Karppinen v. Karl Kiefer Machine Co.

• Citation: 187 F.2d 32
• Decision Date: 13 February 1951
• Docket Number: No. 101,Docket 21779.,101
• Parties: KARPPINEN et al. v. KARL KIEFER MACHINE CO.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

187 F.2d 32 (1951)

KARPPINEN et al. v. KARL KIEFER MACHINE CO.

No. 101, Docket 21779.

United States Court of Appeals Second Circuit.

Argued December 13, 1950.

Decided February 13, 1951.

Moses & Singer and Jerome Goldman, all of New York City, attorneys and counsel for respondent-appellant.

Robert M. Rubenstein, New York City, attorney and counsel for petitioners-appellees; Harvey W. Sherman, Brooklyn, N. Y., on the brief.

Before AUGUSTUS N. HAND, CLARK and FRANK, Circuit Judges.

AUGUSTUS N. HAND, Circuit Judge.

Eino C. Karppinen and John W. Saxman, copartners doing business as Mrs. Dixon's Products Company, moved in the district court to confirm an arbitration award which entitled them to return a machine purchased from The Karl Kiefer Machine Co. and to receive a refund of the purchase price. The award was confirmed and The Karl Kiefer Machine Co. appeals.

The underlying controversy between seller and purchaser of the machine is recited in the arbitration submission agreement and may be summarized as follows: On or about October 5, 1945, appellant sold to appellees a machine for filling jams, jellies, preserves and marmalade into containers. The purchase price, $7950, was paid on October 30, 1947, and the machine was delivered during February, 1948. Subsequently the purchaser claimed to be entitled to rescind because the machine was not fit for the purpose for which it was sold. The seller denied this, and asserted that in any event its guarantee was only good for thirty days after delivery and also that any inadequacy of the machine to serve its purpose was the purchasers' own fault. On November 9, 1949, the controversy was submitted to three arbitrators: an engineer, a business-man, and a lawyer. It was agreed that the arbitrators would inspect the machine at the buyers' premises while it was in operation in a normal commercial manner, and that the parties would abide by any award rendered pursuant to the agreement.

Upon the purchasers' motion to confirm the award granting rescission, the seller filed affidavits asking that the award be vacated. Several grounds were relied on, but the only one before us is based on an allegation that the award was induced by perjured testimony. An affidavit by the president of The Karl Kiefer Machine Co. stated that his company had contended during the arbitration proceedings that the complaints against its machine had been made in bad faith and that the buyers were seeking to rescind because they wished to buy a cheaper machine of a lower productive capacity. The affidavit further asserted that Eino C. Karppinen had rebutted this contention by falsely testifying before the arbitrators that his company had purchased at a higher price — $8,150 — another machine with even greater capacity. In this connection it was asserted that Karppinen had produced a false copy of his purchase order for the new machine, and had thereby convinced the arbitrators of his good faith and also gained their sympathy by making them believe that unless rescission were granted the purchasers would be left with two expensive machines instead of one. An accompanying affidavit by a former employee of the Hope Machine Company, which sold the second machine to Mrs. Dixon's Products Company, stated that the total price of that machine was under $7,000. This assertion was also supported by the affidavit of a person having dealings with the Hope Machine Company.

Reply affidavits were filed, in support of the motion to confirm the award, by Eino C. Karppinen, by his attorney, who was present at the arbitration proceedings, by the president of the Hope Machine Company, and by various employees of that company. These affidavits allege that Karppinen's testimony at the arbitration proceeding had no bearing on the award, that Karppinen did not testify to the price figure alleged but merely stated his belief that the Hope machine would probably cost more than the old one, and that the purchase price of the Hope machine was (apparently depending on the number of accessories) $7,620.25, $8,718, or $8,944.25.

The motion to confirm the award was heard on February 28, 1950, continued on March 1, 1950, and then adjourned to March 15, 1950. Before the last date, The Karl Kiefer Machine Co. moved for an oral examination of Karppinen, and of the president of the Hope Machine Company, and also moved for the production of all papers dealing with the sale of that machine. This motion was granted only to the extent of permitting the examination of Karppinen, during which several documents were introduced in evidence by both sides. After that examination, the arbitrators' award was confirmed, and the portion of the cross-motion demanding other oral examination and the production of papers was denied. A motion for a rehearing was also denied. The appeal is from the denial of those motions, from ...