HomeMy WebLinkAbout98-07289
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NYE CONSTRUCTION
COMPANY, INC.,
IN TIlE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY,PENNSYLVANIA
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Plaintiff
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NO. 9H.72H9 EQUITY
N.T. MANAGEMENT, INC..
Defendant
RULE TO SHOW CAUSE
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AND NOW, this \ , day of June, 2002, upon consideration orthe Motion To Compel
Arbitration, a Rule is issued upon thc Defendant to show cause, if any there bc. why the relicf
requested in the Motion should not bc granted.
Rule returnable \)
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days from service.
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BY THE COURT.
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NYE CONSTRUCTION
COMPANY, INC.,
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY. I'ENNSYLY ANlA
Plaintiff
v.
NO. 98-7289 EQUITY
N.T. MANAGEMENT. INC..
Defendant
MOTION TO COMPEL ARBITRATION
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NOW, comes Nye Construction Company, Inc. ("Nye Construction"), by and through its
attorneys, O'BRIEN, BARIC & SCHERER, and files the within Motion to Compel Arbitration
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and, in support thereof. sets forth the following:
I. By order dated April 7, 1999, this Court ordered arbitration of the above matter.
A copy of the order is attached hereto as Exhibit "A" and is incorporated.
2. The parties, by agreement. entered into non-binding mediation in an attempt to
resolve the matter.
The parties have not been able to reach a resolution of this matter through
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Counsel for plaintiff has contacted counsel for defcndant in an attempt to set
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arbitration of this matter and has been unsuccessful in receiving a response from counsel from
defendant to appoint arbitrators and set arbitration.
5. In accordance with tbe order of Court dated April 7, 1999. plaintilfrequests that
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this Court appoint two independent arbitrators with the third arbitrator being the architect for the
projed at isslie as referenced in the prior order.
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6. PlaintilT requests that the eosts of arbitration be equally divided by plaintiff and
defendant.
WHEREFORE, Plaintiff requests that this Court appoint two independent arbitrators and
dircct that the arbitration be set to take place within a timc cerlain Irom the date of appointment
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ofthe arbitrators with the parties to equally divide the costs of the arbitration.
Respectfully submitted,
o??t:R
David A. Baric, Esquire
!.D. # 44853
17 West South Street
Carlisle, Pennsylvania 17013
(717) 249-6873
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da h.dir/litigationflila lie r/n ~'l'/l'om pel. III 01
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David A. Baric, Esquire
For Petitioner
Matthew Chabal, III, Esquire
For Respondent
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NYE CONSTRUCTION COMPANY, INC,
Pctitioner,
: IN THE COURT OF COMMON PLEAS
: OF CUMBERLAND COUNTY,
: PENNSYLVANIA
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NT MANAGEMENT, INC.,
Respondcnt.
: CIVIL ACTION-EQUITY
RULE TO SHOW CAUSE
AND NOW, this 1A- day of ;\!A/V/V7 ,I 9CJf, upon revicw of the attached Pctition
ofNye Constnlction Company To Compcl Arbitration and For Appointmcnt of Arbitrators A
Rule To Show Cause is issued why thc relief requestcd should not be granted is cntered upon
N.T. Management, Inc.
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This Rule is returnable ~ days from scrvice hercofupon N.T. Managemcnt, Inc.
BY THE COURT,
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4. Pursuant to the Construction Management Agreement, Nye Construction was to
provide construction management services to N.T. Management, Inc. lor the construction ofa
Days Inn in Mechanicsburg, Cumberland County, Pennsylvania.
S. The Construction Management Agreement provided lor payment by NT
Management, Inc. to Nye Construction for the services rendered. N.T. Management, Inc. has
tailed and refused to pay the amounts due under the Construction Management Agreement.
6. At Article VIII, subsection 4 of the Construction Management Agreement, the
parties expressly provided for arbitration of any and all claims or disputes relating to or arising
from the Construction Management Agreement.
7. Petitioner has filed with the American Arbitration Association a request for
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arbitration, a copy of said liIing is appended hereto as Exhibit "8" and is incorporated.
8. Respondent, by and through its counsel, has sought to prevent arbitration of this
matter by the American Arbitration Association alleging that forum is not appropriate.
9. Petitioner requests this Court to appoint neutral arbitrators to hear and resolve this
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matter.
10. Petitioner requests this Court to compel the arbitration of this dispute, which arises
under the Construction Management Agreement, in compliance with the terms of the
Construction Management Agreement.
II . Respondent has liIed a summons only in an action docketed to No. 4641-S-1998 in
the COlll1 of Common Pleas of Dauphin County, Pennsylvania.
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12. Counsel for Nyc Construclion has discusscd thc appointmcnt ofncutral arbitrators
\1 with counscl for NT. Managcmcnt, Inc. and no agreemcnt has bcen reachcd as to thc individuals
to bc appointed or the mcthod of appointment.
13. Pctitioncr has no adcquate rcmedy at law to cnforcc the provisions of the
Construction Managcment Agreement compelling arbitration.
14. This mattcr is subject to common law arbitration as provided for in the
Construction Management Agreemcnt and pursuant to 42 Pa.C.S.A.
97341.
WHEREFORE, Petitioncr requests that this Court compel arbitration of this matter and
appoint a neutral arbitrator or arbitrators.
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Respectfully submitted,
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O'BRIEN, BARIC & SCHERER
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David A. Baric, Esquire
10#44853
17 West South Street
Carlisle, PA 17013
(717) 249-6873
Attorncy for Petitioner
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~illiE!CATlON
I verity that the statements made inlhe lbregoing I'clition of Nye Constrnction
Company, Inc. To Compel Arbitr'lItionllnd For Appointmcnt of ArbitnttOl's are true and
correct to the best of my knowledge, information and belief. I understand that false statements
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herein are made subject to the penalties of 18 Pa. c.s. * 4904, relating to unsworn falsification to
authorities.
DATED: /~~Z-P~7~
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David A. Baric, Esquire
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OCT-1S-L9S6 ~2:~~
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CONSTRUCTION MANAGEMENT AGREEMENT
T!l.i.S agre"~!:
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company, rno:::.)
be12etll:s '::: is
entered 'ne tbi.:-.J.!L..._.dIiY of Z;:,&0 .1996
(Owner) Ii~d Her (Nye Conseruc~ion
( nstrucl:ion M..nge:) i:7 cor.si.de::ati.on ot mutua!
.!greed IiSS t:;llov;J:
ARTICLE J T~e ?r~~ect
.ide;; t.i.!iad a:; 7):]'./ ~ / ht1 10cllt;ed at
Pem:sylva~'ld, l!te work to b-;.. don~ i& c.'1a:
sand spedtica:.:.ons prepared 01' 0 .;T ~
dated and dpproved by ehe ~ncr.
AR~rCLE II Ser'llces ~? Be R~r.der!d
Construction Manager wi~l:
1. F.:nisb 'Proieet Mao.:llgellle::t service.! ec co-.::rdinet;e tlle ",ork of
c~e contractors ~bo wi~l perform all work =0: the project as
d~tir.!d by Constructicn Doc~men:3.
2. project Manager wl1l $~CLlrg bids or quotations for materials,
serviclts dnd ccncrllC:S tor general work. The o-...ner baa the
rlgtt ::0 reject sny or iJ~l bids recei.ved by t11/1 const.r!lction
Managor.
3. After proper a"alysis, detllr.:Uno the most aeceptllble suppliers
or 8ubcontr~ets for Owner's approval.
4.
and issue purcbase orders or
contract wor~ a:::er Owners
purchasing agent will prepare
contracts rOt materials and
approval.
5. Ac:::ou:::::ing wi.ll prepere projflc~ payrolls and related
government ropOre. it requir8d,
6. Accounting will maintain prcper project records, k.eping an
accurate and dee.~l~ account of all transactions resulting
irom pe.riorm<tflce of t.le lIork. Owner s~a.ll be afforded
immediate access ~o all ~uc~ records upon request to
COIl8t:uctioD Manager.
Follo~ a worK progra~ a6 per II bar chart schedule which the
project will proceed with all possible speed consise.nt witb
reasonable CO&tS, good verkmansnip ar.d $a~ety.
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EXHIBIT "A"
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8. projec:: M,sr.4<;e. will prepa.e and re'"i...., ~1l payment.s and
requ$~::s from co~trac:ors. supplier! will show !n det:~~l :be
items covered and shall oe prop~rly supported,
9. Const:r::c:..i.O:l ~an"g..r ",ill i'ravi.de a gualii':'i!d projec,;; .~a::age. f
,Joo sup"rir.te:ldell~ :;r. e.~e :00 tor all f~eld super'J'iJion
and c~ordin~eior. ~s re~aired.
.0. Pro jec': Ma::aS'er ;or!.;; c~a;,d~r... ell all rades !gr. ohange.5 for
struc::::ral, el!lc::d::~l. :t:l.!c.'li!lnical, .;wd plumbing ",itll tile
architect aT-d tho o!l1ner3 a?point~d a::thorized represe"tative.
11. rroj.c~ mar.age. yill ~ee': wien t~" owners repre,entat..i.ve and
ell" arehitect evo:::,/ <;:.a (2i ",eeks to coordinate all COr.t:-llC';;S,
cllarlge orders, ar.d ~n:, oeber !eems at ",ark reliAC.a eo contract
4dminls~:acion !or tb~s pr;ja=e.
12. NeI, CO~3:::~c~lon Manger, ...ill
Subcont:ac:ors on ebe owners behalf.
cOllt:act
with
eha
ARTICLE 11: e~~i~dte ot con~~~~c~ior. celt
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over.~ead and tee as cotr.pueed 9.~all rema.!.:l fixed and ....ill not;
be suaject: eo adjustlllen': except fer cil/lnges in elle work 1:ly
OW:1er.
2.
Becluse or ,:he pcssibil:.t:" of unJc;:o",n cond.i':..ions, the esti~ate
of COllst:UC-::.!.Cll cost: /lilY contain ce.eain items on wbich !III:
accurate amount car-not b. established prior ta construction.
Such iteMS, .if allY, will be set fcrth as alloWllnce items. The'
estimate ....i11 be adjustllC based on the finlll actual COlOre of "
tllis york.
3.
The estimate ot construcc!cn cost doe. not include business
machines or dlllilar equil'mene, arcbitectural or cotlBulea::tC
tees, cost of inspec::crs, surveys, t/lsts, etC.
COlllltrlJcticn M.nageraent 1'66 ,,'ill be S R '7 - ,00 tar /I period
ot eight; (8) month.. from the eM" sit;nttf;i dace and or till
pr~jcc: corn~letlan. This fee do~s not !nolude any bOnd case..
and ls based on ..J.,.o-,g-,,1. propoUl.
ITE~ *1 GEYERAL CONDITIONS
4.
su~erint.ccent and all other g.ne~a1 condition.. are
by OWller as per &tl:/lcbed addllr.dum #1 for <:In
allawance of .:!p \ \ 4-) t7 001 "':
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ITEM '2 SAV:NGS C:AUS!
Any 3a-..i::gs whic.~ t.':e C.'1A b~ys out ot ehe prcpo...~ of
",ill be sp':'it !:let.-een e.'le owner and e.;/I C!fA a::: a :ilte ct 80.
:0 t~e o~~e= aad 20, eo the CMA.
ARTICLE r; ChanClIs !n ~ork
When 4ut:;o:ized i., wrlt.i::g bJr O",ner and egnl/d upo:: by t.~e
ar~hitec:::, the Construe:;or. Menge~ wJll d;:9ct cr.~nges to the work
originally planned ar:d specified, An 8'll cose "'.1.11 be added fer
s1J?ervisio~ and ccn~er~c:ion Maneger fee.
Changss :::0 origin~l b.::d ;;:::opcsaI as ot this conerace date,
ARTICLE v pc~en:
Payments :::: con::rac::s lo'ill .ce :r...de by Owners chee;;s dra;o.r: by eJ:e
Owner on a COn$t:uctlon account of the Owner's choic. and to ....':icn
the ~~er ...i~l dep05i~ t~e necessary tu:ds,
Each >raCC.ill: will sho"', in deesl1, tll.;: i :ems covl9rad aDd wi.ll be
supported by ~opies of i~voi=es, ~equisieions fo~ paymeac,
payrolls, .=c. Ferments will be mdde a5 toIloww:
I. payrolls monchly
Z. Material and oc~er bills - 4S chey come due
3. Material. stored on or olf sica
4. Overhead , !~~ of th& Cons::ruc:ioa ~anQger - 20' ~b.r. CHA
is slgn~ and monthly thereatter in proporeioa co :he
cotal work per!ormea.
ARTICLS VI Time Of Comoietion
It is intended enat the project ~ill be ccmplGead erod ready for
oc:;::pancy by t.!l& Ovt'ler in In lIIon::lu It fter se~rt: of cOllse.uccioR
subj~ct of scrikes, lockoues aad caused not the ,ole and dlrec~
taul:: of the Conscr~ct!on Manager.
~ICLE VII Insuranc~
1.
Tbe Cv:'ler will, du:ing pror;roaa of ehe work, maintain full
insurance against lOB~ of dam4ge by Ii:., windstorm or otber
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CONSTRUCTION INDUSTRY ARBITRATION RULES
DEMAND FOR ARBITRATION
MEDIATION lf'jOU want tht A.:tA 10 conlaCllh~ othtr parI)' and alttmp' to arrongt a mtdiation. pltau chick this box.
TO: Name of Respondent
N.T. MANAGEMENT,
Address
21 EASTGATE DRIVE
City
CAMP HILL
Name of Representative (if known)
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INC.
Address
Zip Code
17011
Ci'y
State
Zip Code
Stale
PA
Fax No.
Phone No.
Fax No.
Phone No.
717 737-56 9
THE NAMED CLAIMANT, A PARTY TO A WRITTEN AGREEMENT DATED 10/28/96 PROVIDING
FOR ARBITRATION UNDER THE CONSTRUCTION INDUSTRY ARBITRATION RULES, HEREBY DEMANDS
ARBITRATION THEREUNDER. (ATTACH THE ARBITRATION CLAUSE.)
NATURE OF DISPUTE (Plca,e gi"e enough del.1i1s 10 enable the AAA to sele<t arbi'rators wi'h appropriate experience.):
RESPONDENT HAS REfUSED TO PAY BALANCE DUE PURSUANT TO CONSTRUCTION
MANAGEMENT CONTRACT.
DOLLAR AMOUNT OF CLAIM: OTHER RELIEF SOUGHT:
S 107,629.00
PLEASE DESCRIBE APPROPRIATE QUALIFICATIONS FOR ARBITRATORIS) TO BE APPOINTED TO HEAR THIS DISPUTE:
FAMILIARITY WITH CONSTRUCTION MANAGEMENT WORK.
CLAIMANT IS:
DOwner 0 Design Proressional lspe<iry
o Subcontractor (spe<iry
RESPONDENT IS:
~ Owner 0 Design Proressional (spe<iry )
o Subcontractor (spe<iry 0 Other (spe<ify
ESTIMATED TIME NEEDED FOR HEARINGS OVERALL: hours 1 days
Copies ofilii. deman~ arc being filed with the Ameriean Arbitration Assoeiatioo at its PHILADELPHIA office
Claimant requests that the AAA commence the administration of the arbitration. Under the rules. you may file an answering statement within ten
days after notice rro:n the AAA.
CLAIMANT REQUESTS THAT ARBITRATION HEARINGS BE HELD AT TilE FOLLOWING LOCALE:
CARLISLE, PENNSYLVANIA
)
IU Othor lspe<ify
o Contractor
CONSTRUCTION MANAGER
o Contractor
1r
Tille
ATTORNEY
Name or Claimant
NIE CONSTRUCTION COMPANY, INC.
Adoren
I Name or Representative
DAVID A. BARIC, ESQUIRE
Addrt:u
17 WEST SOUTH STREET
CIty Sate
17055 CARLISLE PA
Zip Code
17013
>:'
SUIt
ZIp Code
City
MECHANICS BURG
P/\
Phone No. F.. 1'10. Phone 1'10. Fax No.
7 7 7QS- ~ 717 766-4405 717 249-6873 717 249-5755
TO INSTITUTE PROCEEDIl\GS. PLEASE SEND THREE COPIES OF THIS DEMAND AND THE ARBITRATION
AGREEMENT, WITH THE FILING FEE. AS PROVIDED FOR IN THE RULES, TO THE AAA. SEND THE
ORIGINAL DE!>tAND TO THE RESPONDENT.
EXllll'lT "p."
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SHERIPP'S RETURN - REGULAR
CASE NO: 1998-07289 P
COMMONWEALTH OP PENNSYLVANIA:
COUNTY OP CUMBERLAND
NYE CONSTRUCTION CO INC
VS.
N T MANMAGEMENT INC
STEVE WHISTLER , Sheriff or Deputy Sheriff of
CUMBERLAND County, Pennsylvania, who being dUly sworn according
to law, says, the within RULE TO SHOW CAUSE. PETITION
upon N T MANAGEMENT INC
defendant, at 15:47 HOURS, on the 13th day of January
1999 at 21 EASTGATE DRIVE
CAMP HILL, PA 17011 -J CUMBERLAND
County, Pennsylvania, by handing to NEEMA THAKRAR (OWNER)
a true and attested copy of the RULE TO SHOW CAUSE. PETITION
together with CIVIL ACTION-EQUITY
and at the same time directing Hi.s attention to the contents thereof.
was served
the
Sheriff's Coats:
Docketing
Service
Affidavit
Surcharge
18.00
9.30
.00
8.00
So answers: ~
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H. Thomas KIJ.ne, shtr-:::
$30.30 O'BRIEN, BARIC & SCHERER
01/14/1999
by ,~:t~~~_ D\~i~~J.u
Sworn and
t1.
this 1<1 - day
19-.Z..L A. D.
C-J.'<l!<-
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subscribed to before
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NYE CONSTRUCTION COMPANY. INC.: IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY,
Petitioner. PENNSYLV ANlA
v. No. 98-7289 Equity
N.T. MANAGEMENT, INC. CIVIL ACTION-EQUITY
Respondent JURY TRIAL DEMANDED
ORDER
AND NOW, this_day of
, 1999, upon consideration of
respondent's preliminary objections, it is hercby ORDERED that said preliminary objections are
SUSTAINED and the Petition ofNye Constluction Company, Inc. to Compel Arbitration and for
Appointment of Arbitrators in DISMISSED WITH PREJUDICE.
BY THE COURT:
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INTIWI>\lCTION
I. This mattcr ariscs undcr an allcgcd Construction Managcmcnt Agrccmcnt
betwcen the partics datcd Octobcr 28, 1996 (thc "Agrccmcnt"), a complete copy of which is
attached hcrcto as Exhibit A,2
2. The validity of thc Agrccment and thc propcr proccdure for the appointment of
arbitrators are at issue in a civil action filed in the Court of Common Pleas of Dauphin County,
Pennsylvania, on or about October 16,1998. Copies of the Writ of Summons and Sheriffs
Return are attached hcreto as Exhibit B.
3. The present Petition now filed in this Court is the second time Nye has failed to
follow the proper procedure for demanding arbitration.
4. As alleged in Nye's Pctition at Paragraph 7, Nye earlicr attempted to dcmand
arbitration before the Amcrican Arbitration Association (the "AAA"). The AAA dismisscd
Nyc's claim because therc was no agrccmcnt to arbitrate bcforc thc AAA. Copies of the AAA's
December 8, 1998 letter dismissing the claim, and counsel's Novcmber 12 and 13, 1998 lctter
argumcnts, arc attachcd hereto as Exhibit C.
5. Through its most reccnt Pctition, Nyc again sceks thc appointmcnt of Arbitrators
in a manner inconsistent with the tcrms ofthc allcgcd Agrccmcnt, and without first scrving
Noticc of the dcmand for arbitration as cxpressly rcquired. Further, Nye has filcd its Petition in
the \\Tong Court.
2Petitioncr attachcd an incompletc copy of the allegcd Construction Management
Agreement to its l'eti1ion. That copy excludcd page 4 ofthc Agreement, which scts forth thc
actual arbitration provision.
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DEMURRER/MOTION TO STRIKE
6. Paragraphs I through 5 above are incorporated herein by reference.
7. The alleged Agreement contains a provision for the arbitration of "all claims,
disputes and other matters in question between the parties to this Agreement, arising out of, or
relating to this Agreement." (See Page 4, Article VIII, Numbcr 4 of the Agreemcnt at Exhibit
A.)
8. The alleged Agreement further expressly provides for the appointment of "an
arbitration panel of three parties including the architect." (Emphasis added.) The additional
arbitrators are to be appointed by mutual agreement of the parties. (See Constmction
Management Agreement attached as Exhibit A.)
9. The alleged agreement also requires that the arbitration be commenced by serving
Notice of the demand for arbitration, which thcn triggers the parties obligations to appoint the
two remaining arbitrators. (See Exhibit A.)
10. Nye has not followed the prescribcd method for demanding arbitration, and does
not so allege.
11. Pursuant to 42 Pa. C.S.A. S 7304(A), a Court can compel arbitration only upon "a
showing that an opposing party refused to arbitrate."
12. Since Nye has not properly demanded arbitration undcr the alleged Agreement,
N.T. Management, Inc., was never faced with a demand for arbitration, and N.T. Management,
Inc., could not have refused to arbitrate.
13. Moreover. pursuant t042 Pa. C.S.A. S 7305. "Ii]f the agreement to arbitrate
prescribes a method of appointment of arbitrators. the prescribed method shall bc followed."
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14. Bceausc thc Agrccmcnt spccilics thc appointmcnt ofthc projcct architect and two
othcr mutually agrccablc arbitrators, Nyc is not as a mattcr of law cntitlcd to thc rclicf sought in
its Petition, i.e., appointing thrce other arbitrators.
15. Because Petitioner fails to state a dcmand for relief which may properly be
entered by this Court, thc Petition should be dismissed with prejudice.
16. In the altemative, because Petitioner's demand for the appointment of three
arbitrators is not cognizable under the provisions of the Agreement and of Section 7305 of the
Uniform Arbitration Act, it should be stricken from the Petition.
WHEREFORE, Respondent N.T. Management, Inc., respcctfully rcquests that the
Petition ofNye Construction Company, Inc., to Compel Arbitration and for Appointment of
Arbitrators be dismissed with prejudice, or, in thc altcmative, that Petitioner's demand for the
appointment of three arbitrators by the Court be strickcn.
,MOTION TO DISMISS - IMPROPER VEN~
17. Paragraphs I through 16 above arc incorporatcd herein by rcferencc.
18. The Agreement between the parties is thc subject of a civil action pendi 19 beforc
the Court of Common Pleas of Dauphin County, Pcnnsylvania. (See Exhibit 8.)
