Summary
The Louisiana First Circuit Court of Appeal affirmed a trial court judgment sustaining an exception of prematurity and dismissing without prejudice a declaratory judgment petition filed by Stantec Consulting Services, V&A Consulting Engineers, and Patterson Pump. The court held that the parties' separately negotiated arbitration agreement required arbitration of disputes relating to the project, including the defense of peremption, and delegated arbitrability issues to the arbitrator under the applicable rules. The court distinguished prior cases involving arbitration clauses embedded in subcontract agreements.
Topics
Practice areas
Questions Presented
- Whether the plaintiffs' declaratory-judgment action was premature because the parties had entered a valid arbitration agreement.
- Whether the Arbitration Agreement delegated to the arbitrator the question whether project-related claims were perempted.
- Whether peremption was a dispute relating to the project within the scope of the Arbitration Agreement and therefore had to be presented as a defense in arbitration rather than decided initially by the trial court.
Holdings
- The declaratory-judgment action was premature because the parties had entered a valid and enforceable Arbitration Agreement requiring project-related disputes to be arbitrated.
- The parties clearly and unmistakably delegated questions concerning the existence, scope, validity, and overall arbitrability of the Arbitration Agreement to the arbitrator by incorporating arbitration rules authorizing the arbitrator to decide those questions.
- The parties' dispute over whether project-related claims were perempted fell within the Arbitration Agreement and had to be raised as a defense in arbitration rather than resolved first by the trial court.
Key quotations
“The threshold inquiry is whether the parties have agreed to arbitrate the dispute in question.” (at 7)
“Therefore, we find that the parties are bound by the agreement they made to arbitrate any dispute related to the Project, including peremption.” (at 10)
“The trial court did not err in sustaining the exception of prematurity and dismissing the Plaintiffs' claims against PCCP.” (at 10-11)
Factual background
The United States Army Corps of Engineers awarded a design-and-construction project to PCCP, a joint venture consisting of Kiewit Louisiana Co., M.R. Pittman Group, L.L.C., and Traylor Bros., Inc. PCCP subcontracted portions of the project to Stantec, V&A, and Patterson. After the Army Corps asserted claims concerning alleged project defects, PCCP and the plaintiffs executed a separate Arbitration Agreement providing for arbitration of disputes relating to the project and stating that the agreement did not revive time-barred claims. When PCCP sought to resume arbitration, the plaintiffs filed a declaratory-judgment action asking the district court to decide the peremption issue before arbitration.
Procedural history
The parties entered a separate Arbitration Agreement concerning disputes arising from a federal construction project. After the defendants sought to proceed with arbitration, the plaintiffs filed a declaratory-judgment petition asking the district court to determine that perempted claims were outside the agreement and extinguished. The Nineteenth Judicial District Court sustained the defendants' exception of prematurity and dismissed the petition without prejudice. The court of appeal affirmed.