This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
From the nature of arbitration, a submission, which is the voluntary agreement of the parties to the original controversy to refer the matter in dispute to arbitrators, is necessary.1 Under our constitutional guaranty of right of access to the courts, and right of trial by jury, the legislature can not compel the parties to submit to arbitration unless a means is given for appealing to the courts for trial in accordance with constitutional guaranties.2 The submission by which the parties agree to refer certain questions to arbitration is a contract and is governed by the general principles which apply to ordinary contracts.3 Like other contracts, it must be sufficiently definite in its terms,4 and a mere suggestion by one party that certain matters be settled by arbitration if not accepted by the adversary party,5 does not amount to a submission. It is not necessary that the submission should specify the time and place of the hearing,6 since the law will presume that the parties intended a reasonable time and place if none is specified.7 The time for hearing may be extended by subsequent mutual informal agreement, even if the original contract fixing the time for hearing were under seal.8
California. North American Dredging Co. v. Outer Harbor Dock & Wharf Co., - Cal. - , 173 Pac. 756.
Georgia. Lawrence v. White, 131 Ga. 840, 19 L. R. A. (N.S.) 966, 63 S E. 631.
Missouri. Mecartney v. Guardian Trust Co., 274 Mo. 224, 202 R. W. 1131.
West Virginia. Flavelle v. Red Jacket Consol. Coal & Coke Co., 82 W. Va. 295, 96 R. E. 600.
See Sec. 721.
2 North American Dredging Co. v. Outer Harbor Dock & Wharf Co., - Cal. - , 173 Pac. 756; Lawrence v. White. 131 Ga. 840, 19 L. R. A. (N.R.) 966, 63 R. E. 631; Mecartney v. Guar dian Trust Co., 274 Mo. 224, 202 S. W. 1131; Flavelle v. Red Jacket Consol. Coal & Coke Co.. 82 W. Va. 295, 96 R. E. 600.
3 Aktieselskabet Korn-og Foderstof Kompagniet v. Rederiaktiebolaget At lanten, 250 Fed. 935.
1Burghardt v Turner. 29 Mass. (12 Pick.) 534: Mecartney v. Guardian Trust Co., 274 Mo. 224. 202 R. W. 1131.
2 Railway Company v. Garrett, 50 O. S. 405, 34 N. E. 493.
The exercise of the police power is not compulsory arbitration. State Board of Health v. Greenville, 86 O. S. 1, 98 N. E. 1019.
3 District of Columbia v. Bailey, 171 U. R. 161, 43 L. ed. 118; Mecartney v. Guardian Trust Co., 274 Mo. 224, 202 R. W. 1131.
"The genera] rule is, 'that everyone who is capable of making a disposition of his property, or a release of his right, may make a submission to an award; but no one can, who is either under a natural or civil incapacity of contracting.' Kyd, p. 35; Russell on Arbitrators, p. 14. And Morse, in the opening paragraph of his treatise on Arbitration and Award (p. 3), says: 'A submission is a contract.' And again, at p. 50: 'The submission is the agreement of the parties to refer. It is, therefore, a contract, and will in general be governed by the law concerning contracts.' In Whitcher v. Whit-cher, 49 N. H. 176, the supreme court of New Hampshire said (p. 180): 'A submission is a contract between two or more parties, whereby they agree to refer the subject in dispute to others"
A submission has no legal effect, unless it is made by parties who have power to make contracts with reference to the right in question, by which such right may be discharged.9
From the nature of submission, questions of consideration rarely arise. Submission implies a mutual agreement on each side to submit the matters in question to the decision of the arbitrators, and accordingly the promise on either side is a sufficient consideration for the promise on the other side.
and to be bound by their award, and the submission itself implies an agreement to abide the result, even if no such agreement were expressed.' It was because a submission to arbitration had the force of a contract, that at common law a submission by a corporation aggregate was required to be the act of the corporate body. Russell on Arbitrators, fifth edition, p. 20; which act was of necessity required to be evidenced in a particular manner.
"It is true that an executor, at common law, had the power to submit to an award. But this power arose by reason of the full dominion which the law gave the executor or administrator over the assets, and the full discretion which it vested in him for the settlement and liquidation of all claims due to and from the estate. Wheatley v. Martin, 6 Leigh 62; Wamsley v. Warns-ley, 26 W. Va. 45: Wood v. Tunnicliff, 74 N. Y. 38. Whilst, however, the agreement of the executor to a common-law submission was binding upon him, such a consent on his part did no protect him from being called to an account by the beneficiaries of the estate, if the submission proved not to be to their advantage, because the submission was the voluntary act of the executor and was not the equivalent of a judicial finding. 3 Williams on Executors, p. 326, and authorities cited. So. also, the power of a municipal corporation to arbitrate arises from its authority to liquidate and settle claims." District of Columbia v. Bailey, 171 U. S. 161, 43 L. ed. 118.
4 Rawlinson v. Shaw, 124 Mich. 340, 82 N. W. 1054: Mecartney v. Guardian Trust Co., 274 Mo. 224, 202 S. W. 1131; Klock Produce Co, v. Robertson, 90 Wash. 260, 155 Pac. 1044.
5 Mecartney v. Guardian Trust Co., 274 Mo. 224, 202 S. W. 1131.
6 Curtis v. Potts, 3 M. & S. 145.
7 Curtis v. Potts, 3 M. & S. 145.
8 Hill v. Taylor, 15 Wis. 100.
9 District of Columbia v. Bailey, 171 U S. 161. 43 L. ed. 118; Millsaps v. Estes. 137 N. Car. 535, 107 Am. Rt, Rep. 406, 70 L. R. A. 170, 50 S. E 227.