In HRH Constr. LLC v. MTA, 33 A.D.3d 568, 569, 823 N.Y.S.2d 140 (1st Dept 2006), defendant MTA and HRH Construction Interior, Inc. entered into a construction management agreement.
As a result of an arbitration proceeding between the parties, MTA learned HRH Construction LLC had taken over HRH Construction Interior Inc.'s performance of the CMA. The MTA moved to join HRH Construction LLC in the arbitration. (HRH, 33 A.D.3d at 568.)
The First Department held that since HRH Construction LLC undertook the obligations under the construction management agreement and derived a direct benefit of receiving over $7 million for its performance of the construction management agreement, HRH Construction LLC was estopped from avoiding the agreement's obligation to arbitrate. (Id.)