State ex rel. Skinner v. Lombard Co.

• Decision Date: 21 April 1982
• Docket Number: No. 81-0006,81-0006
• Citation: 436 N.E.2d 566,62 Ill.Dec. 540,106 Ill.App.3d 307
• Parties: , 62 Ill.Dec. 540 STATE of Illinois ex rel. Samuel K. SKINNER, Chairman Capital Development Board, Plaintiff-Appellee, v. The LOMBARD COMPANY, an Illinois Corporation, Defendant-Appellant, and Fitch/LaRocca Associates, Inc., an Illinois Corporation; Gordon Electric Construction Co., an Illinois Corporation; the Aetna Casualty and Surety Company, a Connecticut Corporation; and Fidelity and Deposit Company of Maryland, a Maryland Corporation, Defendants.
• Court: United States Appellate Court of Illinois

Page 566

436 N.E.2d 566

106 Ill.App.3d 307, 62 Ill.Dec. 540

STATE of Illinois ex rel. Samuel K. SKINNER, Chairman Capital Development Board, Plaintiff-Appellee, v. The LOMBARD COMPANY, an Illinois Corporation, Defendant-Appellant and Fitch/LaRocca Associates, Inc., an Illinois Corporation Gordon Electric Construction Co., an Illinois Corporation the Aetna Casualty and Surety Company, a Connecticut Corporation; and Fidelity and Deposit Company of Maryland, a Maryland Corporation, Defendants.

No. 81-0006.

Appellate Court of Illinois, First District, Third Division.

April 21, 1982.

Clausen, Miller, Gorman, Caffrey & Witous, Snow & Snow, Ltd., Chicago (James T. Ferrini, David B. McAfee, Robert H. Mittelman, Chicago, of counsel), for defendant-appellant.

Tyrone Fahner, Atty. Gen., Saul A. Epton-Sp. Asst. Atty. Gen., Chicago (Epton, Mullin, Segal & Druth, Ltd., Chicago, of counsel), for plaintiff-appellee Capital Development Bd.

Lord, Bissell & Brook, Chicago (Richard E. Mueller, Chicago, of counsel), for Chicago Builders' Ass'n amicus curiae brief.

McGILLICUDDY, Justice:

This case comes before this court as a permissive interlocutory appeal pursuant to Supreme Court Rule 308 (Ill.Rev.Stat.1979, ch. 110A, par. 308) and concerns the interpretation of a certain building contract. ¹

The plaintiff, The State of Illinois ex rel. Samuel K. Skinner, Chairman, Capital Development Board (Capital), brought this action in the circuit court of Cook County for breach of contract and negligence arising out of alleged deficiencies in the construction of Morton Community College. The defendants are the architect, Fitch/LaRocca Associates, Inc.; the general contractor, The Lombard Company (Lombard); its surety, Aetna Casualty and Surety Company; the electrical contractor, Gordon Electric Construction Co.; and its surety, Fidelity and Deposit Company of Maryland.

Lombard filed a motion to dismiss the action or in the alternative for a stay of proceedings and to compel arbitration as provided in its construction contract with Capital. The contract between Capital and Lombard, which was executed on December 6, 1973, consisted of the general conditions of the contract for construction, prepared by the American Institute of Architects as Document A201, and the supplemental general conditions, prepared by the parties. The pertinent provisions of the contract, relating to the motion, are as follows:

"7.6 RIGHTS AND REMEDIES

7.6.1 The duties and obligations imposed by the Contract Documents and the rights and remedies available thereunder shall be in addition to and not a limitation of any duties, obligations, rights and remedies otherwise imposed or available by law."

"7.10 ARBITRATION

7.10.1 All claims, disputes and other matters in question arising out of, or relating to, this Contract or the breach thereof, except as set forth in Subparagraph 2.2.9 with respect to the Architect's decisions on matters relating to artistic effect, and except for claims which have been waived by the making or acceptance of final payment as provided by Subparagraphs 9.7.5 and 9.7.6, shall be decided by arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association then obtaining unless the parties mutually agree otherwise. This agreement to arbitrate shall be specifically enforceable under the prevailing arbitration law. 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."

"7.10.3 The Contractor shall carry on the Work and maintain the progress schedule during any arbitration proceedings, unless otherwise agreed by him and the Owner in writing."

On December 11, 1980, the trial court denied the motion to dismiss finding that:

"It was the clear intention of the agreement as expressed in Articles 7.6.1 and 7.10 of the General Conditions of the Contract for Construction that arbitration be used for any and all claims or problems that arose during the course of construction. Once the building was completed, all remedies available by law under Article 7.6.1, namely, a lawsuit, may be used."

On December 19, 1980, the trial court certified the following questions for immediate appeal:

"(1) Whether an arbitration provision in a building construction contract preempts suit, when the contract also provides that the remedies available thereunder 'shall be in addition to and not in limitation of any duties, obligations, rights and remedies otherwise imposed or available by law.'

(2) Whether an arbitration provision in a building construction contract which also provides the remedies available thereunder are 'in addition to and not in limitation of' any remedies otherwise available by law was intended to settle disputes arising while the contract was executory and that suit is an available remedy for matters which arise after completion of construction."

It is a general rule that parties are bound to arbitrate only those issues which by clear and unequivocal language they have agreed to arbitrate. (Flood v. County Mutual Insurance Co. (1968), 41 Ill.2d 91, 242 N.E.2d 149; Ozdeger v. Altay (1978), 66 Ill.App.3d 629, 23 Ill.Dec. 446, 384 N.E.2d 82.) Article 7.10.1 of the construction contract clearly and unequivocally provides that all claims arising out of or relating to the contract or the breach thereof shall be decided by arbitration. It is undisputed that the claims in the instant case arose out of an alleged breach of the construction contract.

It is Capital's position, and the trial court agreed, that the provision for mandatory arbitration was modified by certain other provisions of the contract. Capital asserts that the parties intended that only disputes arising during construction be submitted to arbitration and points out that Article 7.10.3 provides for the continuation of the construction during arbitration. Capital concludes that if arbitration is allowed after completion of the construction, Article 7.10.3 is rendered meaningless.

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