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SC&A Construction, Inc. v. Potter

Court of Chancery of Delaware

March 5, 2019

CHARLES POTTER, JR. and VELDA C. JONES-POTTER, husband and wife and residents of the State of Delaware, Respondents.

          Submitted: February 25, 2019

          Donald L. Logan and Victoria K. Petrone, of LOGAN & PETRONE, LLC, New Castle, Delaware, Attorneys for Petitioner.

          Samuel L. Guy, of SAMUEL L. GUY, ATTORNEY AT LAW, Wilmington, Delaware, Attorney for Respondents.



         This matter originally came before me on the Petitioner's request to confirm an arbitrator's award in favor of SC&A Construction, Inc. ("SC&A") and against Charles Potter, Jr. and Velda C. Jones-Potter (the "Potters"). That arbitration was pursuant to a construction contract for work purportedly performed by SC&A on the Potters' home. The Final Award of Arbitrator (the "Arbitrator's Award"), dated September 23, 2014, is attached as Exhibit "A" to this Memorandum Opinion. I confirmed the Arbitrator's Award by Order of January 6, 2016. The Potters appealed the matter, and our Supreme Court affirmed on September 7, 2016. Thereafter, this matter was closed. By Order of August 2, 2018, 1 reopened this matter at SC&A's request, in order to hear its current motion to enter a supplemental order. The form of supplemental order attached to the "Petitioner's Motion to Reopen the Case and For Entry of an Order Transferring Judgment to the Superior Court" is attached as Exhibit "B" to this Memorandum Opinion. Upon consideration, the Motion to Reopen the case was improvidently granted, and the balance of SC&A's Motion is denied.

         I. BACKGROUND

         This matter is, I believe, among the most procedurally complex with which I have been involved in my years on the bench. What follows is the briefest of adumbrations of the procedural history. As described above, SC&A entered a contract with the Potters for construction work on their home in Wilmington. The Potters were dissatisfied with the work, and declined to make payments under the contract. SC&A pursued contractual arbitration and obtained the Arbitrator's Award attached as Exhibit "A." SC&A then sought a mechanic's lien in Superior Court. That matter was stayed while SC&A attempted to confirm the Arbitrator's Award in this Court. As described above, I confirmed the Arbitrator's Award by Letter Order. The Potters appealed that final Order to the Supreme Court. SC&A did not seek a clarification of my Order. Nor did they assert to the Supreme Court that further motion practice in this Court and a modified order were necessary to their purposes, and that the matter should therefore be dismissed as an interlocutory appeal. The Supreme Court accepted the appeal as an appeal of a final order, considered the matter on the parties' briefs, and affirmed my confirmation of the arbitration award.

         SC&A then pursued its mechanic's lien action, using the Arbitrator's Award as confirmed by my Order. SC&A obtained a judgment for the amount of the principal (with interest) in the Arbitrator's Award against the Potters, a judgment that, according to the parties, has been satisfied.

         At some point thereafter, SC&A asserts that it attempted to reduce my confirmation Order to a second judgment, for those parts of the Arbitration Award that allowed SC&A its attorneys' fees and procedural costs before the Arbitrator. According to SC&A, these had not been appropriate subjects of the mechanic's lien action, and it therefore needed to pursue another judgment for the roughly $14, 000 in fees and costs awarded by the Arbitrator. SC&A alleges that the Prothonotary refused to reduce my confirmation of the Arbitrator's Award to a second judgment, because my Order did not break out the award into damages amenable to the mechanic's lien action, and other sums. At least, that is my understanding of what SC&A has attempted to explain to me about the Prothonotary's position. As a result, SC&A requested that I reopen the case and issue the supplemental order represented in Exhibit "B."[1]

         II. ANALYSIS

         This matter came before me for a very limited purpose: to confirm an arbitration award. My review of an arbitrator's award is necessarily limited- otherwise, binding arbitration itself would be of limited utility. On January 6, 2016, 1 issued an order confirming the Arbitrator's Award, attached at exhibit "A," in full. SC&A did not seek a clarification of that Letter Order, nor did it seek a supplemental order specifically referring to components of the Arbitrator's Award. When the Potters appealed this matter, SC&A did not indicate to the Supreme Court that the matter was interlocutory and that it would be seeking a final order in a form different from that under appeal.[2] If it had, the Potters could have opposed entry of such an order before me, to the extent they found appropriate. They could have then made the same arguments to the Supreme Court on appeal. In actual fact, however, both parties treated my Letter Order as a final order, as did apparently the Supreme Court.

         SC&A had initially sought recovery via a mechanic's lien action in Superior Court. It was at the direction of that Court, I presume, that the mechanic's lien matter was stayed while SC&A sought confirmation of the Arbitration Award. After receiving my confirmation of that award, affirmed by the Supreme Court, SC&A returned to the Superior Court and successfully prosecuted the mechanic's lien action to a judgment, which has been satisfied. The question before me is, having chosen to pursue the litigation in the manner it did, may SC&A successfully request to reopen this matter and have a modified order issued, so that it can proceed to reduce it to an in personam judgment in the Superior Court for its legal fees and costs in the arbitration action? I think the answer is no. The form of order sought by SC&A, attached at exhibit "B," represents relief not requested during the course of this litigation. The Potters strenuously opposed entry of the order for a variety of reasons by, including that the parties intended the satisfaction of judgment in the mechanic's lien action to be in complete satisfaction of all issues raised in connection with their contract with SC&A. I am unable, on this record, to tell whether any of the Potters' purported defenses have merit; I can tell, however, that should I enter the order, due process would require them to be able to test the order's validity in a Supreme Court appeal. The parties, however, implicitly represented to the Supreme Court in the 2016 appeal from my confirmation of the Arbitration Award that the Order was final. I believe that I am procedurally barred from making any substantive amendment to my Final Order of January 6, 2016.[3] To the extent I have discretion to do so, I decline to exercise it.


         Piecemeal litigation in the manner pursued here is unfair to the litigants and inimical to judicial efficiency. SC&A chose a litigation strategy and pursued it, successfully. It must, however, be bound to the strategy it chose. Either my Final Order of January 26, 2016 was satisfactory to its purposes, or it was not. If the latter, the time for challenging that Order has long past.[4] ...

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