Nappa Construction Management, LLC v. Flynn

In 2012, Nappa Construction Management, LLC (Nappa) and Caroline and Vincent Flynn (the Flynns) entered into a contract for a commercial construction project. Service Insurance Company, Inc. (Service Insurance) furnished a performance bond on the contract. In 2013, the Flynns directed Nappa to stop work on the project. Nappa subsequently submitted an application for payment, which the Flynns declined to pay. Nappa then terminated the contract due to nonpayment. The Flynns filed an action alleging that Nappa had wrongfully terminated the contract. Nappa filed a demand for arbitration in accordance with an arbitration provision in the contract and also named Service Insurance as a party to the arbitration. The arbitrator found that Nappa was not justified in terminating the contract but concluded that, under the termination-for-convenience clause in the contract, neither Nappa nor the Flynns were in breach of the contract. The arbitrator awarded Nappa $37,980. The superior court granted Nappa’s petition to confirm the arbitration award, concluding that the arbitrator did not exceed his powers in holding that the contract was terminated for convenience. The Supreme Court vacated the superior court’s judgment, holding that the arbitrator exceeded his authority in interpreting the contract. View "Nappa Construction Management, LLC v. Flynn" on Justia Law