19. Captioned "N.T. Managemcnt, Inc. v. Nye Construction Company, Inc. et al.,"
and docketed at No. 4641-5-1998 (Dauphin C.P. 1998), the above action was instituted on or
about October 16,1998 and arises out ofthc alleged Construction Management Agrcement
referenced in Nye's Petition.
4
20. Nyc's action was commcnccd on Dcccmbcr 29, 1998 with thc filing of its Petition
with this Court.
21. Pursuant to thc Uniform Arbitration Act, 42 Pa. C.S.A. * 7304(C), "if a
controvcrsy allcged to bc or not to be rcfcrablc to arbitration undcr thc agrcement is also
involved in an action or proceeding pcnding in a court having jurisdiction to hear applications to
compel or stay arbitration, the application (to compel arbitration) shall be made to that court."
(Emphasis added.)
22. The controversy for which Nyc sccks arbitration in its Pctition is also
encompassed within the pending Dauphin County action between the parties.
23. The Dauphin County Court of Common Pleas has jurisdiction to hcar applications
to compel arbitration undcr Section 7304(C).
24. Bccause Scction 7304 is a mandatory, not discrctionary, venue provision, venuc
in this Court is impropcr as a mattcr oflaw.
25. Accordingly, pursuant to Pa. R. Civ. P. No. 1028(a)(I) and the applicable
provisions of the uniform and common law arbitration statutes, the Petition must bc dismissed
due to improper venue.
WHEREFORE. Respondent N.T. Managcment, Inc., rcspectfully requests that the
Pctition ofNye Construction Company. Inc.. to Compcl Arbitration and for Appointment of
Arbitrators be dismisscd with prcjudice.
MOTION TO DISMISS - PENDENCY OF PHIOH ACTION
26. Paragraphs I through 25 above arc incorporatcd hcrcin by rcfcrcncc.
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27. The present controversy is encompassed within litigation already pending
between the parties in the Dauphin County Court of Commonl'leas, docket number 4641-S-
1998, filed on Octobcr 16, 1998 and properly served on Nye.
28. The prior Dauphin County action involves the samc parties and issues as are
before this Court.
29. Pursuant to Pa. R. Civ. P. No.1 028(a)(6), the pcndcncy of a prior action
constitutes propcr grounds for sustaining preliminary objections.
WHEREFORE, Respondent N.T. Managemcnt, Inc., rcspcctfully requests that the
Petition ofNye Construction Company, Inc., to Compel Arbitration and for Appointment of
Arbitrators be dismisscd with prejudice.
Respectfully submitted,
M
Matthe v Chabal, III
J.D. #4 926
Douglas M. Wolfbcrg
J.D. #77959
DUANE, MORRIS & HECKSCHER LLP
305 North Front Strect
5\h Floor
lIarrisburg,l'A 17101
(717) 237-5500
Counscl for Rcspondcnt N.T. Management, Inc.
Dated: January 28, 1999
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CONSTRUCTION MANAGEMENT AGREEMENT
T,h.f.s agre 'r.t!':t
bet...ee;z .
Co~;:.tJn:' ,
bcncf,;.;;s
encerOQ /.<6 .day ot: ?;:,b0 .1990
. ;O"me~) ""ci HCr (Uye Coc.cruc;;io.c
( :zstr..cc.:.or. Mi:.1ger; .:.:: c:lI;si.ce:iltioa or mucu,,~
~9~ecd uS f~1;~3:
ARZ'IC!.K r ,.'Je
P!"~"'EC':
.ida:lCJ.!.!.ed as D}'J~ /11(1 . loc~ced at
Pem:sylva:,ia. ~'he work to blJ<. dont;.. i6 clla-::
S .i!nd sp"df:c","ions prop.s::ad b;'" I"J ~ S
G t2.':;;C d.~d 4;:;P:':}"'/cc by :::.h e c-~':: c:.
AR~ICLE IT Ser/i~~~ ~o Be ~~cd~=,d
CQn5tr~c:ion Ha~~gcr w~ll:
1. F'~=r.'::'sr. pro;.ect ."!.3;:~g'r.:e::c servicll$ eo co-c!'d':J'J~ce tne Nark ~f
c~~ ~o~e~acto:s ~bo wi~l ~erform all work :0:: t~e project es
de!ir.ed by Cvl1struceion 'cc~ment~,
~_ ;;;r:Jj~;.:: ~lJne.geI ~..ill S~CU:D bl..dt; 0:: quoe~e::cn.; [or ma~oZ"l03ls,
scrv:..::e:!J and ccn::r~c:s !-:',l" gc;;ct'c!l W'crk. ';'!Je o-,.'11Vt' blto the
::i<;1:,- to reJect OilY or: d:l bid$ rece~ved by ell" CO:1s::r\lccion
MJ.r.~g6r.
J. After p!"oper /l;J"ly:d.,s, ccten:Ullll t!w ",ost dcc"pt.,ble 5upplitll:'1
0: Gubcon~r~ct$ for ~er'$ .,pprov~l.
4.
agent v111 prepJre and i.ssu~ purcbaS5 orders or
for ~ilte:;ials Jr.c concr!ct ~Or^ afte. O~ners
Purcl1ilsing
contracts
llpproval.
5. Ac::ou::t.:ill9 ...-"11 ;>repe.rc project: payroll.> illld rw10lted
gove:;J~ellt I~Fort6 if reg~ir&d.
6.
~rojcct. r"cords, kseping ~r.
e.ll transaceion~ r.su1tir.~
o..'1ler ~ball to oJfforded
re.cords ~;O:1 request to
Accoc~ciLq ~ilJ ~~l~:~in p~cpe~
dCCllnste ilnd det..':I'Xi "r:~'ount: nf
f:o['1 pe:,"{orc""ce of t::e vcrk.
imtr:odillt:C llcces.. to ell .sIJC.~
co~~c~c~iop M~ndge~.
"
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1'012.010' a work progrllto ,'" per B b.:lr: cbolrt: licbed",l" ....t1icb che
prcJc=c wjJl proceed ~ier. ~11 P03sjble ~PQ8d eO~5ise811t vi~b
rl!,,",,o:l,,blf" CC.l:tC, go::;d ...erkm.1nslJ!p .1/;d s..~cty.
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OCT -08" 98 (THU) 11 51
NUDEL LAW OFFICE
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B. projcc: .~~,~~-;iJ:; wi~! F=e9{Jr~ 'In..::. re",i~..", ~ 1": pi!~~r.ts
reqJa3~S !=cm co~e~ac~crs. supplie~3 ~~11 stow ~= ae~~~~
items cover&d and shull be p~Cpdr"y "ur-po"=e~,
9. Cons::-t:c:iO:2 l"!aJ'Jaqp.~ ".:.~l p~avi.C(! d qt.:dli.:.!..ad ::-o].e~~ He:=c::
':00 Superi;;tenden: :;n t.~e .~ob tor .,.1 i.lelc super.-;.
end coordindtlOn ~~ ~eq~icec.
l C. p:-ojec~ J.!a::e.qe;; ....i~; c.oo.d;.::.stfJ ~.!l :e-:.es1.gr. eha::ge.s
serucc:.:.;'/!l, elec~:;i-;:<l~.. :r.echanical, at:c plumbill:; ...i::.~
iin:.~ie"c:: ar.c tile O<r.1er. eppoin:fJ<l a::Jt.~or;.::ed re?rose:;tat~
11. Froj'c: ~ar.~ger v~ll mee~ ~i:~ c~e o~er5 repr8&Qntdti~e
elle arcl::itee'.; eve17 1::'>0 i2i ...",eks to coor'cinatll 1111 cor.trllc
Cbdllge order::, Il1ld /!n:' "eber .items of "",ork re.1,1:'c t::> COlOr:=-
Ildmir.istracion for this pr~jf;~.
12. NCI, CO=3cr:.:c:lon Manger, will
SabconcrllCcors on e~e o~ers behalf.
orith
car.t:a<;,C
ARTICLE I1= Es~i~~e Of CO~!~~~c~io~ Cc~~
1. Overhead a~d tee as comp~eed-!hall ;emai~ fixed /!nd ~ill ~
bc scbj~ct co Qdjus~=eD;; except tcr c~~~gcs in tbe work
OV:2C:.
2. lIel:Sl:se ot :::he pos.!libil.:.c;,1 of ull!t;1o:&,n cond;, ::..!.ons, the esci;;zs
of cor:5~r:lc:;:.!C;1l cose r.lClY COlltain certain items Oil ...bien
BccuratR 4moucC c~r.noe b. 6~~ablished prior to constructio
Such ite.1l13, if allY, ~'ill be Silt to.th lIS alloorl:llC9 it:!!.':!.';. T.
e$tim~t~ ~ill be ~djcsteC b~5ed on the final actual cost
thi:! 'lrork.
3. The escimace ot const:~c:;cn enst co., ~ot inc:uce bu~i~e:
1ll4cbinas or IJ;j,r::i1Ilt" llCjtl.lpl:lGnt, .::;-:=jt~ctural Or' eo~cul !:ol:
te~B, CO$t of ins?ec~cr$, ~urver8, ~e~t$f c~c.
4. COlletructicn M~llllgelll"nt Fee ~::ll be S. R 1 .00 :tor a per~~
of e:.J.9ht (8) montb8 !::om tne CMJ,. olr;r.I:.." dce~ u!!d 0:: !:.!.!
projec: CO~F!Qt~o~. Tr.~S fee does not ~nelude day bond cost
~ud is nesod on -1JL~-=~ proposal.
ITEH ,1 GENERAL CONDITrONS
Superintencent and all ether gene~4; co::ditien8 ere
by ownp.: as pc. atr.actec 4ddendum #1 for an
"llcwanC" of ~ 1 \ 4; 0 Q ;/-=
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OCT -OS" 9S (TIWl 1 \ 33 NUDEL LAW OFFICE
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ITEM ,2 SAV:NGS C~AUS~
Any ~av~~gs whicc ehe CMA b~ys OU~ of cbe pr~?o~~~ of
will be split bee~een che OWDcr ~nd che CMA a~ a ~~t6 cf 80~
to the o..,;;e:- and 20\ to the CHA.
ARTI~ TV ChangG$ In Work
~hl!n autl:o:iZl!d 1.1 wrici.!lq by O",r;er .tr.e! I:lgr!Jed upon by t.~e
architect, ~h6 Const.uc::;or. Manger ~jll d;:ocr. ct.~nges to toe work
originaJJ? pl~r;nBc. 4nd speciiied, An 8\ cost: will be added fer
su?orvisicn anc Ccn~truceion M~llager lee.
Chang~s :0 crigin~l b;d ~:opcsdl ~s at tbis concrac: d3te.
ARTICLE V ?avtQ~~
~a~l!nts to. contracts ~i11 CO ~~de or Owner, cilCCKS ~r4wn by the
OYnor on d const~uction account or thl! Owndf'S cr.olc~ ace! co which
tile O~6r ~i~l de~osit the necessJry fu~d~,
Ed~b '~ccher w~ll ,bo~, in dft~sli, cba i:cms covnred .UQ ~Lll be
suppo:ted by copies of ~~voie~s, :eq~~s~tionG to: pdyrnn~r.,
pay:olls, (ltC. ?aY'""nU ",ill be made ll.S {ollOWJJ:
I. Pdyrol18 ~onebly
2. M4teri~1 And oc~er ~i;l& - as they ~ome due
3. X/lte:lal/l /Ieor~~ 0# or off oi-::/1
4. over!lead , f~ of tb~ cons::ruc-::;iOll MllllQ.'111r - ;In ",Jar. CHA
io $igned and ~r.thly tbar.af-::er in proportion to :be
totlll work pllr!crmcd.
/oRTICLlI VI: ,T.LIJl$! at comoU:tiOll
It is i~tended thllt ebe projecC ~lll bn cc~ploc,d end :C/ldy tor
Qc-::~p~nC'y by th& OvM~~ in~or.tb/l after' se~rc of const~ct~Qn
:;ubjcct of 6>;ri.kllR, lockouts alloj c"U.!1oc: not tile .sole dnd ds'rncr:
!~ult of the con~trJction Manager.
AlU" lCLE VlI rD..:llI~.
1. Tbe ev::er ...ill, audne; pro9rcRa of the work, maintain !ul~
ir.r.u~ance ~g~ln5e lOBJ of d~mage hy f1:&, ~illdstorro or oeber
P 004
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OCT. -08' 98(THUI 1512 NUDEL LAW OFFICE
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casualty for ell WOL'].; incorpo:\leed in th~ building and all
materials on or about eht: premises or in storage, and general
Habili ey insurance, wi th tile minimum limi t:s in respect ot
bodily injury of $500,00 for each person dIlCi $l,OOO,OOO for
each occurrence and property damQges 1,000,000/$2,000,000,
CO!:Jstruction Manager will be add~cJ aB co-insured on the policy
for the term of construction.
2, The Conscruction Man"-ger ,,'ill obtain from each Contractor the
required statutory coverage lor Workme!:J's Compensation
Insurance and a current Certificate Of Insursnce will be
collected by esch contractor and submicr:.ed to the Owner prior
to the start of construction.
ARTICLE VIII t'jscellanerllJs Provis.ions
1, This agreement will be binding and inure to the benetit of the
respective succeSsor5, execlltors, l1dministrators and heirs of
the perties.
2. Constructior. Mana~Qr will not have the right to assign this
agreement wiel/out the wricten consent of tbe Owner.
3. This Agreement represents the entire understanding between the
Construction M/lnllger and the Owner and may be umended only in
writing.
4. Arbi trat.ion - All claims, disputes dnd otber matters in
question between the parties to this Agz.eement, arising out
of, or relating to this Agreement or the breach tbereof, shall
be decided by arbi r:.ration in Bccordance wi th the Construction
Industry Arbitration Rules by appoi.nti.ng an arbitration panel
of three parties including the architect, ell mutually
agreeable to the parties. No arbitration, .arising out of, or
relating to tbi:; Agreement, shall include, by consolidation,
joinder or in any other nUll/ner, ilny "-dditional party not a
party to this Agreement and sign~d by s.ll the parties hereto.
Ally consent: to arbitration involving an .;JdditioDsl p.!lrty or
p/1rties Shd) 1 not constitute consent to arbitration of any
dispu te not der;cribed therein or with acy party not nallled or
described therein. Tllili Agreement to arbitrlttc /Jnd any
Agreem..-:nt, to lIrbitratc with an additional party or parties
fully consented to by the parties Ileret:o shall be speci:iica1ly
enforceable under the prevailing Ilrbit.ratlon lilv. Notice of
the demand tor arbitration shall be fill!d in "'riting llIith the
other party to this Agreement. The deml!lnd shall be made
wi thi n a re,,:;or:able time after the claim, di I;[lute or other
mat.ter in auestiol. lias arisen. In no event. 8/Jdll tbe demand
for iJl-biCriltiflD I", mdde after tile date when il/stitution of
legal or eql'it://I)l/! proceedings based on such cliJim, dispute or
other ml.l ~r.,,: .j" quostion would be bllrn'c! l.>y the appl ictJbl e
stututc cL limit~tion~.
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OCT -08' 98 (THU) 1133 NUDEL LAW OFF I CE
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ADCe:NDUI-! n
ATTACHMENT
L.IS-X OF mnrERAI. COHDrrrONS
Res~denc M&r.agcr/S~pcrincendanc___
Froject J.Mz::a;er
Field o!'~~ce
pt;orzcs
Star. Tra.:ll:i;"3
Ter.rp, Hellt
Temp. Water
~'lenelll equip.
T"lllp. C:l"r::::ic
Temp, Toilet:
Clean-up
Dur:pste:s
Sur./e?i::.~]
Te.HS IT Insp,
P'llx/Copler
CO/lH. Sigr:
Mat'l lfa.':!c.1;,.
COIl:ot. ?1l"tO$
!'''yO~t
____r.xea/I:~urance
S(J[ety
.8u.i1dcrlI R:f.31<
Siilf~ty Pltcl;.4ge
.sIlP?lies/Postege .
____'i~el cle<<n-up
!,emp. Fellcing_,
Temp. Enclo~ur"s
Or).nJt.;.n9 Water
IJ.7
OWNI!:R
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To TA L $ J 14/ QO(} / 0-
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BY
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N.T. MANAGEMENT. INC.
21 Eastgale Drive
Camp Hill, PA 17011
IN THE COURT OF COMMON PLEAS
DAUPHIN COUNTY, PENNSYLVANIA
Plaintiff
LffJ;LJ I-S-}QQ2?
\IS.
No.
NYE CONSTRUCTION COMPANY, INC.
25 Laurel Drive
Mechanicsburg, PA 17055
and
Civil Action
UJJAL MAKER
25 Laurel Drive
Mechanicsburg, P A 17055
Defendants
PRAECIPE FOR WRIT OF SUMMONS
To the Prothonotary:
Please issue a writ of summons in the abovc.caplioncd action against Nyc Construction Company, Inc. and l1jjal
Maker.
/1dtL [{..Lv{ ~
Matthew Chabal, Ill. 1.0. No. 49926
DUANE, MORRIS & HECKSCIlER LLP
305 North Front Street. 5th Flcor
Harrisburg. P A 17101
(717) 237-5508
WRIT OF SUMMONS
TO:
NYE CONSTRUCTION COMPANY, INC.
25 Laurel Drive
Mechanicsburg, PA 17055
UJJAL MAKER
25 Laurel Drive
Mechanicsburg. PA 17055
You arc hereby notified that N.T. Management, Inc., has commenced an action against you.
Date:
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Office of the Sheriff
Ralph G. McAllister
Chief Deputy
Mary Jane Snyder
Real Ettoto Doputy
Michael W. Rinehart
Assistent Chief Deputy
William T. Tully
Solic;tor
Dauphin County
HllIrisburg, Ponnsylvnnia 17101
(717) 255.2660
J. R. Lotwick
Sheriff
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF DAUPHIN
SHERIFF'S RETURN
No. 4641-S - - -1998
AND NOW: October 27, 1998 at 1l:05AM served the within
w'RIT OF SUMMONS upon
NYE CONSTRUCTION COMPANY INC by personallY handi ng to
B. 11AKER, PARTNER 1 true attested copy(iesl of
the original WRIT OF SUMl10NS and making known to
him/her the contents thereof at 25 LAUREL DRIVE
MECHANICSBURG, FA 17055-0000
So Answers, ~
County, Pa,
Plaintiff: I.. T. MAllAGEMENT INC
Sheriff's Costs:
$58.00 PD 10/16/1998 RePT NO 116738
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Dcmos K. Orphanidcs
Novcmbcr 12, 1998
Pagc 2
demand for arbitration shall be filed in writing with the other party to this
Agreement. The demand shall be made within a reasonable time after the claim,
dispute or other matter in question has arisen. In no event shall the demand for
arbitration be made after the date when institution of legal or equitable
proceedings based on such claim, dispute or other matter in question would be
barred by the applicable statute of limitations.
The award rendered by thc arbitrators shall be final, and judgment may be entered
upon it in accordance with applicable law in any court having jurisdiction thereof.
Nowhere in that clause appears any reference to the American Arbitration Association, and in
fact, the parties have never agreed to AAA arbitration.
As an exanlple that shows the parties did not intend to pursue AAA arbitration, the
arbitrator selection procedure in the contract is at odds with the AAA rulcs. The contract
requires that "all" arbitrators must be "mutually agreeable to the parties." The AAA rules have
no such requirement. In fact, the rules only allow a party to strike a limited number of
prospective arbitrators. Furth,:r, in the absence of agreement among the parties, or if acceptable
arbitrators are unable to act, the rules allow the Association to select the arbitrators. That clearly
was not the intent of this agreement, which calls for this matter to be arbitrated by the project
architect and two other mutually acceptable arbitrators.
Thank you for the Association's reconsideration of this issue. TI)is will confirm that you
have tcmporarily put this matter on hold until this issue is decided, that in the meantime we need
nol rcspond to the Demand lor Arbitration, the list of arbitrators or any othcr matter, and that wc
nced not immediately seck injunctive relief to protcct our client's rights. I should note for the
record that our willingness to allow thc Association to take another look at this issue before
going to court should not bf~ construed as waiving any of our rights to challengc the
Association's decision if this issuc is decided against us.
Very truly yours,
/tUL-rc);:;.lJ.~
Matthcw Chabal, 1II
liJr DUANE, MORRIS &. IIECKSCIIER LLP
MC:pzg
cc: David A. Baric, Esq.
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PHI\ECII'E FOH l.ISTING CI\SE FOil I\HGIlMENT
(MuSt be l-ypewritten am subnitted in duplicate)
TO THE PROTHONOTI\HY OF CUMBERLI\ND COUNTY:
Please list the within matter for the next I\rgunent Ca-Irt.
---------------------------------------------------------------------------------------
CAPTION OF CI\SE
(entire caption must be stated in full)
NYE CONSTRUCTION COMPANY, INC.,
( plaintiff)
vs.
N.T. MANAGEMENT, INC.,
(~ferrlant )
lb. 7289
Civil EQUITY
19 98
1. State matter to be argued (i.e.. plaintiff'S lTOtion for new trial, deferrlant's
denurrer to canplaint, etc.):
PRELIMINARY OBJECTIONS OF RESPONDENT
2. Identify counsel ..no will argue case:
(a) for plaintiff: DAVID A. BARIC, ESQUIRE
Address: O'BRIEN, BARIC & SCHERER
17 WEST SOUTH STREET
CARLISLE. PENNSYLVANIA 17013
(b) for defendant: MATTHEI'/ CHABAL, III, ESQUIRE
J\ddress: DUANE, ~IORRIS & HECKSHER, LLP
305 NORTH FRONT STREET, 5TH FLOOR
P.O. BOX 1003
IlIlRHISBURG, PENNSYLVIINIA 17108-1003
3. I wiU notify aU parties in writing within tI.u days that th:i.-; case has
been llited for argurcnt.
4 . ArgUnent Court lbte:
IIPHIL 7, 1999
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by counsel for Respondent to attempt to come to an agreement as to a procedure for arbitration
of this matter and NCI was forced to move forward with arbitration, initially attempting to seek
arbitration through the American Arbitration Association.
4. Denied. Counsel for Petitioner has sought to impede arbitration through the
American Arhitration Association by reliance upon the summons tiled in Dauphin County. The
American Arbitration Association has decided, despite the clear language of the Construction
Management Agreement which compels arbitration, to hold this matter in abeyance pending
resolution of the issues raised by Respondent as to whether arbitration or resort to civil litigation
in the Court of Common Pleas is the appropriate forum.
5. Admitted in part and denied in part. It is admitted that NCI seeks arbitration of
this matter as was agreed to by the parties in the Construction Management Agreement. It is
denied that demand has not been made upor. Respondent or that the present petition has been filed
in the wrong forum. To the contrary, the appropriate forum for this matter is the Court of
Common Pleas of Cumberland County. The principal place of business for both parties is within
Cumberland County, the project which forms the basis for this action is within Cumberland
County, the work was performed within Cumberland County and the Construction Management
Agreement was entered into by the parties in Cumberland County.
