# Petition for Writ of Certiorari — United States ex rel. Keller Pier Drilling Co. v. John H. Eisele Co. > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385602_1619%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition for Writ of Certiorari - **Published:** January 1, 1966 - **Citation:** 385 U.S. 839 ## Text Sepreme Court of the United States October Term, 1965 ~ | % / Li UNITED STATES OF AMERICA for* the Use and | Benefit of KELLER PIER DRILLING COMPANY, - an Ohio. Corporation, Petitioner, vs. ** JOHN H. EISELE COMPANY, INC. | an Ohio Corporation, _ THE BUCKEYE UNION CASUALTY Co., | AMERICAN REINSURANCE Se Rerpendenss_ \ ; PETITION FOR WRIT OF CERTIORARI TO THE UNITED STATES COURT @F APPEALS ‘apes — FOR-FHE SIXTH -CIRCUIT————— THOMAS F. LAZARON, ESQUIRE. of THOMAS & LAZARON, ere. 2456 Futbourne Drive, Bes rari, “ .. . Cincinnati, Ohio 45231 : HERBERT BASS, . 402 Atlas Bank Building 524 Walnut Street ‘Cin¢innati, Ohio 45202 S/* Zp. Attorneys for Petitioners . ETS PE SAT ES TLE ALT TT TN ae TSE COURT INDEX PRESS, INC. rd Printers — 809 Walnut Street, Cincinnati, Ohio 45202 7 ¥ I N DE x Opinions Below ener a Treaty Dee ery cathe eo * Jurisdiction Wes ‘ a ae ‘ errs oy ai larg Ora ia ce of Aa te Questions Presented : cree, aed aioe meee Ce eee Constitutional Provisions, Statutes Involved . Oe Tea. te Statement of the ES re a, Seen pe jeeie ae Basis for Jurisdiction of the U. S. District Court . ake 2 - Argument Amplifying the Reasons Relied on ie’ eet Beene e ees . "stad Conistitutional: ‘Provisions os Gael Bees bd . Article, THY Stction 205 5... ci, Say oo ee ile eee Amendment Fifth :.... Fas Pais ea a ca ae Gc kee : % i . . ‘ @ . -. ow 4 : a ; gtk o's ° a‘ : Py ‘ P se . tad * . . “ - a) oe ? . : 7 a Py ° ° , A ors ae ; rad *. a e ‘ *~ = 4 - ee , ‘ + A 2 : ‘ - - é Il. t ms oy Title 40, “Section 270.b (b). U.S. Code Antiotated .. Title 28, Section 1254 (1)-U. S. Code ............ . Amendment: Thirteenth | oes See xk Nee See ere . Authorities ae ace CCH U. s. Supteme Court Bulletin B-1897 ° cP iar the.” - Supreme Court of the United States alee _-October Teem, 1965 a ni ~ ‘oa? - ; . UNITED STATES OF AMERICA for the Wse and " Benefit of KELLER PIER DRILLING COMPANY, 2 an Ohio. Corporation, 3 3 Petitioner, beet Part | Vi: 2 ai , .° 4% JOHN H. EISELE COMPANY; ING., de '.- an Ohio Corporation, - THE. BUCKEYE UNION CASUALTY CO., '.: AMERICAN RE-INSURANCE CO., | Rte “i _Respondenté. PETITION FOR WRIT OF caxriweant TO - THE UNITED STATES COURT OF APPEALS 5) r FOR THE SIXTH CIRCUIT) To the “Hanorable, the Chief Justice ond ‘the Associate "Justices of the United States Supreme Court: The ‘petition of the above Petitioner is for a Writ of Certiorari to issue to review in part the judgment ¢f the ~ ‘ , Court of Appeals for the Sixth, Circuit of the United ' States, numbered 16,521, entered April 22, 1966 vacating ' the judgment of the United States District Court for the - Southern District of Ohio, Dayton, Western Division en- ..-tered January 11, 1965 and requiring arbitration, and — " _ shows to this court: 9 ® ee, eee OPINIONS BELOW te ‘The judgmenit by order of the District: Court of. die: . United States -for:the Southern District of Ohio in case numbered 3023 filed Janua 11, 1965 and the judgment of the Court of Appeals of the_United States for the Sixth Circuit numbered 16, 521 vacating the U. S. District Court's: _. decision and remanding for stay for arbitration, filed «January. I'l, 1965 have not been reported. _ A copy of the Jndement of the United States District Court judgment .is appended to this Petition as Appendix A; a copy of the judgment of the Circuit Court of Appeals for the United States Sixth Circuit is “appended. hereto as Apt B. i 3 JURISDICTION Jurisdiction of. this court to review ‘the » judgr ient of the, - United States Circuit Court of Appeals for the Sixth Cir- cuit made and entered April 22, 1966 is invoked under Section 1254 (1) of Title 28, Unitéd States Code. On that - date the Court of Appeals vacated the judgment of the _ District Court dismissing the suit of Use Plaintiff but — ‘ confirmed the decision of -the District. Court requiring arbitration and remanding. and staying the case for such.. ‘The questions here presented are raised in the pleadings of the parties in the District Court and the Court, of Ap- peals, except as to the application of the Fifth and Thir- _ teenth Amendment which are here Yaised as a subsidiary © question which must be settled as an incident. of deter- mining the issues raised in the lower courts. QUESTIONS: PRESENTED , : 1. Where the. Respondent “(General Contractor) in | ,-serted unilaterally all of the terms, conditions and. provi- eS | Sot = 3 “sions “of the- government Contract DA-15- 029-ENG-6241. into the subcontract, making it-a part thereof and Peti- " tiener subject thezeto and it to have precedence over any conflicting provisions of the balance of ‘the subcontract, ~ and the government contract required Administrative rem- ; edies ‘for relief to prevail over a conflicting provision for: :. arbitration and Respondent breached ‘its. requirements to. seek administrative relief for Petitioner or itself, and breached its obligation to use arbitration and arbitrarily settled its and Petitioner’s claims, must Petitioner exhaust its administrative remedies . before -suit therefore aan Title 40, Section 270 (b), Miller Act? ~ - | 2. . Was Respondent estopped by its conduct of -its. own acts and deemed to ‘have waived its: rights to governmental administrative remedies, and for arbitration as to its fitst | subcontract with Petitioner? e - 8... Was Respondent by its acts and. unlawful discharge of Petitioner, and. -waiver of administrative relief and right of arbitration so,as to permit the second contract not re- quiring administrative relief or arbitration, and the spé- cial demand and urgings of Respondent to Petitioner to continue to perform after discharge on an implied in fact contract for quantum meruit basis, estopped to deny such two subsequent contracts were separate and néw contracts — for additional work, and recovery of — therefor - “per- missible under thé ‘Miller Act’? 4. Where the Respondent required Petitioner to use its equipment, its officer'and employees to perform. labor in a different capacity than originally agreed to after” firing of Petitioner, and under threat to collect another | subcontractor’s unreasonable costs under bond of Petition- - er, was there a deprivation of the liberty of contract and of property of the Petitioner, and of the officer and the employees of it without due process and a taking of such ; & private property to a public use without just compensation . anda violation of the Fifth Amendment of the United States, and the same acts to bé deemed acts of slavery and involving involuntary labor and violating the Thirteenth Amendment to the United States Constitution, Section -I-_ ‘thereof? . 5. Was the acitlie policy of Congress enacting Title 40, * Section 270 (a) (d) (The Miller Act) to further implement the guaranteed protections of the Fifth and Thirteenth Amendments to the U. S. Constitution? 6. Was Title 9, Sections 2, 3, 4, applicable to a case not involving interstate commerce nor a maritime con- tract but a suit involving federal contract procurement law where Respondent never invoked such law as to require arbitration thereunder and Petitioner never waived its rights to jury trial, and discovery procedure to obtain _ evidence in possession of the Respondent and the U. S. - government? ” 7. Where the subcontractor is ignorant of the require- ments of work and is laboring under misrepresentatioris as’ to conditions of work known to the other party and the conditions of work vastly exceed those as represented, can ~ such subcontrdttor waive in advance his rights to a judicial determination thereof by contract, as well as the right of the United States government to determine its own rights, and submit its rights and: those of the sovereign to arbi- tration? | : 8. Was the right to administrative relief or arbitration of the rights of Petitioner under its first and whole sub: contract, its second contract and third: contract for quantum “meruit adequate and a complete remedy for relief? * eet se ae oe we? 5. CONSTITUTIONAL PROVISIONS, ° STATUTES INVOLVED ~ The constitutional and statutory provisions and pertinent text are set forth in Joint Appendix and are: Article III, 2 Section 2, U. S. Constitution; Title’40, Section 270 b (b) U. S. Code; Title 28; Section 1345 U. S ode; Title 9, Section 2, 3, 4, U. S. Code; Title 28, Section 1352 U. S. Code; and the following Constitutional provisions relevant. as subsidiary issues are: Fifth’ Amendment, set forth in Ap- E pendix C; Thirteenth Amendment, Sections 1 and 2 set forth in Appendix D hereto. STATEMENT OF THE CASE . "This petition seeks review in part of the judgment of the | | U. S. Court of Appeals for the Sixth Circuit filed April 22, 1966 remanding the case and ordering a stay for arbi- tration. The case involves the drilling or pier holes ‘and supervision of pouring of Respondent’ s concrete by Peti- tioner supplying labor therefor, in construction of the Air Force Institute Building of the United States government at Wright Patterson Air Force Base, Dayton, Ohio under a subcontract calling for arbitration and which by express. terms made such subcontract subservient to the conflicting terms of the general governmental standard procurement contract DA-15-029-ENG-6241, and Petitioner subject to all the terms, conditions and provisions of such governmental contract which Respondent unilaterally inserted into such - subcontract; however Respondent never delivered a copy of such government contract to Petitioner thereby Peti- tioner was unaware of certain obligations placed on it-as well as many of its rights and privileges thereunder; Peti- _tioner also suffered certain misrepresentations as to condi- tions of work and was induced to enter into the contract on 6 - certain promises of Respondent. After commencing work‘ the enormity of the substrata changed conditions were © — discovered by Petitioner who notified Respondent. Re: spondent refysed.to listen to the claims of Petitioner and Respondent urged Petitioner to work, labor and supervise as well as its officer.to labor and supervise, and its em- ployees to labor under unreasonable conditions because of . vast amounts of underground as well as surface water, in- creased costs to Petitioner never agreed to, errors caused. _ by Respondent requiring correction by Petitioner at extra ‘costs of use of equipment, and labor and supervision. “Fhat Respondent claiming Petitioner breached its contract de- manded a bond of Petitioner which it supplied; Respond- ent orally agreed with another contractor on March 8, 1963 to hire such contractor to replace Petitioner, then | notified Petitioner by letter dated March 7, and delivered March 11, 1963 of the cancellation of the work of Petitioner and “fired out” Petitioner. Subsequently, it ordered Pe- titioner to correct a hole caused by Respondent by a sepa- rate latter authorization, having no reference to arbitration or administrative relief, on a time and material basis; it also at the same time demanded Petitioner -return to the job and assist the other subcontractor complete the work halted also by extreme adverse weather. Petitioner had to incur additional labor costs, maintenance of insurance and performed under changed conditions than originally con- tracted to perform. It worked ‘from March 11, 1963 through April 3, 1963 and commenced correction of the hole on March 27th, 1963 and completed such April 3, 1963. The Respondent threatened to charge the costs of the new subcontractor to Petitioner over objections of petitioner, who performed 90% of the work where as Respondent billed Petitioner for the 10%. of the work. performed by the substituting contractor at the approxi- 4 mate sum of $12,000.00 and nitued: to pay Petitioner for the work performed by petitioner before unlawful dis- chargé, as well as for the corrective work and the demand : and -request for the additional performance after the un- lawful discharge where no‘arbitratiori or administrative re- _ lief was involved. The Petitioner never’ waived any of | its rights and continued to object to the Respondent refus- ‘ing to heed its demands for performance by Respondent under the contract, as well as the “firing out” and the settling arbitrarily the demands of Respondent against . Petitioner. Petitioner sought Réspondent to exert itself for Petitioner as to its rights under the contract but Re- spondent refused to institute or permit Petitioner to in- stitute a claim for just compensation under the federal administrative remedy for relief. The Petitioner being obligated- to follow the terms of the government as to changed conditions, giving notice of changed conditions of work as well as comply with the disputes clause would have . breached its contract if it had attempted to institute arbi- - tration proceedings in the first instance, and when it at- tempted to institute administrative remedies, the Respond- ent.refused and the contracting officer refused to meet with representatives of Petitioner because there was no privity