Court Opinion

ID: 5459707
Source: CourtListenerOpinion
Date Created: 2022-01-09 19:31:17.495404+00
Date Added: 2024-06-11T08:32:49.534691
License: Public Domain

By the Court, E. Darwin Smith, J.
The chief point presented upon this appeal arises upon the exception to the decision of the referee, overruling the proof offered by the defendants in support of the counter-claim set up in their 4th answer. It appears from the answer and reply, that all the matters in controversy between these parties, except so far as relates to this counter-claim, were mutually submitted to arbitration ; that arbitration bonds in the penal sum of $1000 were mutually executed and delivered, to abide the decision of the arbitrator; that the parties appeared before the arbitrator and proceeded to the hearing before him; and that the plaintiff, after the hearing had been commenced and before it was completed, revoked the submission. The defendants claim to recover, by way of counter-claim, for the damages sustained by them consequent upon such revocation; and they *228offered proof of the expenses paid for witnesses on such arbitration, and such other legitimate expenses as were recoverable in an action upon said bond. This proof was objected to, and overruled by the referee, and the defendants’ counsel duly excepted.
The revocation of the submission to the arbitrator worked a forfeiture of the bond, and entitled the defendants to maintain an action thereon, in which they would have been entitled to recover all the costs, expenses and damages which they might have incurred in preparing for such arbitration. (2 R. S. 544, §§ 23, 24. 16 John. 205.) ¡No question seems to have been made in respect to the items of damages or expenses which the defendants claim to' recover upon this bond; but the objection is simply that a counter-claim for such damages and expenses was not admissible, and that the defendants were not entitled to recover the same in this action. The referee erred, I think, in his decision overruling the evidence offered. The defendants’ claim seems to me to meet precisely all the requisites of a counter-claim, as the same is defined in § 150 of the code. It exists in favor of the defendants against the plaintiff, against whom a separate judgment might be rendered in an action arising out of the cause of action specified. This action arises on contract, and the claim of the defendants arises also on contract, and existed at the commencement of the suit, answering in this. particular the precise description of a counter-claim, as specified in the 2d subdivision of § 150. The parties had cross demands which could be settled in one suit. (Lemon v. Trull, 13 How. 249. Davidson v. Remington, 12 id. 311. Dobson v. Pearce, 2 Kernan, 156. Arndt v. Williams, 16 How. 244.)
I think, also, that the referee erred in excluding the evidence offered, showing that the defendants refused to take the machinery relating to the mash wheel shaft and have it put up at their expense. This evidence was, I think, admissible, as favoring the defendants’ construction of the contract as actually understood and carried into effect, and tending to show that *229this work was not extra; and also, if it were extra work, as limiting the claim of the plaintiff to a recovery for the labor previously done thereupon. I do not think that there was any error committed by the referee in allowing the plaintiff to amend his complaint so as to include the charge in respect to the second boiler. This was within the general scope of the complaint, and it was a fit exercise of the discretion of the referee to receive the evidence in regard to it. It could be no surprise to the opposite party, and no such objection to it was suggested.
[Monroe General Term,
December 5, 1859.
The judgment should be reversed and a new trial granted; costs to abide the event.
Welles, Smith and Johnson, Justices.]