I>El\llJlmERlMOTION TO STRIKE
6. Paragraphs one through live are incorporated herein by reference
7. Admitted
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12. Denied. NCI ineorporates its response to paragraphs 2,3,4.8 and 9.
13. To the extent this averment eonstitutes a conclusion of Jaw, no response is
required. To the extent a response may be required, it is submitted that a dispute exists as to
interpretation of the application of the arbitration provision in the Construction Management
Agreement as above stated. Counsel for NCI and Respondent have been unable to reach an
agreement as to the interpretation of that provision.
14. Denied. It is the position ofNCI that the project architect is not to be a member of
the arbitration panel but rather one of the appointing parties.
15. Denied. To the contrary, NCI has sought to arbitrate this matter and has sought to
obtain the concurrence of Respondent's counsel in the manner as to the method for arbitration
without success.
16. Denied. To the contrary, the Construction Management Agreement provides for
the appointment of three arbitrators and, because counsel for Respondent has refused to proceed,
three arbitrators should be appointed by this Court.
WHEREFORE, Petitioner respectfully requests that this objection be overruled and the
relief sought in the Petition be granted.
MOTION TO DISJ\lISS-IJ\lI'ROPER VENlJE
17. Paragraphs one through sixteen are incorporated herein by reference.
18. Denied It is unknown what the subject is of the "civil action" which consists
merely of the filing ofa summons bv Respondent
4
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19. Admitted in part and denied in palt. It is admitted only that the caption as
referenced is contained on a summons docketed to the number and term alleged. Aller reasonable
investigation, NCI is without knowledge, information or belief suflicient to form a belief as to the
rcmaindcr of this allcgation and strict proofthercofis demandcd.
20. Admittcd.
21. To the extent this avermcnt constitutes a conclusion of law, no response is
required. To the extent a response may be required, the refercnced statute is not applicable. To
thc contrary, there is no question but that arbitration is required, no action has been made by
Respondent to stay arbitration in the Court of Common Pleas of Dauphin County.
22. Denied. NCI incorporates paragraphs 19 and 21.
23. To the extent this is a legal conclusion, no response is required. To the extent a
response may be required, no application to compcl or stay arbitration has been filed in the Court
of Common Pleas of Dauphin County.
24. To the extent this avcrment is a conclusion of law, no response is required. To the
extent a response may bc requircd, this averment is denied.
25. Denied. To the contrary, venue is appropriate in this forum and Respondent has
tiled no motion which has brought this matter to consideration in any other fonllll.
WHEREFORE, l'etitiom~r respectfully requests that this objection be overruled and
and the relief sought in the petition be granted
5
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MOTION TO DISMISS-I'I<:NDENCY OF I'RIOR ACTION
26, Paragraphs one through twenty-five are incorporated herein by reference.
27. Denied. Petitioner incorporates paragraphs 5 and 21.
28. Denied. Petitioner incorporates paragraphs 5 and 21,
29. Denied. To the contralY, the "prior action" has not brought the issue of
compelling or staying arbitration inlhis mailer before the Coun of Common Pleas of Dauphin
County.
WHEREFORE, Petitioner respectfully requests that the objection be overruled and the
relief sought in the petition be granted.
Respectfully submitted,
;;::;; (JERER
David A. Baric, Esquire
101144853
17 Wcst South Street
Carlisle, P A 17013
(717) 249-6873
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YERIFICAT10N
verily that the statcmcnts made in thc forcgoing Rcply To Preliminary Objections of
Respondent are true and correct to thc best of my knowledge, information and belief. I understand
that false statements herein are made subject to the penalties of 18 Pa. C. S. ~ 4904, relating to
"",worn ,.,me"'" '" '",h"'''~p C a.
David A. Baric, Esquire
z..11) If?;
DATED:
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CLAIMANT IS:
DOwner 0 Design Profe..ional (specify
o Subcontractor (specify
RESPONDENT IS:
CD Owner 0 Design ProCessional (specify )
o Subconlractor (specify 0 Other (spedfy
ESTIMATED TIME NEEDED FOR HEARINGS OVERALL: hours 1 dsys
Copies of !his demand "" being filed with the American Amilration AlIociation at its PHILADgLPHIA office.
Claimant requests thallhc AAA commence the admininration of the arbitration. Under the rules. you may me In answering statement wilhm ten
day. anc.r notice from !he AAA.
CLAIMANT REQUESTS THAT ARBITRATION HEARINGS BE HELD AT THE FOLLOWING LOCALE:
CARLISLE. PENNSYLVANIA
American Arbitration Association
CONSTRUCTION INDUSTRY ARBITRATION RULES
DEMAND FOR ARBITRATION
MEDIA. TION If you wonllh. AM 10 conlaCI Ih. olhtr parry and ./ltmpl 10 arrang. a m.dialion. pl.OJ' ch.ck Ihis box.
TO: Name of Re.pondent
N.T. MANAGEMENT.
Address
21 EASTGA.rE DR IVE
City
CAMP HILL
Name of Rep...senlative (if known)
o
Add..... Add.....
~ 17 WEST SOUTH STREET
City Slate Zip Code Cily SlJ.le Zip Code
MECHANICSBURG PA 17055 CARLISLE l'A
Phone No. Fax No. Phone No. Fax No.
7 7 7 "'_ 717 766-4405 717 249-6873 717 249-5755
TO INSTITUTI: PROCEEDINGS, PLEASE SEND THREE COPIES OF THIS DEMAND AND THE ARBITRATION
AGREEMENT, WITH THE FILING FEE. AS PROVIDED FOR IN THE RULES. TO THE AAA. SEND THE
ORIGINAL DEMAND TO THE RESPONDENT.
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INC.
Add",..
Zip Code
17011
City
Slate
Zip Code
Slate
PA
Fax No.
Phone No.
Fax No.
Phone No.
717 737-56 9
THE NAMED CLAIMANT, A PARTY TO A WRITIEN AGREEMENT DATED 10/28/96 PROVIDING
FOR ARBITRATION UNDER THE CONSTRUCTION INDUSTRY ARBITRATION RULES, HEREBY DEMANDS
ARBITRATION THEREUNDER. (ATTACH THE ARBITRATION CLAUSE.)
NATURE OF DISPUTE (Please give enough details to enable the AM 10 sele<larbitrators wilh appropriate experience.):
RESPONDENT HAS REFUSED TO PAY BALANCE DUE PURSUANT TO CONSTRUCTION
MANAGEMENT CONTRACT.
DOLLAR AMOUNT OF CLAIM: OTHER RELIEF SOUGHT:
S 107.629.00
PLEASE DESCRIBE APPROPRIATE QUALIFICATIONS FOR ARBITRATOR(S) TO BE APPOINTED TO HEAR THIS DISPUTE:
FAMILIARITY WITH CONSTRUCTION MANAGEMENT WORK.
)
RJ Olher (spe<ify_
o Contractor
CONSTRUCTION MANAGER
o Contractor
Tille ATTORNEY
Daley, 31 /1?
Name or Claimant
NYE CONSTRUCTION COMPANY. INC.
Name or Rcprcsc-I\lItivC'
DAVID A. BARIC. ESQUIRE
_ r,XlllBIr 1
~'23' 981\\'EDl l2 46
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NUDEL LAW OFFiCE
TEL il:mS080
p, 002
.,
L~W OFflctS
STEPHEN C. NUDEL
219 Pille Stuel
Hmhblu.. Pcn"I'fInia 17101
STePHEN c, NUDE\..
TR~CY L. McN^MAJlA
KAREN s, M.TUIOSE
(111) 216-1000
FA.X on) 'J)6.'OIC
VIA. FAX NO. (717) 249-5755
September 23, 1996
D&vid A.. Baric, Esquire
0' Brien, Baric & Scherer
17 W. South Street
Carlisle, FA 17013
Re: Nye Const~ction Co. v.
N.T. Managam~nt, Inc.
American Arbitration Assoc~ation
No. 14 110 00255 98 V/J
Dear Dave;
.his letter confirms that you have granted to N.T.
Management, Inc. an extension ~n~il October 16, 199B, to file a
response to Nye Construction Co,' 5 Demand for Arbitration
regarding the above matter.
J':"(iii~ -
TraCY~CNama~a ~
TLM/db
Ene.
cc: Mr. Anil C. Thakrar
;;:;;/;I"O'"
David A. Bar~c, Es~ire
EXHIBIT 2
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G~RIU.:KAIE OF S.E.IWJCI,
I hereby certify that on Febmary 12, 1999, I, David A. Baric. Esquire, of O'Brien, Baric &
Scherer, did serve a copy of the Reply To Preliminary Objections of Respondent, by first class U.S.
mail, postage prepaid, to the party listed below, as follows:
Mallhew Chabal, Ill, Esquire
Duane, Morris & Heckscher, LLP
305 North Front St.. 5th Floor
P.O. Box 1003
H"ri,b"',. P'"'''''"A:>>/ t
David A. Baric, Esquire
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NYE CONSTRUCTION COMPANY,INC.: IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY,
Petitioncr, PENNSYLV AN1A
v. No. 98-7289 Equity
N.T. MANAGEMENT, INC. CIVIL ACTION-EQUITY
Respondent JURY TRIAL DEMANDED
BRIEF IN SUPPORT OF PRELIMINARY OBJECTIONS OF
N,T. MANAGEMENT, INC, TO PETITION OF
NYE CONSTRUCTION COMPANY. INC,
TO COMPEL ARBITRATION AND FOR APPOINTMENT OF ARBITRATORS
This Brief is submitted by Respondent N.T. Management, Inc., ("N.T. Management") in
support of its Preliminary Objections to the Petition to Compel Arbitration and for Appointment
of Arbitrators filed by Nye Construction Company, Inc., ("Nye").
I. STATEMENT OF FACTS AND PROCEDURAL HISTORY
This mattcr arises under an allcged October 28, 1996 Construction Management
Agreement (the "Agr~ement") for the construction of a Days Inn hotel. Under the alleged
Agreement, Nye was 1.1 provide certain project management services in order to accomplish the
successful amI timely construction of the hotel. The Agreement was \vritten by Nye.
The Agreement contains an arbitration provision which provides as follows.
(Preliminary Objections, Exhibit A, Pl'. 4-5): I
10nly part of the Agreemcnt was attached to Nye's Petition. A complete copy oftbe
alleged Agreement was attached as Exhibit A to N.T. Management's Preliminary Objections.
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4. Arbitration - All claims, dispUI~S and other mall~rs in qu~slion belween
lb~ parties to tbis Agreem~lIt, arising oul 01: or relating to this Agreement
or the breach th~reof, shall be d~cided by arbitration in accordance with
the Construction Industry Arbitration Rules by appointing an arbitration
pan:! of three p~rti';~I)e~~d,~lJ?.ili~~lL!l1U\lI~lIy a,grmblc~o tI}e
pllj;\l\::i'JNo arbltralJon, anslIlgo"iirC;r,orfC1utlllg to tbls Agreement, shall
include, by consolidation, joinder or in any otber manner, any additional
party not a party to this Agreement and signed by all tbe parties hereto.
Any consent to arbitration involving an additional party or parties shall
not constitute consent to arbitration of any dispute not describcd therein or
with any pm1y not named or described therein. This Agreement to
arbitrate and any Agreemcnt to arbitrate with an additional party or parties
fully consented to by f he parties bereto sball be speeitlcally enforceable
under the prevailing arbitration law. Notice of the demand for arbitration
shall be filed in writing with the other party to this Agreement. The
demand shall be made within a reasonable time after the claim, dispute or
other matter in question has arisen. In no event shall the demand for
arbitration be made after the date when institution of legal or equitable
proceedings based on such claim, dispute or other matter in question
would be barred by the applicable statute of limitations.
The award rendered by the arbi1m.tQJs shall be final, and judgment may be
entered upon it in accordance with applicable law in any court having
jurisdiction thereof.
On or about August 3 I, 1998, Nye filcd a Demand for Arbitration with the Americml
Arbitration Association ("AAA"). However, the AAA, concluding that it lacked jurisdiction
over the mattcr in that there was no agreemcnt of the parties to have the AAA administrate the
arbitration, infonned the parties in D"eember, 1998, of its decision not to hear the ease.2
N.T. Management initiated an action regarding the alleged Agreement in the Dauphin
County Court of Common Pleas in October, 1998.3 Despite the pendency of this prior action in
2Copies ofN.T. Management's and Nye's letter briefs and the AAA's ruling that it lacked
jurisdiction to conduct the arbitration proceeding arc attached to N.T. Management's Preliminary
Objcctions.
3 The writ ofsuJ'llmons and Sheriffs return are attached to N.T. Management's
Preliminary Objections as Exhibit B.
2
Dauphin County, Nye filed in this Court a l'ctilionto Compel Arbitration, which, along with a
Rule to Show Cause, was scrvcd on N.T. Managcmcnt on January 13, 1999. N.T. Managcmcnt
filcd Preliminary Objcctions on January 28, 1999. Nye filed a Reply to N.T. Managemcnt's
Preliminary Objections on February 12, 1999.
This Bricfis filed in support ofN.T. Managcmcnt's Preliminary Objections under
Cumbcrland County Local Rule 210-6.
II. OUESTIONS PRESENTED
A. EVEN ASSUMING THAT A VALID CONSTRUCTION MANAGEMENT
AGREEMENT EXISTS, SHOULD THE PETITION TO COMPEL
ARBITRATION BE DISMISSED WHERE PETITIONER SEEKS RELIEF
THAT IS UNA V AILABLE TO IT AS A MATTER OF LAW AND WHERE IT
HAS FAILED TO COMPLY WITH THE PROVISIONS OF THE
ARBITRATION CLAUSE?
(Suggested Answer: Yes.)
B. WHERE A PR.iO:Z, PEND!1'IG ACTIO?-) ENCOMPASSING THE SAME
PARTIES AND ISSUES HAD ALREADY BEEN INITIATED IN ANOTHER
COUNTY, SHOULD THE PETITION TO COMPEL ARBITRATION BE
DISMISSED AS IMPROPERLY FILED IN THIS COURT UNDER THE
MANDATORY VENUE CLAUSE OF THE UNIFORM ARBITRATION ACT?
(Suggested Answer: Yes.)
3
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III, ARGUMENT
A, THE PETITION TO COMPEL ARBITRATION MUST BE DISMISSED
BECAUSE PETITIONER IS NOT ENTITLED TO THE RELIEF
REQUESTED AS A MATTER OF LAW
I. Nve's Hequest That The Court Anpoint Three Arbitrators Is
Improner Becanse The Parties Have Alrcadv Af,l:recd To Anpoint The
Proiect Architect As One Of 'I' he Three Arbitrators
Nye asks the Court to appoint three arbitrators to hear and decide a dispute under the
Agreement. That request is contrary to the plain language of the Agreement.
As the arbitration clause quoted above clearly spells out, all disputes arising out of or
rclating to the Agreement shall be decided "by appointing an arbitration panel of three parties
includine: the architect, all mutually agreeable to the pUl1ies." (Emphasis added.) The
language of the arbitration clause is clear on its faee and free from any ambiguity regarding the
service of the architect on the arbitration panel. Nevertheless, Nye asserts a rather incredible
argument: that this language calls for the architect to be "one of the appointing parties" rather
than a member of the panel. That interpretation is not at all supported by the plain language of
the arbitration clause, which Nye drafted.
Because Nye seeks the appointment of Ull entire arbitration panel, and because the
alleged agreement already provides for the architect to serve as one of the arbitrators, Nye is not
as a matter oflaw entitled to the relief it seeks in its Petition; i.e., the appointment of three otller
arbitrators. Accordingly, Nye's Petition to Compel Arbitration must be dismissed.'
'It is anticipated Nye will argue that the Agreement requires the three arbitrators to be
"all mutually agreeable to the parties" and that th,~ architect is not agreeable to Nye now.
However, the architect was specifically agreed upon by the parties at the time of contracting to
be a "mutually agreeable" arbitrator.
4
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2. Nyc's Rcqucst That The Court Appoint Arhitrators Must Be
Dismissed Bceausc Nvc Has Not Madc A Propcr Demand For
Arhitration As Rcquired By The Al!recmcnt And The llniform
Arhitration Aet
Nyc has also f~lilcd to comply with the Agreement's requirements regarding making a
demand for arbitration. The arbitration provision in pertinent part states that "[n]otice of the
demand for arbitration shall be filed in writing with the other party to this Agreement."
(Agreement, Article VIII, Paragraph 4, attached to Preliminary Objections as Exhibit A.) With
the exception of the improper demand for arbitration filed with the AAA, which the AAA
dismissed for luck of jurisdiction, Nye has not demanded arbitration as required by the
Agreement.'
Section 7304(a) of the Uniform Arbitration Act, 42 Pa. C.S.A. 9 7304(a), requires "a
showing that an opposing party refused to arbitrate" before the COUlt may "order the parties to
proceed with arbitration." Because Nye has never made a proper demand for arbitration as
contemplated by the Agreement, there cannot have been a refusal to arbitrate by N.T.
Management. Because there has been no refusal, the Court may not compel arbitration. As
explained below, N.T. Management filed an action in Dauphin County in order to raise certain
issues conceming the validity of the Agreement in general and its arbitration clause in particular,
'There is no question that the AAA has dismissed this case. Contrary to the assertion in
Paragraph 4 of its Reply to N.T. r...lanagement's Preliminary Objections that the AAA has
decided "to hold this matter in abeyance pending resolution of the issues raised by Respondent
as to whether arbitration or resort to civil litigation . . . is the appropriate forum," the AAA has
concluded that it lacks jurisdiction and that "it will close its file in this matter in thirty (30) days"
absent a court order or agreement of the parties. See December 8, 1998 letter from the AAA to
the parties, attached to N.T. Management's Preliminary Objections as Exhibit C. More than 30
days have elapsed since the date of the AA^,s letter and it may now safely be assumed that their
file is closed and not being held in abeyance as Nye asscrts.
5
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and N.T. Managcmcnt's counsel discusscd each ofthosc issucs with Nyc's counsel.
Neverthelcss, Nye has bccn willing to waive thosc issues and procccd to arbitration, so long as
the arbitration is conductcd in accordancc with the tcrms of the Agrecment, i.e., with the project
Architect and two other mutually agrceable arbitrators. See, N.T. Managcment's counsel's
February 12, 1999 letter, a copy of which is attached to this Brief as Exhibit A. Thus, Nye's
Petition must be dismissed.
B. THE PENDENCY OF A PRIOR ACTION BETWEEN THE l'ARTIES IN
DAUPHIN COUNTY PRECLUDES !'ETITIONER FROM SEEKING OR
OBTAINING RELIEF FROM THIS COURT AND REQUIRES THE
DISMISSAL OF THE l'ETITlON
Thc present dispute is the subject of a prior, pending action between the identical parties
in the Court of Common Pleas of Dauphin County. That action was instituted by N.T.
Management on October 16, 1998, more than two months prior to the filing ofNye's Petition in
this Court.6 The pendency of the prior Dauphin County action divests this Court of jurisdiction
both under the Unifol1n Arbitration Act and under well-settled principles of common law.
The Uniform Arbitration Act, 42 Pa. C.S.A. S 7304(c), provides that "[i]f a controversy
alleged to be or not to be referable to arbitration under the agreement is also involved in an
action or proceeding pending in a court having jurisdiction to hear app'ications to compel or stay
arbitration, the application [to compel arbitration] sh:11l be made to that court." (Emphasis
added.) So long as the elements of this statutory provision arc satisfied, the law is clear that the
venue provision is malldatcry, not discretionary.
6 The Dauphin County action is captioned "N.T. Management, Inc. v. Nye Construction
Company, Inc. et al.," and is docketed at No. 4641-S-1998 (Dauphin C.P. 1998).
6
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Thc lirst c1cmcnt of thc statutc is thc rcquircmcnt for a controvcrsy which is allcgcd to bc
refcrable or not rcfcrablc to arbitration. That c1cmcnt is clcarly satislicd hcrc. Nyc allcgcs that
the disputc undcr thc allcgcd Construction Managcmcnt Agrccmcnt is rcfcrablc to arbitration;
N.T. Managcmcnt asscrts that it is not referablc to arbitration in the manner sought by Nye (if a
valid agreement indeed exists).
Thc next element to determine the propriety of venue is that the controversy must also be
"involved in an action or procecding pcnding" in a court of competcnt jurisdiction. Thc dispute
betwcen the parties is thc subject of the Dauphin County lawsuit initiated in October, 1998. Nyc
argues that because this action was instituted by writ of summons that it somchow does not
constitute a prior, pending action under Section 7304(c). To the contrary, thc law of the
Commonwealth is clear that there are two separate, equally legitimate mcans to initiate an action
in Pennsylvania: (1) by complaint, or (2) by writ ofsunlll1ons. Pa. R.C.P. No. 1007 ("An action
may be commenced by filing with the prothonotary (1) a praecipe for a writ of summons, or (2) a
complain!.") An action initiated by writ of summons is still an action, and the pendency of the
action in Dauphin County requires Nye to file its Petition to Compel Arbitration in that
jurisdiction. Nye also asserts that the writ of summons is insufficient to determine the nature of
the dispute between the parties in Dauphin County. Nye's argument is disingenuous. Firs!. it has
taken no steps, such as a Rule to File Complaint, to ascertain the nature of the case. Second, and
more importantly, the undersigned has had several conversations with Nye's counsel regarding
the nature oflhe Dauphin County action. Nye is well aware that the Agreement is involved in
the pending action.
7
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The next clement is thattl\<: court in which the prior pending action is tikd have
jurisdiction to hear applications to compel or stay arbitration. Clearly that is thc case, The
Dauphin County Court of Common Pkas, like this Courl, is a court of gencraljurisdietion and
may without question entertain Nye's petition.'
It is thus clear that a prior, pending action cxists bctwcen the parties in Dauphin County
and that jurisdiction in Dauphin County is prop cr. As a rcsult, the mandatory venue selection
provision of Section 7304(a) applies, and provides that an application to compel arbitration shall
be made to that court. Accordingly, Nye's Pctition must be dismissed.s
'Nye's real argument is only that Cumbcrland County IS the more appropriate forum for
this matter. But that argument goes to the convenience of Dauphin County as a forum, not to
whether the DauJ'hin County Court has jurisdiction. Further, even if the issue were one of venue,
there is no doubt venue is proper in Dauphin County, which is a county in which Nye regularly
conducts business. See, Pa. R.C.P. No. 2179.
SThe same result is supported by the common law doctrine of lis pendens and Pa. R.C.P.
