JANUARY 31, 1923. Hon. THOMAS STERLING, United States Senate, Washington, D. C. MY DEAR SENATOR: I have been, as you know, very strongly impressed with the urgent need of a Federal commercial arbitration act. The American Bar Association has now joined hands with the business men of this country to the same effect and unanimously approved, at its convention in San Francisco last August, a draft of a law prepared by its committee on commerce, trade and commercial law and approved of by a large number of associations of business men. It was introduced in the Senate by you as Senate bill 4214 and in the House of Representatives by Congressman Mills as House bill 13522. The clogging of our courts is such that the delays amount to a virtual denial of justice. I append an excerpt of the American Bar Association report which would seem to support that statement. I believe the emergency exists for prompt action and I sincerely hope that this Congress may be able to relieve the serious situation. If objection appears to the inclusion of workers' contracts in the law's scheme, it might be well amended by stating "but nothing herein contained shall apply to contracts of employment of seamen, railroad employees, or any other class of workers engaged in interstate or foreign commerce. If the bill proves to have some defects (and we know most legislative measures do), it might well, by reason of the emergency, be passed and amended later in the light of further experience. The New York State arbitration act, on which the Federal law is based, has been in force since April, 1920, and but for it the court congestion there (26,000 civil cases in the two boroughs of Manhattan and the Bronx alone) would be still worse. Yours faithfully, HERBERT HOOVER, Secretary of Commerce. COMMERCIAL ORGANIZATIONS INDORSING UNITED STATES ARBITRATION ACT. [List submitted by Mr. Charles L. Bernheimer.] 1. The Western Fruit Jobbers' Association of America, Chicago, Ill. 2. National Wholesale Grocers' Association, New York City. 3. San Francisco Chamber of Commerce, San Francisco, Calif. 4. Musical Supply Association, New York City. 5. Babson Institute, Wellesly Hills, Mass. 6. Sun Maid Raisin Growers (formerly California Associated Raisin Co.), Fresno, Calif. 7. National Poultry, Butter, and Egg Association, Chicago, Ill. 8. Chamber of Commerce of Kansas City, Kansas City, Mo. 9. California Peach and Fig Growers, Fresno Calif. 10. Canners' League of California, San Francisco, Calif. 11. Music Publishers' Protective Association, New York City. 12. Lake Charles Association of Commerce, Lake Charles, La. 13. American Chamber of Commerce of Philippine Islands, Manila, P. I. 14. North American Fruit Exchange, New York City. 15. Atlantic Fruit Co., New York City. 16. Live Poultry and Dairy Shippers' Traffic Association, Chicago, Ill. 17. Yakima Fruit Growers' Association, Yakima, Wash. 18. Fruit Dispatch Co., New York City. 19. American Fruit Growers, Pittsburgh, Pa. 20. California Packing Corporation, San Francisco, Calif. 21. Chamber of Commerce of State of New York, New York City. 22. Los Angeles Chamber of Commerce, Los Angeles, Calif. 23. New York Board of Trade and Transportation, New York City. 24. National League of Commission Merchants of United States, Washington, D. C. 25. Converters' Association, New York City. 26. Philadelphia Association of Credit Men, Philadelphia, Pa. 27. Philadelphia Chamber of Commerce, Philadelphia, Pa. 28. Rochester Association of Credit Men, Rochester, N. Y. 29. Broadway Board of Trade, Brooklyn, N. Y. 30. National Association of Credit Men, New York, N. Y. 31. Crockery Board of Trade of New York, New York, N. Y. 32. Arbitration Society of America, New York, N. Y. 33. International Apple Shippers Association, Rochester, N. Y. 34. American Manufacturers Export, New York, N. Y. 35. Central Mercantile Association, New York, N. Y. 36. Building Trades Employers' Association of the City of N. Y., New York, N. Y. 37. Federated Fruit and Vegetable Growers. (Inc.) (Cooperative nonprofit-National Sales Service) New York, N. Y. 48. San Antonio Chamber of Commerce, San Antonio, Tex. 39. Music Industries Chamber of Commerce, New York, N. Y. 40. American Exporters' and Importers' Association, New York, N. Y. 41. The Merchants Association of New York, New York, N. Y. 42. Tri-Boro Chamber of Commerce, Braddock, Pa. 43. The Baton Rouge Chamber of Commerce, Baton Rouge, La. 44. Merchants and Manufacturers Association of Baltimore, Baltimore, Md. 45. New York Coffee and Sugar Exchange (Inc.), New York, N. Y. 46. New York State Forestry Association (Inc.), Albany, N. Y. 47. American Fruit and Vegetable Shippers' Association, Chicago, Ill. 48. San Antonio Chamber of Commerce, San Antonio, Tex. 49. New Orleans Association of Commerce, New Orleans, La. 50. Commercial Law League of America, Chicago, Ill. 51. New Jersey State Chamber of Commerce, Newark, N. J. 52. The Albany Chamber of Commerce, Albany, Ga. 53. Chamber of Commerce of Haywood County, Brownsville, Tenn. 54. Portsmouth Chamber of Commerce. Portsmouth, N. H. 55. Chamber of Commerce and Business Men's Club, San Antonio, Tex. 56. The Atlanta Chamber of Commerce, Atlanta, Ga. 57. The Chamber of Commerce, Hazelton, Pa. 58. Hudson County Typothetæ, Jersey City, N. J. 59. Association of Commerce (for Jackson and Madison County), Jackson, Tenn. 60. Chamber of Commerce of Michigan City (L. M.), Michigan City (L. M.), Ind. 61. The Rotary Club of Newark, N. J., Newark, N. J. 