of contract between the U. S. government | and Petitioner. When Respondent finally réfused to permit Petitioner to ° use administrative remedies and never demanded arbitra- tion, Petitioner sued for its statutory relief under. the * Miller Act, the last day before a year expired. from last day of performance, setting up ‘its various rights under the ‘whole’ subcontract. Thereafter Respondent. filed a motion to stay pending arbitration but never filed a petition. for such under Title 9, Sections 1, 2, 3, and 4, thereof; but Respondent acknowledged the various claims of Petitioner but contended such arose out of the ‘subcontract. The a. joint Appendix of the parties, pages 33a through - pages | 35a set forth the said motion, the order of the court to Petitioner to show cause why the complaint should not - — be dismissed entered June 9, 1964, and pages 35a through page 60a set forth the basis for Petitioner's claim for .jurisdiction. The joint appendix does not contain the memorandum of Respondent opposing Petitioner. The District Court by its order filed January 11, 1964 dis- missed the complaint’and required the parties to resort to arbitration. See Joint Appendix 6la. The Petitioner filed its notice of Appeal to the Circuit Court of Appeals for the Sixth Circuit, February 5, 1965. See Joint Ap- pendix page 62a. An oral argument to the Circuit Court -. of Appeals was made. by Petitioner and Respondent on April 16, 1966 and the Court mdde ad entered its order vacating the judgment-of the District Court and remand- ing the case to the lower court and to stay proceedings — pending arbitration. The Petitioner seeks to review in part the judgment of the Court of Appeals for the Sixth Circuit. of the United States requiring arbitration of the three contracts of Petitioner and its rights thereunder. BASIS FOR’ JURISDICTION OF THE U. S. DISTRICT COURT The Petitioner filed its complaint before the expiration. of one year from date of last day of work performed by it, on April 3, 1964 with the U. S. District Court for the Southern District of Ohio, Western Division, Dayton, Ohio under the provisions of Title 40, Section 270 (a) and © (b). : \ \> 9 ‘ARGUMENT AMPLIFYING THE REASONS RELIED ON FOR ALLOWANCE OF THE WRIT OF CERTIORARI ' The petitioner contends that the decision of this case is contrary to the decision of the Supreme Court of the United © States in holding that Arbitration must apply to the three separate claims of Petitioner where no interstate commerce - and. no maritime contracts were involved and where no petition was filed therefor pursuant to the requirements of the Arbitration Act, Title 9, Sections 1, 2, 3, and 4 of the U. S. Code even though Petitioner has not waived its right to trial by jury and must resort to federal dis- covery procedure to secure evidence known to be in the possession of the U. S. gevermaqent contracting officer as well as the’ Respondent. The Supreme Court in its decision contained in the case of Norman C. Bernhardt v. Polygraphic Co. of America, 350 U. S. 198; 76'S. Ct. 73 —— held such arbitration act applied only to matters involving the movement of interstate commerce and maritime con- tracts. Therein it also,stated that, in addition to other matters, the right to have a. federal’ court give its con- struction as-to matters of law as an aid to a jury are im- © portant. This case involves a narrow: construction of Fed- eral law-peculiar only to U. S. government procurement contracts not usual and not clearly understood by the usual arbitrator not versed in government contract law. | _ This decision of the Circuit Court of Appeals conflicts * with the decision of the Supreme Court in the case of © U.S. v. Holpuch Co., 328 U.S. 701, 1001; which held that where appeal procedure are clearly inadequate one could avoid exhausting administrative remedies. The Court of Appeals decision conflicts with the. Su- preme Court decision in the case of U. S. v. Grace & Sons, Inc. (June 6, 1966) reported in CCH. U. S. Supreme Court Bulletin, B-1897 confirming H. B. Zachary Co. v. U. &.,: 10° » $44 F, 2nd. 352; U. S. v. Blair, 321 U. S. 820; Southeastern Oil Co. v. U. S., 115 F. Supp. 198; C. J. Langenfelder. & Sons, Inc. v. U. S., 341 F2nd. 600, that where one had no full and adequate remedy, one need not exhaust his ad- ministrative remedies; and that in Blair v. U. S. supra a subcontractor not having privity of contract could not re- “cover for. additional expenses against the. United States government. _ | This decision of the Court of Appeals conflicts with that . - > of the 4th Circuit’in U.S. et al. v. Alcon Development : e United States Code por - CONSTITUTIONAL AMENDMENT 6-14, page 269 | ; | . AMENDMENT XII. SLAVERY ABOLISHED. Section 1. ‘Neither slavery nor ‘involuntary servitude, | except as,a punishment for crime whereof the’party shall . have been duly convicted shall exist within the United _ States, er any place subject their jurisdiction. | Section 2. Congress shall have the ‘power to enforce this ‘Article by + Complaint 9. All of said-work and labor and use of drilling equip- ment and supervision of pouring concrete was performed within the said Southern District of Ohio. _ Wherefore, the United States of America for the use and- benefit of Keller Pier Drilling Co. demands judgment. against the defendants in the sum of $5,780.00 plus $2.00 per cu. yard of concrete poured, with interest from the 4th day of April 1963 and the.costs of this action. SECOND COUNT 1. Use Plaintiff repeats and cndtiaiie each and all of the allegations contained in paragraphs 1, 2, 3, 4, 5, of the . First Count of Claim numbered First with like effect as if herein fully repeated. _ 2.. That under the terms of said aleconitaies Defend- _ant Eisele Company, Inc. was required to set off each situs of each hole to be drilled by use Plaintiff, and said De- fendant, John H. Eisele Company, Inc. by its special in- stance and written request made known to use Plaintiff its promise to pay use Plaintiff a reasonable sum of money on a time and ‘material basis for correction of a pier hole location, said sum to be in aciition to the said sub-contract price. : 3. That use Plaintiff ciliadied the correction of said pier hole on March 27, 1963 and completed said correction on April 2, 1963 at the reasonable value for said work and - labor and use of equipment in the sum of $385.21. __ 4, ‘The defendant, John H. Eisele Company, Inc. failed and neglected to pay use Plaintiff the said sum of $385.21 according to its written request. : ‘ 5.. One year has not elapsed from date of final payment of the contract and although: due demand has been made on defendant, John H. Eisele Company, Inc. no part of 6a Complaint _ said $385.21 with interest has been paid t to use Plaintiff. | 6. All of said work and labor for correction said-pier._. hole location and drilling with equipment was performed. . _ within said-Southern District of Ohio. Wherefore, the United States of America for the use and benefit of Keller Pier Drilling Company demands judgment ~-against defendants in the sum of $385.21 with interest from the 4th day of April, 1963 and costs of the action. . rs ” . : “SECOND CLAIM 1. Jurisdiction of this cause is conferred by Section 270 - (a) and (b) of Title 40 of the United -States Code. ‘THIRD COUNT “9. Use Plaintiff repeats and realleges each and all of the allegations containe | in paragraphs numbered 2, 3, 4, of- the First Count of Claim numbered First of this“ complaint with like effect as if herein fully repeated. 3. In order to obtain the performance of the work re- quired under the said contract the Defendant, John H. Eisele Company, Inc. entered into a sub-contract with Keller ‘Pier Drilling Co. an Ohio corporation for the drilling of ‘certain pier holes using drilling equipment and supervising the pouring of concrete to form the said piers which work . by the-use Plaintiff was necessary to the performance of. Defendant, John H. Eisele Company, Inc. and which use_ . Plaintiff offered to perform in consideration of the pay- ment of $5,780.00 plus $2.00 per cu. yard of concrete poured. That use Plaintiff agreed to perform said work - provided Defendant, John H. Eisele Company, Inc. re- moved overhead electrical wires. 4. Use. Plaintiff was not furnished ‘a copy of the prime - contract nor specifications governing same which were in- Ct ee Eee dmv EGAied ~~ in alts Saal on des -— “Ta Complaint . ; corporated into the sub:contract awarded use Plaintiff, a » | copy of which is attached hereto as Exhibit B, and use Plaintiff did not know the method of. pouring concrete required a vibration method thereby increasing to use ~ Plaintiff the costs of such labor and work. 5. That no time was specified as to commencement date or completion date in use Plaintiff’; sub-contract, but he offered to commence work on February 12, 1962 with the approval of Defendant, John H. Eisele Company, Inc: 6.. That Defendant, John H. Eisele Company, Inc. induced use Plaintiff to purchase workmen’s compensation insurance, public liability insurance and property damage insurance and to incur certain other expenses.in attempt- ing to fulfill the requirements of said sub-contract aggre- gating in cost of $7,752.15 to use Plaintiff. 7, That although the contract of use Plaintiff and De- fendant John H. Risele Company, Inc. mae the pro- visions of the prime contract of said defendant and the United States government and use Plaintiff would have, been excused from performing said work because of the extremes of adverse weather, said Defendant urged use - Plaintiff to exert more time and effort than was required under said sub-contract all : of which use Plaintiff com- © * plied with. 8. Use Plaintiff further urges upon information and be- lief that because of the adverse weather prohibiting con- struction, in order to expedite the construction of said pier holes said Deferidant failed and neglected to give use Plain- tiff three days prior notice of defendant’s determination that use Plaintiff was derelict in its obligation and said’ Defendant negotiated with another sub-contractor on or about March 3, -1963 to supplant use Plaintiff three days before said Defendant notified use Plaintiff of its said de- cision contrary to defendant’s a caidas Sa 8a . 9. Use plaintiff says that said Defendant failed and neglected and refused to remove overhead electric wires for use plaintiff as agreed thereby causing great delay to use plaintiff in moving its equipment from situs to situs with drilling boom lowered. 10. Use Plaintiff further says that he was induced to enter into negotiations for such work on ihe representation that the substrata would be merely damp, free of large boulders, whereas and in fact, water drained into each hole: so drilled, necessitating excessive use of pumping equipment beyond normal requirements and’ causing additional un- forseen costs, due to “remucking”. of drilled, water filled . holes at great expense to use ait - 11. That approximately four days after detent 7 n H. Eisele Company, Inc. negotiated a written agreement with. such other sub-contractor, said defendant informed use Plaintiff of its decision to bring additional men and equipment in and charge the same to the expense of use Plaintiff, all at an unreasonable price of $40 per cu.: yard of concrete poured. ; 12. That despite ‘said defendant’s notification to use Plaintiff of its determination to cancel. the balance of use ; Plaintiff's contract, said defendant urged use Plaintiff to. continue to exert its capabilities to complete such work and to incur other and greater expense. 13. Use Plaintiff further alleges that defendant, John H. Eisele. Company, Inc. was required to stake out drilling . .' situs which in certain instances were inaccurately staked and center not accurately indicated, all to the great delay | and expense to use Plaintiff. 7 _ 14. That despite the repudiation of the obligation of’ defendant under its sub-contract with use Plaintiff on March 7, 1963 and due to the“urgings both before and after said date, use Plaintiff had’ fully ‘performed all obligations /On its part to be anleenieaies and at the time ‘of said re- Complaint } pudiation was ready, willing and able and duly offered to continue the due performance thereof. 15.° That defendant, John -H. Eisele Company, Inc. failed, neglected. and refused to pay to use Plaintiff the _ said sum of $5,780.00 plus $2.00 per cu. yard. of concrete poured, and said defendant failed, neglected and refused to pay any other or further amounts said defendant agreed to pay for additional work or to reimburse use Plaintiff he sum of $7,752.15 which use Plaintiff reasonably, in- cured, at said Defendant’s . special urging and requests, hough use Plaintiff made’ demand on said defendant for reimbursement and compensation. . 