No.1028(a)(6). Rule 1028(a)(6) pemlits preliminary objections to be filed on the grounds of
"pendency ofa prior action." This is referred to in Pennsylvania jurisprudence as the doctrine of
lis pendens, though this term is somewhat of a misnomer in non property-related actions. See
Norristown Auto. Co.. Inc. v. T-land, 386 Pa. Super. 269, 562 A.2d 902 (1989) ("a party
asserting...lis pendens must aver that a prior action is pending"). A prior action has been filed,
the same parties are involved, the same rights are asserted, and the same relief is sought.
Meinhart v. Heaster, 424 Pa. Super. 433,622 A.2d 1380 (1993). See also Norristown Auto.,
where in evaluating whether a prior pending action existed the court recognized that actions in
Pennsylvania for lis pendellS purposes can be initiated by \\Tits of summons as well as by
complaint. Though in Norristown Auto thc court ruled that the trial court's dismissal on lis
pendens grounds was improper, it did so because one action sounded in tort while the other was
a breach of contract action in assumpsit. Here, as N.T. Management asserted in a signed
pleading before this Court, both the Dauphin and Cumberland County actions deal with, inter
alia, the arbitrability of the dispute between these parties. Therefore, under the doctrine of lis
pendens as well, Nye's Petition must be dismissed.
8
IV, CONCU1SION
Because the arbitration clause in thc allegcd agrccment between the parties calls for the
architect to serve on a panel of three arbitmtors, Nye is not as a matter of law entitled to the
relief it seeks in its Petition to Compel Arbitration, i.e., the appointment of three other
arbitrators. Further, because Nye has failed to provide proper notice of its arbitration demand,
N .T. Management could not have refused to arbitrate and Nye therefore does not ll1eetthe
statutory prerequisites of the Uniform Arbitration Act. Moreover, the mandatory venue
provision in the Act requires that Nye's Petition be filed not in Cumberland County but in
Dauphin County, where a prior pending action exists. Accordingly, Nye's Petition to Compel
Arbitration must be dismissed.
Respectfully submitted,
tL~LJ~
Matthew Chabal, III
I.D.#49926
Douglas M. Wolfberg
I.D. #77959
DUANE, MORRIS & HECKSCHER LLP
305 North Front Street
5th Floor
Harrisburg, PAl 71 0 I
(717) 237-5500
Counsel for Respondent N.T. Management, Inc.
Dated: March 26, 1999
HBG\2:7RJ I
9
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CERTIFICATE OF SERVICE
I, Patricia Z. Glusko, an cmployec of the law linn of Duane, Morris & Heckscher 1.1.1', do
hcreby certify that a truc and correct copy ofthc forcgoing Preliminary Objections was served upon
th~ following persons at their respective addresses on March 26, 1999 as lbllows:
VIA FIRST-CLASS MAIL
David A. Baric, Esquire
17 West South Street
Carlisle, I' A 170 I 3
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Patl'icia Z. Gluskb
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~YE CONSTRUCTION COMPANY, INC.,
Petitioner,
: IN THE COURT OF COMMON PLEAS
: OF CUMBERLAND COUNTY,
: PENNSYLVANIA
V.
: NO. 98-7289 EQUITY
NT. MANAGEMENT, INC,
Respondent.
BRIEF OF PETITIONER IN OPPOSITION TO
PRELIMINARY OB,IECTlONS OF RESPONDENT
NOW, comes Petitioner, Nye Construction Company, Inc., by and through its attorneys,
O'BRIEN, BARIC & SCHERER, and files this brief in opposition to the preliminary objections of
Respondent and sets forth the following:
I. COUNTER STA TEI\IENT OF FACTS AND PROCEDURAL HISTORY
This matter arises from the Respondent's refusal to make payment of sums due the
Petitioner under a Construction Management Agreement ("Agreement"). The Agreement and the
services rendered thereunder relate to a Days Inn that the Respondent had constructed in
Mechanicsburg, Cumberland County, Pennsylvania. Petitioner adopts the arbitration provision as
cited in Respondent's hl;ef.
A demand for arbitration with the American Arbitration Association was filed in August of
1998 and service was made upon Respondent Respondent immediately contended that the
American Arbitration Association had no jurisdiction which position was initially rejected by the
American Arbitration Association (see, Exhibit A). Counsel for Respondent then filed a summons
only in Dauphin County and asked that the American Arbitration Association reconsider and
re.ieel jurisdiction of this matter
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Association because the AAA had no such "mutual agreement" provision. (See, M. Chabal, Esq.
letter of November 12.1998, Exhibit B). Now, Respondent contends that the mutual agreement
provision is nugatory with the architect an automatic member of the board. The reasonable
reading of this provision in the Agreement is that the architect is one of the parties who may
appoint a representative with the owner, architect and construction manager all to agree to the
ultimate composition of the board. The Uniform Arbitration Act, 42 Pa.C.S.A. Section 7301 et
seq., provides for statutory and common law arbitration. This matter falls within the definition of
common law arbitration. One of the rules applicable to common law arbitration is as follows:
Appointment of arbitmtors by conrt
If the agreement to arbitrate prescribes a method of appointment of
arbitrators, the prescribed method shall be followed, III the absence of
prescribed method or if the prescribed method fails or for any reason cannot
be followed, or when an arbitrator appoillted fails to act or is nnable to act
and his successor has not been appointed, the court on application of a party
shall appoint one or more arbitrators, An arbitrator so appointed has all the
powers of an arbitrator specifically named in the agreement. 42 Pa.C.S.A.
Section 7305
This section does not indicate which court has jurisdiction over appointment of an
arbitrator or arbitrators. It is submitted that it is for this Court to decide how this provision
should be interpreted so the parties may move forward with arbitration of this matter as is
rcquired by the Agreement Should the Court decm it necessary, testimony could be presented as
to the understanding of the parties as to this provision in the Agreement
:;
8. Vcnuc and jurisdiction for this mallcr rcsts in thc CO\ll1s of
Cumbcrland County
The Uniform Arbitration Act provides for a stay of arbitration if an arbitration is
"threatened or commenced.." 42 Pa.C.S.A. ~7304 (b). Had Respondent filed such a request
with the Court of Co 111m on Pleas of Dauphin County. in equity, that court would determine
prelimina-rily whether the instant dispute is subject to arbitration. By filing only a summons with
no allegations as to the subject matter of the action commenced in Dauphin County, Respondent
has not triggered the venue provisions as set forth at Section 7304 (c). There is simply no means
available to make a determination in this Court that there is a similarity of claims or issues as is
required to implicate the venue provision Respondent argues that Petitioner could have ruled a
complaint from Respondent to establish the allegations of its claim, however, there are no
provisions in the Uniform Arbitration Act relating to venue which place such an obligation on
Petitioner. It should also be noted that the suml110ns filed by Respondent names parties who were
not parties to the Agreement. It is anticipated that Respondent will attempt to argue that because
panics arc named in the Dauphin County matter who wcre not parties to the Agreement,
Respondent can circumvent the arbitration provisions of the Agreement. Additionally, it is
submitted that venue of this matter in Dauphin County is not appropriate considering that the
property at the core of this matter is in Cumberland County and that the principal places of
bu..iness of the Petitioner and Respondent are in Cumberland County
.
.,
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@ American Arbitration Association
DispUlt UtJ()/utron Sovios Worldwidt
October 30, 1998
2;30 South BIO.ld Strect, Huur 12.l'hiladelphi;t, P.\ 19102'4199
tclq)hone; 215 732 5260. rarsimil(:; 215 7:i2 50\l1
hup:! h,,,,,,,,,',;adrorg
David A. Baric, Esq. /
O'Brien, Baric & Scherer
17 West South Street
Carlisle, PA 17013
Matthew Chabal,
Duane, Morris &
.305 North Front
P.O. Box 1003
Harrisburg, PA
III, Esq.
Heckscher
Street, 5th
Floor
17108
Re: 14 110 00255 98 V/J
NYE CONSTRUCTION COMPANY, INC.
and
N.T. MANAGEMENT, INC.
Dear Parties:
The Association, after careful review of the parties' contentions, has
determined that Claimant has met the necessary filing requirements of
the rules by filing a Demand for Arbitration which provides for
administration by this agency.
Therefore, absent the agreement of the parties or a court order staying
the arbitration. the AAA will proceed with the further administration
of this matter. The parties may raise this issue with the arbitrator
prior to the hearing.
si/ncer~O
~ Orphanides
Administrator
cc: Ujjal Maker VlA FACSIMILE (717) 766-4405 11/03/98
Ben Musser VIA FACSIMILE (717) 532-5588 11/03/98
EXHIBIT "A".
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DUANE, MORRIS & I.IECKSCHER LLI'
^nnR:->U'~ AllAW
O~i: llntR TY rt.An
PIIILAOl!lpll1.'.rA \Q\OI.7I%
.\\n SOH11lllWNT SlIHJ.l. ~Ih ILOOIt
I' 0 1I0X 1011\
Il^RRISHURG, I'" 1110R.IOO)
(7111 n7.~~OO
)IOt[Xll'o'Gl0S AVI.t..:U
f'l[W YORK. ",\' \0161
I~OI MARKET STREH. SL'IlE I SIlO
WILMINGTOS. DE l'lIOI.OI"~
1661 K STREET "'" W. SUITE 100
WASIIING10t-i, 0 C 2000b.!flOI
"AX
PI7)HHlHS
)1"5 STATESTRtET
DOVf:R. Of: 19"Xl1
l)S CIlf;STERDP-OOK DOUI.EVARD
WAYtolr., PA 19cn.V.1I
SIItAI)OONFlf:.lD ROAD. SUITE HO
CIlI.:RRY HILL. NI 010010'1'0
961 POST At ROA.O, SUITt: 200
ALLENTOWN, rA 11109.0400
249 ROYAL PALM WAY, SUITE 401
PALM nEACl1. fa. ])410
ONE OATEWAV CENHR. SUITE 1210
NEWARK, NJ 07102
November 12, 1998
600 TRAVIS, SUITE 6S00
HOUSTON. TX 77001
MATTHEW CllABAL, III
DlRECT ow.: (711)1)7.HI4
E-MAIL: chaboJ@duanemonisearn
Demos K, Orphanides
Administrator
American Arbitration Association
230 South Broad Street, Floor 12
Philadelphia, P A 19102.4199
Re: 14 no 00255 98 V/J
NYE CONSTRUCTION COMl'ANY,lNC,
and
N. T. MANAGEMENT, INC,
Dear Mr. Orphanides:
I am writing to request the Association to reconsider its October 30, 1998 decision that it
has jurisdiction to proceed with the administration of this arbitration.
The arbitration clause at issue provides in its entirety as follows:
4. Arbitration - All claims, disputes and other matters in question between the
parties to this Agreement, arising out of, or relating to this Agreement or the
breach thereof, shall be decided by arbitration in accordance with the
Construction Industry Arbitration Rules by appointing an arbitration panel of
three parties including the architect, all mutually agreeable to the parties. No
arbitration, arising out of, or relating to this Agreement, shall include, by
consolidation, joinder or in any other manner, arlY additional party not a party to
this Agrcement and signed by all the parties hereto. Any consent to arbitration
involving an additional party or partics shall not constitute consent to arbitration
of any dispute not described therein or with any,party not named or described
thcrein. This Agrccnwl1t to arbitrate :md any Al~reell1ent to arbitrate with an
additional party or parties fully conscnted to by the parties hcrl~to shall be
specifically enforce;lblc under the prevailing :nbitrationlaw. Notice of the
EXIiJPlT "P"
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I hereby certify that on March 30, 1999, I, David A. Baric, Esquire, of O'Brien. Baric &
Scherer, did serve a copy of the Brief of Petitioner In Oppos:tion To Preliminary Objections Of
Respondent, by first class U.S mail, postage prepaid, to the party listed below, as follows:
Matthew Chabal, lJI, Esquire
Duane, Morris & Heckscher
305 North front SI., 5th floor
Harrisburg, Pennsylvania 17108.1003
~.//cf.
David A Baric, Esquire
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NYE CONSTRUCTION COMPANY,
INC.,
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
, ' " .' ,-; ~ .' :- , .: ".' :' . . , . . ;.', . '" . ", . ; ^: .' ~.. .', "', " , " ',' . I ,;..,'... ' _ .
PETITIONER
v.
N.T. MANAGEMENT, INC.
RESPONDENT
98-7289 EQUITY TERM
BEFORE BAYLEY. J, AND OLEA. J.
ORDER OF COURT
AND NOW, this 7th day of April, 1999, IT IS ORDERED:
(1) The preliminary objection of NT Management, Inc., to the petition of Nye
Construction Company, Inc., to compel arbitration, IS DISMISSED.
(2) The Rule entered on January 11, 1999, against N.T. Management, Inc., to
compel arbitration, IS GRANTED.
(3) The dispute shall be submitted to arbitration in accordance with the
Construction Industry Arbitration Rules.
(4) There shall be three arbitrators one of whom shall be the project architect.'
} /
By the Court,
I
~ 'i(Vv/
Edgar B. yley, \
1. We interpret the arbitration language in the parties' contract that states "[b]y
appointing an arbitration panel of three parties Including the architect, all mutually
agreeable to the parties" (emphasis added), as clearly providing that one of three
arbitrators shall be the architect.
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David A. Baric, Esquire
For Petitioner
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Matthew Chabal, III, Esquire
For Respondent
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NYE CONSTRUCTION COMPANY, INC.,
IN THE COURT OF COMMON PLEAS
CUMBERLAND COUNTY, PENNSYLVANIA
Plaintiff
v.
NO. 98-7289 EQUITY
N . T. MANAGEMENT, INC.,
Defendant
ORDER
AND NOW, this '-:~..>t.~..
){'''- --....
day of 'June', '2002, upon consideration
of Defendant's Reply to Plaintiff's Motion to Compel Arbitration,
it is hereby ordered that the parties shall have an additional
twenty (20) days from the date of this Order within which to
attempt to select the additional two (2) arbitrators required for
Arbitration.
If at the expiration of the twenty (20) day period the
parties have not been able to agree on the two required
arbitrators, either party may thereafter contact the Court and
request a Hearing regarding the issues involved in Plaintiff's
Motion and Defendant's Reply thereto.
BY THE COURT: /'
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NYE CONSTRUCTION COMPANY, INC.,
IN THE COURT OF COMMON PLEAS
CUMBERLAND COUNTY, PENNSYLVANIA
Plaintiff
v.
NO. 98-7289 EQUITY
N.T. MANAGEMENT, INC.,
Defendant
DEFENDANT'S REPLY TO PLAINTIFF'S
MOTION TO COMPEL ARBITRATION
AND NOW, comes Defendant, N.T. Management, Inc., by and
through its attorneys, Law Offices Stephen C. Nudel, PC, and
respectfully files the following Reply to Plaintiff's Motion to
Compel Arbitration:
1. On or about June 7, 2002, Plaintiff filed a Motion to
Compel Arbitration requesting this Honorable Court to select two
(2) additional arbitrators and a time period within which
Arbitration would occur.
2. Thereafter, on June 11, 2002, the Court issued a Rule
upon Defendant to show cause why the relief requested by
Plaintiff should not be granted.
3. Prior to the Motion to Compel Arbitration, the
undersigned counsel and counsel for Plaintiff had not exchanged
proposed names of arbitrators.
4. Defendant objects to the Court selecting the additional
two (2) arbitrators as it is contrary to the intention of the
parties and the language set forth in their Agreement.
5. Since the Court issued the Rule to Show Cause, the
undersigned counsel, in attempt to resolve the issues involved,
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NYE CONSTRUCTION COMPANY, INC.,
IN THE COURT OF COMMON PLEAS
CUMBERLAND COUNTY, PENNSYLVANIA
Plaintiff
v.
NO. 98-7289 EQUITY
N.T. MANAGEMENT, INC.,
Defendant
CERTIFICATE OF SERVICE
I hereby certify that a copy of the foregoing has been duly
served upon the following, by depositing a copy of the same in
the United States Mail, first-class, postage prepaid, at
Harrisburg, pennsylvania, as follows:
David A. Baric, Esquire
Law Offices of O'Brien,
Baric & Scherer
17 West South Street
Carlisle, PA 17013
Date: &(J15) Od-,
Mar W. Allshouse, E qu~re
219 pine Street
Harrisburg, PA 17101
(717) 236-5000
Attorney ID #78014
Attorney for Defendant
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STEPHEN C. NUDEL, PC
219 Pine Street
Harrisburg, Pennsylvania 17101
STEPHEN C. NUDEL
MARK W. ALLSHOUSE
(717) 1l6-5000
FAxmn:36-'OIU)
June 21, 2002
David A. Baric, Esauire
Law Offices of 0' Brien,
Baric & Scherer
1? West South Street
Carlisle, PA 17013
Re: N.T. Management, Inc.
v. Nye Construction Company, Inc.
and Ujjal Maker
No. 4641-5-1998; Dauphin County
Dear Mr. Baric:
I have not yet received the list of your proposed
arbitracors. However, as suggested, I am providing to you the
names of one contractor and two attorneys whom I would recomnlend
as potential arbitrators in this matter.
Defendant's suggested arbitrators would be as follows:
l.
2.
3.
Dennis J. Schmidt
John Zonarich, Esq.
Richard P. Mislitsky, Esq.
Contractor
Attorney
- Attorney
If Mr. Schmidt is not acceptable, I will provide an
alternative suggestion.
To alleviate potential objections, I recommend that you
select an arbitrator and I will select an arbitrator and along
with the architect the panel would then be complete.
I look fOr'.vard to receiving your response to this
correspondence along with your list of recommended arbitrators.
Very truly yours,
. r)0,.!:J C?if!:t;(}-k
. (
Mark W. Allshouse
I'
MWA/jlm
cc: Mr. Anil C. Thakrar
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Law Offices
O'BRIEN, 8A11lC & SCHERER
/7 West South Street
Carlisle, Pennsylvania 170/J
Robert L. O'Brlm
David A. Baric
Michael A. Sdttrtr
(117) 249,687 j
Fa.' (717) 249.5755
E_maIl' obs(~obslaw.com
direct: dbarlC@obs/aw com
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June 24, 2002
VIA FACSIMILE: (717) 235-5080
Mark W. Allshouse, Esquire
Law Offices of Stephen C. Nudel
21 9 Pine Street
Harrisburg, Pennsylvania 17101
RE: Nye Construction v. N,T. Management
Dear Mr. Allshouse:
I have received your correspondence. Please provide me with information regarding
Messrs. Schmidt and Zonarich. I seem to recall that you and Mislitsky were with the same law
liIlT! and would object to his involvement.
1 suggest Guy Brooks of Goldberg, Katzman & Shipman and also David Stapler. A
curriculum vitae for him is enclosed.
I want two independent choices agreed to by us and will not agree to each of us selecting
one IU'bitrator.
Very truly yours,
iil:~i1CHERER
David A. Baric, Esquire
DAB/j!
Ene.
ec: File
d. b.dlr/llllil*tioa/mwr:.yei.lkho uoe,ltr
e American Arl>itrauon Association
Du,uU """",.i.. Sc,,,ict! WodJ....iJt
~ ~ ArlJitntloo ""ociation
UO s..-ulh J!rooad Str<<t
PlUladGlpbia. fA. 1910%
"U~Il_t 21S.n1-I1l1O, faolmU..lIS.731,$OO1
'1ed,ator P6Ilel
David Stapler
Cur~nt Employer(T\tle The Witmer Company. Pre,ident
ProflBSlon Mechanical Contractor; Mediator, Arbitrator
Work Hbtory President, The Witmer Company, 1987-presenr; Vice Prelident,
C.]. BeJhore Company. 1985.87: '"Ice Pr~idenr. ~lcClure Company, 1970,
85: U.S, ~avr. 196~.67.
IxpIrlence Over 50 yean' experience in the mechanical contracring industry.
Involved in estimating. p1J~ha,ing. negotiating. proj"t mana~ment. and
de.ignfbuild of plumbing, heating. ventilating and .ir conditioning, .heet
metal. air quality, and process piping. Projects include nursing homes.
high.ri.. office and apartmr1\t buildings, indusU"ia1 piping system'.
shopping centen, "hools. warehousing. hospital>. and private homes.
From 1970,1985, WllS vice pr~ident and general manager of a mechanical
contl1lcting firm that ",a. one oflhe top 100 in the country .
ft.epreHntllttv. Cues Handled as Mediator Successfully mediated ·
dispute betwt'en a general contractor and the owner of a seven..building
aparnnent complex (ovet. $600.000 agreement). Successfull, mediated a
di.pute between. contncror and. township Joint municipal authority
(over $~OO.OOO al!"""ment), Served a$ mediator in numerous ton~truction
cases between owner,! contra-eto"- authorities. and ,ubconrractors
in_olving claim. relaling to defective cons[t'Uetion. dela)"., [.ontractcr
defaclt>, change orders. and nrious co.t o_er run'.
fl._presentative ClUes Handled :u Al'bltratClr Served al arbitralor on
numerous dispute. in_clving both private and public projects for o'.cr 10
ye.rs. C.... ranged from home<:1".ner and contractor di,putes to three-
neutral panel di'putes in ace" of $1 million. Cases ranged from 1t2.day
he.rinS'to 15-<lay hearings. lb, arbitrated o,.er 100 cases to dlle,
Multl.Pu~ DlIpute Reto\utlon Exil_rl.nce Multi'Fall)' expel ience
include. r,l.\me'out cases between """nen. general contractor" cnr,stNelion
manageT', subcontractors, tQ\>o'n,hip authorities, insurance companie'
de'Yelopers, bonding companies. and homeo".r,ers
.....,
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NYE CONSTRUCTION COMPANY, INC.,
Petitioner,
: IN THE COURT OF COMMON PLEAS
: OF CUMBERLAND COUNTY,
: PENNSYLVANIA
: NO.
N.T. MANAGEMENT, INC.,
Respondent.
: CIVIL ACTION-EQUITY
PETITION OF NYE CONSTRUCTION COMPANY, INC. TO
COMPEL ARBITRATION AND FOR APPOINTMENT OF ARBITRATORS
NOW, comes Petitioner, Nye Construction Company, Inc., by and through its attorneys,
O'BRIEN, BARIC AND SCHERER, and files the within Petition and in support thereof sets
forth the following:
1. Nye Construction Company, Inc., ("Nye Construction") is a Pennsylvania
corporation with an address of 25 Laurel Drive, Mechanicsburg, Cumberland County,
Pennsylvania 17055.
2. Respondent, N.T. Management, Inc. is, upon information and belief, a
Pennsylvania corporation with a principal place of business at 21 Eastgate Drive, Camp Hill,
Cumberland County, Pennsylvania 17011.
3. On or about October 28, 1996, the parties entered into a "Construction
Management Agreement" a true and correct copy of which is appended hereto as Exhibit "A" and
is incorporated.
4. Pursuant to the Construction Management Agreement, Nye Construction was to
provide construction management services to N.T. Management, Inc. for the construction of a
Days Inn in Mechanicsburg, Cumberland County, Pennsylvania.
