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Central Ceilings, Inc. v. Suffolk Construction Company, Inc.

Appeals Court of Massachusetts, Suffolk

May 9, 2018

CENTRAL CEILINGS, INC.
v.
SUFFOLK CONSTRUCTION COMPANY, INC., & others.[1]

          Heard: January 10, 2018.

         Civil action commenced in the Superior Court Department on January 31, 2008.

         A motion to confirm an arbitration award was heard by Peter M. Lauriat, J., and a motion to correct and confirm as corrected or to vacate an arbitration award was heard by Linda E. Giles, J.

          Paul R. Mordarski (Margaret Capp also present) for the plaintiff.

          Joel Lewin (John P. Connelly also present) for the defendants.

          Present: Blake, Neyman, & Ditkoff, JJ.

          DITKOFF, J.

         The parties submitted a construction dispute, pending in litigation in the Superior Court, to arbitration under the Uniform Arbitration Act, G. L. c. 251, §§ 1 et seq. The arbitrator issued a substantial award in favor of the plaintiff, Central Ceilings, Inc., but purported to reserve the calculation of preaward interest to a Superior Court judge. The parties did not agree to this reservation. On the plaintiff's motion to confirm the arbitration award, the judge (remanding judge) remanded the matter to the arbitrator for the calculation of preaward interest. After the arbitrator awarded preaward interest well below that requested by the plaintiff, the plaintiff moved to correct or to vacate that award. The plaintiff now appeals from the order denying that motion. Concluding that an arbitrator may not reserve the calculation of preaward interest for a judge without the agreement of the parties, and finding no error in the failure to award attorney's fees, we affirm.

         1. Background.

         The plaintiff was a subcontractor to defendant Suffolk Construction Company, Inc. (Suffolk), the general contractor, in a project for the renovation and construction converting the old Charles Street jail in Boston into the Liberty Hotel.[2] On January 31, 2008, the plaintiff commenced an action in Superior Court against the defendants, raising various claims arising out of its subcontract with Suffolk. After discovery and pretrial proceedings, the parties filed a joint motion to stay the case in favor of resolving the dispute through arbitration. On October 8, 2013, the parties entered into an arbitration agreement governed by the Uniform Arbitration Act, G. L. c. 251, §§ 1 et seq., expressly incorporating the Construction Industry Arbitration Rules of the American Arbitration Association. The arbitration agreement reached "all relevant issues appertaining" to the civil lawsuit and granted the arbitrator "full power and authority to award money damages and to grant such other relief, including without limitation reasonable attorney's fees and any other contractually authorized damages as he, in his sole discretion, shall deem just and proper" "[t]o the same extent as if he were a justice of the Massachusetts Superior Court." A judge allowed the motion and stayed the case during the pendency of the arbitration.

         After extensive arbitration proceedings, the arbitrator issued an initial award on the merits in favor of the plaintiff in a decision dated February 20, 2015, in the amount of $1, 324, 819.24, "with interest thereon in the amount ultimately assessed by the Court, " plus attorney's fees and costs as set out in the subcontract between the parties.[3]

         The parties filed timely cross motions with the arbitrator requesting modification, correction, and clarification of the initial award. The arbitrator denied the defendants' motion and allowed the plaintiff's motion. The modified award, dated April 6, 2015, changed the award only to require an additional interest calculation. It continued to reserve the task of calculating interest on the $1, 324, 819.24 award to a judge, but also required that judge to calculate interest on a payment of $402, 852 already made by Suffolk shortly after the parties agreed to arbitration and prior to any award.

         On April 15, 2015, the defendants moved in Superior Court to vacate the arbitrator's award. The defendants soon reconsidered, paid the modified award plus postaward interest on June 24, 2015, and then withdrew their motion to vacate. Meanwhile, the parties were unable to agree on the attorney's fees and costs owed to the plaintiff. The arbitrator awarded attorney's fees and costs on July 20, 2015, which Suffolk paid within one month.

         The parties, however, continued to dispute the issue of preaward (as opposed to postaward) interest, as neither the initial nor the modified award expressly stated that the interest to be calculated by a judge included preaward interest. The plaintiff maintained that the arbitrator either explicitly or implicitly awarded preaward interest from the commencement of the suit at the statutory rate of twelve percent, see G. L. c. 231, § 6C, and that the judge had ...


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