16. That use Plaintiff's agreement has not reached its termination date and one year has not elapsed from the date of final payment of the agreement and urgings of De- .fendant John H. Eisele Company, Iric. and although due demand has been made on defendant John H. Eisele Com- pany, Inc., no part of the reasonable value of use Plain- tiff’s. work, labor, equipment, or costs have been paid. 17. That the value of $7,752.15 was reasonable which use Plaintiff expended’ on account of defendant John H. Eisele Company, Inc. and which was expended and labor performed in the Southern District of Ohio. Wherefore, the United States of America for the use and benefit of Keller Pier Drilling Co. demands judgment against the defendants in the sum of $7,752.15 with interest from the 4th day of April, 1963 and costs of this action. | /s/ Thomas F. Lazaron Thomas & Lazaron by. Thomas F. Lazaron a member of the firm | Attorneys for Keller Pier Drilling Co. . Office and Post Office address ' 105 Rookwood Bldg. 1077 Celestial St. Cincinnati 2, Ohio ~ & 10a STATE OF OHIO: | ) SS: _ COUNTY OF HAMILTON ) — ‘Wilbur Keller, being duly sworn deposes and says that he resides at 4774 Jessup Street, Cincinnati, Ohio, that he _ is the president of Keller Pier Drilling Co.,an Ohio corpora-. . tion th¢e use Plaintiff herein; and that he has read the . foregoing complaint and knows the contents ‘thereof, that the same are true of his own knowledge except as to the matters therein stated to: be alleged on information and ‘belief and as to those. matters he believes them to be true. we Keller, President Sworn to and ictal before me this ond day of April, « 1964. Ernest V. Thomas, Jr., Notary Public ‘Hamilton ines id Ohio lla EXHIBIT A : ‘CONSTRUCTION CONTRACT |” Contract No. DA-15-029-ENG-6241 Date of Contract 30 November 1962 Namie and Address of Contractor JOHN H. EISELE COMPANY, INC. 18 E. 41st Street : _ + New York 17; New York Corporation, incorporated in the State of Ohio Department or Agency ee | U. S. Army Engineer District, Louisville Corps of Engineers, U. S.A. — P. O. Box 59, Louisville 1, Kentucky Contract for (Work tobe performed) : Construction of Air Force Institute of Technology, Place FO ae ee ae Wright-Patterson Air Force Base, Ohio: Contract Price (Express in words and figures) | . Two Million Six Hundred Sixty-Five Thousand Two Hundred Eighteen. and No/100 Dollars. ($2,665,2 18.00) Estimated = - oa Administrative Data (Optional) ~~ > | Pade To be paid by Special Disbursing Agent (Military Funds), © - U.S. Army Engineer District, Louisville, Corps of -En- gineers, USA, 830 West Broadway, Louisville 3, Ken- tucky from the following funds: __57X3300 377-6513 P.321-32 $ 15-029 (BAN 3-288)- The United States of America (hereinafter.called the Gov- ernment), represented by the Contracting Officer executing ' ‘this contract, and the individual, partnership, joint ven-. ture, or corporation named above (hereinafter. called the Contractor), mutually agree to perform this contract in ‘strict accordance with the General. Provisions (Standard . s 12a . Exhibit A Form 23-A), Labor Standards Provisions Applicable’ to Con- tracts in Excess of $2,000 (Standard Form 19-A), and the following nue specifications, schedules, tala and ” se conditions: | "Specifications: Serial No. ENG-15-029-63-11 as amend- - ed by Amendment Nos. 1, 2 and 3 thereto. _ aperange: As listed in Paragraph SC-3 of the § vecifica- - tions as amended. by Amendment No. 2 thereto. _ General Provisions: Std. Form 23-A (April 1961) as modified by continuation sheets Nos. 5 through 16. Unit Price Schedule: Attached hereto‘and made a part . hereof. Work Shall Be Started - : Within 10 calendar days after date of receipt by contractor of Notice to Proceed. Work Shall Be Completed « “In accordance with the provisions of paragraph SC-1 of thes ecifications. es Alterations. The following. alterations were made in this contract before, it was signed by the parties hereto: Article 28 of ‘General Provisions deleted.. In witness whereof, thie parties hereto have executed this: . " . contract as of the date enteréd-on the first page hereof. THE UNITED STATES OF AMERICA » Js/ James L. Lewis 28 Dec. 62 ‘James L. Lewis, Col., CE District Engineer. Contracting Officer , | CONTRACTOR » John H. Eisele Company, Ine. James Conforti, Jr. — President 7 ad . | St Ray ees ——se ee” Ore ~@ | | 13a eaten Exhibit A. | GENERAL PROVISIONS (Construction Contract) . * . =" 4, CHANGED CONDITIONS The Contractor shall promptly, and’ before such condi- ions are disturbed, notify the Contracting Officer in writing of: (a) subsurface or latent physical conditions at the site differing materially from those’ indicated in this, contract, or (b) unknown physical conditions at the site, of an unusual nature, differing materially from those or- dinarily éncountered and generally recognized as inhering ‘in. work of the character provided for in this: contract. The Contracting Officer. shall. promptly investigate the conditions, and if he finds that -such - conditions do so materially differ and cause an increase or deérease in the Contractor's cost of, or the time required for, performance of this contract, an equitable adjustment shall be made and | the contract modified in writing’ accordingly. Any-claim of the Contractor for adjustinent, hereunder shall not be allowed unless he has given notice as above required; or ‘unless the Contracting Officer grants a further period ‘of © time before the date of final payment under the contract. _ If the parties fail to agree upon the adjustment to be made, the dispute shall be determined as s provided i in Clause 6 ‘of __ these General Provisions. ‘ 5. TERMINATION FOR DEFAULT — DAMAGES FOR DELAY — TIME EXTENSIONS oe - @ —_ . | - (d) The Contractor's right to proceed shall not -be so terminated nor the Contractor charged with resulting dam- age if: o oo | l4a Exhibit A | (1) ‘The delay in the completion of the work arises from unforeseeable causes beyond the control: and without ,the fault or negligence of the Contractor, including but not restricted to, acts of God, acts of the public enemy, acts of © ‘the Government in either its soverign or contractual ca- pacity, acts of another contractor in the performance of a contract with the Government, fires, floods, epidemics, quar- antine~ restrictions, strikes, freight embargoes, unusually severe weather, or delays.of subcontractors or suppliers aris- ing from unforeseeable causes beyond the control and with- out the fault or negligence of both the Contractor and such subcontractors or suppliers; and (2) The Contractor, within 10 days from the oe ' of any such delay (unless the Contracting Officer grants a further period oftime before the date of final payment _ under the. contract), notifies the Contracting Officer in writing of the causes of delay. The. Contracting Officer shall ascertain the facts and the extent of the delay and extend the time for completing the work when, in his judgment, the findings of fact justify such an extension, and his findings of fact shall be final and conclusive on the parties, subject only to appeal as pro- vided in Clause 6 df these General Provisions.’ '(e) If, after notice of termination of the Contractor’s right to proceed, under the provisions of’ paragraph (a) of this clause, it is determined that the delay is excusable under the provisions of paragraph (d) of this clause, such notice of termination shall be deemed t6 have been issued pursuant to the clause of this contract entitled “Termination for Convenience of the Government,” and the rights and obligations of the parties hereto shall in such event be governed by such clause. (This paragraph (e) applies only if this contract contains such termination oe.) ge a ee | Exhibit A 6. DISPUTES , ‘ (a) Except as siaseoitia eoeidal in this contract, ‘any dispute concerning a question of fact arising under this contract which is not disposed of by agreement shall be de- cided by the Contracting Officer, who shall reduce his de- cision to writifig and mail or otherwise furnish a copy there- of to the Contractor.” The decision of ‘the Contracting Officer shall be final and conclusive unless, within 30 days from the date of receipt of such copy, the Contractor mails or otherwise furnishes to the Contracting Officer a written — appeal addressed to the head of the agency involved. Thee decision of the head’ of the agency or his duly authorized representative for the determination of such appeals shall be final and conclusive. This provision shall not bé plead- ed in any suit involving a question of fact arising under this contract as dimiting judicial review of any such de- — cision to cases where fraud by such official or his representa- tive or board is alleged: Provided, however, that any such _ decision shall be final and conclusive unless the same is fraudulent or capricious or arbitrary or so grossly errone- ous as necessarily to imply bad faith or is not supported by ‘substantial evidence. In connection with any appeal pro- ceeding under this clause, the Contractor shall be afforded an opportunity to-be heard and to offer evidence in support of his appeal. Pending final decision of a dispute here- . ‘under, the Contractor shall proceed diligently with the performance o fthe contract and in accordance with the Contracting Officer's decision. * ‘* * _ 99. TERMINATION FOR CONVENIENCE OF THE GOVERNMENT. (JAN. 1961): (a) The performance of work under this contract may be terminated by the Government in accordance with this _ 2. 16a Exhibit A clause in whole, or from time to time in part, whenever the Contracting Officer shall determine that such termination is in the best interest of the Government. Any such ter- mination shall be effected by delivery to the Contractor- of a Notice of Termination specifying the extent to which performance of work under the contract is terminated, . and the date upon which such termination becomes effec- tive. ; Re (b) After receipt of a Notice of Termination, and ex- cept as otherwise directed by the Contracting Officer, the Contractor shall: . ow) * * | * (iv ‘assign to the Government, in the manner, at the times,-and to the extent directed by the Contracting Of-: ficer, all of the right, title, and interest of the Contractor under the orders and subcontracts so terminated, in which case the Government shall have the right, in ‘its discretion, to settle or pay any or all claims arising out of the termina- tion of such orders and subcontracts; (v) settle all outstanding liabilities and all claims arising out of such termination of orders and subcontracts; with the approval or ratification of the Contracting Officer to the extent he may require, which approval or ratification shall be final for all the purposes of this clause; * * * (ix) take such action as may be necessary, or as the Con- : tracting Officer may direct, for the protection and preserva- tion of the property related to this contract which is in the possession of the Contractor and in which the Government has or may acquire an interest. * y * * (e) In the event of the failure of the Contractor and the Contracting Officer to agree as provided in paragraph , 17a y » Exhibit (d) upon the whole amount to be er to the a by reason of the termination of: stad pursuant to this clause, the. Contracting Officer shall, subject to any Settlement Review, Board approvals required by Section VIII of the - Arméd Services Procurement Regulation in effect as of the daté of execution of this contract, determine,-on the. basis of information available to him, the amount, if any, due to the Contractor by reason of the termination and shall pay © to the Contractor the amounts ‘determined as follows: (i) with respect to all contract work performed prior to the effective date of the Notice of Termination, the total (without duplication of any items) of — ak ee (B) the cost’ of settling and paying claims arising out of the termination of work under sub-contracts or orders as provided in paragraph (b) (v) above, exclusive’ of the amounts paid or payable on account of supplies or ma- terials delivered or services furnished by. the subcontractor - prior to the effective date of the Notice of Termination of - work: under this contract, which amounts shall be in- cluded in the cost on account of which payment is made. under (A) above; and * * * 25. GRATUITIES. (MAR. 1952). * * * (c) -The rights and remedies of the Government pro- vided in this clause shall not be exclusive and are in addi- tion to any other _— and akc oes provided by law or under this contract. (ASPR 7-104.16) 18a » , - Exhibit A 40. PRIORITIES, ALLOCATIONS, AND. ALLOT- MENTS. (JAN. 1961) — e ; *. * . * . Subparagraph / (d)(1) and paragraph (e) of General Pro- vision 5, entitled “Termination for Default — Damages. for Delay — Time Extensions,” have been deleted and the fol- lowing are substituted therefor: : ° “(1) - The delay in the completion of the’ work arises from causes other than normal weather beyond the con- trol and without the fault or negligence of the Contractor, including but not restricted to, acts of God, acts of the pub- lic enemy, acts of the Government in- either its sovéreign _or contractual capacity, acts of another contractor in the performance of a contract with thé Government, fires, floods, epidemics, quarantine restrictions, strikes, freight — embargoes, unusually severe weather, or delays of subcon- tractors or manta ating from causes other than normal ‘weather beyond the control and. without the fault or negli- ~“» gence of both the Contractor and such subcontractors or suppliers; and” (ECI 7-602.5) “(e) If, after notice of yerminaticn of the Contractor's right to proceed under the provisions of this clause, it is determined for any reason that the Contractor was not in default under the provisions of this clause, or that the delay _ was excusable under the provisions of ‘this clause, the | rights and obligations of the parties shall, if the contract | contains a clause providing for termination for convenience _ of the Government, be-the same as if the notice of termina- tion had been issued pursuant to such clause.” (ASPR - 8-709) in 19a Exhibit A . 