STORY FROM: Reinsurance & Arbitration

Surety Not Bound by Subcontract’s Arbitration Provision, D.C. Federal Judge Rules

WASHINGTON, D.C. — A surety company is not bound by an arbitration provision in a subcontract because the provision clearly only encompassed claims between the engineering company and its subcontractor, a District of Columbia federal judge has ruled.

In applying a heightened standard of “clear and unmistakable evidence,” Judge Tanya S. Chutkan of the U.S. District Court for the District of Columbia concluded in the Sept. 30 order that the surety company did not agree to arbitrate.

On January 25, 2012, Turner Construction retained U.S. Engineering to perform construction and renovation work at the South African Embassy in Washington, D.C. ...

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