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Allied Constr. Corp. v. Parsons Transp. Group of NY Inc.

Construction Agreement Provides for Mediation Before Arbitration

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This action arises from a dispute over payment for construction-management services provided by plaintiff, Allied Construction Corp., to defendant Parsons Transportation Group of New York in connection with a public-works project owned by defendant New York City Transit Authority. Plaintiff contends that Parsons failed to pay approximately $400,000 that Parsons owed to plaintiff under the terms of their construction agreement. Plaintiff brought this action to foreclose on several mechanic’s liens securing payment from Parsons and to collect on a payment bond guaranteed by defendants Federal Insurance Company, Fidelity & Deposit Company of Maryland, and Zurich American Insurance Company. Plaintiff’s complaint also asserts claims against Parsons sounding in breach of contract, unjust enrichment, and an account stated.1 Three days after filing the original summons and complaint, plaintiff brought this motion to compel Parsons to arbitrate their dispute under terms set forth in the underlying construction agreement. (See NYSCEF No. 11.) The motion is denied without prejudice. DISCUSSION As a threshold matter, although it may appear incongruous that plaintiff is the party seeking to compel arbitration (and to stay its own action pending arbitration), plaintiff has not waived its right to arbitrate by bringing this suit. Plaintiff asserts that it brought the action to preserve its mechanic’s liens and its right to payment under the payment bond. (See NYSCEF No. 18 at 13 [amended complaint]; NYSCEF No. 14 at 7 [affidavit of plaintiff's principal]; NYSCEF No. 12 at

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