21.. NONDISGRIMINATION IN EMPLOYMENT. - (JUL 1962) | | + * eo. et \’ (g) The Contractor will.include the provisions: of the’. foregoing paragraphs (a) through .(f) in every subcontract or purchase order unless exempted. by rules, regulations, or orders of the President’s Committee on Equal Employment Opportunity issued pursuant to séction 303 of Executive — Order No. 10925 of March 6, 1961, so that such provisions will be binding upon each subcontractor or vendor.* The Contractor will take such action with respect to any sub- contract or purchase order as the: contracting agency may . direct as a means of enforcing such provisions, including © sanctions for noncompliance: Provided, however, that in the event the Contractor becomes involved in, or is threat- ened with, litigation with a subcontractor or vendor as a result of such direction by the contracting agency, the Con- tractor may request the United States to enter into such liti- gation to protect the interests of the United States. *The President’s Committee on Equal Employment: Opportunity interprets the first sentence of paragraph (g) to mean that the Contractor will include the provisions of ‘ the foregoing paragraphs (a) through (f) in every first-tiér subcontract or purchase order, so t provisions will . be binding upon each such subcontractor or vendor, and will require each first-tier subcontractor or vendor similar- ~ ly to.include the provisions of paragraphs (a) through (f) in any subcontract or purchase order which he places, un- less exempted by rules, regulations, or orders of the Presi- dent’s Committee on Equal.Employment Opportunity is- sued, pursuant to section 303 of Executive Order 10925 of . March 6, 1961. (ASPR 12-802) = ¥* * 1€ 20a Exhibit A 2. WORK HOURS ACT OF 1962 — OVERTIME COM- PENSATION. Cd (a) No Contractor or subcontractor contracting for any ~ part of the contract work shail require or permit any laborer or mechanic to be employed on such work in excess of eight hours in any calendar day or in excess of forty hours in any -workweek unless such laborer or mechanic received com- pensation at a rate not less than one and one-half times his basic rate of pay for all hours worked in’ excess of eight hours in any calendar day or in excess of forty hours in such workweek whicheyer is ‘the greater number of. over- time hours. (b) In the event of any violation of the provisions of paragraph (a) the Contractor and any subcontractor re- sponsible for such violation shall be liable to any affected . employee for his unpaid wages. In addition such Con- - _ tractor or subcontractor shall be liable to the United States . for liquidated damages. Such liquidated damages shail be - computed with respect to each individual laborer or me- ‘chanic employed i in violation of the provisions of paragraph | (a) in the sum of $10 for each calendar day‘ on which such employee was required or permitted to work in excess of eight hours or. in excess of forty hours in a work-week without payment of the required overtime wages. (c) The Contracting Officer may withhold or cause to be withheld from moneys payable on account of work per- formed by the Contractor or subcontractor the full amount of wages required by this contract and such sums as may administratively be determined to be necessary to satisfy any liabilities of such Contractor or subcontractor for liquidated damages as provided in paragraph (b). - eae Tele * ° 2la Exhibit A LABOR STANDARDS -PROVISIONS _ Applicable to Contracts in Excess of $2,000 * * * - 7. SUBCONTRACTS — TERMINATION The Contractor agrees to insert Clauses I through 7 hereof in all subcontracts and furthe? agrees that a breach ” of any of the requirements of these clauses may be grounds for termination of this contract. The term “Contractor” as used in such clauses in any subcontract shall be deemed to refer to the subcontractor except in the phrase * ‘Govern- ment Prime Contractor.” & EXHIBIT B INSERTION PAGES 2- A, 2-B and 2-C by GENERAL - CONTRACTOR ARE, PART OF THIS CONTRACT. - .STANDARD’ FORM OF SUBCONTRACT * * . CONTRACT 251-3 - a THIS AGREEMENT made this SIXTEENTH day of JANUARY in the year NINETEEN. HUNDRED and SIXTY-THREE by and between KELLER PIER DRILL- ING CO., 4774 Jessup Street, CINCINNATI 39, OHIO hereinafter called the Subcontractor and JOHN H. EISELE, _ COMPANY, Inc. (OHIO) hereinafter called the Contractor. WITNESSETH, That the Subcontractor and Contractor for the consideration hereinafter named agree: as follows: SECTION 1. The Subcontractor agrees to furnish all _ material and perform all work as described in Sectjon 2 here- of for Air Force Institute of Technology for The United - States of America hereinafter called the Owner, at Wright- Patterson Air Force Base, Ohio. in accordance ‘with the General Conditions of the Contract between the Owner and. tore 22a dditional cost caused thereby regardless - of whether these delays are caused by the Owner, Archi- tect, General Contractor or Subcontractor and/or any other delays or for other reasons. | 12. The Contractor shall be. at liberty from time to. time,:whether the work’ or any part thereof shall or shall . not have been completed, to make changes, and/or omis- sions in the work as he may deem necessary, upon written order to the Subcontractor, When’ the amount of the debit or credit has been agree upon the Contractor shall t . 28a Exhibit B issue a -written order to the’ Subcontractor stating the amount to be added to or deducted from the Contract Price. 13.. Any extra orders authorized by the Contractor on .a time and material basis will not be paid by the Contractor unless Subcontractor obtains vouchers signed by the Con- . tractor’s authorized job representative at the end of each _ day: These vouchers to show the exact time spent, labor rates, quantities and cost of materials used. These time and material extra orders tq be billed to the Contractor at . actual cost plus ten percent (10%) to cover other costs, ex- penses and profit of the Subcontractor. | 14. It is understood that should there be an increase in wages and/or materials during the life of this contract, the additional cost of same is to be paid for by the Subcon- tractor without additional cost to the Contractor. | 15. The Subcontractor shall not sub-let, assign or trans- fer this agreement or any part of the work-included herein or any moneys to become due hereunder, without the written consent of the Contractor. 16. The Subcontractor is to have monthly’ requisition in office of Contractor on the last day of each month for. all work performed during’ that month; otherwisé it may not ‘ be possible for Contractor to consider Subcontractor’s _ Tequisition for payment. The Subcontractor agrees to sub- mit on demand by the Contractor, with, his first requisition a complete detailed statement of the contract amount cor- rectly sub-divided and equally balanced into the various. ‘items comprising this contract to be used only as a’ basis of calculating the payments due. : : 17. The Subcontractor is to furnish the Contractor with receipted bills or other evidence of payment for any and - all labor, materials, and supplies used by this Subcontractor - .in the performance of his work. ‘The Contractor reserves the right to withhold any payments due the Subcontractor 29a Exhibit B ‘ until such receipted, bills, or other satisfactory evidence of payments are presented to the Contractor. 18. If at any time there shall be evidence of any lien or any other claim of any kind or description for which the Contractor or the said premises may become liable, and which is chargeable to the Subcontractor or his subcon- — tractors, and/or when damages shall be caused by this Sub- contractor to another subcontractor’s- work, then the Con- tractor shall have the right to: retain out of any payment then due or thereafter to become due an amount sufficient, in the opinion of the Contractor, to completely indemnify the Contractor against any such lien or claim. If there shall prove to be any such lien or claim after all payments are made, the Subcontractor shall refund to the Contractor all ‘moneys that the latter may be compelled to pay in dis- — _ charging or disposing thereof and of any other claim made in consequence of the Subcontractor’s default, and this Agreement shall not be affected by the final payment. 19. The Subcontractor, for thé contract price herein provided for, hereby accepts and assumes exclusive liability ff for, and shall hold the Contractor harmless —_— the payment of: (a) All contributions, taxes or premiums slich may be payable. under the Unemployment Insurance Law of any State or under the Federal Social Security Act, measured upon the payroll of employees, by whomsoever employed, engaged in the performance of the work included in this contract. (b) All sales taxes levied or ine against the Owner, the Contractor or the Subcontractor arising out of the furnishing or installing by the Subcontractor hereunder of oh any kind of personal property. 20. The Subcontractor is to furnish to the Contractor Certificates showing that he is covered on this contract with the following Insurance, ~ © 30a ‘(a) Workmen’ s =e in | accordance with the. laws of the State of Oba (b) Public Liability®asurance in the limits of $250,000, for each person and $500,000, for each accident, (c) Property Damage in an amount not less than $50,000. (d) Contractors’ Protective ‘Public Liability Insurance, - with an individual limit of $250,000, and a total limit for any one accident $500,000, for the account of the Subcon- . tractor when the Subcontractor sublets to another any portion of the work undertaken under this Agreement. . (e) Contingent Property’ Damage Insurance in an amount not less than $50, 000. : | | . Certificates of Insurance must be at the Contractor’s office before Subcontractor commences work. : _ 21. The Subcontractor hereby agrees to indemnify and save harmless the owner and the general contractor from and against any and all loss and/or experise which they, or. — either of them, may suffer or pay as a result of claims, settle- ments, suits, judgments or damages due to, because of, or _arising out of any and all injuries to, or death of, any and all persons including the subcontractors employees and for any and all damage to property, caused by or resulting from or arising out of or in connection with: the.contract and/or. the prosecution of the work thereunder whether due to | the acts or omissions of the owner, or the acts or omissions -of the general contractor, or the acts or omissions of any other contractor, or the acts or omissions of any other per- . son, firm, partnership, association or corporation, or other- : wise. 22. The Subcontractor shall defend all suits or deine “for infringement by him of any patent rights that-may be brought against the Contractor and/or the Owner arising out of the Work contemplated by this Agreement, and shall save the Contractor and/or Owner harmless from loss on saat ; ? 5 P ‘ 3 a \ 8la . ; Exhibit B ee account thereof, except that the Subcontractor shall not be responsible for such loss when particular process or product of a particular manufacturer or nianufacturers is specified in the Contract Documents. 23. Should Subcontractor elect to store materials and/or equipment on, the sidewalk or street at his: own risk it shall be his duty to properly stack same in a neat and orderly ‘ manner and to install and fhaintain such protection lights _as are required. | 24. Paragraphs (g), (h) and () of Section 5 are super- ceded as follows: Payments shall beset forth ii Section 4, ' Claims or changes by contractor shall be valid at anytime before final payment is made to the subcontractor. 25. There are incorporated by reference in this sub- - contract, with like force and effect:as.if the same were stip- ulated herein at length, all of the terms and conditions ‘of the contract between ‘the general contractor and The United States of America, dated November 30, 1962 and bearing Contract No. DA-15-029-ENG-6241. Wherever there shall be any discrépancy or differerice in terms or provisions be- tween the said general contract and the standard form of |. general conditions of the contract of the American Insti- tute of Architects 1958 edition (together with these gen- eral contractors additional insertions as modified), then, _and, in such event, the provisions of the general contract between the general contractor and the said United ‘States of America, shall govern. aA 26. The subcontractor agrees: to 0 perform this contract in strict accordance with the General Provisions (Standard Form 23-A, April 1961, pages 1 thru 16 inclusive); Labor Standards Provisions (Standard form 19-A), and the fol- . lowing designated specifications, schedules, Grawings, and o - conditions: SPECIFICATIONS: Serial No. ENG-L5. 