5. The Construction Management Agreement provided for payment by N.T.
Management, Inc. to Nye Construction for the services rendered. N.T. Management, Inc. has
failed and refused to pay the amounts due under the Construction Management Agreement.
6. At Article VIII, subsection 4 of the Construction Management Agreement, the
parties expressly provided for arbitration of any and ail claims or disputes relating to or arising
from the Construction Management Agreement.
7. Petitioner has filed with the American Arbitration Association a request for
arbitration, a copy of said filing is appended hereto as Exhibit "B" and is incorporated.
8. Respondent, by and through its counsel, has sought to prevent arbitration of this
matter by the American Arbitration Association aileging that forum is not appropriate.
Petitioner requests this Court to appoint neutrai arbitrators to hear and resolve this
matter.
10.
Petitioner requests this Court to compel the arbitration of this dispute, which arises
under the Construction Management Agreement, in compliance with the terms of the
Construction Management Agreement.
11. Respondent has filed a summons only in an action docketed to No. 4641-S-1998 in
the Court of Common Pleas of Dauphin County, Pennsylvania.
12. Counsel for Nye Construction has discussed the appointment of neutral arbitrators
with counsel for N.T. Management, Inc. and no agreement has been reached as to the individuals
to be appointed or the method of appointment.
13. Petitioner has no adequate remedy at law to enforce the provisions of the
Construction Management Agreement compelling arbitration.
14. This matter is subject to common law arbitration as provided for in the
Construction Management Agreement and pursuant to 42 Pa.C.S.A.
§7341.
WHEREFORE, Petitioner requests that this Court compel arbitration of this matter and
appoint a neutral arbitrator or arbitrators.
Respectfully submitted,
O'BRIEN, BARIC & SCHERER
David A. Baric, Esquire
ID#44853
17 West South Street
Carlisle, PA 17013
(717) 249-6873
Attorney for Petitioner
VERIFICATION
I verify that the statements made in the foregoing Petition of Nye Construction
Company, Inc. To Compel Arbitration and For Appointment of Arbitrators are true and
correct to the best of my knowledge, information and belief. I understand that false statements
herein are made subject to the penalties of 18 Pa. C.S. § 4904, relating to unsworn falsification to
authorities.
David A. Badc, Esquire
CONSTRUCTION MANAGEMENT AGREEMENT
I. Furnis~ Project Ma=agama=: services Co co-~rdinaue the work of
c~e =on=rat:ora ~ho will ~erform all work for =~e proJe~: as
defi=ed by Con~sruc:ion Dccumen:s.
2. Projecu ~nager wi~i ~ecurs bads ~r ~o=a=ion~ for ~terials,
services and cou:rac=s for general wor~. The ~ner ~a4 :he
Manager.
3. A~er proper anal?sis, deC~rm./.ae the ~oeC accepeab!e suppliers
or subcontracts for owner $ approval.
4. will prepare and issue purchase orders or
after Owners
approval.
Accoun=ing will prepare pro, ac: payrolls
government reports if reguired.
sad related
accuraCe and daCa~i~ ec¢o~ne of all Cransa¢Cions resulCA~g
from performance of cfle work. Owner shall be afforded
i~media~e access co all such records upon request co
7. Follow a work program as per a bar charC schedule w~io~ the
proJe== will proceed wi=~ all possible speed consistent w/ch
reasonable costs, good w~rkmanship and safety.
EXHIBIT KA"
2
orders, ~d any ocher !Cema of ~rk rela~ed Co con~ract
Subcon=ra~:ors on the o~ers behalf.
owner.
Because of =he ~ossibillt7 of ask=awn condi=ions, the estimate
accurate amount csn~o~ be established prior to coas=ru¢=~on.
Such i:ams, ~f any, w:lI be sat for=h as allowance items. The'
~achines or similar e~zpment, arehtCecturao or con#axe c
4. Construction Ma~agemea= Fee will ~e s~f°r a ~ariad
pr~ja¢~ ~omple=ion. Th~s ~a~ dens ~0= £~clude any~ond costa
GENERAL CONOZT~OM$
b~owner as per aCtac~ed addendum ~l for an
3
will be split becwee~ :he owner sad :he CMA a= a rate cf 80%
ARTZ~CL~ 1"; Chan~q.~_~A_nWork
~rigina~l~ plan~d end specified. An 8% cost will be added for
payments :~'con~racts ~ili ~e .~de by Owners checks drawn b~ ~e
Owner on a con~=ruccion ac:cue: of :he Owner's choice a~d to whi¢~
Each voucher will S~O~, in de:ali, th~ /:ems covered and will be
supported by copies of !~voices, reguiai=ion~ for payment,
~e~roll~, etc. ~ayments will be ~de as follows:
is sign~ and~nC~lY thereafter ia proporcio~ co :he .
=o:al wor~ perform.
ARTZCL~ Vr ~ime Of Comoletion
i=:e~ded :~a: :he pr jec= wall be completed
faulg of :he Cons:~ct!on Manager.
AR~ZC. LEVII~
i. The Owner will, during progress of :he wo~, maid:aim full
law in any tour= h~v!~g jurlsdic=~o~ thereof.
CONSTRUCTZON MANAGER
- T~TLE
ATTACHMENT
.~ee£den c Ha~.a~e~/$uper£nCen~anc_
Temp. Ele¢=ri¢
Temp. Toile=_
H~C'i E~n~Ig.
Co,sC.
Temp. Fenciug__
Teffip. ~nclosureS
wa=er_
Equip.
& ~nsp.
Suppli~s/Pom~age
TOTer ~. 0'~
CONSTRUCTION INDUSTRY ARBITRATION RULES
DEMAND FOR ARBITRATION
MEDIATION lf you want the AAA to contact the other party and attempt to arrange a mediation, please check thi~ box.
TO: Name of Respondent
N.T. MANAGEMENT, INC.
Address
21 EASTGATE DRIVE
Name of Repre~nmtive (if known)
Address
City I State Zip Code City ] State Zip Code
CAMP HILL PA [ !7011 I
Phone No. I Fax No. Phone No. I Fax No.
(717; 737-56~
THE NAMED CLAIMANT, A PARTY TO A WRITTEN AGREEMENT DATED 10/28/96 PROVIDING
FOR ARBITRATION UNDER THE CONSTRUCTION INDUSTRY ARBITRATION RULES, HEREBY DEMANDS
ARBITRATION THEREUNDER. (ATTACH THE ARBITRATION CLAUSE.)
NATURE OF DISPUTE (Please give enough details to enablc thc AAA to sclect arbitrators with appropriate experience.):
RESPONDENT HAS REFUSED TO PAY BALANCE DUE PURSUANT TO CONSTRUCTION
MANAGEMENT CONTRACT.
DOLLAR AMOUNT OF CLAIM: [ OTHER RELIEF SOUGHT:
$ 107,629.00
PLEASE DESCRIBE APPROPRIATE QUALIFICATIONS FOR ARBITRATOR(S) TO BE APPOINTED TO HEAR THIS DISPUTE:
FAMILIARITY WITH CONSTRUCTION MANAGEMENT WORK.
CLAIMANT IS:
E3 Owner I~ Design Professional (specify.
~ Subcontractor (spo~ify
.) [] Contractor
) [] Other (specify CONSTRUCTION MANAGER
RESPONDENT IS:
[] Owner I-1 Design Professional (specify, )
I-1 Subcontractor (specify ) I-1 Other (spoeif~ )
ESTIMATED TIME NEEDED FOR HEARINGS OVERALL: hours ~ days
[-~ Contractor
Copies of this demand are being filed with the American Arbitration Association at its PHILADELPHIA of Scc
Claimant requests that thc AAA commence thc administration of thc arbitration. Under tho rules, you may file an answering statement within ten
days a~,er notice from the AAA.
CLAIMANT REQUESTS THAT ARBITRATION HEARINGS BE HELD AT THE FOLLOWING LOCALE:
/,,~ CARLISLE , PENNSYLVANIA
$ig~l' {may b~'~)d~y/re)~scntativc) Title
I
Name of Claimant
NYE CONSTRUCTION COMPANY,
INC.
Name of Representative
DAVID A. BARIC, ESQUIRE
Address
25 LAUREL DRIVE
City ] State ] Zip Code
MECHANICSBURG PA [ 17055
Phone No. I Fax No.
(717} 79~-9~ (717) 766-4405
Address
17 WEST SOUTH STREET
City J State [ Zip Code
CARLISLE PA I 17013
Phone No. Fax No.
(717) 249-6873 /717) 240-5755
TO INSTITUTE PROCEEDINGS, PLEASE SEND THREE COPIES OF THIS DEMAND AND THE ARBITRATION
AGREEMENT, WITH THE FILING FEE, AS PROVIDED FOR IN THE RULES, TO THE AAA. SEND THE
ORIGINAL DEMAND TO THE RESPONDENT.
EXHIBIT "B"
NYE CONSTRUCTION COMPANY, INC.,
Petitioner,
N.T. MANAGEMENT, INC.,
Respondent.
: IN THE COURT OF COMMON PLEAS
: OF CUMBERLAND COUNTY,
: PENNSYLVANIA
: CIVIL ACTION-EQUITY
RULE TO SHOW CAUSE
AND NOW, this ~ day of XC,,~II~ff~ , 19~, upon review of the attached Petition
of Nye Construction Company To Compel Arbitration and For Appointment of Arbitrators A
Rule To Show Cause is issued why the relief requested should not be granted is entered upon
N.T. Management, Inc.
This Rule is returnable l~J days from service hereof upon N.T. Management, Inc.
BY THE COURT,
SHERIFF'S RETURN - REGULAR
CASE NO: 1998-07289 P
COMMONWEALTH OF PENNSYLVANIA:
COUNTY OF CUMBERLAND
NYE CONSTRUCTION GO
VS.
N T MANMAGEMENT INC
STEVE WHISTLER
CUMBERLAND County, Pennsylvania,
to law, says, the within RULE TO SHOW GAUSEo PETITION
upon N T MANAGEMENT
defendant, at l~Y HOURS, on the 13th day of January
i999 at 2! EASTGATE DRIVE
, Sheriff or Deputy Sheriff of
who being duly sworn according
was served
the
CAMP HILLr PA l?Ol! ,CUMBERLAND ,
County, Pennsylvania, by handing to NEEMA THAKRAR (OWNER}
a true and attested copy of the RULE TO SHOW CAUSE. PETITION ,
together with CIVIL AGTION-EgUITY ,
and at the same time directing His attention to the contents thereof.
Sheriff's Costs:
Docketing
Service
Affidavit
Surcharge
So an
R. Thomas Kl~ns;
~F~'BRIEN, BARIG & SCHEHER
01/14/1999
Depu%y
Sworn and eubscrib~ t~ before me
this /g -~ day
19_~_~ A, D,
Pro~,hono~sry
NYE CONSTRUCTION COMPANY, INC.:
:
Petitioner,
V.
N.T. MANAGEMENT, INC.
Respondent
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY,
PENNSYLVANIA
No. 98-7289 Equity
CIVIL ACTION-EQUITY
JURY TRIAL DEMANDED
PRELIMINARY OBJECTIONS OF N.T. MANAGEMENT, INC.
TO PETITION OF NYE CONSTRUCTION COMPANY. INC.
TO COMPEL ARBITRATION AND FOR APPOINTMENT OF ARBITRATORS
Respondent N.T. Management, Inc., through its counsel, Duane, Morris & Heckscher
LLP, respectfully files preliminary objections~ to the Petition of Nye Construction Company,
Inc. ("Nye") to Compel Arbitration and for Appointment of Arbitrators as follows:
~ Because a Petition to Compel Arbitration is "the functional equivalent of a complaint"
under Pennsylvania law, preliminary objections are the appropriate vehicle for raising challenges
such as those raised herein and that unless raised by preliminary objection would be waived
under the Pennsylvania Rules of Civil Procedure. Clark v. State Farm Auto. Ins. Co., 410 Pa.
Super. 300, 311,599 A.2d 1001, 1006 (1991 ). Accordingly, Respondent's answer to the factual
averments of the Petition and new matter would be premature pending disposition of these
preliminary objections. Moreover, the assertion of aff'mnative defenses, such as fraud in the
inducement and no agreement to arbitrate, are properly reserved until such time as an answer is
filed, if any is required.
1. This matter arises under an alleged Construction Management Agreement
between the parties dated October 28, 1996 (the "Agreement"), a complete copy of which is
attached hereto as Exhibit A.2
2. The validity of the Agreement and the proper procedure for the appointment of
arbitrators are at issue in a civil action filed in the Court of Common Pleas of Dauphin County,
Pennsylvania, on or about October 16, 1998. Copies of the Writ of Summons and Sheriff's
Return are attached hereto as Exhibit B.
3. The present Petition now filed in this Court is the second time Nye has failed to
follow the proper procedure for demanding arbitration.
4. As alleged in Nye's Petition at Paragraph 7, Nye earlier attempted to demand
arbitration before the American Arbitration Association (the "AAA"). The AAA dismissed
Nye's claim because there was no agreement to arbitrate before the AAA. Copies of the AAA's
December 8, 1998 letter dismissing the claim, and counsel's November 12 and 13, 1998 letter
arguments, are attached hereto as Exhibit C.
5. Through its most recent Petition, Nye again seeks the appointment of Arbitrators
in a manner inconsistent with the terms of the alleged Agreement, and without first serving
Notice of the demand for arbitration as expressly required. Further, Nye has filed its Petition in
the wrong Court.
2petitioner attached an incomplete copy of the alleged Construction Management
Agreement to its Petition. That copy excluded page 4 of the Agreement, which sets forth the
actual arbitration provision.
2
DEMURRER/MOTION TO STRIKE
6. Paragraphs 1 through 5 above are incorporated herein by reference.
7. The alleged Agreement contains a provision for the arbitration of"all claims,
disputes and other matters in question between the parties to this Agreement, arising out of, or
relating to this Agreement." (See Page 4, Article VIII, Number 4 of the Agreement at Exhibit
A.)
8. The alleged Agreement further expressly provides for the appointmem of"an
arbitration panel of three parties inel din ' ." (Emphasis added.) The additional
arbitrators are to be appointed by mutual agreement of the parties. (Se~ Construction
Management Agreement attached as Exhibit A.)
9. The alleged agreement also requires that the arbitration be commenced by serving
Notice of the demand for arbitration, which then triggers the parties obligations to appoim the
two remaining arbitrators. (See Exhibit A.)
Nye has not followed the prescribed method for demanding arbitration, and does
10.
not so allege.
I1.
Pursuant to 42 Pa. C.S.A. § 7304(A), a Court can compel arbitration only upon "a
showing that an opposing party refused to arbitrate."
12. Since Nye has not properly demanded arbitration under the alleged Agreement,
N.T. Management, Inc., was never faced with a demand for arbitration, and N.T. Management,
Inc., could not have refused to arbitrate.
13. Moreover, pursuant to 42 Pa. C.S.A. § 7305, "[i]f the agreement to arbitrate
prescribes a method of appointment of arbitrators, the prescribed method shall be followed."
3
14. Because the Agreement specifies the appointment of the project architect and two
other mutually agreeable arbitrators, Nye is not as a matter of law entitled to the relief sought in
its Petition, i.e., appointing three other arbitrators.
15. Because Petitioner fails to state a demand for relief which may properly be
entered by this Court, the Petition should be dismissed with prejudice.
16. In the alternative, because Petitioner's demand for the appointment of three
arbitrators is not cognizable under the provisions of the Agreement and of Section 7305 of the
Uniform Arbitration Act, it should be stricken from the Petition.
WHEREFORE, Respondent N.T. Management, Inc., respectfully requests that the
Petition of Nye Construction Company, Inc., to Compel Arbitration and for Appointment of
Arbitrators be dismissed with prejudice, or, in the alternative, that Petitioner's demand for the
appointment of three arbitrators by the Court be stricken.
MOTION TO DISMISS - IMPROPER VENUE
17. Paragraphs 1 through 16 above are incorporated herein by reference.
18. The Agreement between the parties is the subject of a civil action pending before
the Court of Common Pleas of Dauphin County, Pennsylvania. (See Exhibit B.)
19. Captioned "N.T. Management, Inc. v. Nye Construction Company, Inc. et al.,"
and docketed at No. 4641-S-1998 (Dauphin C.P. 1998), the above action was instituted on or
about October 16, 1998 and arises out of the alleged Construction Management Agreement
referenced in Nye's Petition.
20. Nye's action was commenced on December 29, 1998 with the filing of its Petition
with this Court.
21. Pursuant to the Uniform Arbitration Act, 42 Pa. C.S.A. § 7304(C), "ifa
controversy alleged to be or not to be referable to arbitration under the agreement is also
involved in an action or proceeding pending in a cout~ having jurisdiction to hear applications to
compel or stay arbitration, the application (to compel arbitration) shall be made to that court."
(Emphasis added.)
22. The controversy for which Nye seeks arbitration in its Petition is also
encompassed within the pending Dauphin County action between the parties.
23. The Dauphin County Court of Common Pleas has jurisdiction to hear applications
to compel arbitration under Section 7304(C).
24. Because Section 7304 is a mandatory, not discretionary, venue provision, venue
in this Court is improper as a matter of law.
25. Accordingly, pursuant to Pa. R. Civ. P. No. 1028(a)(1) and the applicable
provisions of the uniform and common law arbitration statutes, the Petition must be dismissed
due to improper venue.
WHEREFORE, Respondent N.T. Management, Inc., respectfully requests that the
Petition of Nye Construction Company, Inc., to Compel Arbitnttion and for Appointment of
Arbitrators be dismissed with prejudice.
26.
MOTION TO DISMISS - PENDENCY OF PRIOR ACTION
Paragraphs 1 through 25 above are incorporated herein by reference.
5
27. The presem controversy is encompassed within litigation already pending
between the parties in the Dauphin County Court of Common Pleas, docket number 4641-S-
1998, filed on October 16, 1998 and properly served on Nye.
28. The prior Dauphin County action involves the same parties and issues as are
before this Court.
29. Pursuant to Pa. R. Civ. P. No. 1028(a)(6), the pendency of a prior action
constitutes proper grounds for sustaining preliminary objections.
WHEREFORE, Respondent N.T. Management, Inc., respectfully requests that the
Petition of Nye Construction Company, Inc., to Compel Arbitration and for Appointment of
Arbitrators be dismissed with prejudice.
Respectfully submitted,
Douglas M. Wolfberg
I.D. #77959
DUANE, MORRIS & HECKSCHER LLP
305 North Front Street
5th Floor
Harrisburg, PA 17101
(717) 237-5500
Counsel for Respondent N.T. Management, Inc.
Dated: January 28, 1999
I, Douglas M. Woliberg, hereby depose and state that I am an attorney with the law finn
of Duane, Morris & Heckseher LLP and make this Verification on behalf of N.T. Management,
Inc. as its counsel. I further state that the averments set forth in the foregoing Preliminary
Objections are true and correct based upon knowledge or information and belief. This
Verification is made subject to the penalties of 18 Pa. C.S.A. §4904, relating to unswom
falsification to authorities.
Date:
Exhibit A
NUDEL LAW OFPICE
,, ?EL:7172365080
P 002
CONSTRUCTION MANAGEMENT AGREEMENT
ARTICLE
~f~ne=.by_, ~$ etd $~ecifzc~C-ons prepa-ed by
Con$cr~¢ti~n Manager ''~
Fu~ish ~rOject M~=~g~e=: services ~0 CO-Ordinate t~e work ~f
:~= con:fac=ors who will ~erform ali work for ~he proJec: as
defined by Cons:ruction Occumcn=s.
servi~e~ and ccuTrac=s for general work. The ~wner ~aa the
rigk: =a regent amy or all bids received by :he Co~$:ruc:£on
M~nager.
3. .A..~:er proper analysis, de~erm/ao :he ~ost acceptable supplie~
o. SuDcon:ra¢:$ fo~ O~ner'a approva~.
Surchasing
co~=rac~s
approval.
for materials &nd CO, Tract wO~ altar Owners
5. Acuou=aing will prepare RroJec~ payrolls and related
go~ernmem~ reporc~ if reguired.
accurate and ~etai~ account of all transa=tion$ resulting
from pe~forma~Ce of c~e Work. Owner shall be afforded
immediate access Co all such records =~o~ request re
Conz:ructios Manager.
projec~ will pr0cee~ wi:h all poa$ible speed eoasistent wi:~
rea~oneDie co&t~, good workmanshl~ ~d safety.
OCT.-O~~ 9~(THU),II:S1 NUDEL UAW OFFICE ', ', TEL:?l?2565080 'P. OOI
2
re~®s~$~..a~age~ wi~! ~reg~re
Job Supar~n~e~den~
authorized represe~ta=~
a~istra=~on for =~is
S~contrac:ors on t~e o~ers behalf.
ARTICL~ III E$=im~'e ~f Con_~.-._-u¢-~io.? Cos:
be subject =o adjus~en~ excep~ for ¢~ge$ in ~he work
IT~'M ~! GE.VE~ CONDITrON$
OCT,-OS"9~{THU).iI:33 NUDEL LAW OFFICE ~ ?EL:7172565080 P 004
ITEM #2 SAVINGS CLAUSE
oavo..gs whica C~e CML buF$ ouC of the prcpcas2 of
to =he ow=er and 20% ~0 =he CMA.
ARTI~ IV Chances In Work
When. au=ken, zed in wincing by Owner and agreed upO~ by the
orig~nsllZ ulan~ and spoc£fi~W. An g% cos=
Changes :o orig£ual b~d ~ropcs~i ~s cf this con=fac: d~e.
Payments to'cOn:facts rill be .T~de by Ow~e:a checks drawn by =he
Owner on a construction account of the O~ner'$ choice a~d co w~ich
Each '~ouoher will sho~, in de:sjl, the /cema covered e~ ~ill be
~up~orted by ¢o~ie~ of ~voices, requisition~ f~r .oaFme~t,
2. ~a=ertal ~ ocaer bilks - as :hey c~me due
4. Overhead & f~ of :he cons=ru¢C~o~ Manager - 20% ~en C2~A
is signs6 and monthly Cherea£ter in propor:i~a =o =he
OCT.-OS'9.8(?HU).15:12 NUDEL LAW OFFICE ~ TEL:7172365080 P. OOi
4
casualty for all work incorporated in the building and all
materials on or about the premises or in storage, and general
liability insurance, with the minimum limits in respect of
bodily injury of $500,00 for each person and $1,000,000 for
each occurrence and property damages 1,000,000/$2,000,000.
Construction Manager will be added as co-insured on the policy
for the ~arm of construction.
The Construction Manager will obtain from each Contractor the
required statutory coverage for Workmen's Compensation
Insurance and a current Certificate Of Insurance will be
collected by each contractor and submitted to the Owner prior
to the start of construction.
