HVAC Breaking News

March 23, 2007: Appeals Court Upholds Contractors' Right to Require Arbitration

March 23, 2007
/ Print / Reprints /
ShareMore
/ Text Size+

WASHINGTON - Siding with the Associated General Contractors of America (AGC) and its Greater Florida Chapter, the Court of Appeals for the First District of Florida has held that the arbitration clauses embedded in standard contracts widely used throughout the construction industry survive contract termination. The court found it "well established that the duty to arbitrate does not necessarily end when a contract is terminated" and stated that, at least in Florida, such clauses apply to "disputes arising after the cancellation of the underlying contract unless … specifically excluded."

"Both project owners and their contractors are entitled to know what they are agreeing to do," said AGC CEO Stephen E. Sandherr. "We cannot have the courts reinterpreting standard language which owners and their contractors have chosen specifically to stabilize their relationship."

Before the court was the 1997 version of the "A201," a standard form construction contract that the American Institute of Architects (AIA) has published and that continues to govern the construction of many projects. The case arose very near the contractor's completion of the project that its contract covered, and after the contractor had secured a certificate of occupancy. At that late point in the process, the owner unilaterally terminated the contract and then filed a lawsuit against the contractor. In response, the latter filed a motion to compel the owner to arbitrate its dispute, and to dismiss or stay the lawsuit pending arbitration. The trial court denied the contractor's motion. The appellate court has now reversed the lower court's decision.

In the friend-of-the-court brief filed in "The Auchter Company v. Fouad Zagloul," AGC and its chapter had stressed that the trial court's "misinterpretation of well worn language" threatened to throw "an enormous number of contracts incorporating A201 into a state of uncertainty."

Publication date: 03/19/2007

Did you enjoy this article? Click here to subscribe to The NEWS Magazine

You must login or register in order to post a comment.

Multimedia

Videos

Image Galleries

2014 MCAA Annual Convention

Scenes from the 2014 MCAA Annual Convention in Scottsdale, Ariz.

Podcasts

NEWSmakers: Julian Scadden

Training is an ongoing process. Julian will discuss how you can generate maximum return on time and energy invested training by following a three part process. Listen to this podcast to get expert tips on training, tracking and follow up. 

More Podcasts

THE MAGAZINE

ACHRNEWS

NEWS 04-14-14 cover

2014 April 14

Check out the weekly edition of The NEWS today!

Table Of Contents Subscribe

SERVICE CALLS POLL

Which statement on service calls best applies to your business?
View Results Poll Archive

HVACR INDUSTRY STORE

plumbing-hvac.gif
2014 National Plumbing & HVAC Estimator

Every plumbing and HVAC estimator can use the cost estimates in this practical manual!

More Products

Clear Seas Research

 

Clear Seas ResearchWith access to over one million professionals and more than 60 industry-specific publications, Clear Seas Research offers relevant insights from those who know your industry best. Let us customize a market research solution that exceeds your marketing goals.

DON'T MISS A THING

Magazine image
 
Register today for complete access to ACHRNews.com. Get full access to the latest features, Extra Edition, and more.

STAY CONNECTED

facebook icontwitter iconyoutube iconLinkedIn i con