Ehrman v. Stanfield , 80 Ala. 118 ( 1885 )

CLOPTON, J.

The statutes, prescribing the mode of submission, and the requisites of an award, do not prevent persons from settling any matter of controvers3r, by a reference to arbitration at common law. Code, § 3548. When the submission is not pursuant to the statute, the common law remedies to enforce the award must be adopted. To constitute a valid award in such case, it is requisite, there shall be a submission by the parties of an existing matter of difference to arbitrators, and an award made, which finally determines the matter of controversy, and is within the scope of the authority of the arbitrators. Tlic present suit is brought on an award delivered under a submission according to the common law. A demurrer was interposed directed to the sufficiency of the averments of the complaint iu specific respects, and also the validity of the award is assailed by a charge requested by the defendant.

It is not necessary, that the complaint shall set forth an agreement in writing to submit. A submission, in a case like this, may be in writing or by parol. The complaint specifically and sufficiently shows the question of dispute, being the amount of damages on account of an injunction, granted by the judge of the City Court of Montgomery, and identifies the suit, in which it was granted by a description of the parties thereto, and the court in which it is pending; and then avers, “ that on the said 8th day of August, 1885, the said plaintiff and the defendant submitted to said arbitrators,' the disputed question of damages arising from said injunction;” the names of the ' arbitrators, and the rendition of the award on August 8th, 1885, having been previously averred. An unexecuted agreement is not sufficient. A submission is the material and essential matter, which, though by parol, necessarily implies a promise to submit and abide by the award.

Whatever may be the legal necessity for an averment in the complaint, when the award does not state the fact, that the defendant had notice of the time and place, when and where the arbitrators would meet to hear and determine the controversy, as to which the decisions are not in harmony; and conceding the necessity that both parties shall have an opportunity of be ing 'heard, the absence of such averment is not assigned as cause of demurrer; and under the statute, can not be considered.

The complaint avers, that the arbitrators found, that the defendant owed the plaintiff an ascertained amount on account of the damages sustained by the injunction, but does not aver that any day of payment was fixed. It is not essential to either the certainty or the finality of an award for the payment of money, that a time in the future shall be specified within which it is to be paid. Such award, when no day of payment is fixed, will ordinarily be construed as an award to pay instanter. No demand is necessary. The party, on whom the duty to pay is devolved, must seek the payee. Squire v. Grevil, Holt, 81; Moore on Arbitration, 548. ’The complaint avers, that the award was made August 8th, 1885, and that a copy was furnished to the defendant. It sufficiently shows that the amount awarded was payable before the institution of the suit.

The facts of the case are presented in an intelligible form, and so that a material issue can be taken by the adverse party. There was no error in overruling the demurrer on any of the causes assigned.

By the submission, either the questions of liability and amount of damages, or only the question of amount, were submitted. If the former, the award is conclusive as to both liability and amount, no fraud, corruption, or partiality or other sufficient objection to' common law award, being alleged or proved. If the latter, the defendant, by the submission, waived or conceded thé matter of liability. The issues in' the suit relate to the facts of the submission, and the making of the award, and its validity. The papers and orders in the chancery suit, other than the bond, which was introduced in evidence by the defendant without objection, do not shed any ■light upon, and are not relevant to the issues between the parties. They would serve only to introduce into the investigation the question of liability on the bond, without tending to show the extent of the authority of the arbitrators. They were properly excluded.

The remaining question arises on an instruction requested by the defendant substantially as follows: If the jury find, that the matter submitted to the arbitrators was the damage for which the defendant was liable on the injunction bond; that the penalty of the bond is only three hundred dollars; and that the award is for three hundred and fifty-two dollars, the plaintiff is not entitled to recover. The principle, underlying the proposition of the charge, is, that the bond limits the authority of the arbitrators, and the award, being for a sum exceeding the amount of the bond, is wholly void. The rule is well settled, that the arbitrators derive their powers entirely from the submission, and while the award should be co-extensive therewith, it must not include any matter not within its terms and scope. If it does, it will be void in toto, or for the excess, according to circumstances. If it contains an allowance for any matter not authorized, and which is not separable from the allowance for the matter submitted, the entire award is vitiated; bnt if such allowance is, upon the face of the award, distinguishable from the authorized residue, and so disconnected, that the one is not dependent upon the other,-and each does not enter into the consideration of the several allowances, the award will be upheld except as to the excess. — Reynolds v. Reynolds, 15 Ala. 398; 6 Wait’s Ac. & Def. 548.

On the hypothesis of the charge, the matter submitted to the arbitrators was the damage, for which defendant was liable on the injunction bond. There is a manifest difference between the nature and character of the damages naturally and proximately resulting from a breach of the bond, and the amount of recovery in a suit thereon as limited by the penalty. The actual damages may largely exceed the sum of the boúd. It does not appear from the award, and there is no effort to show, that the arbitrators considered or allowed any element of damage, which was foreign to the submission, or for which the defendant was not liable on the bond. The contention is, that the arbitrators awarded an amoitnt in excess of what could have been recovered in an action at law on the bond ; and therefore it must be presumed, the arbitrators considered some element of damage not-referred, and not covered by the bond. Arbitration as a mode of settling disputes and controversies, is encouraged and highly favored by the law and courts. Awards are construed with great liberality, and all reasonable intendments are made to support them. Unless the contrary appears from the award, or is affirmatively shown, the presumption prevails, that the arbitrators have not exceeded their authority7. The burden is upon the party impeaching to show, that matters not submitted were considered aud allowed. — Burns v Hendrix, 54 Ala. 78.

On the presumption, that the arbitrators did not estimate any7 unauthorized element of damage, the question arises, is the award void in toto, because they found the actual and legitimate damages to exceed the sum, for which a recovery could be had on the bond ? Where the parties submitted a controverted matter to arbitrators, who, in addition to damages, awarded costs, which were not included in the submission, the award was sustained as to the damages, but held bad as to the costs. — Day v. Hooper, 51 Me. 178; Genter v. Carter, 16 Md. 509. The inquiry is, does the award demarkate the good and bad parts? Conceding that the penalty of the bond, by the terms of submission, limited the sum,- which the arbitrators were authorized to award, and applying the rule of presumption in favor of the correctness and validity of awards, the excess of authority only consists in the sum awarded, and not because of the consideration of any matter not comprehended in the submission.- It was a mere error of judgment as to the amount, aud not as to the elements, of damages, which they were authorized to award. The award, construed in connection with the submission, furnishes the means of separating that which is in excess of authority from the remainder. In the absence of evidence showing that any matter not comprehended was considered, or that the excess entered into the consideration of the residue, or that the one is dependent upon the other, and the good and bad parts being separable, the award will be sustained to the extent of the authority of the arbitrators.

As the plaintiff remitted the excess, we have not considered, and do not decide whether, under the terms of the submission, the authority of the arbitrators was limited by the sum of the bond ; but have decided the case on the seeming concession by both parties, that their authority was so limited.

Affirmed.