Summary
In Matter of Acadia Co. (Edlitz) (7 N.Y.2d 348), we held only that an arbitration clause contained in a written contract continues in existence when the parties orally agree to renew the written agreement.
Summary of this case from Schubtex, Inc. v. SnyderOpinion
Submitted January 20, 1960
Decided February 25, 1960
Appeal from the Appellate Division of the Supreme Court in the First Judicial Department, EDGAR J. NATHAN, JR., J.
Robert W. Adler and Ruben Schwartz for appellant. Arthur J. Katzman for respondent.
This is an appeal from an order of affirmance by the Appellate Division, First Department, by a divided court, of an order by Special Term which denied appellant's motion to compel arbitration between the parties and to stay an action in the Municipal Court, Borough of Manhattan.
The essential facts are undisputed. Under a written agreement respondent was employed by appellant for a period from July 22, 1957 to January 22, 1958, and the agreement provided for arbitration of "any question, difference or controversy [arising] as to the interpretation or performance of any of the foregoing provisions". It is conceded that prior to its expiration the contract was orally renewed and respondent's employment extended six months. Subsequently the employment was terminated and a dispute arose over whether the contract had been breached, and as to wages due thereunder.
Special Term denied the motion on the theory that no binding agreement to arbitrate was created by the oral renewal since the renewal agreement was not reduced to writing (Civ. Prac. Act, § 1449). We reach a different conclusion. By orally renewing the written agreement the parties in effect adopted it as an integral part of the new arrangement, modified only by an extension of the time of employment. No other logical meaning can be attached to the expression "oral renewal", an expression used by the respondent himself. There was, therefore, a sufficient compliance with section 1449 of the Civil Practice Act, which requires "A contract to arbitrate a controversy thereafter arising between the parties must be in writing." It was not necessary for the parties to prepare a new written agreement since they bound themselves to the old one, nor was it necessary for them to sign a new agreement ( Matter of Helen Whiting, Inc. [ Trojan Textile Corp.], 307 N.Y. 360-367).
The order should be reversed, with costs in all courts, and the motion granted.
Chief Judge DESMOND and Judges DYE, FULD, FROESSEL, VAN VOORHIS, BURKE and FOSTER concur.
Order reversed, with costs in all courts, and matter remitted to Special Term for further proceedings in accordance with the opinion herein.