Foulger-Pratt Residential Contracting, LLC v. Madrigal Condominiums, LLC
779 F. Supp. 2d 100
D.D.C.2011Background
- Foulger-Pratt and Travelers seek judicial confirmation of an arbitration award against Madrigal in a DC District Court diversity case.
- The project concerns Madrigal Lofts in Washington, D.C. with Glen Construction as original GC; Travelers issued performance/payment bonds.
- The contract contemplated a three-member arbitration panel for disputes exceeding $100,000, with mediation attempted first.
- Glen stopped paying subs in 2007; Foulger-Pratt took over the project, achieving substantial completion around June 2008.
- An APS (partial settlement) in February 2009 designated a Project Neutral and reserved certain exterior-skin issues for arbitration, with a Gale Report basis.
- Interim Award (Nov. 30, 2009) ordered due payments, an escrow for further payments, and reserved some attorney-fee determinations for a later interim award.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Governing law for arbitration review | FAA governs review; preempts DC law. | DC law applies per contract clause selecting DC law for arbitration. | DC law applies; DCRAA governs review. |
| Vacatur grounds under DC law | Vacatur grounds are narrow; challenge only specific portions. | Panel exceeded authority or denied fair hearing on multiple items. | DC review remains extremely limited; some vacatur grounds denied, others not proven. |
| Panel's jurisdiction over Exterior Skin claims | Exterior Skin issues reserved for Project Neutral; Panel exceeded scope. | Panel properly decided within its arbitration scope per APS and Gale carve-out. | Panel had jurisdiction; Madrigal's challenge denied. |
| Pre-award interest on final payments | Interest awards flow from Panel's merits findings and APS terms. | Interest violates APS prerequisites to payment or contracts. | No vacatur; Panel reasonably awarded pre-award interest. |
| Warranties/close-out and punch-list costs | Panel could determine ongoing obligations and related warranties. | Panel exceeded authority by altering close-out deliverables and warranties under APS. | Claims denied; Panel acted within arbitration scope; no vacatur. |
Key Cases Cited
- Volt Information Sciences, Inc. v. Board of Trustees of the Leland Stanford Junior University, 489 U.S. 468 (1989) (FAA creates federal arbitrability law; choice of law governs arbitrability conflicts)
- Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52 (1995) (general choice-of-law clauses vs. arbitration rules; context matters)
- Jung v. Association of American Medical Colleges, 300 F. Supp. 2d 119 (D.D.C. 2004) (generic choice-of-law clause may not prove intent to opt out of FAA)
- First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995) (arbitrability questions generally decided by courts unless panel has jurisdiction)
- Major League Baseball Players Ass'n v. Garvey, 532 U.S. 504 (2001) (extremely limited review of arbitration awards)
- A1 Team USA Holdings, LLC v. Bingham McCutchen, LLP, 998 A.2d 320 (D.C. 2010) (DCRAA not expanding review beyond established limits)