ARTICLE VIII ~scella~ous Provision~
This agreemen~ will be binding and inure to the benefit of the
respective successors, executors, administrators and heirs of
the parties.
2. Construction Manager will not have the right to assign this
agreement without the written consent of the Owner.
This Agreement represents the entire understanding between the
Construction Manager and the Owner and may be amended only in
writing.
A~bitration - Ail claims, disputes and other matters in
question between the parties to this Agreement, arising out
of, or relating to this Agreement or the breach thereof, shall
be decided by arbitration in accordance with the Construction
Industry Arbitratian Rules by appointing an arbitration panel
of three parties including the architect, ~i1 mutually
agreeable to the partie~. No arbitration, mrising out of, or
relating to this Agreement, shall include, by consolidation,
joinder or i~ any other manner, any additional partF not a
party to this Agreement and signed by all the parties hereto.
Any consent to arbitration involving an additional party or
parties shall not constitute consent to arbitra~ion of any
dispute not described therein or with any party not named or
described therein. This Agreement ~o arbitrate and any
Agreement to arbitrate with an additional party or parties
fully consented toby the parties hereto sha~l be specifically
enforceable under the prevailing arbitration law. Notice of
the demand for arbitration shall be filed in writing with the
other party to this ~greement. The demand shall be made
within a reasonable t~me after the claim, dispute or other
matter i~ questio~ has arisen. In no event shall the demand
for arbitration be made after the date when institution of
legal or equitable proceedings based on such claim, dispute or
other matter in question would be barred by the applicable
statute of limitations.
OCT-OS'9,8(?HU).II:33 NUDEL LAW OEPICE
law in any co~r~
CONSTRUCTION MANAGER
~I TZTL£
OCT.-0~' ~! {?MU/.It :~
NUDEL LAW Off~IG~
· TEL:7172365080
P, 006
ATTACHMENT
Rield office , .P~o~es .....
$~or. Trai~er~_ .Temp.
Temp, To/ge=.. = .... ~enCei Equip. ,
Clean-up .....
Ha¢'l Wandlg. Fax/Copier.,
L~yOuC _ ., Tsxe~/I~surance ........
S~fe~y .....
Suilders Risk _.
T~mp. Fe~ing ~n$1 Cleaa.up ....
Temp. Enclosures __. Dr£n~lag Water
TOTAL ~. E'?
N.T. MANAGEMENT, INC.
21 Eastgate Drive
Camp Hill, PA 17011
Plaintiff
VS.
NYE CONSTRUCTION COMPANY, INC.
25 Laurel Drive
Mechanicsburg, PA 17055
and
UJJAL MAKER
25 Laurel Drive
Mechanicsburg, PA 17055
Defendants
: IN THE COURT OF COMMON PLEAS
: DAUPHIN COUNTY, PENNSYLVANIA
: Civil Action
PRAECIPE FOR WRIT OF SUMMONS
To the Prothonotary:
Maker.
Please issue a writ of summons in the above-captioned action against Nye Cons~uction Company, Inc. and Ujjal
Matthew Chabal, III, I.D. No. 49926
DUANE, MORRIS & HECKSCHER LLP
305 North Front Street, 5th Floor
Harrisburg, PA 17101
(717) 237-5508
WRIT OF SUMMONS
TO:
NYE CONSTRUCTION COMPANY, INC.
25 Laurel Drive
Mechanicsburg, PA 17055
UJJAL MAKER
25 Laurel Drive
Mechanicsburg, PA 17055
Date:
You are hereby notified that N.T. Management, Inc., has commenced an action against you.
Mary Jane Snyder
Real Estate Deputy
William T~ Tully
Solicitor
Office of the Sheriff
Dauphin County
Harrisburg, Penr~Sylvenia 17'101
(717') Z55-2660
J. R. Lotwick
Sheriff
COMMONWEALTH OF PENNSYLVANIA ~
COUNTY OF DAUFHIN ~
Ralph G. McAIlister
Chief Deputy
Michael W. Rinehart
Assistant Chief Deouty
SHERIFF' S RETURN
NO. 4641-S - --1998
AND NOW~ October 27, 1998
WRIT OF SUmmONS
MAKER UJJAL
B MAKER, WIFE
the original WRIT OF SUMMONS
him/her the contents thereof at
at ll~05AM served the within
upon
by personally handing to
1 true attested copy(ies)
25 LAUREL DRIVE
of
and making known to
MECHANICSBURG, PA 17055-0000
iff of Dauphin County, Pa.
Plaintifft N.T. MANAGEMENT INC
Sheriff's Costst $58.00 PD 10/16/1998 RCPT NO 116738
Mary Jane Snyder
Real E~tate Deputy
William T, Tully
solicitor
Office of the Sheriff
Dauphin County
Harrisburg, Pennsylvania 17101
(717) 255-2660
J. R. Lotwick
Sheriff
COMMONWEALTH OF PENNSYLVANIA ~
COUNTYOF DAUPHIN ~
Ralph G. McAIlister
Chief Deputy
Michael W. Rinehart
Assistant Chief Deputy
AND NOW.' October 27, 1998
WRIT OF SUMMONS
NYE CONSTRUCTION COMPANY INC
B. MAKER, PARTNER
the original WRIT OF SUMMONS
him/her the contents thereof et
SHERIFF' S RETURN
NO. 4641-S --1998
at llt05AM served the within
upon
by personally handing to
1 true attested copy(les) of
and making known to
25 LAUREL DRIVE
MECHANICSBURG, PA 17055-0000
So Answers,
~y, Pa.
Plaintiff: N.T. MANAGEMENT INC
Sheriff's Costs: $58.00 PD 10/16/1998 RCPT NO 116738
Exhibit C
MATTHEW CHABAL, HI
DUANE, MORRIS & HECKSCHER LLP
November 12, 1998
Demos K. Orphanides
Administrator
American Arbitration Association
230 South Broad Street, Floor 12
Philadelphia, PA 19102-4199
Re:
14 110 00255 98 V/J
NYE CONSTRUCTION COMPANY, INC.
and
N. T. MANAGEMENT, INC.
Dear Mr. Orphanides:
I am writing to request the Association to reconsider its October 30, 1998 decision that it
has jurisdiction to proceed with the administration of this arbitration.
The arbitration clause at issue provides in its entirety as follows:
Arbitration - All claims, disputes and other matters in question between the
parties to this Agreement, arising out of, or relating to this Agreement or the
breach thereof, shall be decided by arbitration in accordance with the
Construction Industry Arbitration Rules by appointing an arbitration panel of
three parties including the architect, all mutually agreeable to the parties. No
arbitration, arising out of, or relating to this Agreement, shall include, by
consolidation, joinder or in any other manner, any additional party not a party to
this Agreement and signed by all the parties hereto. Any consent to arbitration
involving an additional party or parties shall not constitute consem to arbitration
of any dispute not described therein or with any party not named or described
therein. This Agreement to arbitrate and any Agreement to arbitrate with an
additional party or parties fully consented to by the parties hereto shall be
specifically enforceable under the prevailing arbitration law. Notice of the
Demos K. Orphanides
November 12, 1998
Page 2
demand for arbitration shall be filed in writing with the other party to this
Agreement. The demand shall be made within a reasonable time after the claim,
dispute or other matter in question has arisen. In no event shall the demand for
arbitration be made after the date when institution of legal or equitable
proceedings based on such claim; dispute-or other matter in question would be
barred by the applicable statute of limitations.
The award rendered bythe arbitrators shall be final, and judgment may be entered
upon it in accordance with applicable law in any court having jurisdiction thereof.
Nowhere in that clause appears any reference to the American Arbitration Association, and in
fact, the parties have never agreed to AAA arbitration.
As an example that shows the parties did not intend to pursue AAA arbitration, the
arbitrator selection procedure in the contract is at odds with the AAA rules. The contract
requires that "all" arbitrators must be "mutually agreeable to the parties." The AAA rules have
no such requirement. In fact, the roles only allow a party to strike a limited number of
prospective arbitrators. Further, in the absence of agreement among the parties, or if acceptable
arbitrators are unable to act, the rules allow the Association to select the arbitrators. That clearly
was not the intent of this agreement, which calls for this matter to be arbitrated by the project
architect and two other mutually acceptable arbitrators.
Thank you for the Association's reconsideration of this issue. This will confirm that you
have temporarily put this matter on hold until this issue is decided, that in the meantime we need
not respond to the Demand for Arbitration, the list of arbitrators or any other matter, and that we
need not immediately seek injunctive relief to protect our client's rights. I should note for the
record that our willingness to allow the Association to take another look at this issue before
going to court should not be construed as waiving any of our rights to challenge the
Association's decision if this issue is decided against us.
MC:pzg
cc: David A. Baric, Esq.
Very truly yours,
Matthew Chabal, IH
for DUANE, MORRIS & HECKSCHER LLP
O'BRIEN, BARIC & SCHERER
Robert L. O'Brien
David A. Baric
Michael A. Scherer
171~Test South Street
Carlisle, Pennsylvania 17013
Steven J. Fishman
Of Counsel
E-mail
obs(~epix, net
(717) 249-6873
FAX (717.) 249-5755
November 13, 1998
VIA FACSIMILE AND REGULAR MAIL
Demos K. Orphanides
Administrator
American Arbitration Association
230 South Broad St., Floor 12
Philadelphia, Pennsylvania 19102-4199
RE: Nye Construction Company, Inc. v. N.T. Management, Inc.
14 110 00255 98 V/J
Dear Mr. Orphanides:
As I expressed to you in my correspondence of October 29, 1998, it is our position that
this matter is properly before the American Arbitration Association for resolution and that the
filing ora praecipe for a summons in the Court of Common Pleas of Dauphin County by counsel
for N.T. Management, Inc. does not stay the instant arbitration filing.
IfN.T. Management, Inc. desires to attempt to stay this arbitration they must file such a
demand with the court to which we will respond contending that arbitration is the forum agreed to
by the parties as set forth in the contract.
If you have any questions, please contact me.
Very truly yours,
V~latthew Chabel, III, Esquire
File
O'BRIEN, BARIC & SCHERER
David A. Baric, Esquire
~ American Arbitration Association
Dispute Resolution Services Worldwide
December 8, 1998
David A. Baric, Esq.
O'Brien, Baric & Scherer
17 West South Street
Carlisle, PA 17013
230 South Broad Street, Floor ~ ~, Philadelphia, PA ~9~o~-4x99
telephone: 2~5 732 5260, facsimile: ~5 732 5oo2
http://www, adr. org
Matthew Chabal, III, Esq. "
Duane, Morris & Heckscher
305 North Front Street, 5th Floor
P.O. Box 1003
Harrisburg, PA 17108
Re: 14 110 00255 98 V/J
lqYE CONSTRUCTION COMPAlqY, INC.
and
N.T. MANAGEMENT, INC.
Dear Parties:
This will acknowledge receipt of letters dated November 12 and 16, 1998
from Mr. Chabal and Mr. Baric.
After careful review of the parties' positions and the arbitration
clause contained in the agreement, the Association has determined that
it does not have jurisdiction to proceed absent a court order or the
agreement of the parties.
Please be advised that the Association will close its file in this
matter in thirty (30) days absent a court order or the agreement of the
parties.
Demos K. Orphanides
Administrator
CERTIFICATE OF SERVICE
I, Patricia Z. Gluslo, an employee of the law firm of Duane, Morris & Heekscher LLP, do
hereby certify that a true and correct copy of the foregoing Preliminary Objections was served upon
the following persons at their respective addresses on January 28, 1999 as follows:
VIA FIRST-CLASS MAIL
David A. Baric, Esquire
17 West South Street
Carlisle, PA 17013
Patricia Z. ~lt~ko
PRAECIPE FOR LISTING CASE FOE ARGUMENT
(Must be typewritten and suhnitted in duplicate)
TO THE PROTHONOTARY OF CUMBERLAND COUNTY:
pl~a-~e ]i-~t the withJan matter for the next Ar~t Court.
CAPTION OF CASE
(entire caption must be stated in hi]I)
NYE CONSTRUCTION COMPANY, INC.,
(pi aintiff)
N.T. MANAGEMENT, INC.,
( Defer~ant )
No. 7289 Civil EQUITY 19 98
State matter to be argued (i.e., plaintiff's motion for new trial, defer~ant's
d~mu~£er to CuE%~l~int, etc.):
PRELIMINARY OBJECTIONS OF RESPONDENT
2. Identify counsel who w4]l argue case:
e
(a) for plaintiff: DAVID A. BARIC, ESQUIRE
~dr~ss: O'BRIEN, BARIC & SCHERER
17 WEST SOUTH STREET
CARLISLE, PENNSYLVANIA 17013
(b) for defem~ant: MATTHEW CHABAL, III, ESQUIRE
~ess: DUANE, MORRIS & HECKSHER, LLP
305 NORTH FRONT STREET, 5TH FLOOR
P.O. BOX 1003
HARRISBURG, PENNSYLVANIA 17108-1003
I ~ l l notify A11 p~ies i~ writing within two days that th_is case has
been li~tedforargu~-nt.
4. Argument Court Date:
APRIL 7,
1999
Attorney for ~ ~, ~-~,~
NYE CONSTRUCTION COMPANY, INC.,
Petitioner,
: IN THE COURT OF COMMON PLEAS
: OF CUMBERL~ COUNTY,
: PENNSYLVANIA
N.T. MANAGEMENT, INC.,
: NO. 98-7289 EQUITY
: CIVIL ACTION-EQUITY
Respondent.
REPLY TO PREIJMINARY OBJECTIONS OF RESPONDENT
AND NOW, comes Petitioner, Nye Construction Company, Inc. ("NCI"), by and through
its attorneys, O'BRIEN, BARIC & SCHEREIL and files this Reply to the Preliminary Objections
of Respondent, and in support thereof, sets forth the following:
1. Denied as stated. This matter does arise under a Construction Management
Agreement executed by the parties a copy of which is appended to Respondent's pleading.
2. Denied. Respondent has filed only a summons in the Court of Common Pleas of
Dauphin County, Pennsylvania. The purpose or eff'ect of that summons is undecipherable from
the pleading so filed. Moreover, this matter has nothing to do with Dauphin County and said
summons was, upon information and belief, filed by counsel for Respondent for no purpose other
than to attempt to create, without factual support, jurisdiction of this matter in an inappropriate
venue.
3.
Denied. To the contrary, counsel for NCI contacted counsel for Respondent prior
to initiating any attempt to arbitrate this matter. Counsel for Respondent suggested that perhaps
appointment of a sole arbitrator would be appropriate. Thereat~er, no further attempt was made
by counsel for Respondent to attempt to come to an agreement as to a procedure for arbitration
of this matter and NCI was forced to move fonvard with arbitration, initially attempting to seek
arbitration through the American Arbitration Association.
4. Denied. Counsel for Petitioner has sought to impede arbitration through the
American Arbitration Association by reliance upon the summons filed in Dauphin County. The
American Arbitration Association has decided, despite the clear language of the Construction
Management Agreement which compels arbitration, to hold this matter in abeyance pending
resolution of the issues raised by Respondent as to whether arbitration or resort to civil litigation
in the Court of Common Pleas is the appropriate forum.
5. Admitted in part and denied in part. It is admitted that NCI seeks arbitration of
this matter as was agreed to by the parties in the Construction Management Agreement. It is
denied that demand has not been made upon Respondent or that the present petition has been filed
in the wrong forum. To the contrary, the appropriate forum for this matter is the Court of
Common Pleas of Cumberland County. The principal place of business for both parties is within
Cumberland County, the project which forms the basis for this action is within Cumberland
County, the work was performed within Cumberland County and the Construction Management
Agreement was entered into by the parties in Cumberland County.
DEMURRER/MOTION TO STRIKE
Paragraphs one through five are incorporated herein by reference.
Admitted.
8. Admitted in part and denied in part. It is admitted that this language is set forth in
the Construction Management Agreement. To the extent Respondent implies that this provision
is to be interpreted as including the architect for the project as an arbitrator, said inference is
denied. To the contrary, the provision in the Construction Management Agreement provides for
the selection of an arbitrator to the panel to be made by the architect. This question of
interpretation was previously discussed by counsel for the parties to this action without agreement
being reached as to the interpretation to be applied. Moreover, the referenced sentence of the
Construction Management Agreement reads as follows:
All claims, disputes and other matters in question between
the parties to this Agreement, arising out of, or relating to this
Agreement or the breach thereof, shall be decided by arbitration
in accordance with the Construction Industry Arbitration Rules
by appointing an arbitration panel of three parties including the
architect, all mutually agreeable to the parties.
9. Admitted in part and denied in part. It is admitted that a demand for arbitration is
required pursuant to the Construction Management Agreement. A demand for arbitration was
served on prior counsel for Respondent. A copy of the demand as forwarded by the American
Arbitration Association is appended hereto as Exhibit "1" and is incorporated. By
correspondence dated September 23, 1998, prior counsel for Respondent sought and was granted
an extension of time to file a response to "Nye Construction Co.'s Demand for Arbitration". A
copy of this correspondence is appended hereto as Exhibit "2" and is incorporated.
10. Denied. NCI incorporates its response to paragraph 9.
11. This is a conclusion of law to which no response is required.
12. Denied. NCI incorporates its response to paragraphs 2,3,4,8 and 9.
13. To the extent this averment constitutes a conclusion of law, no response is
required. To the extent a response may be required, it is submitted that a dispute exists as to
interpretation of the application of the arbitration provision in the Construction Management
Agreement as above stated. Counsel for NCI and Respondent have been unable to reach an
agreement as to the interpretation of that provision.
14. Denied. It is the position of NCI that the project architect is not to be a member of
the arbitration panel but rather one of the appointing parties.
15. Denied. To the contrary, NCI has sought to arbitrate this matter and has sought to
obtain the concurrence of Respondent's counsel in the manner as to the method for arbitration
without success.
16. Denied. To the contrary, the Construction Management Agreement provides for
the appointment of three arbitrators and, because counsel for Respondent has refused to proceed,
three arbitrators should be appointed by this Court.
WHEREFORE, Petitioner respectfully requests that this objection be overruled and the
relief sought in the Petition be granted.
MOTION TO DISMISS-IMPROPER VENUE
17. Paragraphs one through sixteen are incorporated herein by reference.
18. Denied. It is unknown what the subject is of the "civil action" which consists
merely of the filing of a summons by Respondent.
4
19. Admitted in part and denied in part. It is admitted only that the caption as
referenced is contained on a summons docketed to the number and term alleged. A_qer reasonable
investigation, NCI is without knowledge, information or belief sufficient to form a belief as to the
remainder of this allegation and strict proof thereof is demanded.
20. Admitted.
21. To the extent this averment constitutes a conclusion of law, no response is
required. To the extent a response may be required, the referenced statute is not applicable. To
the contrary, there is no question but that arbitration is required, no action has been made by
Respondent to stay arbitration in the Court of Common Pleas of Dauphin County.
22. Denied. NCI incorporates paragraphs 19 and 21.
23. To the extent this is a legal conclusion, no response is required. To the extent a
response may be required, no application to compel or stay arbitration has been filed in the Court
of Common Pleas of Dauphin County.
24. To the extent this averment is a conclusion of law, no response is required. To the
extent a response may be required, this averment is denied.
25. Denied. To the contrary, venue is appropriate in this forum and Respondent has
filed no motion which has brought this matter to consideration in any other forum.
WHEREFORE, Petitioner respectfully requests that this objection be overruled and
and the relief sought in the petition be granted.
5
MOTION TO DISMISS-PENDENCY OF PRIOR ACTION
26. Paragraphs one through twenty-five are incorporated herein by reference.
27. Denied. Petitioner incorporates paragraphs 5 and 21.
28. Denied. Petitioner incorporates paragraphs 5 and 21.
29. Denied. To the contrary, the "prior action" has not brought the issue of
compelling or staying arbitration in this matter before the Court of Common Pleas of Dauphin
County.
WHEREFORE, Petitioner respectfully requests that the objection be overruled and the
relief sought in the petition be granted.
Respectfully submitted,
O'BRIEN, BARIC & SCHERER
David A. Baric, Esquire
ID~44853
17 West South Street
Carlisle, PA 17013
(717) 249-6873
VERIFICATION
I verify that the statements made in the foregoing Reply To Preliminary Objections of
Respondent are true and correct to the best of my knowledge, information and belief. I understand
that false statements herein are made subject to the penalties of 18 Pa. C.S. § 4904, relating to
unsworn falsification to authorities.
David A. Baric, Esquire
American Arbitration Association
CONSTRUCTION INDUSTRY. ARBITRATION RULES
DEMAND FOR ARBITRATION
IMBDIATION ~fyo# ~ the AAA to contact the other party and attempt to arrange a mediation, please
check
th~
box.
TO: NIme of Reepondent
N.T. MANAGEMENT~ INC.
A~ress
21 EASTGATE DRIV~
City I State I ~p Code
CAMP HILL PA ~ 17011
Phone No. I F~ No.
{717) 737-~6~$
Name of Representative (if known)
Address
City [State [ Zip Code
Phone No. Fax No.
TIlE NAMED CLAIMANT, A PARTY TO A WRITTEN AGREEMENT DATED 10/28/96 PROVIDING
FOR ARBITRATION UNDER THE CONSTRUCTION INDUSTRY ARBITRATION RULES, HEREBY DEMANDS
ARBITRATION THEREUNDER. (ATTACH TIIE ARBITRATION CLAUSE.)
~IATURE OF DISPUTE (Please give enough details to cnablc thc AAA to select arbitrators ~4th appropriate experience.):
RESPONDENT HAS REFUSED TO PAY BALANCE DUE PURSUANT TO CONSTRUCTION
MANAGEMENT CONTRACT.
DOLLAR AMOUNT OF CLAIM: I OTHER RELIEF SOUGHT:
$ 107,629.00
PLEASE DESCRIBE APPROPRIATE QUALIFICATIONS FOR ARBITRATOR(S) TO BE APPOINTED TO HEAR THIS DISPUTE:
FAMILIARITY WITH CONSTRUCTION MANAGEMENT WORK.
CLAIMANT IS:
[-I Owner [] Design Pmfessiorml (specify )
[] Subcontractor (specify, ) ~] Other (specify
RESPONDENT IS:
[] Owner [] Design l~ofessinnal (specify, )
[] Subeontnctor (specify. ) [] Other (specie,.
ESTIMATED TIME NEEDED FOR HEARINGS OVERALL: hours ~, dsys
[] Contrector
CONSTRUCTION MANAGER
[] Contractor
Copies of this demand are being fdod with thc American Afoitration Association at its PHILADELPHIA office,
CIsimant requests that thc ~ commence thc administration of thc arbitration, Under thc roles, you may t'fie an answering statement within ten
days after notice from the AAA.