62. Massachusetts State Chamber of Commerce, Boston, Mass. 63. Winsted Chamber of Commerce, Winsted, Conn. 64. New Brunswick Board of Trade, New Brunswick, N. J. 65. Chamber of Commerce, Fort Smith, Ark. 66. New Jersey Lumberman's Association, Newark, N. J. 67. Chamber of Commerce, Houston, Tex. Hon. THOMAS STERLING, NEW YORK, N. Y., January 8, 1924. Senate Office Building, Washington, D. C.: National Wholesale Grocers' Association of United States heartily indorses principles involved in your bill, 1005, and House 646, proposing United States arbitration act. In interests economical adjustment of trade disputes and elimination expensive litigation. This association for many years has urged commercial arbitration. Respectfully urge favorable action these measures by your subcommittee at hearing to-morrow. M. L. TOULME, Secretary. Senator STERLING, Washington, D. C.: CHICAGO, ILL., January 7, 1924. Your committee has called hearing Wednesday, January 9, on United States arbitration act, House bill 646, Senate bill 1005. Respectfully urge committee's favorable consideration of this measure, as it is legislation that is badly needed in order to cure certain trade evils; hope you will support it. J. W. DAVIS, Chairman Legislative Committee American Fruit and Vegetable Shippers' Association. Senator STERLING, Washington, D. C.: CHICAGO, ILL., January 7, 1924. Our association was very anxious be represented at hearing Wednesday, January 9, in connection with Senate bill 1005, House bill 646, United States arbitration act, but owing to our convention now in session be impossible. We represent shippers from all sections of United States and are strongly in favor of this bill. Hope committee will give it favorable consideration. AMERICAN FRUIT AND VEGETABLE SHIPPERS' ASSOCIATION. Hon. THOMAS STERLING, PHILADELPHIA CHAMBER OF COMMERCE, United States Senate, Washington, D. C.: · January 8, 1924. MY DEAR SENATOR STERLING: The executive committee of the Philadelphia Chamber of Commerce begs that you will present the following resolution in connection with the United States arbitration act to your Committee on the Judiciary: "Resolved, That the executive committee of the Philadelphia Chamber of Commerce approves the amended draft of the Federal arbitration law, S. 1005, H. R. 646. and the draft of the commercial arbitration treaty adopted by the Chamber of Commerce of the State of New York, both of which have been unanimously approved by the American Bar Association." Yours very truly. Hon. THOMAS STERLING, N. B. KELLY, General Secretary. THE AMERICAN BANKERS ASSOCIATION, Chairman Subcommittee Senate Committee on Judiciary, Washington, D. C. DEAR SIR: S. 1005; H. R. 646, Federal arbitration act. Referring to the above bills, we are advised that S. 1005 will be given a hearing on January 9 by a subcommittee of which you are chairman in which hearing a committee from the House Judiciary Committee will probably join. The American Bankers Association with a membership of over 22,000 banksNational, State, trust companies, and savings banks-after careful consideration of similar bills which were pending in the 67th Congress (H. R. 13522; S. 4214) went on record as being thoroughly in accord with the efforts made to enact Federal legislation legalizing the settlement of commercial disputes and indorsing in principle the bills pending in the 67th Congress. The above action was the result of a careful study of these bills by the commerce and marine commission of our association whose resolution indorsing them in principle was approved by the association. It is impracticable on such short notice to send a delegate to personally represent the Association at the hearing; therefore, by this letter, we desire to present the attitude of our association in support of these measures. Very truly yours, Senator THOMAS STIRLING, THOMAS B. PATON, CONVERTERS' ASSOCIATION, United States Senate, Washington, D. C. DEAR SIR: We are to-day in receipt of advice that sub-committee meeting will take place on the 9th instant for the purpose of conducting a hearing on bill S. 1005 referring to Federal arbitration. It is a matter of great regret to us that the chairman of our association's committee on arbitration, who is fully familiar with this subject matter, is not at present in town and will not return until the 14th instant as it had been our hope that he would be able to appear before such Sub-Committee for the purpose of voicing our decided views in support of this proposed legislation. Our association has had very large experience under the New York arbitration act and with arbitration generally and we most strongly feel that the adoption of a Federal arbitration act such as is now proposed will be one of the most forward steps in commercial life. Our members have found arbitration to be expeditious, economical, and equitable, conserving business friendships and energy. We trust that we will be granted the privilege of having our chairman enlarge on this proposition upon his return. Very respectfully yours, SAMUEL M. FORBES, Secretary. NEW YORK BOARD OF TRADE AND TRANSPORTATION, Hon. WILIAM E. CLEARY, DEAR CONGRESSMAN: You will probably remember that this board was quite active in supporting the Sterling bill, S. 4214, last year, and we understand that the Sterling bill, S. 1005, introduced in the present session is the same measure. Mr. Charles L. Bernheimer is very anxious that the board be represented at the hearing on Wednesday next, January 