Gangel v. DeGroot

• Decision Date: 15 February 1977
• Citation: 362 N.E.2d 249,41 N.Y.2d 840,393 N.Y.S.2d 698
• Court: New York Court of Appeals Court of Appeals
• Parties: , 362 N.E.2d 249, 1977 A.M.C. 2166 Richard GANGEL, Respondent, v. N. DeGROOT, PVBA, et al., Defendants, and Henrijean & Cie et al., Appellants.

Page 698

393 N.Y.S.2d 698

41 N.Y.2d 840, 362 N.E.2d 249, 1977

A.M.C. 2166

Richard GANGEL, Respondent, v. N. DeGROOT, PVBA, et al., Defendants and Henrijean & Cie et al., Appellants.

Court of Appeals of New York.

Feb. 15, 1977.

Brendan J. Connolly, New York City, for appellants.

Jerold W. Dorfman and David A. Beale, New York City, for respondent.

MEMORANDUM.

Order affirmed, with costs.

Special Term correctly held that a contractual choice of forum, whether as to place or the preclusion of the right to litigate in favor of arbitration, must be express (see Matter of Rosenbaum (American Sur. Co.),11 N.Y.2d 310, 314, 229 N.Y.S.2d 375, 377, 183 N.E.2d 667, 668; Matter of Riverdale Fabrics Corp. (Tillinghast-Stiles Co.), 306 N.Y. 288, 289--292, 118 N.E.2d 104, 106; cf. Matter of Marchant v. Mead-Morrison Mfg Co., 252 N.Y. 284, 298--301, 169 N.E. 386, 391, app. dsmd.282 U.S. 808, 51 S.Ct. 104, 75 L.Ed. 725; Matter of Doughboy Inds. (Pantasote Co.), 17 A.D.2d 216, 220, 233 N.Y.S.2d 488, 493). The clause in the marine insurance policy in suit, as opposed to the 'broad' arbitration clause accepted in this and other American jurisdictions as unlimited, was limited (e.g., Matter of Weinrott (Carp), 32 N.Y.2d 190, 196, 344 N.Y.S.2d 848, 853, 298 N.E.2d 42, 45; see Matter of Marchant v. Mead-Morrison Mfg. Co., supra, 252 N.Y. p. 299, 169 N.E. p. 391; compare 2 Am.Jur. Legal Forms 2d, Arbitration and Award, § 23:32, with § 23:42). The instant clause refers to disputes 'regarding the execution of the present policy'. Although the term 'execution' has both a broad and a narrow connotation, an arbitration clause must be read conservatively if it is subject to an equivocal reading (see Matter of Riverdale Fabrics Corp. (Tillinghast-Stiles Co.), supra, 306 N.Y. 291, 118 N.E.2d p. 105; Matter of Marchant v. Mead-Morrison Mfg. Co., supra, 252 N.Y. pp. 298--301, 169 N.E. p. 391; Matter of Doughboy Inds. (Panasote Co.), supra,17 A.D.2d p. 220, 233 N.Y.S.2d p. 493). A distinction must be drawn. The agreement to arbitrate must be express, direct, and unequivocal as to the issues or disputes to be submitted to arbitration. But, once there is agreement or submission to arbitration, the scope of the arbitrators is unlimited and, with very limited exceptions, unreviewable (Matter of Weinrott (Carp), supra,32 N.Y.2d p. 198, 344 N.Y.S.2d p. 855, 298 N.E.2d p. 46; Lentine v. Fundaro,29 N.Y.2d 382, 383, 386, 328 N.Y.S.2d 418, 419, 422, 278 N.E.2d 633, 634, 635).

Although, as appellants argue, the law of Belgium would appear prima facie to be applicable to the execution and interpretation of the agreement, appellants offered no proof or argument as to the applicable Belgian law. Left unresolved is whether under Belgian law the word 'execution', or the clause as a whole, would be given the broad connotation comparable to that of a broad arbitration clause in American jurisdictions. Compounding the difficulty is the ambiguous and unexplained final sentence of the arbitration provision: 'The parties concerned reserve themselves the right of appeal.' Again, appellants offer no proof or argument what that means under Belgian law. Instead, they blandly refer to the arbitration clause as governing 'all disputes', thus begging the question. It would be foolhardy to assume that...