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Watch what you ask for

By Steven R. Minor

In MCI Constructors v. City of Greensboro, the Fourth Circuit in an opinion by Judge Duncan joined by Chief Judge Traxler and Judge Davis affirmed an arbitration award in favor of the City and against the contractor for over $14 million, arising under a $29 million contract for the construction of a wastewater treatment facility.

The case began when the Contractor filed suit against the City and its Engineer, then the City counterclaimed for breach of contract. The District Court granted summary judgment for the City on the counterclaim, in the amount of $13 million, but the Fourth Circuit reversed and remanded, in 2005.

On remand, the parties agreed to arbitration. The arbitration was heard in 2006, the arbitration panel decided the merits of the contract claim in 2007 and awarded $14 million as damages in 2008. The panel refused to modify its award and refused the Contractor's request for a "reasoned award." Back in District Court, the parties filed twenty-two briefs, including such issues as whether the $14 million award included or did not include the $9 million that was still owed to the Contractor for other parts of the contract.

It doesn't sound like the Contractor's decisions to file the suit and then to choose arbitration turned out well - and I've been there.

Full post as published by Southwest Virginia Law Blog on July 01, 2010 (boomark / email).