9, at 2.30 p. m., in the Senate Judiciary Committee room. As Wednesday is our board meeting day, none of us can go over. Will you be good enough to represent us in this matter? As a former vice president of the board and a present director it would be quite suitable. Mr. Bernheimer would be delighted I am sure. He will be there. I inclose some printed matter relating to bill of last year which is good as to present bill. Very truly yours, Hon. WILLIAM E. CLEARY, FRANK S. GARDNER, Secretary. BROOKLYN CHAMBER OF COMMERCE, House Office Building, Washington, D. C. MY DEAR CONGRESSMAN CLEARY: The Brooklyn Chamber of Commerce has been very much interested in commercial arbitration, as it believes that it is often possible by arbitration to save time, trouble and money. We have established an arbitration court in the Brooklyn Chamber of Commerce and are successfully handling disputes. As you know, last year there was an Arbitration Law passed in the State of New York. At the present time House bill No. 646 has been introduced to give a national law on arbitration to correspond with the New York State law. The Brooklyn Chamber of Commerce believes that it would be a very good thing for the country at large, to have this arbitration legislation passed, and we are writing you as a Brooklyn Congressman, to urge that you use your influence in supporting House bill No. 646. There is a joint hearing on this bill at 2.30 p. m. Wendesday, January 9th in the office of the Senate Judiciary committee. Hope that you can be present. Very truly yours, ARTHUR S. SOMERS. The CHAIRMAN. Who is your next witness, Mr. Bernheimer? Mr. BERNHEIMER. Mr. Alexander Rose, of the Arbitration Society of America. Representative DYER. Is there anybody here in opposition to the bill. The CHAIRMAN. No one that I know of. Representative DYER. Is there anybody who has indicated any opposition in writing, or otherwise? The CHAIRMAN. No; I knew of no real opposition when the bill was before the Senate subcommittee at the last session. Representative DYER. There is no question of the authority of Congress to legislate on this subject as provided in the bill, is there? The CHAIRMAN. I do not think there is. Representative DYER. The authority and jurisdiction is ample? The CHAIRMAN. Yes. STATEMENT OF MR. ALEXANDER ROSE, REPRSENTING THE ARBITRATION SOCIETY OF AMERICA, NEW YORK CITY. Mr. ROSE. Mr. Chairman, in speaking on this matter before the committee I desire to express my thanks for the privilege, and, following as I do after Mr. Bernheimer and Mr. Julius Henry Cohen, of New York, I do not want to pass by the opportunity, on behalf of those of us from New York, to witness to their untiring efforts in this cause and to extend to them a tribute of praise and our regards for the efforts that Mr. Bernheimer has always exhibited and for the great learning and erudition that Mr. Cohen has brought to this matter of arbitration. Representative DYER. Are you not going to include in that my constituent, Mr. Piatt, in your eulogy? Mr. ROSE. I thought Mr. Piatt did not lay claim to residence in New York City. I want to speak, first of all, as I think it will be illuminative, on the question with reference to the formation of this society known as the Arbitration Society, of New York, and their functioning solely in the cause of arbitration. That is not solely a trade organization, although it has some 60 trade organizations who affiliate with it and avail themselves of the service. That society arose out of the enactment of the law of 1920 by the New York State Legislature, which law I think Mr. Bernheimer and Mr. Cohen were primarily responsible for in that State. That law, as has been alluded to here and I desire to point out, has two features by which it remedies two existing conditions in the law of arbitration. And it was due to the remedying of these two conditions which existed before that it had fallen into disuse. Those two features consisted of the revocability of an arbitration, as has been pointed out, and to the fact that the courts held right straight along that it was not competent for parties to agree on an arbitration of an entire controversy. They could agree upon some incidental features-whether some work on a building contract had been properly performed; whether a payment was due; whether some matter of value was to be determined as an incidental matter, but the question of liability under the whole contract was one which the courts assumed to take away from the parties. That is, it held that the parties had no right to oust the courts of jurisdiction and refused to enforce contracts of arbitration. When those were taken out of the statute, those seeds of destruction, it remedied the things by which the statute had fallen into disuse. In about two years thereafter, the statute still being on the books in its present form, it had not yet attracted public notice, and a project came up to organize a society to give vitality to this statute in the common estimation before the public had it. And so the society was organized, in which there were some 20 governors appointed, and among those governors we had a showing of the desirability of this law from every point of view; and on which were the deans of both of the great law schools of New York City, the Columbia University and New York University, sponsoring the project, and such public men as Mr. Charles M. Schwab, acting as chairman of the general committee. And we had the former chief |