Over the past decade, international arbitration has played an increasingly prominent role in the construction industry.  As contractors and owners pursue greater opportunities outside their domestic jurisdictions, international arbitration has provided parties with a reliable, flexible, and neutral forum to resolve disputes.  Indeed, a quick glance at the most recent statistics from any number of the leading international arbitral institutions, such as the International Chamber of Commerce and International Centre for Dispute Resolution, shows that construction arbitration accounts for one of the largest components of the institutions’ caseload.

United Illuminating Company v. Whiting-Turner Contracting Co. v. Cherry Hill Construction Co., Inc., et al. v. GEI Consultants, Inc., et al., 3:18-cv-00327-WWE (D. Conn. 2019)

In 2010 The United Illuminating Company (“UI”), an electric utility company, and Whiting-Turner, a construction contractor, entered into a general contractor agreement for the construction of the United Illuminating Central Facility Project (the “Project”) in Orange, Connecticut.  The Project required construction of an office building, an operations building, and related parking lots and common driveways.  Whiting-Turner and Cherry Hill Construction Co. (“Cherry Hill”), a heavy civil construction contractor, then entered into a subcontractor agreement which required Cherry Hill to perform site work.

BML Properties Ltd. v. China Construction America Inc., et al., 101 N.Y.S. 3d 597 (N.Y. App. Div. 2019)

On July 2, 2019, a New York appellate court upheld a lower court ruling by Justice Saliann Scarpulla, denying a state-backed Chinese contractor’s attempt to compel international arbitration arising out of a dispute involving the construction of the multibillion Baha Mar mega-resort in the Bahamas.  As a result of the ruling in BML Properties Ltd. v. China Construction America Inc., et al., 101 N.Y.S. 3d 597 (N.Y. App. Div. 2019), aff’ing No. 657550/2017 (N.Y. Sup. Ct. Jan. 24, 2019), the $2.25 billion lawsuit alleging “one of the largest construction-based frauds in this hemisphere” will remain in the New York courts.  As explained below, for those in the international construction industry, the case will be worth following.

As many owners and contractors involved in the international construction industry are aware, international arbitration is a popular dispute resolution device for international construction disputes because, in part, international arbitration awards are, broadly speaking, enforceable in practically every jurisdiction in the world. This facet of international arbitration has been set out in the U.N. Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the New York Convention) — a multilateral convention that requires the courts of the contracting states to recognize and enforce arbitration awards made by tribunals seated in other contracting states. Now, with 160 signatory states and the increasing popularity of international arbitration around the world, the New York Convention is widely viewed as one of the most successful international conventions ever.

MBlock Investors, LLC v. Bovis Lend Lease, Inc., etc., et al., 44 Fla. L. Weekly d1432 (3d DCA 2019)

A Florida Appellate Court recently reversed a trial court’s decision granting summary judgment finding an issue of fact based upon an expert affidavit.  The underlying matter involved an action by MBlock Investors against Lend Lease (US) Construction, Inc. for latent defects following MBlock’s acquisition of a property commonly known as the Midblock Miami East Project (the “Property”).

DAK Americas Mississippi, Inc. v. Jedson Engineering, Inc. et al, No. 1:18cv31-HSO-JCG, 2019 BL 208838 (S.D. Miss. June 6, 2019)

This dispute arose out of the design and construction of a concrete storage slab at DAK’s polymer resin manufacturing facility located in Hancock County, Mississippi.  DAK hired Ohio-based Jedson to design and oversee the construction of a cement slab suitable for commercial operating loaders and other heavy equipment necessary to transport, unload, and stack shipping containers.  DAK allegedly discovered substantial cracking and chipping of the cement, and filed suit in federal court claiming Jedson failed to design a slab suitable for DAK’s intended purposes.  DAK asserted claims for negligent design, negligent construction management, and breach of contract.

Popple Construction, Inc. v. Reilly Associates, Inc. No. 775-MDA-2017, 2019 BL 213236 (Pa. Sup. Ct., June 10, 2019).

On June 10, 2019, the Superior Court of Pennsylvania affirmed a lower court decision to deny a motion to dismiss in connection with a tort claim for negligent misrepresentation by a contractor against a third-party design/engineer.  The Court’s opinion highlights Pennsylvania’s exception to the economic loss doctrine insofar as it applies to claims raised by contractors against architects/engineers for faulty bidding documents, specifications, or designs.

Dolan v. Hurd Millwork Co., No. 2951 EDA 2015, 2019 BL 229344 (Pa. Super. Ct. June 21, 2019)

This cases arises out of defective windows installed in a residential construction project. In 1999, Leo J. Dolan purchased a custom home from Bentley Homes, Ltd. and its affiliates (“Bentley Homes”).  Hurd Millwork Company, Inc. provided many of the home’s windows.   Dolan almost immediately observed issues in the home’s construction, including air and water leaks around the windows.   Bentley Homes, however, led him to believe the issues had been fixed.

Gainesville Mech., Inc. v. Air Data, Inc., No. A19A0518., 2019 BL 229069 (Ga. Ct. App. June 19, 2019)

The First Division of the Georgia Court of Appeals affirmed a superior court’s decision to confirm an arbitration award against Appellant Gainesville Mechanical, Inc. (“Gainesville”) because Gainesville failed to show that the arbitrator manifestly disregarded the law governing the “modified total cost” approach to damages.

Thomaston Acquisition, LLC v. Piedmont Construction Group, Inc., No. S19Q0249, 2019 BL 202176 (Ga. June 03, 2019)

The acceptance doctrine represents the principle that an independent contractor is not liable for damages occurring after the contractor has completed its work and the work is turned over to and accepted by the owner, provided that the defect was readily observable on reasonable inspection and was not inherently dangerous.