Mentz v. Armenia Fire Ins. Co.

• Decision Date: 06 January 1876
• Citation: 79 Pa. 478
• Parties: Mentz <I>versus</I> Armenia Fire Insurance Co.
• Court: Pennsylvania Supreme Court

79 Pa. 478

Mentz versus Armenia Fire Insurance Co.

Supreme Court of Pennsylvania.

November 24, 1875.

January 6, 1876.

November 24th 1875.

Before AGNEW, C. J., SHARSWOOD, MERCUR, GORDON, PAXSON and WOODWARD, JJ.

Error to the Court of Common Pleas of Crawford county: Of October and November Term 1875, No. 158 H. C. Johns, for plaintiff in error.—A general covenant or agreement providing for settling disputes by arbitration without naming the arbitrators, does not take away the jurisdiction of the courts: Gray v. Wilson, 4 Watts 41; Lauman v. Young, 7 Casey 310; Snodgrass v. Gavit, 4 Id. 224; Ins. Co. v. Morse, 20 Wall. 445.

J. B. Brawley, for defendant in error, from whom the reporter received no paper-book.

Mr. Justice SHARSWOOD delivered the opinion of the court, January 6th 1876.

There can be no doubt that if this case stood upon a general arbitration clause in the policy alone, it would fall within the principle settled by this court, conformably to all the previous English authorities, in Gray v. Wilson, 4 Watts 41; Snodgrass v. Gavit, 4 Casey 224, and Lauman v. Young, 7 Id. 310; that it is not in the power of the parties to a contract to oust the courts of their jurisdiction.

The cases in which the certificate or approbation of any particular person — as the engineer of a railroad company — to the amount of a claim, is made a condition precedent to an action, rest upon entirely different principles. He is not created a judge or arbitrator of law and facts, but simply an appraiser of work done: Monongahela Nav. Co. v. Fenton, 4 W. & S. 205; Lauman v. Young, 7 Casey 306. In all these cases there is an actual reference, founded upon consideration, and therefore irrevocable. That which is before us, is a mere agreement to refer to arbitrators to be chosen at a future time.

Such an agreement, like any other agreement of reference, is revocable, though the party may subject himself to an action of damages for the revocation. It is not in the power of parties thus to oust the courts of their general jurisdiction, any more than they have to add to a personal covenant, that they are not to be responsible for a breach of it: Furnivall v. Coombes, 5 Mann. & G. 736. The Supreme Court of the United States have recognised the soundness of this general principle in Insurance Co. v. Morse, 20 Wallace 445, in which they held that an agreement by a foreign insurance company, in conformity with a state statute, that if sued in a state court they would not remove the suit into the Federal court, was invalid.

The contention, however, here is, that the special provision added in this policy to the arbitration clause, distinguishes this case from those cited. It declares that "no action, suit, or proceedings at law or in equity, shall be maintained on this policy, unless the amount of loss or dispute as aforesaid shall have been...