SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-5651-18T3

CLAREMONT CONSTRUCTION

GROUP, INC.,

Plaintiff-Appellant,

v.

KEYSTONE MOUNTAIN LAKES 

REGIONAL COUNCIL OF

CARPENTERS, f/k/a NORTHEAST

REGIONAL COUNCIL OF

CARPENTERS and THE NORTHEAST

CARPENTERS FUNDS,

Defendants-Respondents.

_________________________________

Submitted January 22, 2020 – Decided

Before Judges Yannotti and Firko.

On appeal from the Superior Court of New Jersey, Law 

Division, Somerset County, Docket No. L-0871-19.

Hedinger & Lawless, LLC, attorneys for appellant 

(Robert T. Lawless, on the briefs). 

Kroll Heineman Carton LLC, attorneys for respondents 

(Bradley Mark Parsons, of counsel and on the brief).

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the 

internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.

February 18, 2020
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PER CURIAM

Plaintiff Claremont Construction Group, Inc. (Claremont) appeals from an 

order entered by the Law Division on August 19, 2019 compelling it to 

participate in binding arbitration. We affirm the order insofar as it compels 

binding arbitration, however, we reverse in part and remand to the trial court for 

entry of an amended order dismissing the complaint without prejudice.

I.

Claremont was the general contractor for a project in Jersey City. The 

parties entered into a Project Labor Agreement (PLA) in which they agreed that 

Claremont and its subcontractors would employ union workers. The PLA 

incorporated the terms of the Collective Bargaining Agreements (CBA) of the 

subcontractors and the union, defendant Keystone Mountain Lakes Regional 

Council of Carpenters (Keystone).1

The PLA further provided that the subcontractors would be required to 

pay certain fringe benefits to the unions for the workers. The PLA stated that if 

any subcontractor failed to make a required contribution, Claremont would 

withhold monies due to the subcontractor and pay the unions the amounts 

withheld.

1

 We refer to defendants, unions, and the funds collectively as Keystone.
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Additionally, the PLA provided a three-Step grievance procedure 

covering "[a]ny question, dispute or claim arising out of, or involving the 

interpretation or application of [the PLA] . . . ." Further, the PLA provided that 

all grievances "shall be resolved pursuant to the exclusive procedure" outlined 

therein, culminating in binding arbitration before the designated arbitrator.

Article nine of the PLA sets forth the procedure for grievances and 

arbitration:

If the grievance shall have been submitted but not 

resolved in Step [two], any of the participating Step

[two] entities may, within [twenty-one] calendar days

after the initial Step [two] meeting, submit the 

grievance in writing (copies to other participants) to J.J. 

Pierson, Jr., Esq. who shall act as the Arbitrator under 

this procedure. The Labor Arbitration Rules of the 

American Arbitration Association (AAA) shall govern 

the conduct of the arbitration hearing, at which all Step

[two] participants shall be parties. The decision of the 

Arbitrator shall be final and binding on the involved 

Contractor, Local Union and employees and the fees 

and expenses of such arbitrations shall be borne equally 

by the involved Contractor and Local Union.

The general contractor has the option to "participate in full in all 

proceedings at these Steps, including Step [three] arbitration." The PLA also 

provides that if the general contractor participates in the grievance, it "shall be 

part[y]" to any following Step three arbitration. (Emphasis added). The PLA 

states:
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Should any Contractor or Subcontractor or the General 

Contractor become delinquent in the payment of fringe 

benefits as required by this agreement, it is agreed that 

General Contractor and/or Owner will be notified in 

writing by authorized representatives of the involved 

union via certified mail of the specific documented 

details of such delinquencies. Upon receipt of such 

certified mail notice, if the delinquency has not been 

paid, General Contractor and/or Owner agrees to 

withhold from outstanding monies due an alleged 

delinquent Contractor/Subcontract/General Contractor 

the amount claimed, or less if the amount due is less 

than the amount claimed by the union. The amount 

withheld will be paid by the General Contractor and/or 

Owner within fourteen . . . days after receipt of an 

arbitration award or order of a court of competent 

jurisdiction by the union, if not paid prior to said date 

by the delinquent Contractor/Subcontractor/General 

Contractor. With respect to the amounts owed by 

Contractors or Subcontractors pursuant to the relevant 

union agreements, the withholding of monies owed to 

Contractors as provided in this paragraph shall be the 

General Contractor’s sole responsibility.

Sky High Management, LLC (Sky High) was one of Claremont's 

subcontractors. Between September 2017 and August 2018, Sky High became 

delinquent in its payments of fringe benefits for its workers, and Keystone 

notified Claremont. In response, Claremont withheld approximately $440,000 

in monies due to Sky High's malfeasance and paid these monies over to 

Keystone.
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In August 2018, Sky High owed an additional $180,250.53 for the 

workers' fringe benefits. Claremont was notified of Sky High's delinquencies 

on August 24, 2018 and terminated Sky High's subcontract. The August 24, 

2018 notice triggered Claremont's obligation to withhold outstanding monies 

owed to Sky High as set forth in article eleven of the PLA. Citing a provision 

of the contract, Claremont asserted that no additional monies were due to Sky 

High. Keystone's communications with Sky High and Claremont satisfied Step 

one of the grievance procedure.