CLAIMANT REQUESTS THAT ARBITRATION HEARINGS BE HELD AT THE FOLLOWING LOCALE:
~.; CARLISLE, PENNSYLVANIA
//
Name of Claimant
NYE CONSTRUCTION COMPANY,
INC ·
Address
25 LAUREL DRIVE
City J State J Zip Codc
MECHANICSBURG PA ] 17055
Phone No. I Fax No.
(717) 79~-Q~1 (717) 766-4405
Name of Representative
DAVID A. BARIC, ESQUIRE
Address
17 WEST SOUTH STREET
City [ State
CARLISLE PA
Phone No. Fax No.
17171 249-6873 {717}
IZip Code
249-5755
17013
TO INSTITUTE PROCEEDINGS, PLEASE SEND THREE COPIES OF THIS DEMAND AND THE ARBITRATION
AGREEMENT, WITH THE FILING FEE, AS PROVIDED FOR IN THE RULES, TO THE AAA. SEND THE
ORIGINAL DEMAND TO THE RESPONDENT.
EXHIBIT 1
,...%%f~.-23'98{WED) 12:46 NUDEL LAW OFF[CE TEL..I,b6S080 P. O02
-~T{:PNEN C. NUDE{.
T~AC3Y L. MC~IA, MARA
~ $. ALT~40$I~
LAW OIIFIC~S
STEPHEN 12. NUDEL
VIA FAX NO. (717) 249-$755
September 23, 1998
Davi~ A. Baric, Esquire
0'Brien, Baric & Scherer
17 W. South Street
Carlisle, PA 17013
Nye Construction Co. v.
N.T, Management~ Inc.
American Arbitration AsSociation
NO. 14 110 002~5 98 V/J
Dear Dave:
Thi-~ letter confirms that you have granted to N.T.
Management, Inc. an extension until October 16, 1998, to file a
response to Nye Construction Co.'s Demand for Arbitration
regarding the above matter,
Ver~ truly yours, /,
Enc.
CC: Mr. A~i C.
Thakrar
I agree with
~avid A. Bar,c,
EXHIBIT 2
CERTIFICATE OF SERVICE
I hereby certify that on February /;~, 1999, I, David A. Baric, Esquire, of O'Brien, Baric &
Scherer, did serve a copy of the Reply To Preliminary Objections of Respondent, by first class U.S.
mail, postage prepaid, to the party listed below, as follows:
Matthew Chabal, III, Esquire
Duane, Morals & Heckscher, LLP
305 North Front St., 5th Floor
P.O. Box 1003
Harrisburg, Pennsylvania 17108-1003
David A. Baric, Esquire
NYE CONSTRUCTION COMPANY, INC.:
Petitioner, :
:
V.
N.T. MANAGEMENT, INC.
Respondent
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY,
PENNSYLVANIA
No. 98-7289 Equity
CIVIL ACTION-EQUITY
fURY TRIAL DEMANDED
BRIEF IN SUPPORT OF PRELIMINARY OBJECTIONS OF
N.T. MANAGEMENT. INC. TO PETITION OF
NYE CONSTRUCTION COMPANY. INC.
TO COMPEL ARBITRATION AND FOR APPOINTMENT OF ARBITRATORS
This Brief is submitted by Respondent N.T. Management, Inc., ("N.T. Management") in
support of its Prelimina~ Objections to the Petition to Compel Arbitration and for Appointment
of Arbitrators filed by Nye Construction Company, Inc., ("Nye").
I. STATEMENT OF FACTS AND PROCEDURAL HISTORY
This matter arises under an alleged October 28, 1996 Construction Management
Agreement (the "Agreement") for the construction ora Days Inn hotel. Under the alleged
Agreement, Nye was to provide certain project managemem services in order to accomplish the
successful and timely cons~'uction of the hotel. The Agreement was written by Nye.
The Agreement comains an arbitration provision which provides as follows.
(Preliminary Objections, Exhibit A, pp. 4-5):~
~Only part of the Agreement was attached to Nye's Petition. A complete copy of the
alleged Agreement was attached as Exhibit A to N.T. Management's Preliminary Objections.
Arbitration - All claims, disputes and other matters in question between
the parties to this Agreement, arising out of, or relating to this Agreement
or the breach thereof, shall be decided by ar}itration in accordance with
the Construction Industry Arbitration Rule{by appointing an arbitration
panel of three parties including the architectr all mutually aareeable to ~e
p~l~,')No arbitraffofi, ansm~rout ox, or relating to this Agr-eem-ent, shall
include' ' ~ by consolidation, joinder or in any other manner, any additional
party not a party to this Agreement and signed by all the parties hereto.
Any consent to arbitration involving an additional party or parties shall
not constitute consent to arbitration of any dispute not described therein or
with any party not named or described therein. This Agreement to
arbitrate and any Agreement to arbitrate with an additional party or parties
fully consented to by the parties hereto shall be specifically enforceable
under the prevailing arbitration law. Notice of the demand for arbitration
shall be filed in writing with the other party to this Agreement. The
demand shall be made within a reasonable time after the claim, dispute or
other matter in question has arisen. In no event shall the demand for
arbitration be made after the date when institution of legal or equitable
proceedings based on such claim, dispute or other matter in question
would be barred by the applicable statute of limitations.
The award rendered by the ~r_hi*ratnr,q shall be final, and judgment may be
entered upon it in accordance with applicable law in any court having
jurisdiction thereof.
On or about August 31, 1998, Nye filed a Demand for Arbitration with the American
Arbitration Association ("AAA"). However, the AAA, concluding that it lacked jurisdiction
over the matter in that them was no agreement of the parties to have the AAA administrate the
arbitration, informed the parties in December, 1998, of its decision not to hear the case.2
N.T. Management initiated an action regarding the alleged Agreement in the Dauphin
County Court of Common Pleas in October, 1998.3 Despite the pendency of this prior action in
2Copies ofN.T. Management's and Nye's letter briefs and the AAA's ruling that it lacked
jurisdiction to conduct the arbitration proceeding are attached to N.T. Management's Pmliminaxy
Objections.
3 The writ of summons and Sheriff's return are attached to N.T. Management's
Preliminary Objections as Exhibit B.
2
Dauphin County, Nye filed in this Court a Petition to Compel Arbitration, which, along with a
Rule to Show Cause, was served on N.T. Management on January 13, 1999. N.T. Management
filed Preliminary Objections on January 28, 1999. Nye filed a Reply to N.T. Management's
Preliminary Objections on February 12, 1999.
This Brief is filed in support of N.T. Management's Preliminary Objections under
Cumberland County Local Rule 210-6.
OUESTIONS PRESENTED
EVEN ASSUMING THAT A VALID CONSTRUCTION MANAGEMENT
AGREEMENT EXISTS, SHOULD THE PETITION TO COMPEL
ARBITRATION BE DISMISSED WHERE PETITIONER SEEKS RELIEF
THAT IS UNAVAILABLE TO IT AS A MATTER OF LAW AND WHERE IT
HAS FAILED TO COMPLY WITH THE PROVISIONS OF THE
ARBITRATION CLAUSE?
(Suggested Answer: Yes.)
WHERE A PRIOR, PENDING ACTION ENCOMPASSING THE SAME
PARTIES AND ISSUES HAD ALREADY BEEN INITIATED IN ANOTHER
COUNTY, SHOULD THE PETITION TO COMPEL ARBITRATION BE
DISMISSED AS IMPROPERLY FILED IN THIS COURT UNDER THE
MANDATORY VENUE CLAUSE OF THE UNIFORM ARBITRATION ACT?
(Suggested Answer: Yes.)
III. ARGUMENT
A. THE PETITION TO COMPEL ARBITRATION MUST BE DISMISSED
BECAUSE PETITIONER IS NOT ENTITLED TO THE RELIEF
REQUESTED AS A MATTER OF LAW
1. Nye's Reouest That The Court Anooint Three Arbitrators Is
Improper Because The Parties Have Already Affreed To Aoooint The
Project Architect As One Of The Three Arbitrators
Nye asks the Court to appoint three arbitrators to hear and decide a dispute under the
Agreement. That request is contrary to the plain language of the Agreement.
As the arbitration clause quoted above clearly spells out, all disputes arising out of or
relating to the Agreement shalI be decided "by appointing an arbitration panel of three parties
ineludine the architect, all mutually agreeable to the panics." (Emphasis added.) The
language of the arbitration clause is clear on its face and free from any ambiguity regarding the
service of the architect on the arbitration panel. Nevertheless, Nye asserts a rather incredible
argument: that this language calls for the architect to be "one of the appointing parties" rather
than a member of the panel. That interpretation is not at all supported by the plain language of
the arbitration clause, which Nye drafted.
Because Nye seeks the appointment of an entire arbitration panel, and because the
alleged agreement already provides for the architect to serve as one of the arbitrators, Nye is not
as a matter of law entitled to the relief it seeks in its Petition; i.e.. the appointment of three other
arbitrators. Accordingly, Nye s Petition to Compel Arbitration must be dismissed.
4It is anticipated Nye will argue that the Agreement requires the three arbitrators to be
"all mutually agreeable to the parties" and that the architect is not agreeable to Nye now.
However, the architect was specifically agreed upon by the parties at the time of contracting to
be a "mutually agreeable" arbitrator.
4
2. Nye's Reuuest That The Court Appoint Arbitrators Must Be
Dismissed Because Nye Has Not Made A Prooer Demand For
Arbitration As Reauired Bv The A ~reement And The Uniform
Arbitration Act
Nye has also failed to comply with the Agreement's requirements regarding making a
demand for arbitration. The arbitration provision in pertinent part states that "[n]otice of the
demand for arbitration shall be filed in writing with the other party to this Agreement."
(Agreement, Article VIII, Paragraph 4, attached to Preliminary Objections as Exhibit A.) With
the exception of the improper demand for arbitration filed with the AAA, which the AAA
dismissed for lack of jurisdiction, Nye has not demanded arbitration as required by the
Agreementfi
Section 7304(a) of the Uniform Arbitration Act, 42 Pa. C.S.A. § 7304(a), requires "a
showing that an opposing party refused to arbitrate" before the Court may "order the parties to
proceed with arbitration." Because Nye has never made a proper demand for arbitration as
contemplated by the Agreement, there cannot have been a refusal to arbitrate by N.T.
Management. Because there has been no refusal, the Court may not compel arbitration. As
explained below, N.T. Management filed an action in Dauphin County in order to raise certain
issues concerning the validity of the Agreement in general and its arbitration clause in particular,
~There is no question that the AAA has dismissed this case. Contrary to the assertion in
Paragraph 4 of its Reply to N.T. Management's Preliminary Objections that the AAA has
decided "to hold this matter in abeyance pending resolution of the issues raised by Respondent
as to whether arbitration or resort to civil litigation.., is the appropriate forum," the AAA has
concluded that it lacks jutisdiction and that "it will close its file in this matter in thirty (30) days"
absent a court order or agreement of the parties. See December 8, 1998 letter from the AAA to
the parties, attached to N.T. Management's Preliminary Objections as Exhibit C. More than 30
days have elapsed since the date of the AAA's letter and it may now safely be assumed that their
file is closed and not being held in abeyance as Nye asserts.
5
and N.T. Management's counsel discussed each of those issues with Nye's counsel.
Nevertheless, Nye has been willing to waive those issues and proceed to arbitration, so long as
the arbitration is conducted in accordance with the terms of the Agreement, i.e., with the project
Architect and two other mutually agreeable arbitrators. See, N.T. Management's counsel's
February 12, 1999 letter, a copy of which is attached to this Brief as Exhibit A. Thus, Nye's
Petition must be dismissed.
B. THE PENDENCY OF A PRIOR ACTION BETWEEN THE PARTIES IN
DAUPHIN COUNTY PRECLUDES PETITIONER FROM SEEKING OR
OBTAINING RELIEF FROM THIS COURT AND REQUIRES THE
DISMISSAL OF THE PETITION
The present dispute is the subject ora prior, pending action between the identical parties
in the Court of Common Pleas of Dauphin County. That action was instituted by N.T.
Management on October 16, 1998, more than two months prior to the filing of Nye's Petition in
this Court.6 The pendency of the prior Dauphin County action divests this Court of jurisdiction
both under the Uniform Arbitration Act and under well-settled principles of common law.
The Uniform Arbitration Act, 42 Pa. C.S.A. § 7304(c), provides that "[i]f a controversy
alleged to be or not to be referable to arbitration under the agreement is also involved in an
action or proceeding pending in a cout~ having jurisdiction to hear applications to compel or stay
arbitration, the application [to compel arbitration] shall be made to that court." (Emphasis
added.) So long as the elements of this statutory provision are satisfied, the law is clear that the
venue provision is mandatory, not discretionary.
6 The Dauphin County action is captioned '2q.T. Management, Inc. v. Nye Construction
Company, Inc. et al.," and is docketed at No. 4641-S-1998 (Dauphin C.P. 1998).
The first element of the statute is the requirement for a controversy which is alleged to be
referable or not referable to arbitration. That element is clearly satisfied here. Nye alleges that
the dispute under the alleged Construction Management Agreement is referable to arbitration;
N.T. Management asserts that it is not referable to arbitration in the manner sought by Nye (if a
valid agreement indeed exists).
The next element to determine the propriety of venue is that the controversy must also be
"involved in an action or proceeding pending" in a court of competent jurisdiction. The dispute
between the parties is the subject of the Dauphin County lawsuit initiated in October, 1998. Nye
argues that because this action was instituted by writ of summons that it somehow does not
constitute a prior, pending action under Section 7304(c). To the contrary, the law of the
Commonwealth is clear that there are two separate, equally legitimate means to initiate an action
in Pennsylvania: (1) by complaint, or (2) by writ of summons. Pa. R.C.P. No. 1007 ("An action
may be commenced by filing with the prothonotary (1) a praecipe for a writ of summons, or (2) a
complaint.") An action initiated by writ of summons is still an action, and the pendency of the
action in Dauphin County requires Nye to file its Petition to Compel Arbitration in that
jurisdiction. Nye also asserts that the writ of summons is insufficient to determine the nature of
the dispute between the parties in Dauphin County. Nye's argument is disingenuous. First, it has
taken no steps, such as a Rule to File Complaint, to ascertain the nature of the case. Second, and
more importantly, the undersigned has had Several conversations with Nye's counsel regarding
the nature of the Dauphin County action. Nye is well aware that the Agreement is involved in
the pending action.
7
The next element is that the court in which the prior pending action is filed have
jurisdiction to hear applications to compel or stay arbitration. Clearly that is the case. The
Dauphin County Court of Common Pleas, like this Court, is a court of general jurisdiction and
may without question entertain Nye's petition.7
It is thus clear that a prior, pending action exists between the parties in Dauphin County
and that jurisdiction in Dauphin County is proper. As a result, the mandatory venue selection
provision of Section 7304(a) applies, and prOvides that an application to compel arbitration shall
be made to that court. Accordingly, Nye's Petition must be dismissed,s
7Nye's real argument is only that Cumberland County is the more appropriate forum for
this matter. But that argument goes to the convenience of Dauphin County as a forum, not to
whether the Dauphin County Court has jurisdiction. Further, even if the issue were one of venue,
there ig no doubt venue is proper in Dauphin County, which is a county in which Nye regularly
conducts business. See, Pa. R.C.P. No. 2179.
8The same result is supported by the common law doctrine of lis pendens and Pa. R.C.P.
No.1028(a)(6). Rule 1028(a)(6) permits preliminary objections to be filed on the grounds of
"pendency of a prior action." This is referred to in Peunsylvania jurisprudence as the doctrine of
lis pendens, though this term is somewhat of a misnomer in non property-related actions. See
Nordstown Auto. Co.. Inc. v. Hand. 386 Pa. Super. 269, 562 A.2d 902 (1989) ("a party
asserting...lis pendens must aver that a prior action is pending"). A prior action has been filed,
the same parties are involved, the same rights are asserted, and the same relief is sought.
Meinhart v. Heaster, 424 Pa. Super. 433,622 A.2d 1380 (1993). See also Nordstown Auto..
where in evaluating whether a prior pending action existed the court recognized that actions in
Pennsylvania for lis pendens purposes can be initiated by writs of summons as well as by
complaint. Though in Norristown Auto the court ruled that the trial court's dismissal on lis
pendens grounds was improper, it did so because one action sounded in tort while the other was
a breach of contract action in assumpsit. Here, as N.T. Management asserted in a signed
pleading before this Court, both the Dauphin and Cumberland County actions deal with, inter
alia, the arbitrability of the dispute between these parties. Therefore, under the doctrine of lis
pendens as well, Nye's Petition must be dismissed.
IV. CONCLUSION
Because the arbitration clause in the alleged agreement between the parties calls for the
architect to serve on a panel of three arbitrators, Nye is not as a matter of law entitled to the
relief it seeks in its Petition to Compel Arbitration, i.e., the appointment of three other
arbitrators. Further, because Nye has failed to provide proper notice of its arbitration demand,
N.T. Management could not have refused to arbitrate and Nye therefore does not meet the
statutory prerequisites of the Uniform Arbitration Act. Moreover, the mandatory venue
provision in the Act requires that Nye's Petition be filed not in Cumberland County but in
Dauphin County, where a prior pending action exists. Accordingly, Nye's Petition to Compel
Arbitration must be dismissed.
Dated: March 26, 1999
Respectfully submitted,
Matthew Chabal, III
I.D. g49926
Douglas M. Wolfberg
I.D. #77959
DUANE, MORRIS & HECKSCHER LLP
305 North Front Street
5th Floor
Harrisburg, PA 17101
(717) 237-5500
Counsel for Respondent N.T. Management,'Inc.
Exhibit A
MATIlqEW CH. AB~, III
DII1.ECT DIAL: (717) 23%5514
~MAIL: chabal~duanemorris, com
DUANE, MORRIS & HECKSCHER LLP
305 NORTH FRONT STREET, 5th FLOOR
P.O. BOX 1003
HARRISBURG, PA 17108-1003
(717) 237-5500
FAX
(717) 2324015
Febmary12,1999
PHILADELPHIA, PA
NEW YORK, NY
WASHINGTON, DC
SAN FP~NClSC0, CA
David A. Baric, Esq.
O'Brien, Baric & Scherer
17 West South Street
Carlisle, PA 17013
Re: Nye Construction v. N.T. Management
Dear Mr. Baric:
I am in receipt of your February 8, 1999 letter. As we have discussed previously, we
object to arbitrating your client's claims on a number of grounds. Nevertheless, we are willing to
consider the appointment of arbitrators under the express terms of the written Agreement
between our clients.
The plain language of the Agreement requires the project architect to serve as one of the
three arbitrators. My understanding of your position is that the Agreement does not mean what it
says in that regard and that the project architect shall not serve as aa arbitrator. If that is the
case, I do not believe we have anything to discuss. If your position has changed, however, I will
gladly discuss the appointment of the two remaining arbitrators with my client and will report
back to you.
Very truly yours,
Matthew Chabal, III
for DUANE, MORRIS & HECKSCHER LLP
MC:pzg
CERTIFICATE OF SERVICE
I, Patricia Z. Glusko, an employee of the law firm of Duane, Morris & Heckscher LLP, do
hereby certify that a true and correct copy of the foregoing Preliminary Objections was served upon
the following persons at their respective addresses on March 26, 1999 as follows:
VIA FIRST-CLASS MAIL
David A. Baric, Esquire
17 West South Street
Carlisle, PA 17013
Pa~i'cia Z. G~
NYE CONSTRUCTION COMPANY, INC.,
Petitioner,
NT. MANAGEMENT, INC.,
Respondent.
: IN THE COURT OF COMMON PLEAS
: OF CUMBERLAND COUNTY,
: PENNSYLVANIA
: NO. 98-7289 EQUITY
BRIEF OF PETITIONER IN OPPOSITION TO
PREI,IMINARY OBJECTIONS OF RESPONDENT
NOW, comes Petitioner, Nye Construction Company, Inc., by and through its attorneys,
O'BRIEN, BARIC & SCHEREK and files this brief in opposition to the preliminary objections of
Respondent and sets forth the following:
I. COUNTER STATEMENT OF FACTS AND PROCEDURAL HISTORY
This matter arises from the Respondent's refusal to make payment of sums due the
Petitioner under a Construction Management Agreement ("Agreement"). The Agreement and the
services rendered thereunder relate to a Days Inn that the Respondent had constructed in
Mechanicsburg, Cumberland County, Pennsylvania. Petitioner adopts the arbitration provision as
cited in Respondent's brief.
A demand for arbitration with the American Arbitration Association was filed in August of
1998 and service was made upon Respondent. Respondent immediately contended that the
Ameri6an Arbitration Association had no jurisdiction which position was initially rejected by the
American Arbitration Association (see, Exhibit A). Counsel for Respondent then filed a summons
only in Dauphin County and asked that the American Arbitration Association reconsider and
reject jurisdiction of this matter.
1
At several instances during the period August, 1998 through and into 1999, counsel for
Petitioner has attempted to reach an agreement with counsel for Respondent regarding an
appropriate method and means to establish an arbitration panel and move this matter to
arbitration. No agreement has been reached.
H. QUESTIONS PRESENTED
A. HAS THE PETITIONER PROPERLY PRESENTED A MOTION TO
COMPEL ARBITRATION AND FOR APPOINTMENT OF
ARBITRATORS WHERE RESPONDENT HAS REPEATEDLY
REFUSED TO ARBITRATE THE MATTER AND HAS FAILED TO
AGREE TO A METHOD OF SELECTION OF ARBITRATORS?
(Suggested Answer in the Affirmative.)
B. WHERE RESPONDENT HAS FILED A SUMMONS ONLY WHICH
SETS FORTH PARTIES WHO ARE NOT SUBJECT TO AN
ARBITRATION PROVISION IN THE CONTRACT AT ISSUE HAS
RESPONDENT DETERMINED THE FORUM FOR A MOTION TO
COMPEL?
(Suggested Answer in the Negative.)
Eli. ARGUMENT
A. Petitioner is entitled to the relief requested.
At various times up to the present, counsel for Respondent has discussed arbitration as a
means to resolving this matter, however, he has failed and refused to move to arbitration of this
case. Clearly, a dispute exists as to interpretation of the clause in the arbitration provision which
determines the composition of the board of arbitrators. Interestingly, counsel for Respondent
previously took the position that the language requiring mutual agreement of all parties as to the
composition of the board took this matter out of the jurisdiction of the American Arbitration
2
Association because the AAA had no such "mutual agreement" provision. (See, M. Chabal, Esq.
letter of November 12, 1998, Exhibit B). Now, Respondent contends that the mutual agreement
provision is nugatory with the architect an automatic member of the board. The reasonable
reading of this provision in the Agreement is that the architect is one of the parties who may
appoint a representative with the owner, architect and construction manager ali to agree to the
ultimate composition of the board. The Uniform Arbitration Act, 42 Pa.C.S.A. Section 7301 et
seq., provides for statutory and common law arbitration. This matter falls within the definition of
common law arbitration. One of the rules applicable to common law arbitration is as follows:
Appointment of arbitrators by court
If the agreement to arbitrate prescribes a method of appointment of
arbitrators, the prescribed method shall be followed. In the absence of
prescribed method or if the prescribed method fails or for any reason cannot
be followed, or when an arbitrator appointed fails to act or is unable to act
and his successor has not been appointed, the court on application of a party
shall appoint one or more arbitrators. An arbitrator so appointed has all the
powers ofan arbitrator specifically named in the agreement. 42 Pa.C.S.A.
