United States District Court, E.D. Virginia, Newport News Division
THE UNITED STATES OF AMERICA ex rel. HARBOR CONSTRUCTION COMPANY, INC., Plaintiff,
T.H.R. ENTERPRISES, INC., ET AL. Defendants.
G. DOUMAN UNITED STATES DISTRICT JUDGE.
matter comes before the Court on the defendant T.H.R.
Enterprises, Inc.'s ("THR") Motion to Compel
Arbitration, ECF No. 14, and accompanying motion to stay this
action pending arbitration ("Motion to Stay"), ECF
No. 16. Despite THR's request for a hearing on same, the
Court dispenses with oral argument because the facts and
legal contentions are adequately presented in the materials
before the Court, and argument would not aid in the
decisional process. For the reasons below, THR's Motions
to Compel Arbitration and to Stay are
GRANTED and this action is
STAYED for a period of six months as set
forth in this Order.
December 15, 2017, Plaintiff United States of America for the
use of Harbor Construction Company, Inc.
("Subcontractor" or "Harbor") filed a
complaint against T.H.R. Enterprises, Inc.
("Contractor" or "THR") and Hanover
Insurance Co. ("Hanover" or "Surety")
(collectively, "Defendants") pursuant to the Miller
Act, 40 U.S.C. §§ 3131-34. See Complaint
("Compl."), ECF No. 1. Defendants initially moved
to dismiss the complaint or, alternatively, stay the action,
but on April 9, 2018, such motion was denied after a hearing.
ECF No. 13. With leave of court, THR then filed the instant
Motion to Compel Arbitration, ECF No. 14, and Motion to Stay,
ECF No. 16, on April 12, 2018.These motions are now ripe for
relevant times, THR has been the prime contractor for the
United States government on a construction and building
repair project at Langley Air Force Base in Hampton, Virginia
("Project"). Compl. ¶ 6. At all relevant
times, Hanover has been the surety under the Project contract
having furnished to the United States a payment bond under
such contract and pursuant to the Miller Act. Id; see Payment
Bond executed 10/24/2011, Id. at Ex. A.
October 19, 2011, THR entered into a written subcontract
agreement, as amended, with Plaintiff Harbor
("Subcontract") to perform certain work under the
Project contract. Id. ¶ 11; see Subcontract,
Id. at Ex. B. Pursuant to the terms of the
Subcontract, Harbor agreed to render electrical services and
certain labor and materials for the Project, and THR agreed
to pay the agreed contract price of $1, 400, 000.00,
"excluding change orders and additional work."
Id. ¶ 12; see Subcontract ¶ 4. Article 5
of the Subcontract provides that such sum shall be paid to
Harbor in partial progress payments. See Compl. ¶ 12;
Subcontract ¶ 5.
last performed work under the Subcontract in September 2017.
Id. ¶ 16. According to Harbor, it has completed
all of the work required under the Subcontract as well as all
change orders and directions for extra work, and it has
demanded payment for same from THR. Id. ¶ 13.
Harbor claims that, to date, THR has failed to pay $269,
056.86 owed to Harbor under the Subcontract. Id.
of Harbor's complaint seeks action on THR's payment
bond with Hanover to recover the monies owed under the
Subcontract; Count II alleges breach of contract by THR; and
Count III alleges unjust enrichment by THR. Id.
Harbor ultimately seeks a judgment against the Defendants,
jointly and severally, awarding Harbor compensatory damages
in the amount of $269, 056.87 plus interest, costs, and
attorneys' fees. Id. at 6.
MOTION TO COMPEL ARBITRATION
asks the Court to compel arbitration pursuant to the Federal
Arbitration Act, 9 U.S.C. §§1, et seq.. on
the grounds that the contractual dispute at issue in
Harbor's complaint is subject to an alternative dispute
resolution ("ADR") provision in Article 13 of the
Subcontract. This provision, entitled "Disputes and
Dispute Resolution, " states in relevant part:
At CONTRACTOR'S sole election, any and all disputes
arising in any way or related in any way or manner to this
Agreement may be decided by mediation, arbitration or other
alternative dispute resolution proceedings as chosen by
The remedy shall be SUBCONTRACTOR'S sole and exclusive
remedy in lieu of any claim against CONTRACTOR'S bonding
company pursuant to the terms of any bond or any other
procedure or law, regardless of the outcome of the claim. The
parties further agree that all disputes under this
Subcontract shall be determined and interpreted pursuant to
the laws of the Commonwealth of Virginia....
Subcontract ¶ 13, Compl. at Ex. B.
that THR has elected arbitration under Article 13 to resolve
the contract disputes at issue here, THR submitted the
following documents in support of its Motion to Compel
Arbitration: (1) a copy of its letter, dated April 12, 2018,
to the American Arbitration Association ("AAA")
requesting initiation of arbitration with Harbor, enclosing
its Arbitration Demand with respect to same, and remitting
fees to the AAA in the amount of $2, 500; and (2) a copy of
THR's letter, also dated April 12, 2018, to Harbor's
counsel furnishing copies of THR's Arbitration Demand and
its related correspondence with the AAA. See ECF No. 14 at
Federal Arbitration Act
Federal Arbitration Act ("FAA") provides:
A written provision in any . . . contract evidencing a
transaction involving commerce to settle by arbitration a
controversy thereafter arising out of such contract or
transaction ... shall be valid, irrevocable, and enforceable,
save upon such grounds as ...