62 F.2d 1004 (2nd Cir. 1933), 190, Krauss Bros. Lumber Co. v. Louis Bossert & Sons, Inc.

Docket Nº:190.
Citation:62 F.2d 1004
Case Date:February 06, 1933
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

Page 1004

62 F.2d 1004 (2nd Cir. 1933)




No. 190.

United States Court of Appeals, Second Circuit.

February 6, 1933

Page 1005

Appeal from the District Court of the United States for the Eastern District of New York.

Maurice B. Rich, of New York City, for appellant.

Wickes & Neilson, of New York City (Herman E. Riddell and Gabriel E. Torre, both of New York City, of counsel), for appellee.

Before L. HAND, SWAN, and GHASE, Circuit Judges.

L. HAND, Circuit Judge.

The plaintiff is a corporation, organized under the laws of Washington; the defendant another, organized under those of New York. On March 11, 1930, the parties tentatively agreed orally for the sale by the plaintiff to the defendant of three hundred thousand feet of 'small timbers,' and between three hundred and three hundred and fifty-thousand feet of 'underflooring.' The plaintiff confirmed the talk by letter on the same day, asking for 'specifications * * * on the small timbers.' This the defendant answered, giving such 'specifications,' but without exactly allocating the quantities to each size. It asked for shipment on April first. The plaintiff replied on March fourteenth by a document called an 'Order Acknowledgment.' This contained a detailed statement of the terms of sale, including credit, date of shipment (April), a clause for arbitration by 'the Arbitration committee of any lumber association purchaser may elect,' and other provisions. It definitely allocated the quantity for each size of the 'small timbers,' which were to be shipped from Seattle, and it omitted the 'underflooring.' It concluded: 'Unless notified to the contrary at once, order will be executed as written above and is final and binding on both of us.' The defendant kept this paper without objection, and the plaintiff shipped from Seattle three hundred thousand feet of 'small timbers,' distributed by size and quantity according to its terms, which arrived in New York on June eleventh, and which the defendant accepted. In December, some months after expiration of the stipulated credit, the plaintiff sued at law for the purchase price in the state court. The defendant answered, denying delivery, and alleging late shipment as a defence and counterclaim. It also pleaded that the contract had provided for arbitration, and that the defendant 'had offered and by its answer renews its offer to submit the differences or controversies to arbitration.' The plaintiff replied to the counterclaim in January, 1931, and noticed the cause for trial in March, the defendant serving a cross notice on the following day. In July, the plaintiff unsuccessfully moved for a voluntary dismissal, and on August sixth wrote the defendant accepting its offer to arbitrate contained in the answer, and asking it to select the arbitrator. The defendant refused and this suit, specifically to enforce the contract, followed on August twenty-fourth. The judge granted an order compelling the defendant to arbitrate and appointing arbitrators, and the defendant appealed.

We held in Marchant v. Mead-Morrison Co., 29 F.2d 40, that such a suit could not be removed to a federal court after the arbitrators had been appointed and had made their award, because the proceeding is single until its conclusion. It does not follow that the order appointing arbitrators is not appealable under section 225 of title 28. The purpose of arbitration is essentially an escape from judicial trial; the court takes a hand only so far as some sanction is necessary to compel performance of the agreement to adopt the means provided. It is true that under section 9 of title 9 (USCA) the successful party may enforce the award by judgment, on which execution will go under section 13. But the judgment follows automatically unless the award has been vacated under section 10, and that is an independent application. So far as the arbitration proceeding itself is concerned, the last deliberative action of the court is the appointment of the arbitrators, who thereupon take over the controversy and dispose of it. Their disposition is not, properly speaking, reviewed by the court, in spite of possible disturbance under sections 10 and 11. It seems to us therefore...

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