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July 17, 1956

Charles JACKSON, Plaintiff,
ATLANTIC CITY ELECTRIC CO., a corporation of the State of New Jersey, and/or Gibbs & Hill, Inc., a corporation of the State of New Jersey, Defendants and Third-Party Plaintiffs (Pittsburgh Bridge & Iron Works, a corporation of the State of Pennsylvania, Third-Party Defendant)

The opinion of the court was delivered by: MADDEN

This is an action for personal injuries allegedly sustained by plaintiff, Charles Jackson, against defendants, Atlantic City Electric Co., hereinafter called Atlantic, and Gibbs & Hill, Inc., hereinafter referred to as Gibbs. Plaintiff's complaint alleges that on January 26, 1954, he was an invitee upon premises of Atlantic as an employee of Pittsburgh Bridge & Iron Works, hereinafter referred to as Pittsburgh, and as a result of the negligence of either Atlantic or Gibbs, or both of them, he was injured. He seeks damages. There is diversity as to all parties.

Atlantic and Gibbs both deny negligence and further allege negligence on the part of the fellow employees of Jackson through Pittsburgh. In addition in a third-party complaint against Pittsburgh, Atlantic alleges a contract for the construction job in question and further alleges that said contract provides for indemnification by Pittsburgh to Atlantic for any liability Atlantic may have to Jackson. Gibbs joins in the third-party action and alleges it was the agent, servant and employee of Atlantic under the terms of the contract.

 In an amended answer to the third-party complaint Pittsburgh denies liability, avers that the only liability it has to Jackson is under the Compensation Law of New Jersey, R.S. 34:15-1 et seq., N.J.S.A., and further that this Court has no jurisdiction because the matter is one for arbitration under the terms of the contract and the provision of 9 U.S.C.A. § 3. Pittsburgh has made the present motion for a stay of this proceeding until arbitration is had under the terms of the contract.

 The contract, dated July 29, 1952, between Atlantic and Pittsburgh, does provide for arbitration, as follows:

 'Article X'


 'Any controversy or claim arising out of or relating to this Contract, or the breach thereof, shall be settled by arbitration according to the rules then obtaining of the American Arbitration Association or such other rules as it may designate. The American Arbitration Association is hereby authorized to make arrangements for any such arbitration to be held under such rules in Atlantic City, New Jersey, unless the parties hereto agree upon some other location for arbitration.

 'This Contract shall be enforceable and judgment upon any award rendered by all or a majority of the arbitrators may be entered in any court having jurisdiction.'

 Pittsburgh argues that under Section 3 of Title 9 U.S.C.A. that this Court is without jurisdiction and under the authority of Tenney Engineering, Inc., v. United Electric Radio & Machine Workers, 3 Cir., 207 F.2d 450, and Evans v. Hudson Coal Co., Cir., 165 F.2d 970, it must grant the stay until arbitration is completed.

 Title 9 U.S.C.A. § 3 provides:

 ' § 3. Stay of proceedings where issue therein referable to arbitration

 'If any suit or proceeding be brought in any of the courts of the United States upon any issue referable to arbitration under an agreement in writing for such arbitration, the court in which such suit is pending, upon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under such an agreement, shall on application of one of the parties stay the trail of the action until such arbitration has been had in accordance with the terms of the agreement, providing the applicant for the stay is not in default in proceeding with such arbitration. July 30, 1947, c. 392, § 1, 61 Stat. 669.'

 In the Tenney case, supra, Judge Maris, did say, 207 F.2d at pages 453, 454:

 'The collective bargaining agreement here involved, not being excluded by Section 1, undoubtedly is within the purview of Section 3 of title 9. For it is settled that Section 3, being a purely procedural section, applies to all contracts for arbitration which may be involved in suits properly brought in the federal courts and not merely to those maritime transactions or contracts evidencing transactions involving interstate, foreign or territorial commerce the arbitration clauses of which are made valid and enforceable by the substantive provisions of Section 2 of title 9. We, therefore, do not have to decide whether the ...

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