Fudickar v. Guardian Mutual Life Insurance

If this were an appeal from a judgment entered upon the report of a referee, instead of being a bill in equity to set aside the award, I should, without much hesitation, vote for reversal and a new trial. But the doctrine of error has no application in an action to set aside an award.

When not limited by the terms of the submission (and in this case there is no such limitation) the arbitrator has authority to decide all questions of fact and of law arising upon the matters submitted. He is the judge of the parties’ own choosing; and his decision of the questions of fact and of law, within the scope of his authority, is conclusive upon the same principle that a final judgment of a court of last resort is conclusive.

As a general rule, it is only in case of a fraud practiced by a party, or in case of corruption, partiality or misconduct on the part of the arbitrator within the legally established meaning of these terms, that a court of equity will interfere, after an unrestricted submission. The court will also interpose in *468case of excess or imperfect execution of the powers conferred, and in case of a gross mistake, about which there can be no dispute. Plaintiff did not bring himself within any of these cases.

There are, however, some exceptions in which the court will grant relief, notwithstanding the submission was an unrestricted one, viz.:

First. Where, as pointed out by Mr. Morse in his recent valuable work on “ Arbitration and Awards,” the arbitrator himself, either by the shape in which he makes his award',' or by embodying in it a full statement of the grounds of his decision or of his intention to be governed by strictly legal prineijfles, has conferred upon the court a power of inquiry and revision which it would not otherwise have had. This must appear so clearly upon the face of the award as to justify the judicial mind in supposing that the arbitrator would have made a different award had he known that the judicial tribunals held a different view of the questions of law arising in the case from that entertained by himself.

Secondly. When the arbitrator has proceeded upon a gross and palpable mistake, either of law or of fact, directly affecting the merits. Here the error must be fundamentally and glaringly wrong.

The case at bar does not fall within the first exception; for the award shows no intention to be guided solely by legal principles, and expressly states that it does not contain all the reasons which influenced the decision of the arbitrator. The second exception I at first supposed did cover the case. It seemed to me that the conventional relation, created by contract under seal between a corporation and its,superintendent, could not be held to be the same in all respects as the common-law relation of master and servant. It also appeared to me that the contract in this case, which was entered into after careful consideration by both parties, which contained minute and intricate provisions as to the rights and obligations of the parties, and which was several times *469amended and modified to adjust differences that had from time to time sprung up between the parties, could not be rescinded by the company by reason of its inability to restore the plaintiff to his original position. For these reasons 1 felt strongly inclined to hold that the plaintiff was improperly discharged, and that the decision^of the arbitrator to the contrary, in view of the magnitude of the interests involved, and in view of the arbitrator’s further ruling, flowing from this first named erroneous decision, that in consequence of such dismissal plaintiff was no longer entitled to the renewal commissions guaranteed to him by the contract, amounted to a gross and palpable mistake of law, entitling the plaintiff to a vacation of the award. But, after an exhaustive examination of the authorities cited by both parties, I felt constrained to come to the conclusion that the evidence before me is not sufficient to warrant my interference. Although the American as well as the English decisions upon this point, which are by far too numerous to be specially adverted to here, are very conflicting, yet the clear weight of authority is that the mistake must be so fundamentally, palpably, and glaringly wrong as to amount, in the light of the facts of the case, almost to evidence of misconduct. It is not enough that the point is doubtful.

As the whole evidence taken by the arbitrator has not been placed before me, and as the award does not contain all the facts and reasons which influenced the decision, but merely gives a selection of some by way of illustration, it is impossible for me to say that, in the face of the final, general findings, that the contract was broken by plaintiff repeatedly and constantly; that his acts were not only wrong but unjustifiable ; that such acts have entailed upon the company great loss, which will be known and felt during future years; and that, for these reasons, it became the duty »f the company to dismiss him; the rulings of the arbitrator upon the questions of law herein before referred to, but arising "in connection *470with this state of facts, were so indisputably and unmistakably wrong as to vitiate the award.

As to alleged mistakes of figures, it was incumbent upon the plaintiff to show not only that the arbitrator had erred, but, also, that the plaintiff subsequently convinced the arbitrator as to the existence of such mistakes. This the plaintiff failed to show.

The fact that the arbitrator, after the close of the evidence, received and accepted from the company a statement of its claims, extracted from the company’s books, was an irregularity, notwithstanding the arbitrator’s explanation of it. According to his own version the parties had consented that he should make' an examination in person of the company’s books. That did not authorize him to accept the company’s extract from the books in place of such examination. But the plaintiff saw the statement in the hands of the arbitrator, talked with the latter about it, and finally concluded to take his chances for an award under it. If he was dissatisfied, he should have revoked the submission.

The defendant is entitled to judgment, dismissing the complaint with costs. Ho extra allowance will be granted. The findings, to be prepared in accordance with the opinion, are to be handed up for settlement on a notice of at least five days.