniformly held to the doctrine that when a cause of action has arisen the courts cannot be ousted of their jurisdiction by agreements, previously entered into, to submit the liabilities and rights of the parties to the determination of other tribunals named in (209) the agreement; but it has been, also, generally held that the agreement to submit the particular question of the amount of loss or damage of the assured under an insurance policy is not against public policy, and is sustained. That is simply a method for the ascertainment of a single fact, and not the determination of the legal liability of the insurer," citing Braddy v. Ins. Co.,
The principle which we have stated as having received the sanction of the courts of England and this country is recognized as sound and well settled in other decisions of this Court. Carpenter v. Tucker,
There is no stipulation in this contract that no suit shall be brought until the amount of loss or damage is ascertained by arbitration, as inMfg. Co. v. Assur. Co., supra, but a sweeping provision that both the liability and the loss shall be decided and settled by arbitrators, (210) and by clear implication it excludes the right of resort to the courts. Ins. Co. v. Alvord, 61 Fed., 752. Stipulations *165 expressed in language not unlike that which the parties used in the arbitration clause of this contract have, as we have seen, been held to be void and not available as a bar to an action on the contract.
It may be observed that the defendant has not attempted to arbitrate the differences which have arisen. In Smith v. Alker, supra, it was said that this fact deprives him of the right to rely upon the agreement for arbitration. "No evidence," says the Court, "was given that the defendant took any steps for the selection of arbitrators. It was not more the duty of the plaintiff than that of the defendant to do so. We need not inquire, therefore, how far, if at all, such defense would have availed," if such steps had been taken. His plea, based upon the clause as to arbitration, was, accordingly, overruled.
Our conclusion is that the judgment of the court below was not authorized by the opinion and certificate of this Court, which covered only the items of the plaintiff's bill of particulars, dated prior to 20 February, 1906. As to items of subsequent date, the judgment was erroneous. In that respect, it is not in accordance with our former decision and cannot be upheld as justified by the defendant's plea, based upon the arbitration clause of the contract, which we hold to be void.
We would suggest that the plaintiff be permitted to file an amended complaint, eliminating the items of his account already passed upon, and confining the pleadings and issues to the matters which are now in dispute. This will prevent confusion in the further consideration of the case. The judgment is set aside, and the court will proceed further in the cause, in accordance with this opinion.
Error.
Cited: Nelson v. R. R.,
(211)