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Application of Spectrum Fabrics Corp.

Supreme Court of New York, Appellate Division

April 12, 1955

Application of Spectrum Fabrics Corp.

Page 711

APPEAL from an order of the Supreme Court at Special Term (BENVENGA, J.) entered October 11, 1954, in New York County, which denied a motion by appellant for an order staying arbitration.

COUNSEL

Bernard A. Saslow of counsel (Harold A. Axel with him on the brief; Lynton & Saslow, attorneys), for appellant.

Robert W. Adler of counsel (Ruben Schwartz, attorney), for respondent.

RABIN, J.

The petitioner agreed to sell to respondent and respondent agreed to buy 5,000 yards of fabric of a pattern designated as 'Scottie'. Most of the goods ordered were delivered. A dispute has arisen between the parties, the buyer claiming that the seller failed to restrict that pattern to it

Page 712

exclusively as, it alleges, the seller was bound to do under its agreement. The seller denies that under the contract between the parties it was under any obligation to do so. It is that dispute which the buyer seeks to arbitrate under the arbitration clause that both parties agree is contained in the contract. The seller resists arbitration, asserting that there is no arbitrable dispute between the parties for the contract is clear and unambiguous and does not contain any such exclusive privilege claimed by the buyer. Accordingly, the seller petitioned Special Term to stay the proposed arbitration. From the refusal of Special Term to grant such relief, the petitioner appeals.

The first writing to be considered is the one dated April 15, 1954, on the printed form of the seller. It is the original order of the buyer and contains the following clause: 'Confined to coat and Rainwear. Cloth is released only if no further orders received by June 30.'

It is upon this clause that the buyer rests his claim. This order form is signed by the president of the buyer and also by the representative or salesman of the seller. However, on its face there is printed the following legend: 'This order is subject to the acceptance of Spectrum Fabrics Corporation and to the conditions appearing on the face and reverse side hereof.' On the reverse side, we find printed the following: '10. Acceptance. This instrument shall become a contract when signed by Buyer and Accepted by Seller.'

The second writing to be considered is likewise one on the printed form of the seller and is dated the day following the signing of the order, i.e., April 16, 1954. It is entitled 'CONTRACT' and printed on the face thereof is the following provision: 'The order, the subject of this contract, has been accepted and recorded by the seller at its office in New York. This contract, (the provisions on both this and the reverse side of this sheet) supersedes the buyer's own form of manifold or order, if any, and constitutes the only contract between buyer and seller covering this transaction. There are no oral understandings, representations or agreements relative to this contract that are not fully expressed herein, and this contract shall not be modified or amended except in writing.'

The seller claims that this document constitutes the sole contract between the parties, is silent as to any exclusive privilege and, in the light of the above provision, one may not read into it the confinement clause found in the order of April 15th. Therefore, urges the seller, it appears clearly that there is no obligation on the part of the seller to confine the Scottie fabric to the

Page 713

buyer and thus no arbitrable issue exists between the parties. Is that position sound? Is it so clear, beyond real dispute, that the second document replaces and removes the first from consideration, as seller contends, rather than incorporates it by reference, as buyer contends, that a court can say ...


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