029-63-11 as: amended by Amendment Nos. 1, 2 and 3 thereto. 32a «Exhibit B ‘DRAWINGS: As listed in Paragraph SC-3 of the Speci- fications as amended by Amendment No. 2 thereto. : _ 27.. PRIORITY RATING DO-C2. Certified for national defense usé under _— Regula- tion 1. ‘ Subcontractor is required to follow the provisions of DMS Reg. 1, and of all other applicable. regulations and orders of BDSA in obtaining controlléd materials and, other products and materials’ needed to fill this order. 28. This project is exempt from Ohio State Sales ‘Tax. Exemption Certificate is attachedto this contract. 29. All shop drawings and samples, certificates of com- _ pliance with the Specifications, and payroll reports. should be sent to contractors Ohio Office located at 111 East Main Street, New London, Ohio. 30, Certificates of Compliance with Federal Specifica- tions as indicated in the specifications will be required by _ each supplier of material for the job and reference should be made to the Section and the Paragraph of the specifica- tions to which such compliance: is: intended. This certifi- cation should be signed by an official of the manufacturer. — . SECTION 6. . ‘Agreement between Bey paper .. Subcontractor. ‘ Luew esis .. Contractor ene re ee Owner _ “Litedenteecans Architect” = Contract, Price $.. is... a5 000 9 IN WITNESS WHEREOF the parties hereto have ex- ecuted this Agreement, the day and year first above written. JOHN H. EISELE COMPANYInc. _ By: John P. NELSON, Vice President ° KELLER PIER DRILLING CO. ~ ‘By: WILBUR S. KELLER, Pres. — itle) 33a IN THE UNITED STATES DISTRICT COURT - Southern District of Ohio, Western Division Dayton, Ohio — *Givil Action No. 3023 (CAPTION OMITTED) MOTION — (Filed April 27, 1964.) - Now come the defendants and respectfully move this Court that the “above styled action and all proceedings . - herein be stayed until an arbitration shall be had in accord-, ance with the terms of the contract entered into between the use —— and defendant, John H. Encle Company, Inc. For the grounds a: this’ motion, defendants respectfully direct.the Court’s attention to Paragraph No. 5. in the use ‘ plaintiff's complaint wherein the use plaintiff alleges a contract between said plaintiff and the defendant John H. Eisele Company, Inc.,. and attaches a copy of said con- | tract to its complaint marked “Exhibit B”. The Court is then referred to.the said “Exhibit B” and specificalf} Para- graph No. 3 of the said “Exhibit B” which reads as @bllows: — “Any controversy jor claim arising out of or relating to this contract, or the breach thereof, shall be settled by arbitration in accordance with the Rules of the American Arbitration Association, and judgment upon - the award rendered by the Arbitrator(s) may be en- tered in any Court having jurisdiction thereof.” The use plaintiff's complaint alleges certain transactions occurring between the use plaintiff and defendant John H. . ‘Eisele Company, Inc., which give rise to ‘the claim as_set + he. 34a | ‘ Motion io Stay Action forth’ in the use plaintiff's complaint filed the third day. of April, 1964, under the above style. All of said trans- actions: set forth in use plaintiff's complaint arose out of or relate to the aforesaid contact. The use plaintiff has not at any time asked or demanded | of the defendant John H. Eisele Company, Inc., that it .* proceed to arbitrate any alleged claim, @ispute, or right it may have, if any, by reason of the matters and alleged facts set forth in the complaint herein, nor has the. de-_ fendant John ‘H. Eisele Company, Inc;, failed, neglected, or refused to proceed to arbitrate any of such alleged claims. The defendants, therefore, claim that under, and pur- suant to the provisions of the said contract set forth in the | - complaint of the use plaintiff as“Exhibit: B”, and the statutes of the Uniited States ‘in such cases made and provided there- for, this Court is without jurisdiction to proceed upon, or determine the alleged, cause of action set forth in the com- plaint herein, and that the alleged action set forth i in ‘the _ complaint is prematurely brought. . #. WHEREFORE, defendants heréin pray that an order may be entered by- this Honorable Court staying the action - _ and all proceedings herein until an arbitration shall be had: in accordance with the terms of the contract entered into between the use plaintiff and defendant John H. Eisele ‘Company, Inc. (DULY SIGNED WITH CERTIEICATE OF SERVICE.) 35a. % 4 Se a _ (CAPTION OMITTED) | ORDER OF UNITED STATES DISTRICT cou RT° 3 _ (Entered June, 9, 1964.) Now comes the Court and notes that: defendants eeaee 2. filed'a motion to stay all proceedings until an arbitration is.held in accordance with the terms of the contract entered into between the use plaintiff-and defendant John H. | "Eisele Company, Inc. It appears to the Court that the | filing of this law suit was premature and accordingly the - . .. use plaintiff shall file a memorandum within 15: days show- ing cause why this action should. not be dismissed, -CARLA.WEINMAN ss Chief Judge U. S. District Court ei | (CAPTION OMITTED) as MEMORANDUM. OF USE PLAINTIFF OPPOSING THE MOTION OF DEFENDANTS FOR A STAY OF — _ PROCEEDINGS AND F OR ARBI TION, FILED APRIL 27,1964; AND PURSUAN O ORDER OF ‘ COURT ENTERED JUNE 9, 1964 w COMPLAINT {Filed June 24, 1964.) The complaint filed April 3, 1964 contains two aera against the Defendant herein: 1 FIRST “CLAIM containing two unts, alleged juris- diction of the-cause conferred upon the court by Title 40, - _ Sections 270a and 270b of the United States Code. . 4 | 1. The second paragraph thereof alleged construction " eontract DA-15-029-ENG-6241 between: JOHN H. EISELE COMPANY, INC. DEFENDANT and THE UNITED . STATES OF AMERICA, U. S. ARMY ENGINEER © - | 36a | CORPS; LOUISVILLE DISTRICT, for construction of an Air Force Institute of Technology building at Wright Patterson Air Force Base,at the contract price of $2,665,- 218.00, and represented by Exhibit A attached. - 2. .Third paragraph thereof alleged Defendants AMER- ICAN REINSURANCE COMPANY and THE BUCK- EYE UNION CASUALTY CO., as sureties and DEFEND. —_ ANT JOHN H. EISELE COMPANY, INC. as’principal, executed ‘a standard form of payment bond to the United States ‘government ‘wherein such suréties. would remain ’ liable for the amount of said bond if the named principal ' failed to make promptly payments to all persons supplying labor or materials. : 3. Fourth paragraph thereof alleged acceptance of tach bond by the United States government. 4. Fifth paragraph thereof alleged execution .of sub- contract 251- 3 by DEFENDANT JOHN H. EISELE COM- PANY, INC. and USE-PLAINTIFF KELLER PIER DRILLING CO., attached thereto as Exhibit B and dated January 16, 1963.- 5. Section 1 of such sub-contract viata Use-Plaintift to “supply material and perform all work as described in Section 2 thereof for the United States of America (therein- after called the Owner), at Wright Patterson Air Force Base, Ohio, in accordance with the general conditions of — — the contract betweensuch Owner and JOHN H. EISELE | GOMPANY, INC. therein named Contractor, and in ac- cordance with Supplementary General Conditions, the . Drawings and Specifications prepared by Grifels & Ros- setti, Inc., and U. S. Army Engineer District, Louisville . Corps of Engineers, Louisville, Kentucky thereinafter called Architects, all of which General Conditions, Draw- © ings and Specifications, signed by the parties thereto or identified by the Architect, form a part of the contract be- tractor States: | . ae ae . * Memorandum of Use Plaintiff Opposing. Motion for Stay / tween the Contractor and the Owner dated November 30th, 1962 and hereby become a part of this contract”. Aemphasis added) 6. Section 2 of such subcontract stated 0 Tree subject to approval of the Architects and Owners”. 7. Exhibit B reflects -the unilateral action of the De- fendant Contractor ifsérting without spegial notice to Use- Plaintiff of pages 2-A, 2-B preprinted pages, and the spe- cially typed page 2-C and making such, ‘subcontragt si | to said such pages. 3 / 8: Exhibit A (Contract # DA-15.029- ENG- 6241) ‘waile a part of such subcontract Lapedes Section 2: Specifica- | tions; and Drawings; Section 4: CHanged Conditions; Sec- tion. 3: Changes; Section 5: Termination for ¢ default-dam- , _ ages for delay, Time Extension; S¢ction 6: Disputes; Section 9: Materials and Acceptance; S¢ction 10: Inspection and | ‘ Acceptance; Section 21: Nondiscfimination i in Employment, certain exclusive procedure for government of the parties... thereto. as ‘to terms, conditions) and performance | and obli- gations. — | 9, : Section 1 of Page 2-A ‘inserted by Defendant Con- “The Standard Form of the .General Conditions of the Contract of the American Institute of Architects . is made a part of the Specifications and of the ~ ‘ contract and shall govern the execution of the work . and all questions ie thereunder, except where | stated to the contrary . pages 2A and 2Bherein.”. ~ 10. Sestion 3 of said insertion. states: “Any controversy or claim arising out of or ‘relating to this contract or the breach thereof, shall be settled ‘by arbitration in accordance with the Rules of the Ameri- . can Arbitration Association, .and judgment upon the 38a Sinica: “ol Won: Weis Ginn Wiiitaas tay tant . “award rendered by the. Arbitratar(s); may be entered . in any court having Jurisdiction thereof.” - " However, specially typed continuation of page 2- B (en- _ titled -2-C) inserted solely. by Defendant ‘Gampenctor into ~ such sub-contract states: dc e “25. There are incorporated by reference in this subcontract, with like force and effect as if the same were stipulated herein at length, all of the terms .and-- conditions of the contract between the general con- tractor and the. United States of: America, ‘dated No- vember 30th, 1962 and bearing contract No. DA-15- 029-ENG-6241. Wherever there.shall be any discrep- ancy or difference in the terms and provisions thereof : between the said general contract and the standard form of general conditions of the contract of the Amer- ican Institute of Architects 1958 edition (together with these general contractors additional insertions as modi- fied), then and, in such event, the provisions of the . - general contract between the ‘general contractor and the said United States of America, shall govern.” “26.; The subcontractor agrees to. perform this con- tract in strict accordance with the General Provisions (Standard Form 23-A, April 1961, pages 1 through 16. inclusive) Labor Standards Provisions (Standard form 19-A), and | the following designated specifications, | Additionally Section 5 of the said sub-contract states: schedules, drawings, and conditions . . .”- -“The contractor and subcontractor agree to, be bound by the terms of the Agreement, the General Condi- tions, Drawings, and Specifications as far as applicable to this subconttact, and also Me the following provi- sions: The Subtomenictos: agrees— a) - To be bound to the Contractor by the terms of the Agreement, General Conditions, the Drawings and Specifications, and to assume toward him all thé obli- ~ 39a | | | Memorandem of Use Plaintiff Opposing Motion for Stay gations and responsibilities that he, by thoge documents ., assumes toward the Owner. c) * * * The Contractor agrees— ° 7 Me d) To be bound to the Subcantractor by all the obli- gations that the Owner assumes to the Contractor under the Agreement, General Conditions of the Con- tract, the Supplementary General Conditions, the Drawings and Specifications, and by all the Provisions thereof affording remedies and redress to the Contract- . or from the Owner. *. * * ly. That no claim for services rendered or materials ‘furnished by the Contractor to the Subcontractor shall be valid unless written notice thereof is given by the Contractor to the Subcontractor during the first 10 ,days of the calendar month following that in which the claim originated.” ‘Also Section 6 of the said i insértions by the Contractor, * namely 2-A states: ~ The Sheuicel must have sufficient men, ma- terials, and, equipment on the job at all times in: ~ _ order to properly carry out the work (in the judgment _ ___Of the contractor). Should the Subcontractor at any time delay the progress of the work-{in-the-judgment-———— of the Contractor) then the Contractor has the right tq hire men and equipment and to buy all necessary materials in order to carry on the work properly, and to charge all costs involved in doing so to the Sub- contractor; it being only necessary for the Contractor to notify th te Subcontractor by means’ of the “three days’ notice” by registered mail to the Subcontractor’s address, in order to exercise the above mentioned right.” (Emphasis added.) i. Paragraph 7 alleged Defendant Contractor in de- fault of payment according to its contracts and under such > 4 - @ +. - &, @ 3 ate | 40a Memorandum of Use intiff Opposing Motion for Stay bond contract accepted by‘thé’Plaintiff herein for the bene- fit of ‘ Use-Plaintiff and other subcontractors — similarly situated, such subcontractors obtained a right to sue on such bond furnished by Defendant’s sureties herein pur-— suant to Title 40, Sections 270a; and 270b, United States Code. oe: 3 Paragraph 8 alleged one year had not elapsed, show: ing compliance with said Section 270b. "13. Paragraph 9 alleged work and labar had been per- _ formed and equipment furnished in thé Southern District ~ of Ohio in conformity with said Section 270b (b). 