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Saturn Constr. Co. v. Landis & Gyr Powers, Inc – Case Brief Summary (New York)

In Saturn Constr. Co. v. Landis & Gyr Powers, Inc., 238 AD2d 428, 656 N.Y.S.2d 367 (2d Dept 1997), the court found that there was no "express and specific" agreement to arbitrate a dispute between a general contractor and subcontractor where the contract between the general contractor and the owner contained an arbitration clause, and the subcontract provided that the subcontractor agrees to be bound to the Contractor. . . by the terms of the . . . Principal Contract . . . and to assume to the general contractor all the obligations and responsibilities that the general contractor . . . assumes to the owner. (id. at. 428).

In that case, the Court found that there was no agreement to arbitrate. The language regarding the subcontractor's agreement to "assume" to the general contractor "all the obligations and responsibilities" that the general contractor "assumes" to the owner, could not have referred to arbitration because arbitration is not an obligation or responsibility which may be "assumed."

Moreover, in Saturn, the language regarding subcontractor's agreement to be bound to the contractor by "the terms of the. . . Principal Contract" could not have incorporated an arbitration agreement by reference, because it reflected only the subcontractor's agreement to be bound to the contractor concerning agreements made between the contractor and the owner.