concluding that an arbitrator did not exceed his authority in awarding interest although the arbitration agreement was silent concerning interestSummary of this case from Gordon Sel-Way v. Spence Bros
Argued March 6, 1908
Decided March 31, 1908
George Hahn for appellant.
Frederick Hulse for respondent.
This appeal is taken from a judgment of the Appellate Division, which affirmed a judgment entered upon the confirmation of the award of an arbitrator. Controversies had arisen between the parties over the execution of a contract for mason work in the alteration of a certain building. The respondent herein was the contractor and the appellant was the owner of the building. Upon the completion of the work, the contractor made a claim for a balance due under his contract and for extra work. This claim the owner disputed and, himself, advanced the claim that the contractor had failed to perform his contract and that he was entitled to damages. In that situation, the two entered into an agreement in writing for the arbitration of their differences; which agreement, after reciting the existence of controversies over the amount, if any, due to the contractor on account of work performed, or in connection with the alterations on said building, and over the amount, if any, due to the owner upon his various claims, provided as follows: "that the parties hereto do hereby pursuant to chapter 17 title 8 of the Code of Civil Procedure submit all and all manner of actions, cause and causes of actions, suits, controversies, claims and demands whatsoever, now pending and existing by and between them, as aforesaid, to the Hon. D. Cady Herrick, as arbitrator, to decide the same with all reasonable dispatch, his decision to be final." Subsequently, the arbitrator made an award, in which he found "that there is due to Luke A. Burke, (the contractor), from Henry Corn, (the owner), on account of the matters and things set forth in the said agreement of arbitration, after making deductions and allowances in favor of said Henry Corn from the amount claimed by said Luke A. Burke, the sum of Forty-five thousand three hundred eighty-seven and 18/100 dollars ($45,387.18), with interest thereon from June 1, 1904, being the sum of Five thousand and nine hundred and 33/100 dollars ($5,900.33), amounting in the aggregate to the sum of Fifty-one thousand two hundred eighty-seven and 51/100 dollars ($51,287.51)." After the arbitrator had made his award, Corn, the owner, paid the principal sum awarded and judgment was entered, only, for the amount awarded for interest and unpaid. Upon this appeal, the one question argued by the appellant relates to the award of interest; in respect of which he claims that it was not a matter within the submission.
That question is no longer open for review. When parties have agreed for the arbitration of their differences, pursuant to the provisions of the Code of Civil Procedure, and an application is made to the court for an order confirming the award, section 2373 provides that the court must grant such an order, unless the award is vacated, modified, or corrected, as prescribed in the next two sections. Section 2374 does not apply; inasmuch as the application here was for a modification of the award as to the interest sum. Section 2375 provides that the court may modify, or correct, the award upon application, "so as to effect the intent thereof, and promote justice between the parties", in cases of evident miscalculations, or of mistakes; or "where the arbitrators have awarded upon a matter not submitted to them, not affecting the merits of the decision upon the matters submitted"; or "where the award is imperfect in a matter of form, not affecting the merits of the controversy" etc. The only one of these provisions, which is applicable, is that which relates to a case where the arbitrator has awarded upon a matter not submitted.
The proposition of the appellant that interest could not be a part of respondent's claim is untenable. The demand for interest, ordinarily, inheres in a claim for moneys due upon a contract and withheld by the debtor, as a compensation for the detention. When it is legally demandable and recoverable is another question. As a matter of fact, it appears from the record that, in an action commenced upon the same contract prior to the agreement for arbitration, interest was demanded; so that it cannot be, reasonably, pretended that it was importing any new element of claim into the submitted controversy. But the broadness of the submission to the arbitrator's decision is such as, necessarily, to comprehend every claim and demand and it is sufficient to say that interest was a possible claim on the part of the respondent. Being so comprehended, the legal question of the right to interest is withdrawn from the consideration of the court.
Such an agreement for arbitration is to be given effect, in the most liberal sense, as accomplishing a complete and final settlement of all existing controversies. The award thereunder is unassailable upon the ground that errors of law, or of fact, were committed. For it to be assailable at all, a ground must be found for charging the arbitrator with some misconduct, or with fraud, or with having exceeded his powers; or for the charge that the award, on its face, shows some mistake in figures, or in description, or some imperfection not going to the merits. (See Perkins v. Giles, 50 N.Y. 228; Masury v. Whiton, 111 id. 679; Code Civ. Pro. secs. 2374, 2375.)
I am of the opinion that the appellant's application furnished no ground for the interference by the court with the award. The arbitrator did not exceed his powers and the award was well within the terms of the submission.
The judgment should be affirmed, with costs.
CULLEN, Ch. J., HAIGHT, VANN, WERNER, WILLARD BARTLETT and CHASE, JJ., concur.