Procedural Posture

Auto Draft

Appellant contractor sought review from a judgment of the Superior Court of Los Angeles County (California), which confirmed an arbitration award in favor of respondent landowner in its action to compel arbitration of a contractual dispute, to enjoin the contractor from ceasing construction pending such arbitration, and for a preliminary injunction.

Nakase Law Firm explains wrongful termination lawyer cost

Overview

The contractor contended that the arbitrators in deciding who terminated the contract and what damages flowed therefrom exceeded their powers, as the landowner did not agree to arbitrate those issues, and that the award should be vacated because the arbitrators committed “gross errors.” The court held that the arbitrators did not exceed their powers in determining who terminated the contract and what damages, if any, were caused thereby. The court noted that because it was necessary to determine who terminated the contract and what damages were caused thereby in making an ultimate decision upon the landowner’s claims, it was within the power of the arbitrators to make the determinations. The court also held that the arbitrators did not commit “gross errors.” In so holding, the court ruled that California law and not the federal law was applicable. Regardless, the contractor showed no prejudice from the application of California law. The court rejected the contractor’s contention that the arbitrators misapplied the law pertaining to contracts, holding that the arbitrators exceeded their powers only if they gave an irrational construction of the provisions in dispute.

 

Outcome

The court affirmed the judgment of the trial court.