Opinion ID: 859475
Heading Depth: 3
Heading Rank: 1

Heading: HCCL’s Complaint

Text: Count I – Removal of Wrongful Construction Lien ¶50. Because HCCL allegedly failed to pay Myrick, Myrick filed a construction lien against HCCL. The trial court did not mention this claim in its order and thus, by effect, ordered this claim to arbitration. HCCL argues that its refusal to pay is based on the building’s unsatisfactory appearance, so the claims are related to aesthetic effect and not subject to arbitration. We disagree. 20 ¶51. The claim stems directly from Myrick’s construction lien filed for nonpayment. We decline to stretch the narrow, aesthetic-effect exception to include this claim. The trial court properly ordered the claim to arbitration. Count II – Slander of Title and Motion for Injunctive Relief Count III – Removal of Cloud on Title Count IV – Abuse of Legal Process in Filing Lien ¶52. In count two, HCCL claimed “[t]he willful and malicious filing of the Notice of Construction Lien on May 27, 2009, constitutes a slander of title against HCCL.” HCCL makes similar claims in counts three and four. Once again, these claims relate directly to Myrick’s construction lien. Thus, the trial court properly ordered these claims to arbitration. Count V – Breach of Contract ¶53. HCCL lodges various complaints in its breach-of-contract claim. Given the general definition of the term, some claims arguably are related to aesthetic effect – performing the work in a sloppy, defective, and/or unworkmanlike manner and failing to submit a comprehensive list of items to be completed. But several other complaints are not related to aesthetic effect – wrongfully filing a construction lien, making unauthorized changes to the work, failing to complete the work in a timely manner, submitting inflated and/or incorrect payment applications, failing to use Mike Penny as project manager, and failing to replace Scott Oliver with H. Gordon Myrick Jr. as project manager. The trial court properly ordered the latter claims to arbitration. Count IV – Negligence 21 ¶54. Like the breach-of-contract claim, some of HCCL’s negligence claims arguably are related to aesthetic effect: negligent construction and unworkmanlike construction. Others are not: failure to complete the project in a timely manner and within budget and deviating from the bid documents.8 The trial court properly ordered the latter claims to arbitration. Count VII & VIII – Fraud and Intentional Misrepresentation Count IX – Negligent Misrepresentation ¶55. In these counts, HCCL alleges that Myrick filed incorrect payment applications, failed to complete the project in a timely and workmanlike manner, and failed to remove Scott Oliver as project manager as promised. These claims are not related to aesthetic effect and thus are subject to arbitration. Count X – Bad-Faith Breach of Agreement and Breach of Duty of Good Faith and Fair Dealing ¶56. HCCL claims that Myrick intentionally misrepresented the payments owed to it, maliciously ceased work to force HCCL to pay, and improperly filed the lien against the building. These claims are not related to aesthetic effect and thus are subject to arbitration. Count XI – Accounting ¶57. To prove whether Myrick submitted false payment applications, HCCL requests an accounting from Myrick. This claim is not related to aesthetic effect and thus is subject to arbitration. Count XII – Injunction to Prevent Further Slander of Title 8 For instance, HCCL alleges that Myrick deviated from the bid regarding heating and air conditioning units. 22 ¶58. As previously stated, the slander-of-title issue relates directly to Myrick’s construction lien. This claim is not related to aesthetic effect and thus is subject to arbitration. Count XIII – Injunction Regarding Arbitration ¶59. In this count, HCCL alleges that the arbitration provision is invalid and unenforceable. As previously discussed in Section I of this memo, the arbitration agreement is valid and enforceable. This issue is without merit. Count IV – Damages ¶60. HCCL requests damages for each of its previous counts. All requests for damages, except those related to aesthetic effect, are subject to arbitration. We specifically address HCCL’s claim for liquidated damages. ¶61. The contract contained a liquidated-damages clause. HCCL claims the issue relates to aesthetic effect and thus is not subject to arbitration. The liquidated-damages clause, which was added by the parties, specifically provides: If substantial completion is not achieved by 210 days after date permit is issued, liquidated damages in the amount of $1,000 per day shall be payable by contractor to owner until such date as substantial completion is achieved. . . If substantial completion is achieved before 210 calender days after permit is issued, an early completion bonus of $1,000 per day shall be paid by Owner to Contractor. Because this claim relates to timeliness (not aesthetic issues), the trial court properly ordered arbitration on the liquidated-damages claim. See Roosevelt Univ. v. Mayfair Constr. Co., Inc., 331 N.E. 2d 835, 848 (Ill. 1975) (finding that a liquidation clause concerns the administration of the contract and thus is arbitrable).