14. Paragraphs 2, 3, 4, 5, as well as 1, of the Second Count. alleged a separate claim for, payments under a _ separate written instrument for correction of a pier hole location and not under subcontract 251-3. 15. . The Second Claim of the Use-Plaintiff alleges juris- diction of the case under said Sections 270a; and 270b. 16. Paragraph 5 states no time as specified for’ com- " . mencement nor completion of the work and that Use-Plain- .. tiff offered to commence work on February 12, 1963 with ~ approval of Defendant. Contractor. Paragraph 7 alleges the defense of adverse. idee adie said contract DA-15-029-ENG-6241 to the claim of De-., fendant Contractor that Use-Plaintiff had failed to perform its contract but. that Use-Plaintiff continued to perform | beyond those obligations ae of _ ity: requests of Defendant. Paragraphs 8 and 1] sain that deine ‘iti weather ___had_a claim against -Use-Plaintiff-in that “Use-Plaintiff was stated as not keeping sufficient men and equipment on the job; and. terminated the balance of Use-Plaintiff’s work by a letter of notice dated March 7, 1963 and which letter. was . . not delivered to Use-Plaintiff until March 11, 1963; ‘that . . delaying Use-Plaintiff, Defendant Contractor insisted a Ala -. ; ‘k | Mamorandom of Uso Plaitit Oppesing Motion for Stay’ Deferidant had prior thereto engaged another subcontractor. to replace Use-Plaintiff on or about March 3, 1963 and had . entered into an agreement dated. March 8, 1963. — ~ Paragraphs 9 and 10 of said Second Claim alleged claims Use-Plaintiff had against Defendant Contractor and which claims would be defenses in favor of Use-Plaintiff under ‘Clause 4 of Contract DA-15-029-ENG-6241 against any - alleged delay, and which claims as well as those allegedly of Defendant Contractor were ‘subject to arbitration,. but for the inclusion of DA-15-029-ENG-6241, its terms, condi- ° tions and remedies into the subcontract; as well as those special provisions of subcontract which confirmed that the contgact DA-15- o29ENG 624] would govern. i "WAIVER. The affidavits annexed hereto reflect the actions of the Use-Plaintiff and ‘Defendant Contractor as. follows: . 1. The Defendant Contractor breached its own contract ~ (251-3 subcontract), by requiring Use-Plaintiff to perform beyond those requirements imposed by such contract and __by the contract DA-15-029-ENG-6241, and by the Defend- | ant acknowledging that such Defendant had a claim or con- troversy against the Use-Plaintiff but by said Defendant refusing and failing to call for arbitration at any’ time. _ 2. The Defendant Contractor breached its-own agree- ment to arbitrate, if there was such a requirement on the — parties to arbitrate, in that Defendant submitted its ‘claim to. Use-Plaintiff_ to provide for a performance bond, -and . to terminate Use-Plaintiff’s work balance by wiitten notice, © without requiring arbitration of such claim, resisted by Use-Plaintiff. : aol 3. “The Defendant breached its own agreement not say as to give proper notice to Use-Plaintiff, but also. Defendant Contractor's obligation to arbitrate any claim of lack of ee Re aN te Lk 2 Momarandom of Use Plaintif Opposing Matin for Stay _ sufficient men and equipment, when such Defendant en- tered. into a-contract with another. subcontractor, on or ‘about March 3, 1963; four days before date of the letter , of Defendant, and 8 days before Usé-Plaintiff received such . letter of notification, That Defendant should have firstly, if it had a justifiable claim against Use-Plaintiff, have noti~ fied’ Use-Plaintiff. first and then hired other = persons and equipment following three days notice, - 4... That Defendant breached its own agreement with : | - Use-Plaintiff that- when ‘contacted by Counsel for. Use- 7 Plaintiff, the President of Defendant Contractor, one James --— Conforti, Jr. met with such counsel at Dayton, Ohio on | March 21; 1964 and discussed ways to settle the. dispute between Use-Plaintiff and such Defendant, and when ap- . proached-with the method of using U. S. governmental “administrative procedures set forth in said contract #DA- 15-029-ENG-6241, and when asked permission to institute such procedure as Use-Plaintiff had: no privity of contract _ with the’ United States whereas: Defendant did, and said. pe rae: “President of Defendant’ advised that he would firstly have ° ° . . , * ° » BPR re mr apapc nitions chesemencce ire a senees Sane a letter on behalf of Use-Plaintiff to the effect that Defend- ant would not be deemed by Use-Plaintiff to have prejudiced Defendant's rights by | pursuing such administrative action - .. before the,.Contracting Officer at Louisville, Kentucky . . under the procedures set forth in such Principal Contract. © ‘_ New York City; between ms Washington, D. Cc. and New York ~ - That certain meetings were held between counsel for Use- Plaintiff and“ Defendant, namely said president and a: Vice . President, John Nelson at New York City; State of New - York, all to the effect to induce Use-Plaintiff in the belief = Defendant would institute such action for administrative relief; that counsel for Use-Plaintiff had. telephoned con-’ ‘ versations with Defendant. through its said officers on vari- ‘ous occasions between the points of Cincinnati; Ohio and dee Ce oe ; o ? 43a ; Memorandum of Use Plainiif Opposing Motion for Stay City and between’ Dayton, Ohio and New York City. That as. time approached for termination of the right of Use~ - Plaintiff to file suit on the bond of Defendant for payment,. that Defendant represented to Counsel for Use-Plaintiff that Defendant would supply the bond number and the . _ names of the sureties, until 's several days. before the suit “° "herein was instituted. That on March 25, 1964, Use-Plain- tiff. submitted to Defendant: its written statement that -join- ing in such action for administrative relief of behalf of Defendant, would not be held asa waiver of right of De- fendant to bring claims against Use-Plaintiff if Defendant might have such or any claim. That Use-Plaintiff had communicated. to Defendant that' as time for filing suit on the payment bond of Defendant was terminating, that Use- Plaintiff would attempt to institute the suit to protect itself, and: during such. interim Use-Plaintiff and Defendant might seek an adjudication of the right of Use-Plaintiff before the Contracting Officer at Louisville, under proper contract administrative procedures, until several days before termi- nation’ of Usé-Plaintiff’s right to enforce payments rights . _ om said bond through court action, at which time Defend- “ant failed, neglected and refused, to supply such bond, number, name of sureties or terms thereof to Use-Plaintiff. That because of such unfair dealings of a large corporate Defendant having many experiences with governmental procedures and construction. contracts whereas Defendant | suffered its first experience under a United States govern- ment contract, and - attempted to perform fully all the terms and. requirements written therein as well. as those additionally imposed by Defendant, and looking to De- * fendant’ to obtain corrective relief for Use-Plaintiff under ‘the. remedial sections of Contract DA-15-029-ENG-6241 as — . only Defendant had privity of contract with the United * States of pany Use-Plaintiff w was induced by the actions 3 44a | -” Mamorandese of Use Plaintif Opposing Motion for Stay. - ; of Defendant tepudiating the requirements placed on De- ~ -" fendant.and to attempt'the only method remaining to Use- Plaintiff: to file suit im court on. the payment bond of ~ . Defendant and forego administrative relief under ‘the Principal contract as well as any possible relief under -_ subcontract, of which no femedy ‘existed. = sa 4. That Defendant waived any right it ever : had, te ae unilaterally i inserting into such subcontract the requirement that the Contract DA-15-029-ENG-624 ould govern the rights of the parties, arid the additional provisions into such: _ subcontract, confirming such specially typed requirement.. « . 5. That under the “Standard form of General Condi-. tions of the Contract of the American Institute.of Archi- tects’ requirements; requiring timely notice of arbitrations, as Section 40 thereof states: “Notice of the demand for arbitration: of a 1 dispute.“ | shall be filed in writing with the other party to the contract, and a copy filed with the Architect. The. demand for arbitration shall be made within’ a: reason- able time after the dispute has arisen; in no- case, how- . ever shall the demand be made later than the-timeof _. final payment, except as otherwise re, stipulated — in the contract. ve _ THE LAW Title 40, Section 270b (b) . _ “Every suit shall be ee in the name » of the United States for the use of the person suing, in the ‘United States District Court for any district in which | the contract was to be performed and executed and . not elsewhere, irrespective of the amount in contro- ~ versy, but no suit shall be commenced after the ex- . piration of one year after the day on which the last of. the labor was eae or.material was supplied Mm ° > 45a " Mamerandom of Use Plaintit Opposing) Mation for Stay him. The United States shall not be liable for the pay- ... ment of any costs or — of any such suit.” —— ARTICLE Ill, SECTION 2. Constitution as the: United _ States of America states:. “Section 2. The indicial power shall ne ‘to all - Cases it Law and Equity, arising under this Constitu- tion, the laws of the United. States, and Treaties, made or which shall be made under their Authority; . . . to Controversies in which the United es shall bé ° a party; ... te , ; * Title 28, Section 1345, United ies Code, states: “Except as otherwise provided by Act of Congress, the. district courts shall have original jurisdiction: of all: civil suits, actions or proceedings commenced by the United States, or by any agency or officer thereof-ex- pressly authorized to sue by Act of Congress.” rae _(see United States Fidelity & Guaranty Co. v. United |. States, 204 U.S: 349; 27 S. Ct. 381, 51 L. Ed. 516,'to. - _ «the effect that suit-on a surety’s bond on behalf of per- sons supplying labor or materials, and brought.in the . -name of the United States, that such Plaintiff is a real ~ and not 7 a nominal party) TITLE 9; “ARBITRATION, detain 2, United States we, | Code states: | “A written provision (in any maritime transaction or ‘ a contract evidencing a transaction involving com- merce) to settle by arbitration a controversy thereafter arising, out of such contract, or -transaction or the . refusal to perform the whole-or any part thereof, or © an agreement in’ writing to submit to the arbitration in existing controversy arising out of such contract; transaction or refusal shall be valid, irrevocable and enforceable, save upon such grounds as exist at law or in im enpeey for the revocation. of any contract.” 0 > 46a . UO Memerinden of Ue: Plaintiff Opposing Motion for ‘Stay Section 3 of said.'Title ee “If any suit or proceeding be brought in any of the courts of the United States upon any issue referable to arbitration under an agreement in writing for such arbitration, the court in which such suit is pending, _-upon being satisfied. that the issue involved in such suit or. proceeding is referable to arbitration under such agreement, shall on application of one of the’ parties, stay. the trial of the action until.such arbitra- tion has been had.in accordance with the terms of the agreement, provided the applicant for the stay is not in — default in proceeding with such arbitration.” (Em- — phasis added). TITLE 28, Section 1 352 United States Code states: ' “The District Courts shall have original jurisdiction concurrent with State Courts, of any action on a bond executed under any law of the United States.” APPENDIX, RULES AND REGULATIONS IMPLE- MENTING TITLE 41, PUBLIC CONTRACTS, states: “Section 52. 