Court Opinion

ID: 7099592
Source: CourtListenerOpinion
Date Created: 2022-07-24 12:14:26.55447+00
Date Added: 2024-06-11T16:13:21.999695
License: Public Domain

Day, J.
i. arbitraTOR: misconduct of. When this case was before us on a former appeal it was held that a demurrer to 'a counter claim for damages, alleging the same facts as those now relied upon , , r, ' ’ as a defense, was properly sustained, See Jones v. Brown, 54 Iowa, 74. It was held that the arbitrators acted in a judicial capacity, and could not be held liable in a-civil action for-damages! for. an award, although alleged to. have been made fraudulently and.corruptly. It is but a corróllary of this decision that the claim of -the arbitrators for compensatioh for their services cannot be recouped by damages :to the extent,of the .claim, for making .a fraudulent and, *569corrupt award. But we have now involved in this case a different question. The answer alleges, that because of the wi’ongful and illegal acts of the arbitrators the award by them made was by order of the court re-submitted and the finding of the arbitrators was void and of no value, and the services of-the plaintiff were useless and of no effect. The answer does ,not seek to recoup the plaintiff’s claim with damages, but alleges a want of consideration growing out of the fact that the services of the plaintiff, owing to his misconduct, were useless and 'of no value. We have now the question whether the rule of judicial immunity which protects an arbitrator from liability for damages for a fraudulent and corrupt award goes also to the extent of inhibiting all proof that the award was valueless on account of the corrupt and willful misconduct of the arbitrator, for the purpose of defeating the arbitrator’s claim for compensation for his services. In this case the arbitrators made an agreement with the parties to the suit for compensation at the rate of ten dollars per day. Now whilst the arbitrators did not contract for the possession of perfect judgment, and did not undertake to make an award which should -be sustained by the court, there was, we think, an implied undertaking that they would not by their corrupt and , fraudulent practices render their award valueless to the parties. We think that the rule of judicial immunity goes far enough when it protects the arbitrators from ■ an action for damages, without allowing them compensation for an act rendered useless by their will-ful misconduct. . This seems to have been the view originally entertained by the court below, for whilst it sustained a demurrer to the counter claim for damages, it overruled a de-.murrer to the answer which set up the same facts as a defense to the plaintiff’s claim. When the case came on for hearing, however, the court rejected all evidence offered by the defendants and instructed the jury to return a verdict for the plaintiff for the amount claimed. The defendant offered amongst other things to prove that Jones delegated to a third party, *570not one of the arbitrators, his duties as arbitrator, and that said person, together with J. IT. Camburn, made up and prepared said award, and that said person had no right or authority from N. B. Brown or any one acting for him; that Jones and Camburn knowingly allowed, in making up said award, large amounts upon which no proof had been offered, and large amounts upon which proof had only been partially submitted, when they well knew that N. B. Brown and Wiiliam Harper desired to introduce further proof in relation to the same, and before the samé had been submitted by either party to said arbitrators; that some days before the making of the award said arbitrators had adjourned the hearing to a time and place fixed, whereof notice was given to all parties interested, and that several days before said time arrived Jones and Camburn proceeded, in the absence of all parties interested, and in the absence of W. S. Taylor, one of the arbitrators, and without notice to him, and without consent of parties, to make and sign an award, and retained said award, and refused to make the same known or public, or to file the same, until the 7th of April, 1879; that at the time the award was signed by Camburn and Jones the time limited for making and filing an award had expired; that Jones did not know what it contained; that he did not know whether it contained any of the credits that should be allowed to Brown; that he did not know but what double the amount that Harper was entitled to was allowed in the award. The defendants also offered to prove that the award was recommitted. This proof should have been admitted for the purpose of showing that the award was rendered unavailing to the parties, through misconduct of the arbitrators.
Reversed.