District 65, R. W. D. S. U. v. Paramount Surgical Supply Co.

• Decision Date: 17 November 1971
• Citation: 117 N.J.Super. 125,283 A.2d 766
• Parties: , 79 L.R.R.M. (BNA) 2015, 66 Lab.Cas. P 12,218 DISTRICT 65, R.W.D.S.U., Plaintiff-Appellant, v. PARAMOUNT SURGICAL SUPPLY CO. et al., Defendants-Respondents.
• Court: New Jersey Superior Court — Appellate Division

Page 125

117 N.J.Super. 125

283 A.2d 766, 79 L.R.R.M. (BNA) 2015,

66 Lab.Cas. P 12,218

DISTRICT 65, R.W.D.S.U., Plaintiff-Appellant, v. PARAMOUNT SURGICAL SUPPLY CO. et al., Defendants-Respondents.

Superior Court of New Jersey,

Appellate Division.

Argued Oct. 12, 1971.

Decided Nov. 17, 1971.

Nicholas Politan, Jersey City, for appellant (Krieger, Chodash & Politan, Jersey City, attorneys; Lewis C. Stanley, Trenton, on the brief).

David R. Simon, Newark, for respondent Paramount Surgical Supply Corp. (Simon & Allen, Newark, attorneys; Richard B. Goldsmith, Newark, on the brief).

Before Judges CONFORD, MATTHEWS and FRITZ.

The opinion of the court was delivered by

CONFORD, P.J.A.D.

The issues in this appeal have been considerably simplified by appellant's warranted concession at oral argument that it is not entitled to judgment on the arbitrators' award. With conspicuous fairness, it concedes that respondents may have been misled by their interpretation of the opinion in John Wiley & Sons, Inc. v. Livingston, 376 U.S. 543, 84 S.Ct. 909, 11 L.Ed.2d 898 (1964), to believe they could with impunity abstain from participation in the arbitration proceedings although duly noticed to participate therein.

However, for future guidance, we here state our considered view that Battle v. General Cellulose Co., 23 N.J. 538, 129 A.2d 865 (1957), is controlling on the procedural issues presented and that Wiley is not in conflict with it.

Battle holds that when a party claims he has a contract with another calling for arbitration of disputes arising thereunder, and proceeds to invoke arbitration in the manner set forth in the alleged contract, there is no preliminary obligation on the demandant for arbitration first to go to court to compel the other party to participate. He may do so, but he is not compelled to. If the decides to proceed with the arbitration on the assumption that he has an agreement calling for it, then the opponent, who takes the position that there is no contract between them or that the dispute is not arbitrable, ignores notice of the arbitration proceeding at his peril of a later judicial determination that there was in fact a contract requiring arbitration of the dispute, and of being subjected to the award, even though he did not participate in the proceeding.

The foregoing does not mean that such a defendant waives his right to a judicial determination that he was under no contractual obligation to arbitrate. He may raise that issue in defense of an application by the demandant for entry of judgment on the award. But if he loses on that defense in court, he is obligated on the award. What he should have done if he wanted a judicial determination in advance of the arbitration, under the rationale of Battle, is to have moved in court to stay the arbitration proceedings at the outset and in That proceeding to have obtained a judicial decision on the question of contractual obligation to arbitrate.

We do not regard the Dictum in Wiley relied upon by respondents as being contrary to the foregoing. We need not intimate any view as to whether, if it were, it would, because involving a...