6 DISRU'TES All questions and disputes with respect to contract performance, payment and ‘procedure should be re- ferred to the contracting officer concerned, through an inspector if available at the premises, in the absence of-a special instruction or notice received in particular cases. Determinations of the contracting officer are . ordinarily reviewable, in the manner prescribed by the Secretary of the, Treasury or such representative. as he may, designate from time to time. No special . , forms are required to submit questions, disputes and ‘claims, or appeals from the determination thereof. Howevef, claims for amounts due deceased contractors must be filed on Standard form 1055 (Revised), ‘Claim against the United States for amounts due in the case of a Decedent.. ‘s ; 47a Memorandum of Use Plaintiff Opposing Motion for Stay | TITLE 9 ARBITRATION, SECTION 4. FAILURE TO ARBITRATE UNDER AGREEMENT: PETITION TO UNITED STATES COURT .HAVING JURIS- . DICTION FOR ORDER TO COMPEL ARBITRA- TION: NOTICE AND SERVICE THEREOF: HEAR- . ING-AND DETERMINATION, states: ia 6 “a party aggrieved by the alleged failure, neglect or refusal of another to arbitrate under a written agree- © ment for arbitration may petition any United States District Court which, save for such agreement would have jurisdiction under Title 28, in a civil action or in admiralty, of the subject matter of a. suit arising ‘out of the controversy between the parties, for an _ order directing that such arbitration proceed in the thanner provided for in such agreement. Five days notice in writing of such application shall be served upon the party in default. Service thereof shall’ be made in the manner provided by the Federal Rules of Civil Procedure. The Court shall hear the parties, and upon being satisfied that the making of the agree- ment for arbitration or the failure to comply therewith - is not in issue, the court shall make an order directing the parties to proceed to arbitration in the manner in accordance with the terms of the agreement. The hearing and proceedings, under such. agreement, shall _ be within the district in which the petition for an order directing arbitration is filed. If the making of _ the arbitration agreement, or the failure, neglect, or refusal to perform the same be in issue, the court shall proceed summarily to the trial thereof. If no jury trial be demanded by the party alleged to be in de- fault, or if the matter in dispute is within the admiralty jurisdiction, the court shall hear and determine such issue. Where such an issue is raised, the party alleged to be in default, may, except in cases of admiralty, on or before the return day of the notice of the applica- tion, demand a jury trial of such issue or issues, and _ upon such demand, the court shall make an order re- ‘8a ) Memorandum of Use Plaintiff Opposing Motion for Stay ferring the issues to a jury in the manner provided by the. Federal Rules of Civil Procedure, or may ially call a jury for that purpose. If the jury find t no agreement for arbitration was made or that there is’ no default in the proceeding thereunder, the proceeding shall be dismissed. If the jury find that an agreement for arbitration was made in writing and — there is a default in proceeding thereunder, the court shall make an order summarily directing the parties to proceed with arbitration | in accordance with the _terms thereof.” RULES OF THE UNITED STATES DISTRICT COURT, SOUTHERN DISTRICT OF OHIO, RULE 7, MOTION AND MOTION DAYS: “1. There shall be Sled with each motion a brief state- ment of the grounds of the same, with citations of authorities relied upon, and failure to do so shall be good ground for striking the motion from the files for want of ccmearn re a LOCAL NO. 1505, INTERNATIONAL BROTHER. HOOD OF ELECTRICAL WORKERS AFL-CIO, IN-— TERVENOR VS. LOCAL LODGE OF DISTRICT 38 of THE INTERNATIONAL ASSOCIATION OF MA- CHINISTS, AFL-C1O, ET AL., Raytheori, United States Court of Appeals | First Circuit, May 3, 1962, 304 F2d 365, held: o “We believe that the exclusive jurisdiction to resolve’ | the conflict between the parties is within the Labor Board whose certifications have permitted these over- lapping claims. It is true that no unfair labor practice has been committed. . . . Even had there been, this | might not pre-empt the District Court's jurisdiction 29 U.S.C.A. #185. . . A union by contract with an employer cannot define the scope of that certification. That is the 49a Memorandum of. Use Plaintiff Opposing Motion for Stay court’s function . | . Not only has: the Board made - necessary clarifications in the past . . . but jurts- dictional es ic between unions are precisely it’s province. . . . It is appropriate that its jurisdiction be exclusive.” LOCAL NO. 725, INFERNATIONAL UNION OF OPERATING ENGINEERS VS. STANDARD OIL . COMPANY OF INDIANA, District Court North Dakota, 1960; 186 F. Supp. 895 which held: / “1, Arbitration is a matter of contract and_a party cannot be required to submit to arbitration any dispute which he has not agreed so to do. ‘For arbitration is a matter of contract and a party is not required to - submit to arbitration any dispute which . he has not ' agreed ‘so to submit.” .“9. The courts have the exclusive jurisdiction to determine whether the reluctant party has breached — its promise to arbitrate — this is not a question to be . up to the arbitrator . ...” “6. The arbitration agreement being a matter of con- tract should be interpreted in accordance with the in- tentions of the parties as therein expressed and in the light of the facts and circumstances surrounding the negotiations for and execution of the agreement.” __ “A specific collective bargaining agreement may ex- clude contracting out from the grievance procedure or a written collateral agreement may make clear that the excluding out was not a matter of arbitration. In such a case a grievance may not when contracting out ' be arbitrationable.” . | RADIATION SPECIALTY COMPANY VS. CANNON _ MILLS, Circuit. Court of Appeals, 4th Circuit, 1938; 97 F2d 318 which held on the facts where the Defendant made an election not to seek arbitration initially: ‘Here’ when the Plaintiff chose to ignore the arbitra- ~ 50a ne Memorandum of Use Plaintif Opposing Motion for Stay tion clause in the sales contract, the Defendant did not immediately, as was its duty as if it intended to rely on the arbitration clause, assert its intention to en- force the arbitration; on the contrary the Defendant ‘appéared and filed an answer to the complaint . More than three months afterwards the Defendant ap- ‘peared and filed a motion for an order for continuance that a witness was absent . . . and it was not until six months afterwards and on the day expressly agreed upon that the trial was to be had that the Defendant . without giving notice filed its motion to stay the trial pending arbitration which it then sought to enforce. _ By its course the Defendant waived its right to arbi- tration under the clause in the contract and was in » default in proceeding with arbitration and in the case of ZIMMERMAN VS, COHEN, 236 NY. 15, 139 NE 764, will be found a discussion of similar facts. There the court said, page 765: Plaintiffs’ by bringing the action ignored this provision of the contract; they made no reference to it in their complaint. Defendants under provisions of the arbitration law could have applied to the court to enforce arbitration and stay . all proceedings in the action and instead of doing so the Defendant answered; the Defendant ‘went even further and made a counterclaim setting up a demand for judgment against the Plaintiffs in a large sum , Whatever right the Defendant might have had under the arbitration clause and the arbitration law to enforce arbitration he deliberately waived; he chose and elected to proceed by action in court for the deter- mination of the respective claims. While the Arbitra- tion Law provides for the: enforcement of arbitration agreements there is nothing in the law which pre- vents the parties agreeing between themselve$ to resort to any other method of settlement; the law does bar the parties from coming into the court of the state if they mutually choose to do so.” | bla : Memorandum of Use PistalitipOppesing Motion for Stay _AMERICAN GUARANTY COMPANY VS. CALD- WELL, Circuit Court of Appeals, 9th Circuit, 1934 where: | in a party agreed that a certain: arbitration method would be followed; however when the:claim or dispute arose that __. party did not follow the method of arbitration and the method of arbitration set out in the contract was abandoned. | That court held: . “The Federal Court acquired jurisdiction of the pro- ceedings when confirmation of the arbitrators’ award - was transferred thereto from the state court had juris- ~ diction to set aside the first award . . . Courts generally will not construe arbitration agreement as ousting them of jurisdiction unless such construction is _. ' inevitable, TITLE 9 ARBITRATION ACT, USS. C.A. Section 1 et sequor.” ae . UNIAO DE TRANSPORTADORES PARA IMPOR- TACAO E’ COMMERCIO LTDA COMPANHEA DE NAVAEGACAEO CARREGADORES ACRRAGADO- RES, District Court of New York, 1949; 84 F. Supp. 582 which held dnder an agreement to arbitrate: “ ' “Under the Federal Arbitration Act an arbitration agreement may be repudiated, waived or abandoned by one or both of the parties. But even in such case where one party seeks to do so, the other has the right to plead the agreement as a defense. and such a stay does not oust the court of jurisdiction but provides for maintaining its jurisdiction.” © ; PA THE LABORATORIES VS. DU PONT FILM CORPORATION, District Court of New York, 3 Federal Rules Decisions 11, January 16, 1943 and where the De- — fendant agreed simultaneously with Du Pont De Nemours to purchase its. supplies from such company and which _ agreement stated that in the event of a dispute the matter . 52a Memorandum of Use Plaintiff Opposing Motion for Stay should be referred to the firm of Price & Waterhouse as to costs, as a defense to the suit.and order for subpoena duces tecum issued by a Master Commissioner at request of -~Plaintiff; held: - “Whether Section 12 is enforceable or unenforceable arbitration clause ‘or whether it is a’ clause for the reference of an incidental issue, it is nevertheless sub- ject to waiver I have concluded that the Defendant -,has waived whatever right it had thereunder. f “It was on Defendants own motion that:a master be appointed to take testimony as to costs and this would mean that Price Waterhouse & Co. would have to’ — perform the same function that. as to some of the - - ‘issues already being heard by the special master. It. is apparent that the Defendant’s request has not been timely made. RADIATOR SPECIALTY COMPANY | _ VS. CANNON _MILLS, 4th Gir. 1938, 97 F2d 318, / 17 ALR 298... ."° TRANSCONTINENTAL & WESTERN “AIRLINES , VS. PARKER, C. C. of Missouri, 1944,:144 F2d 735 where- in the employer and decedent agreed that death benefits would be payable in the maximum Amount under the law ' of Missouri and such payments under such workmen’s com- _ pensation to be payable to employee or his dependents as -. ' provided in ‘said law. The contract also provided for arbitration of:disputes between the employer and. em- ployee, otherwise than as specifically provided shall be determined by a contracting officer of the government or | . State authorized Tepresentative. On action by the widow . of decedent and the Defendant did not file an answer but filed its motion for a stay of the proceedings under Section 3 of Title 9,. Arbitration Action, asking for arbitrations. _- That court held the following: | 53a" | Memorandum of Use Plaintiff Opposing Motion for Stay “neither the employee nor the beneficiary had con- _ tracted with the employer for submission of such dis- _ pute to the arbitration. If the parties to the contract of employment had intended to include such dispute in the arbitration clause, the words “between such employer and employee” should have been omitted . from: the clause. There is.no basis for assuming that therein the clause is not fully and accurately written - __. LOCOMOTIVE COMPANY VS. GYRO PROCESS COMPANY ET AL, United States Court of Appeals, 6th Circuit, November 24, 1950; 185 F2d 316; wherein Gryo Process ‘instituted suit in a Michigan court for breach of contract and. Chemical Process jained in such, and Loco- | motive filed its petition in the Federal District Court for a stay of the. proceeding in accordance with Section 4 of Title 9, Arbitration Act and contended that such section ° -did not permit the court to determine a waiver of the -_ agreement for arbitration and the non-compliance there- with are in issue and that if the court finds that if neither of such facts are in issue then the court must issue an order for arbitration: Held: . Gg . .°We do not agree. We stated on the formér appeal that the contract right of arbitration could be waived .and we have adhered to that conclusion. - GALION IRON WORKS VS. ADAMS, 7th Cir. 128 F2d 411,.413. . . . Section four of the Act merely provides that the procedure for enforcing the right’ provided by the contract, if that right although if - ' originally existing has been ‘lost and does no longer exist, there is nothing for Section fouf* to enforce. : + Filing of the original action by Gyro was notice to | Locomotive that ,Gyro was refusing to arbitrate the . FS . : * ‘ . . i . ? ‘ \ fe . _ -. | i eee Memorandum of Use Plaintiff Opposing Motion ‘for Stay dispute under the arbitration agreement .°. . Loco- motive could lave and should have decided at that - time whether it would insist on which of the two methods of procedure it would elect to follow; either -_ _ insist on the contract, right of arbitration or prepare - for trial by jury. The two methods are inconsistent _ enough to require an election between them. It made no attempt:to enforcé its right under present section four of the act until the present action was. filed. It ‘did not apply for a stay of proceeding under Section . 