Court Opinion

ID: 9885592
Source: CourtListenerOpinion
Date Created: 2023-10-06 13:07:56.956513+00
Date Added: 2024-06-11T07:48:55.252851
License: Public Domain

Desmond, J.
(dissenting). Republique Francaise is entitled to its award since it met every requirement of contract and law for a valid arbitration. Particularly is this so since appellant Brown who now asserts that he at the time of the arbitration was and now is, the sole and actual owner of, and/or liquidator of, Cellosilk Manufacturing Company then in dissolution received but deliberately ignored full and timely notice of the arbitration hearing.
The contracts between Republique and Cellosilk, described in detail in Chief Judge Conway's opinion, called for deliveries *281of the merchandise at the Port of New York. Both agreements recited that they were to he “ governed by and construed according to the laws of the State of New York In each agreement the parties covenanted to submit to arbitration all claims or controversies in accordance with the procedures of the American Arbitration Association. The later contract specified that any arbitration should be held in New York City and the courts below properly held that to cover both agreements. By the rules of the American Arbitration Association, incorporated into both contracts by reference, each party was deemed to have consented that all demands for, and notices of, arbitration and of court action for judgment or an award might be served by mail addressed to the other party “ at his last known address ”. The address of Cellosilk in both agreements was given as “ Barrington, Illinois there is no claim that Cellosilk ever had any other address, or that, until the first arbitration notices were sent by, and returned to, Republique, the latter knew that Cellosilk was out of business and no longer to be found in Barrington, Illinois. Despite its agreements that arbitration notices should be sent to its last known address, neither Cellosilk, which had meanwhile taken voluntary dissolution proceedings, nor anyone on its behalf, ever notified Republique, or American Arbitration Association, of any other or different address. Appellants’ position comes to this: that, having sold and been paid for merchandise under such contracts, Cellosilk could unilaterally destroy all Republique’s rights to arbitration simply by dissolving, discontinuing business and turning over its assets to its sole stockholder.
The argument that there was jurisdictional insufficiency in the service of notices by mail on Cellosilk is readily answered. Service by Republique of its demand for arbitration was made in exact conformity with the association’s rules. Appellants concede, as they must, that Barrington, Illinois, was Cello-silk’s last address. That fact could not be altered by Cello-silk’s act of self-immolation. Much is made of the return to Republique of that notice, with the stamped legend ‘‘ out of business ”. But what was Republique then supposed to do? Abandon its claim? It did what the association’s rule 29 permitted it to do. It proceeded to arbitration despite ‘ ‘ the absence *282of any party, who, after due notice, fails to he present ”. But Republique did see to it that the association sent to appellant Brown, who says he is and then was the sole party in interest as to the dissolved or dissolving Cellosilk, a letter giving Brown fourteen days’ notice of the time and place of the arbitration hearing. Brown ignored the letter, and the arbitration proceeded to an award. Wherein was there any lack of “ reasonable opportunity to be heard ”?
As to the service of notice of motion to confirm the award in Supreme Court, New York County, it does not seem to be disputed that, this service, too (by mail to Cellosilk at Barrington, Illinois), complied exactly with the requirements of American Arbitration Association rule 29 (supra) as well as with section 1461 of the New York Civil Practice Act. The majority opinion in this court says that Republique had an obligation to investigate Cellosilk’s status or location and to notify the Supreme Court as to its discoveries. We do not know of any such obligation.
The only obstacle found by Special Term (but denied by the Appellate Division) to confirmation of the award was the prior dissolution in Illinois of Cellosilk, an Illinois corporation. But Illinois, like New York, has a survival statute (111. Rev. Stat., 1953, ch. 32, § 157.94) by virtue of which corporate dissolution in Illinois does ‘ ‘ not take away or impair any remedy available to or against such corporation ”, “ if action or proceeding is commenced within two years after the date of such dissolution ”. The confirmation of Republique’s award was within two years after Cellosilk’s dissolution. The Illinois statute does not require that such “ proceedings ” after dissolution be had in Illinois in order to be valid, and there was every reason here why this arbitration (which the parties had agreed should be held, and was held, in New York) should be the subject of confirmation proceedings in New York (see Matter of Gantt [Hurtado & Cia.], 297 N. Y. 433). Thus, there was a continuing “ remedy available ” to Republique in New York, and that remedy was in no way cut down or destroyed by the survival statute of Illinois, the State of Cello silk’s incorporation.
While we of the dissent are strongly of the opinion that the Appellate Division was correct, we must point also to a jurisdictional objection to entertaining this appeal. The arbitration *283award was made against Cellosilk alone. The Appellate Division order sought to be appealed from denied a motion to vacate the previous confirmation of that award. Nothing is better settled as to our jurisdiction than that such an order, being nonfinal, is not appealable to this court without the Appellate Division’s permission, which was not obtained here. That rule does not apply where the vacatur is sought by one not a party to the action or proceeding in which was made the determination sought to be vacated. But Cellosilk was a party to the confirmation proceedings and its status as a party therein is not altered or destroyed by its present contention that service on it was invalid. So the appeal of Cellosilk should be dismissed (Civ. Prac. Act, § 589, subd. 1, par. [a]).
Brown’s appeal, too, should be dismissed for lack of jurisdiction. In the eyes of the law he, individually, is not a party aggrieved. The arbitration award did not run against Brown. In moving to vacate it, he could be heard as a liquidator or stockholder or representative, only, of Cellosilk. A stockholder has, as such, no standing to vacate a judgment against his corporation. Thus, since Cellosilk has no right to appeal here, neither has Brown.
The order should be affirmed, with costs, or the appeal dismissed, with costs.
Froessel, Van Voorhis and Burke, JJ., concur with Conway, Ch. J.; Desmond, J., dissents in an opinion in which Dye and Fuld, JJ., concur.
Order reversed, etc.