In the Matter of the Arbitration between PAVIA & CO., INC., Appellant, and FULTON COUNTY SILK MILLS, Respondent.
APPEAL from an order of the Supreme Court at Special Term (EDER, J.), entered March 22, 1954, in New York County, which vacated a stay restraining respondent from prosecuting an action against appellant in the Supreme Court, Fulton County, and denied a motion by appellant for an order directing that the controversy between the parties be arbitrated.
Michael P. Bazell of counsel (Baker, Obermier & Rosner, attorneys), for appellant.
Horace S. Manges of counsel (Milton Haselkorn with him on the brief; Arthur C. Aulisi, attorney), for respondent.
The parties effected a sale of goods by telephone on September 14, 1953. Petitioner, the seller, asserts that its standard form of contract containing an arbitration clause was then mailed to respondent, the buyer. The form stated that it was in confirmation of sale made by telephone, provided for acceptance by signature of the buyer, and further provided that 'Unless this contract is returned by the Buyer duly signed by the Buyer by return air mail, Seller shall have the option to cancel this contract.' Respondent never signed or returned the form of contract and denies ever having received it. The goods were invoiced on September 21, 1953, and payment made. Later complaint as to the quality of the goods resulted in suit.
Petitioner has sought to stay the court action and to compel arbitration. Special Term denied the motion to compel arbitration, stating that the so-called contract containing the arbitration clause 'was never signed by respondent and hence is not binding on it'. It is conceded that the agreement was never signed, but petitioner claims, nevertheless, that a triable issue as to the making of the contract is raised by its affidavit of
mailing against respondent's affidavit of denial of receipt. The contention is that if the court after trial believed that the contract form had been received by respondent, its mere retention of the form without remonstrance would be assent to the terms
We would agree that the absence of a signed acceptance is not conclusive and that the making of a contract to arbitrate, satisfying the requirements of section 1449 of the Civil Practice Act, might be established by showing a mutual adoption of a written agreement to arbitrate without the affixing of signatures to the document. There would have to be a clear showing, however, of such an understanding.
Here we find that the arrangements of sale were made without any reference to arbitration. The form containing the arbitration clause was only by way of confirmation and contemplated a signed acceptance as the mode of assent. After waiting for a longer time than that required for the requested return of the signed copy, petitioner made shipment of the goods without either insisting upon receiving back the contract form or inquiring as to respondent's inattention or intention. There would be no warrant for a finding in these circumstances that the parties had entered into a contract to arbitrate and petitioner has failed to sustain the burden of establishing the existence of a substantial issue as to the making of such a contract. ( Matter of Layton-Blumenthal [Wasserman Co.], 280 A.D. 135.)
The order appealed from should be affirmed, with costs to respondent.
BREITEL, J. (dissenting).
Petitioner, by his affidavits, made out a substantial issue requiring trial. The questions are whether the contract form was received and retained without objection by the respondent and became a binding contract. If the contract form had a valid inception, there was a valid ...