3 of the Act . . . We agree with the trial judge that such conduct in the’ trial court amounted to a - relinquis!iment of the right to arbitrate. . It is true that an executory waiver being in the nature © of a promise for a contract must be ‘supported by con- sideration to be enforceable; but a waiver taking or the nature of an election, like an election, needs no consideration and cannot be retracted; it takes on. the Mature of an executed transaction.” - AMERICAN SUGAR REFINING COMPANY VS. THE ANACONDA, Circuit Court. of Appeals of Florida, 1943, 138 F2d 765; affirmed 64 S. Ct. 863; 88 L. Ed. 1117. The charter. party agreement provided for arbitration and _ Defendant excepted to the jurisdiction of the couft of the - subject matter insisting the agreement to arbitrate’ ousted the court of jurisdiction. Held: ~ ‘The Act (Arbitration Act of the United States) was passed not to oust the court of jurisdiction but to .. provide for maintaining their jurisdiction while: at ¢ the same time recognizing arbitration agreements are “0 affirmative defenses and providing for a forum for their specific. enforcement. . . . The purpose and effect of Section 8 ‘was to leave in no doubt by Section 4 conferring ‘such right for enforcement of the arbi- tration agreement would-be available as well in suits — - where property was not seized as in those suits where _ property was seized. Courts will not construe arbitra- xu 55a “Memorandom of Use Plaintil Opposing Motion for Stay tion agreements ‘of ousting them of. jurisdiction unless the construction is. inevitable. . . . The agreement did not oust the jurisdiction to entertain the suit. It did not give the appellee the right to have the suit wrong. MURRAY OIL PRODUCTS COMPANY VS. MITSUI -& CO., Circyit Court of New York Appeals, N.Y., 1944; -146.F2d 381. Suit on an oil purchase agreement comm an arbitration .clause; held: “That a provision in a contract containing an arbitra- tion clause affects only the remedy and it is not gov- erned’ by the law of the state wherein the contract was made. If the provision in the New York contract requiring any dispute arising out of the contract to be settled by arbitration ‘was not a condition precedent, it was not a bar to an action to litigate at comimon law on the contract regardless of its legality.” UNITED STATES FOR THE USE AND BENEFIT OF H. W. MOSELEY VS. ELECTRONIC & MISSILE ‘ FACILITIES, INC., ET AL, Supreme Court of United States, 1962 Term, held: “In denying the action on the motion the: District Court held that the Arbitration Act did not apply here since any other holding would nullify the provisions of the Miller Act. . . . We agree that .. . fraud - ‘In the procurement of an arbitration contract ‘like fraud in the procurement of any contract makes it’ void and unenforceable and that this question of fraud is a judicial one which must be determined by the court. To allow this.question to be decided by arbi- tion agreefnent. even though er in the grossest of fraud.” dismissed. The judgment dismissing the suit was. trators would to that extent be to enforce the arbitra- o@ aie Pera 56a Mamerandem of Use Palntit Opposing Maton fr Stay “CONCLUSION Re - 1. ‘That if there was an agreement of the parties for arbitration initially, then by agreement of the parties, par- ticularly by the unilateral action of the Defendant Con- tractor of insorporating the administrative procedures. 7 under such contract of the Government and Defendant #DA-15-029-ENG-6241, as modifying and cancelling such provision; that the séctior of the subcontract Use-Plaintiff specifically nkew the Use-Plaintiff was agreeing to did pro- vide for U.-S. governmental administrative remedies and not for arbitration. 2. That Defendant had. three courses open to it, as ‘it could have initially attempted to arbitrate its earlier claims against Use-Plaintiff, whereas instead, it refused to heed - the claims of Use-Plaintiff for removal of the wires, and the extreme adverse weather; and. instead of arbitrating - such claims as well as any imagined claims of its own Defendant contractor elected to terminate the contract, at the same time urging Use-Plaintiff to perform without ° the benefit of any contract, contrary to any requirement for arbitration, as well as contrary to the rights of the United States government, Section 21, (g) of.said ‘contract. 3. That, Defendant waived any possible right to arbitra- © -tion, if such could be deemed a part of the contract, ‘by - inducing Use-Plaintiff to negotiate with Defendant on the © false promise that Defendant would permit. the Use-Plain- _ tiff. to join with Defendant to seek administrative relief under the provision of contract DA-15029, ENG- 6241; as well of the conduct of the Defendant, well versed in U. S. ° governmental procedures from prior multi contracts, to ? t to cause’ Use-Plaintiff to go beyond the statutory time fpr instituting suit on the payment bond supplied _in default of payment of. the separate written agreement for | 3 Paso ac Cee a §. ‘Fhat the Defendant waived its right under the very . ' General Conditions’ of the Contract of the American Insti- tute of Architects requiring timely demand for arbitration as above set out. 6. That Defendant was a party breaching its own agree- ment for arbitration if suth might be deemed a part of the - subtontract by not calling for timely arbitration but by arbitrarily ‘and unilaterally’ taking its own way in the matter, despite the other terms of the prime contract and the sub-contract, and. being so in default, and particularly | © 4 correction of a pier hole location; not subject to the terms. of the subcontract, and doubtful of government ‘of the _ terms and performance by even the Prime contract, De- ‘fendant could not comply with the terms of Section 3 of the Title 9 ARBITRATION ACT, US.C. 7. Furthermore this contract obligation of the Defend-\ ant under the prime contract to Use-Plaintiff and likewise under the special written agreement as well as that of the subcontract required not arbitrators unversed in law but the determination of the court_ itself’ in construing the orders and regulations of the. Secretary of the Air Force, of the comptroller- general; Board of Contract Appeals, En- gineéring Corps, Court of Claims and Federal Courts of Appeal all of which are highly sophisticated determinations * of Federal Common Law and do not: include ‘ ‘commerce” nor maritime jurisdictional problems, as,,or such contracts Section 1 of Title 9, Arbitration. 8. Furthermore Use-Plaintiff is highly vetiudbied 4f its sole action urider any of its contracts might be dismissed as the Defendant induced Use-Plaintiff to delay any filing on the bond pursuant to Section 270 b of Title 40 until — » ‘> ‘relating to such two classes requiring — under ye b . 58a ao Memorandum of Use Plaintiff Opposing ‘Motion for Stay © the day before the statutory time limit ran, and Use-Plaintiff - would have no remedy against the Defendant's sureties. Furthermore the actions of the parties themselves, the Defendant first and on many occasions:and Use-Plaintiff Ahereafter by filing suit and by acquiescing in seeking ‘administrative relief and by conferring with Defendant’s principal officers, as well as supplying such requested letter to Defendant, and relying on Defendant to institute admin- istrative action directly with the* Contracting officer and ' the Board of Contract Appeals under the ,provisions of Prime Contract DA-15-029-ENG-6241 and the ‘Statutes, Rules and Regulations of the United States Government in such cases made and provided. , 9. That Defendant in attempting to invoke the equity powers of the District must do equity itself and not enrich itself by if not its own wrong, then by its unfair conduct and dealings. 10. That Defendant did not : domnighy with the Statute governing arbitration and failed, neglected and refused to file timely its petition for arbitration, if it ever could _ *be deemed to have had such ‘right under its said subcon- “tract, and in the long delay caused Plaintiff to under great expenses, whereas and in fact the motion of Defend- ant for a.stay pending arbitration is not the procedure required under Section 4 of Title 9 Arbitration Act; which requires a petition of 4 party not in default, with service, of notice timely made and pursuant to the Federal Rules of Civil Procedure, none of which Defendant had done. -l11. That the motion of the Defendant should also be | “3 pee because of noncompliance with the very rules of the Court wherein Defendant is asking assistance in not attaching authorities to support its motion, despite the sworn verifications of the complaint of Use-Plaintiff. » 59a Memorandum of Use Plaintiff Opposing Motion for Stay WHEREFORE Use-Plaintiff through its counsel earn- estly prays the court to overrule the motion of Defendants herein, and to retain jurisdiction of the case and the cause of Use-Plaintiff under the authorities-of the Statute, . rule and authorities above submitted. «Thomas F. Lazaron:of Thomas & Lazaron, ‘Attorneys for Plaintiff (Use) ° 105 Rookwood Building, Cincinnati 2, Ohio PROOF OF SERVICE This is to certify that Thomas F. Lazaron, one of at- torneys for Use-Plaintiff herein, have served a copy of the foregoing Memorandum upon the law firm of Kuhns, Ken- nedy & ‘Platenburg, Attorneys for Defendant at their office at 1506 Hulman Building, Dayton 2, Ohio on June 24, 1964, by personal delivery by said Thomas F. Lazaron. Thomas F. Lazaron of Thomas & Lazaron, Attorneys for Use-Plaintiff = 105 Rookwood Building, ‘Cincinnati, Ohio ad AFFIDAVIT OF THOMAS F. LAZARON SUPPLE- MENTING MEMORANDUM OPPOSING MOTION OF DEFENDANT FOR STAYING PROCEEDINGS - AND FOR ARBITRATION (Filed April 27, 1964.) STATE OF OHIO ; : — } SS: COUNTY OF BUTLER ; Thomas F. Lazaron being first duly sworn according to law deposes and says that he has served as one of the at- torneys for Use-Plaintiff from the inception of employment | of counsel by. Keller Pier Drilling Company, and that he, |. aan is fully aware of all phases of the litigation between the «wre me 60a « . Affidavit of Thomas F. Lazaron said .various parties, and that to the best information and belief of said affiant, Defendant Contractor never requested — nor made demand on Use-Plaintiff for arbitration of the — | disputes existing between the said parties; that of his own personal knowledge affiant knows he met with James Con- | forti, Jr., Esquire whois also President of Defendant con- tractor, in the City of Dayton on March 21, 1964, wherein: Defendant and counsel ‘for Use-Plaintiff discussed proper methods -of settling the dispute ‘arising. under. the ‘provi- sions of Contract DA-15-029-ENG-6241 and that at no — ‘ time did such officer make demand for arbitration; that as the meeting broke up, and understanding said James. Conforti, Jr. also was an attorney of the State of Ohio, on ° "being asked: if said “affiant didn’t believe that in order to be able to file suit under the ‘Miller Act’ it would appear to James Conforti, Jr., Esq., that one should first.seek arbi- tration,” said affiant, also an Attorney at Law of the State of Ohio replied that in his ‘ ‘opinion the procedure would . appear-to be administrative action under the institution and provisions of Contract OEE 241: - and under the ‘Miller Act’.” /s/ Thomas F. afamron Sworn to before me and subscribed i in my presence this 24 _— of June, 1964. i ' .fs/ Helen Johnson Notary Public in and for Butler County, Ohio My Commission Expires July 14, 1967 (Seal) ’ 3 oe Yee tee fi rm roe ae « 6la ORDER OF UNITED STATES DISTRICT COURT (Filed January 11, 1965.) : On June 9, 1964 the Court issued an order for the use plaintiff to show cause why this action should not be dis- missed. Subsequently the use plaintiff filed a memoran- dum which was responded to by defendants. The Court has -carefully considered this, matter arid éoncludes that this action should be dismissed. - The Court ts compelled to reach this conclusion because of the broad arbitration clause which is contained in the. original contract. - That ‘clause provides: “Any controversy ia claim arising out of or relating to this contract, or the breach thereof, shall be settled by arbitration in accordance with the Rules of the American Arbitration Association, and judgment upon . the award rendered by the Arbitrator(s) may be en- tered in any Court having jurisdiction thereof. 38 (Emphasis added). Accordingly, the use plaintiff's comiplainey 1s hereby DIS- MISSED and the parties shall proceed with arbitration. Te ereegeeecezc eevee eoue es aeeeesese eves > Chief Judge U. S. District Court: 4 ar 62a NOTICE OF APPEAL (Filed February 5, 1965.) Notice is hereby given that THE UNITED STATES’ OF AMERICA, Plaintiff For The Use And Benefit of KELLER PIER DRILLING CO., an Ohio corporation hereby appeals to the United States Court of Appeals for the Sixth Circuit from the order of the United States Dis- trict Court for the Southern District of Ohio, Western Divi- . sion, Dayton, Ohio, filed January 11, 1965 at 3:45 P.M., dismissing the Use Plaintiff's Complaint and ordering the -parties to proceed with arbitration. . /s/ Thomas F. Lazaron, Esq. of counsel, Thomas & Lazaron Attorneys at Law. For Appellant 402 Atlas ‘Building 524 Walnut Street Cincinnati, Ohio, 45202 ot C35 ? inate --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385602_1619%3A1. Public record. Not legal advice.