Section 7305
This section does not indicate which court has jurisdiction over appointment of an
arbitrator or arbitrators. It is submitted that it is for this Court to decide how this provision
should be interpreted so the parties may move forward with arbitration of this matter as is
required by the Agreement. Should the Court deem it necessary, testimony could be presented as
to the understanding of the patties as to this provision in the Agreement.
B. Venue and jurisdiction for this matter rests in the Courts of
Cumberland County
The Uniform Arbitration Act provides for a stay of arbitration if an arbitration is
"threatened or commenced..." 42 Pa.C~S.A. §7304 (b). Had Respondent filed such a request
with the Court of Common Pleas of Dauphin County, in equity, that court would determine
preliminaTrily whether the instant dispute is subject to arbitration. By filing only a summons with
no allegations as to the subject matter of the action commenced in Dauphin County, Respondent
has not triggered the venue provisions as set forth at Section 7304 (c). There is simply no means
available to make a determination in this Court that there is a similarity of claims or issues as is
required to implicate the venue provision. Respondent argues that Petitioner could have ruled a
complaint fi-om Respondent to establish the allegations of its claim, however, there are no
provisions in the Uniform Arbitration Act relating to venue which place such an obligation on
Petitioner. It should also be noted that the summons filed by Respondent names parties who were
not parties to the Agreement. It is anticipated that Respondent will attempt to argue that because
parties are named in the Dauphin County matter who were not parties to the Agreement,
Respondent can circumvent the arbitration provisions of the Agreement. Additionally, it is
submitted that venue of this matter in Dauphin County is not appropriate considering that the
proper~y at the core of this matter is in Cumberland County and that the principal places of
business of the Petitioner and Respondent are in Cumberland County.
IV. Conclusion
For all of the forgoing, Petitioner requests that the preliminary objections of Respondent
be overruled and arbitration be compelled and arbitrators be appointed by the Court.
Respectfully submitted,
David A. Baric, Esquire
ID#44853
17 W. South St.
Carlisle, PA 17013
(717) 249-6873
Attorney for Petitioner
(~ .American Arbitration Association
Dispute Resolution Services World~idt
October 30, 1998
David A. Baric, Esq.
O'Brien, Baric & Scherer
17 West South Street
Carlisle, PA 17013
a3o South Broad Street, Floor i a, Philadelphia, PA tgtoa-4t 99
telephone: ~ t 5 73a 5~6°' facsimile: a ~ 5 73a 5°°~
http://www, adr.org
Matthew Chabal, III, Esq.
Duane, Morris & Heckscher
.305 North Front Street, 5th Floor
P.O. Box 1003
Harrisburg, PA 17108
Re: 14 110 00255 98 V/J
NYE CONSTRUCTION COMPANY,
and
N.T. MANAGEMENT, INC.
INC.
Dear Parties:
The Association, after careful review of the parties' contentions, has
determined that Claimant has met the necessary filing requirements of
the rules by filing a Demand for Arbitration which provides for
administration by this agency.
Therefore, absent the agreement of the parties or a court order staying
the arbitration, the AAA will proceed with the further administration
of this matter. The parties may raise this issue with the arbitrator
prior to the hearing.
Sincerely~
~os K. orphanides
Administrator
cc: Ujjal Maker VIA FACSIMILE (717)
Ben Musser VIA FACSIMILE (717)
766-4405 11/03/98
532-5588 11/03/98
EXHIBIT "A"'
MATrHEW CHAB~J~ I11
DUANE, MORPdS & HECKSCHER LLP
November 12, 1998
Demos K. Orphanides
Administrator
American Arbitration Association
230 South Broad Street, Floor 12
Philadelphia, PA 191024199
Re:
14 110 00255 98 V/J
NYE CONSTRUCTION COMPANY, INC.
and
N. T. MANAGEMENT, INC.
Dear Mr. Orphanides:
I am writing to request the Association to reconsider its October 30, 1998 decision that it
has jurisdiction to proceed with the administration of this arbitration.
The arbitration clause at issue provides in its entirety as follows:
Arbitration - All claims, disputes and other matters in question between the
parties to this Agreement, arising out of, or relating to this Agreement or the
breach thereof, shall be decided by arbitration in accordance with the
Construction Industry Arbitration Rules by appointing an arbitration panel of
three parties including the architect, all mutually agreeable to the parties. No
arbitration, arising out of, or relating to this Agreement, shall include, by
consolidation, joinder or in any other manner, any additional party not a party to
this Agreement and signed by all the parties hereto. Any consent to arbitration
involving an additional party or parties shall not constitute consent to arbitration
of any dispute not described therein or with any, party not named or described
therein. This Agreement to arbitrate and any Agreement to arbitrate with an
additional party or parties fully consented to by the parties hereto shall be
specifically enforceable under the prevailing arbitration law. Notice of the
EXHIBIT "B"
Demos K. Orphanides
November 12, 1998
Page 2
demand for arbitration shall be filed in writing with the other party to this
Agreement. The demand shall be made within a reasonable time alter the claim,
dispute or other matter in question has arisen. In no event shall the demand for
arbitration be made afier the date when institution of legal or equitable
proceedings based on such claim, dispute or other matter in question would be
barred by the applicable statute of limitations.
The award rendered by the arbitrators shall be final, and judgment may be entered
upon it in accordance with applicable law in any court having jurisdiction thereof.
Nowhere in that clause appears any reference to the American Arbitration Association, and in
fact, the parties have never agreed to AAA arbitration.
As an example that shows the parties did not intend to pursue AAA arbitration, the
arbitrator selection procedure in the contract is at odds with the AAA rules. The contract
requires that "all" arbitrators must be "mutually agreeable to the parties." The AAA rules have
no such requirement. In fact, the rules only allow a party to strike a limited number of
prospective arbitrators. Further, in the absence of agreement among the parties, or if acceptable
arbitrators are unable to act, the rules allow the Association to select the arbitrators. That clearly
was not the intent of this agreement, which calls for this matter to be arbitrated by the project
architect and two other mutually acceptable arbitrators.
Thank you for the Association's reconsideration of this issue. This will confirm that you
have temporarily put this matter on hold until this issue is decided, that in the meantime we need
not respond to the Demand for Arbitration, the list of arbitrators or any other matter, and that we
need not immediately seek injunctive relief to protect our client's rights. I should note for the
record that our willingness to allow the Association to take another look at this issue before
going to court should not be construed as waiving any of our rights to challenge the
Association's decision if this issue is decided against us.
MC:pzg
cc: David A. Badc, Esq.
Very truly yours,
Mattbew. Chabal, III
for DUANE, MQRRIS & HECKSCHER LL?
CERTIFICATE OF SERVICE
I hereby certify that on March 30, 1999, I, David A. Baric, Esquire, of O'Brien, Baric &
Scherer, did serve a copy of the Brief of Petitioner In Opposition To Preliminary Objections Of
Respondent, by first class U.S. mail, postage prepaid, to the party listed below, as follows:
Matthew Chabal, III, Esquire
Duane, Morris & Heckscher
305 North Front St., 5th Floor
Harrisburg, Pennsylvania 17108-1003
David A. Baric, Esquire
NYE CONSTRUCTION COMPANY,
INC.,
PETITIONER
N.T. MANAGEMENT, INC.
RESPONDENT
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
:
98-7289 EQUITY TERM
BEFORE BAYLEY. J. AND OLER, J.
ORDER OF COURT
AND NOW, this 7th day of April, 1999, IT IS ORDERED:
(1) The preliminary objection of N.T. Management, Inc., to the petition of Nye
Construction Company, Inc., to compel arbitration, IS DISMISSED.
(2) The Rule entered on January 11, 1999, against N.T. Management, Inc., to
compel arbitration, IS GRANTED.
(3) The dispute shall be submitted to arbitration in accordance with the
Construction Industry Arbitration Rules.
(4) There shall be three arbitrators one of whom shall be the project arohitect.~
Edgar B. ~~
1. We interpret the arbitration language in the parties' contract that states "[b]y
appointing an arbitration panel of three parties Including the architect, all mutually
agreeable to the parties" (emphasis added), as clearly providing that one of three
arbitrators shall be the architect.
David A. Baric, Esquire
For Petitioner
Matthew Chabal, III, Esquire
For Respondent
-2-
NYE CONSTRUCTION
COMPANY, INC.,
Plaintiff
N.T. MANAGEMENT, INC.,
Defendant
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
NO. 98-7289 EQUITY
MOTION TO COMPEL ARBITRATION
NOW, comes Nye Construction Company, Inc. ("Nye Construction"), by and through its
attorneys, O'BRIEN, BARIC & SCHERER, and files the within Motion to Compel Arbitration
and, in support thereof, sets forth the following:
1. By order dated April 7, 1999, this Court ordered arbitration of the above matter.
A copy of thc order is attached hereto as Exhibit "A" and is incorporated.
2. The parties, by agreement, entered into non-binding mediation in an attempt to
resolve the matter.
The parties have not been able to reach a resolution of this matter through
mediation.
4.
Counsel for plaintiffhas contacted counsel for defendant in an attempt to set
arbitration of this matter and has been unsuccessful in receiving a response from counsel from
defendant to appoint arbitrators and set arbitration.
5. In accordance with the order of Court dated April 7, 1999, plaintiff requests that
this Court appoint two independent arbitrators with the third arbitrator being the architect for the
project at issue as referenced in the prior order.
6. Plaintiff requests that the costs of arbitration be equally divided by plaintiff and
defendant.
WHEREFORE, Plaintiff requests that this Court appoint two independent arbitrators and
direct that the arbitration be set to take place within a time certain from the date of appointment
of the arbitrators with the parties to equally divide the costs of the arbitration.
Respectfully submitted,
t0'BRIEN, BARIC & SC~.ER
David A. Baric, Esquire
I.D. # 44853
17 West South Street
Carlisle, Pennsylvania 17013
(717) 249-6873
dab.dir/litigation/maker/nye/compei, mot
VERIFICATION
The statements in the foregoing Motion To Compel Arbitration are based upon
information which has been assembled by my attorney in this litigation. The language of the
statements is not my own. I have read the statements; and to the extent that they are based upon
information which I have given to my counsel, they are tree and correct to the best of my
knowledge, infomiation and belief. I understand that false statements herein are made subject to
the penalties of 18 Pa.C.S. § 4904 relating to unswom falsifications to authorities.
Ujjal M~-
NYE CONSTRUCTION COMPANY,
INC.,
PETITIONER
N.T. MANAGEMENT, INC.
RESPONDENT
: IN THE COURT OF COMMON PLEAS OF
· CUMBERLAND COUNTY, PENNSYLVANIA
:
98-7289 EQUITY TERM
BEFORE BAYLEY, J. AND OLFR, J.
ORDER OF COURT
AND NOW, this 7th day of April, 1999, IT IS ORDERED:
(1) The preliminary objection of N.T. Management, Inc., to the petition of Nye
Construction Company, Inc., to compel arbitration, IS DISMISSED.
(2) The Rule entered on January 11, 1999, against N.T. Management, Inc., to
'arbit n/IS GRANTED., ~.~
compel ratio ~ : ~'i',:., :*,:.' :' ~. ....... :. ,:.
(3) The dispute shall be submitted to arbitration in accordance with the
Construction Industry Arbitration Rules.
(4) There shall be three arbitrators one of whom shall be the project architect.~
1 ,' We interpret the arbitration language in the parties' contract that states ,[b]y
appointing an arbitration panel of three parties Including the architect, all mutually
agreeable t° the parties" (emphasis added), as cleadY' providing that one of three
arbitrators shall be the architect.
David A. Baric, Esquire
For Petitioner
Matthew Chabal, III, Esquire
For Respondent
-2-
CERTIFICATE OF SERVICE
I hereby certify that on June ,2002, I, David A. Baric, Esquire of O'Brien, Baric &
Scherer, did serve a copy of a Motion To Compel Arbitration, by first class U.S. mail, postage
prepaid, to the parties listed below, as follows:
Stephen J. Hogg, Esquire
19 South Hanover Street, Suite 101
Carlisle, Pennsylvania 17013
Stephen C. Nudel, Esquire
219 Pine Street
Harrisburg, Pennsylvania 17101
N.T. Management, Inc.
21 Eastgate Drive
Camp Hill, Pennsylvania 17011
David A. Baric, Esquire
NYE CONSTRUCTION
COMPANY, INC.,
Plaintiff
Vo
N.T. MANAGEMENT, INC.,
Defendant
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
NO. 98-7289 EQUITY
RULE TO SHOW CAUSE
AND NOW, this ~ ~ day of June, 2002, upon consideration of the Motion To Compel
Arbitration, a Rule is issued upon the Defendant to show cause, if any there be, why the relief
requested in the Motion should not be granted.
Rule returnable
[~' days from service.
NYE CONSTRUCTION COMPANY, INC., :
:
Plaintiff .:
:
:
N.T. MANAGEMENT, INC. , :
:
Defendant :
IN THE COURT OF COMMON PLEAS
CUMBERLAND COUNTY, PENNSYLVANIA
NO. 98-7289 EQUITY
DEFENDANT'S REPLY TO PLAINTIFF'S
MOTION TO COMPEL ARBITRATION
AND NOW, comes Defendant, N.T. Management, Inc., by and
through its attorneys, Law Offices Stephen C. Nudel, PC, and
respectfully files the following Reply to Plaintiff's Motion to
Compel Arbitration:
1. On or about June 7, 2002, Plaintiff filed a Motion to
Compel Arbitration requesting this Honorable Court to select two
(2) additional arbitrators and a time period within which
Arbitration would occur.
2. Thereafter, on June 11, 2002, the Court issued a Rule
upon Defendant to show cause why the relief requested by
Plaintiff should not be granted.
3. Prior to the Motion to Compel Arbitration, the
undersigned counsel and counsel for Plaintiff had not exchanged
proposed names of arbitrators.
4. Defendant objects to the Court selecting the additional
two (2) arbitrators as it is contrary to the intention of the
parties and the language set forth in their Agreement.
5. Since the Court issued the Rule to Show Cause, the
undersigned counsel, in attempt to resolve the issues involved,
has contacted Plaintiff's counsel, and each has submitted to the
other an initial list of recommended arbitrators. A true and
correct copy of the correspondence is attached hereto and made a
part hereof as "Exhibit A".
6. Counsel for both Plaintiff and Defendant are attempting
to select the arbitrators themselves without the need for Court
Order.
7. Defendant respectfully requests, and counsel for
Plaintiff has consented and does not object to, an extension of
twenty (20) days in which the parties will attempt to select the
additional two (2) arbitrators and schedule an estimated time
period for the Arbitration in the above matter.
WHEREFORE, Defendant respectfully requests this Honorable
Court to execute the attached Order, or in the alternative,
should the Court be unwilling to execute the attached Order,
counsel for Defendant would request a Hearing to be held to
determine the issues involved herein.
Respectfully submitted,
LAW OFFICES STEPHEN C. NUDEL, PC
St~phe~ ~. Nu~el~ ~squ~ire
Attorney ID ~41703~
M~k W. Allshouse,~Es~ire
At'torney ID ~78014~
219 Pine Street
Harrisburg, PA 17101
(717) 236-5000
Attorneys for Defendant
NYE CONSTRUCTION COMPANY, INC., :
:
Plaintiff :
:
V. :
:
N.T. blAN'AGEMENT, INC., :
Defendant :
IN THE COURT OF COMMON PLEAS
CUMBERLAND COUNTY, PENNSYLVANIA
NO. 98-7289 EQUITY
CERTIFICATE OF SERVICE
I hereby certify that a copy of the foregoing has been duly
served upon the following, by depositing a copy of the same in
the United States Mail, first-class, postage prepaid, at
Harrisburg, Pennsylvania, as follows:
David A. Baric, Esquire
Law Offices of O'Brien,
Baric & Scherer
17 West South Street
Carlisle, PA 17013
W. Allshouse, E~quire
Pine Street '
Harrisburg, PA 17101
(717) 236-5000
Attorney ID #78014
Attorney for Defendant
EXHIBIT A
ST~,FH~.,N C. N-IDEL
MARK W. ALLSHOUSE
STEPHEN C. NUDEL, PC
219 Pine SU'eet
Harrisburg, Peunsylvania 17101
(717) 236-5000
June 21, 2002
David A. Baric, Esquire
Law Offices of O'Brien,
Baric & Scherer
17 West South Street
Carlisle, PA 17013
N.T. Management, Inc.
v. Nye Construction Company, Inc.
and Ujjal Maker
No. 4641-S-1998; Dauphin County
Dear Mr. Baric:
I have not yet received the list of your proposed
arbitrators. However, as suggested, I am providing to you the
names of one contractor and two attorneys whom I would recommend
as potential arbitrators in this matter.
Defendant's suggested arbitrators would be as follows:
Dennis J. Schmidt - Contractor
John Zonarich, Esq. - Attorney
Richard P. Mislitsky, Esq. - Attorney
If Mr. Schmidt is not acceptable, I will provide an
alternative suggestion.
To alleviate potential objections, I recommend that you
select an arbitrator and I will select an arbitrator and along
with the architect the panel would then be complete.
I look forward to receiving your response to this
.correspondence along with your list of recommended arbitrators.
MWA/j lm
cc: Mr. Anil C. Thakrar
Very truly yours,
~I/r/k~'W. Allshouse
Robert L. O'Brlen
David A. Bm'lc
Michael,4. $c}~rer
L~ O~ces
O'~RIEN, BAltIC & SCltEItER
17 ~Fest South Street
Carlisle, Pennsylvania 17015
June 24, 2002
(7]7} 249.6873
Fax (717) 249-5755
E-mad: ob$(~ob$law, com
direct: dbaric(~ob$1aw, com
VIA FACSIMILE: (717) 235-5080
Mark W. Allahouse, Esquire
Law Offioe~ of Stephen C. Nudel
219 Pine S~-t
Harrisburg, Pemmylvania 17101
Rig: Nye Con.ruction v. N.T. Management
Dear Mr. Allshome:
I have received your correspondence. Please provide me with information regarding
Messrs. Schmidt and Zonarich. I seem to recall that you and Mislitsky were with the same law
fi.a and would object to his involvement.
I suggest Ouy Brooks of Goldberg, Katzman & Shipman and also David Stapler. A
curriculum vitae for him is enclosed.
I want two independent choices agreed to by us and will not agree to each of us selecting
one arbitrator.
DAB/jl
cc: File
Very truly yours,
O'BKIEN, BARIC & SCHERER
David A. Baric, Bsquire
da b.dlf/'dtllation/mair~r/aya/a Ilsho .~.ltr
AmericanArbitration Association
lqd~4elpl~, PA 1910~
IM~ 31~-732~2&0, fa~lm#~ 2 IS.T32-~02
Mediator P~nel
David Stapler
C~rv~nt Emplw/~r/'rltle The Wicmev Company. President
Mechanical Contractor; Mediator, Arbitrator
Wor~ kltltOV/ Ih-esi&m, The Witmer Company, 1987-present; Vice President.
C.J. Beshore Company, 198!J-$'/; Vice President, McClure Company, 1970-
85; U.S, Navy. 1963-67,
[~perlence Over S0 yeat~' experience in the mechanical contracting industry.
Involved in estimating, purchasing, negotiating, project management, and
desiglxtbuild of plumbing, heating, ventilating and air conditioning, sheet
metal, sir quality, and process piping. Proiecu include nursing homes,
high.rise office and apartmem buildings, industrial piping systems,
shopping centers, schools, warehousing, hospitals, and private homes.
l~rom 1970.1985, was vice president and general manager of a mechanical
conC,-acting firm that was one of the top 100 in the country..
Represen~t'l~l C~e~ Handled as Plediat~or Success~l~ mediated a
~u~e be~en a ~n~ con~ar ~d the ~er of · s~en-building
apa~ent compbx (~er ~00,000 a~eemen0. Success~lly mediated a
dispute ~ a con~ctor and a t~n~p joint municip~ authority
(o.er $~00,000 s~nt), Sewed as me~ror in humerus construction
ca~s b~n ~n~s, con~o~, ~u~orifies, and su~onr~ctors
invoking claims teeing to ~ec~ve ~c~on, de~)~, c~n~ractor
de~ulu, ~ order, ~d v~o~ co~t ~ ~m.
R0eprese~estlve Cases Handled as ~rbltrator Served as arbitrator on
numerous disputes involving both private and public projects for over l0
}'ears. Cases ranged from homeowner and contractor disputes to three-
neutral panel disputes in e~ceu orS1 million. Cases ranged fi.om 1/i-da7
hearings to 15-day heatings. Has arbitrated over 100 cases to date.
I~ultl-PartT Oispute Reaolutioe r:xperlence Multi. party experience
includes numeroua cases between owners, general contractors, construction
managers, subcontractors, township authorities, insurance companies.
developers, bonding companies, and homeowners.
~ DlSlXSte R~sMut~on
aJ~eraa~ve ~spu~ r~o~fions, invol~ag ~ pfi~ and pub]lc proj~s,
~ ~ ~tor for over 10 ~e~s aad ~ a m~tor for over 8 years.
~e D~put~ ~ol~n T~nI ~ Co~c~iou ~edia~r
T~g, Chi~g~ 5~7; ~ Comtmcfion ~mr T~ning Worhhop,
P~ph~ ~97; ~ ~1 and Consign ~bi~r
Ph~delp~ 10/~;
P~d ~sos ~d Mu~ ~um~: H~sburg, ~n~ter,
CheK~, and ~d~g, Perdita (198~; ~]~d, 1990.
~~ ~a~s ~i~ ~u~ofl~clors ~citfion of Cent~l
Pena~; ~socia~d Build~s ~d Contours (~stone
~ Bur ~i~ofl (~te Mm~r).
~~ S~te U~versiw of N~ York at C~on (~-1970).
~ Jam~ Ber~01], ~17) 85t-7894; David B~dl~, (610) 468-9555;
B~ ~oms; (814)
:11200.00 per hour (min. S hours) Mediator Compensation;
$70.00 per hour AAA Administrative Fee. Case study,
coniretence calLs, and preparation will be billed at hourlr rate.
Cancellation Fee: with 2 days' notice. $600.00.
CMtlg~lp United States of America
New Holland, PA