In December 2018, following an unsuccessful resolution of the matter, 

Keystone initiated a grievance proceeding with Sky High for the fringe benefits 

due under the contract. Claremont participated in the Step two meeting and 

asserted it had no obligation to pay Keystone because it had terminated Sky 

High's contract and Sky High was not entitled to any additional payments under 

the contract.

On June 11, 2019, Keystone demanded arbitration under Step three of the 

PLA's grievance resolution process, which prompted Claremont to file this 

lawsuit and to enjoin the arbitration process. After hearing oral argument on 

August 19, 2019, the trial court entered an order dismissing Claremont's 

complaint with prejudice and compelling the parties to proceed to binding 
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arbitration. On the record, the trial court reasoned that "the way that the contract 

is written, the [c]ourt [must] favor the fact that the . . . binding arbitration is 

really what has occurred here by use of the [S]tep two grievance procedure by 

Claremont in reference to this matter."

On appeal, Claremont challenges the order compelling arbitration.

Claremont argues that the PLA does not obligate it to participate in binding 

arbitration and there is no language in the PLA supporting the trial court's 

conclusion. We are not persuaded by Claremont's arguments.

II.

We use a de novo standard of review when determining the enforceability 

of arbitration agreements. Goffe v. Foulke Mgmt. Corp., 238 N.J. 191, 207 

(2019) (citing Hirsch v. Amper Fin. Servs., LLC, 215 N.J. 174, 186 (2013)). 

The validity of an arbitration agreement is a question of law, and we conduct a 

plenary review of such legal questions. Atalese v. U.S. Legal Servs. Grp., L.P., 

219 N.J. 430, 446 (2014) (citing Hirsch, 215 N.J. at 186); Barr v. Bishop Rosen 

& Co., 442 N.J. Super. 599, 605 (App. Div. 2015) (citations omitted).

It is also well-established that this State has a strong public policy 

"favoring arbitration as a means of dispute resolution and requiring a liberal 

construction of contracts in favor of arbitration." Alamo Rent A Car, Inc. v. 
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Galarza, 306 N.J. Super. 384, 389 (App. Div. 1997) (citing Marchak v. Claridge 

Commons, Inc., 134 N.J. 275, 281 (1993)). However, the scope of arbitration is 

governed by the agreement of the parties. Young v. Prudential Ins. Co. of Am., 

Inc., 297 N.J. Super. 605, 617 (App. Div. 1997); Singer v. Commodities Corp.

(U.S.A.), 292 N.J. Super. 391, 402 (App. Div. 1996) (quoting Cohen v. Allstate 

Ins., 231 N.J. Super. 97, 101 (App. Div. 1989)) ("[T]he scope of arbitration [is] 

dependent solely upon the parties' agreement."). 

Courts should review whether the arbitration clause explicitly states its 

purpose "to assure that the parties know that in electing arbitration as the 

exclusive remedy, they are waiving their time-honored right to sue." Marchak, 

134 N.J. at 282. Thus, "only those issues may be arbitrated which the parties 

have agreed [to arbitrate]." Singer, 292 N.J. Super. at 403 (quoting Grover v. 

Universal Underwriters Ins., 80 N.J. 221, 229 (1979)).

Here, the CBA and PLA were negotiated and agreed to by Claremont. The 

PLA provides that the general contractor may participate in all grievances and 

Claremont voluntarily did so. In addition, the PLA states that any of the entities 

who participate in the Step two process qualify to submit the dispute to binding 

arbitration, to be conducted in accordance with the "Labor Arbitration Rules of 

the [AAA]."
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Saliently, under Article nine of the PLA, Claremont's decision to 

participate in Step two of the process subjects Claremont to arbitration with the

AAA. In our view, the trial court correctly found that once Claremont chose to 

participate in Step two, Claremont committed to arbitrate at Step three. In 

rendering its decision, the trial court placed the issue in the proper context—that 

arbitration has long been a favored method of dispute resolution particularly as 

it relates to labor disputes. Cty. Coll. of Morris Staff Ass'n v. Cty. Coll. of 

Morris, 100 N.J. 383 (1985).

Applying these principles, we reject Claremont's argument that since it 

did not initiate the Step two meeting it cannot be compelled to arbitrate. It does 

not matter whether Claremont or Keystone initiated that process. Since 

Claremont participated in the Step two meeting and Keystone properly sought 

arbitration of their dispute pursuant to the express terms of the PLA, the trial 

court correctly compelled arbitration.

We conclude that Claremont's remaining arguments—to the extent we 

have not addressed them—lack sufficient merit to warrant any further discussion 

in a written opinion. R. 2:11-3(e)(1)(E).

While the trial court correctly ordered the parties to arbitrate their dispute, 

the court erred by dismissing the complaint with prejudice. Since there was no 
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adjudication on the merits of the complaint, the trial court improperly exercised 

its authority under Rule 4:37-1(b). We therefore remand to the trial court, with 

directions to enter an amended order, dismissing the complaint without 

prejudice.

Affirmed in part, reversed and remanded in part. We do not retain 

jurisdiction.