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LIENS - Enforcement of lien - Arbitration

Thursday, May 18, 2017 @ 8:52 AM  


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Application by the defendant, Tata Steel Minerals Canada (Tata Steel), for a stay of the action by the plaintiff, AECOM Consultants, pending arbitration. In 2011, the plaintiff contracted with the defendant for provision of engineering, procurement and construction management services. In 2015, the plaintiff registered a mechanics' lien in the amount of $5.7 million to secure payment under the contract. In 2016, the plaintiff commenced litigation to enforce the lien. On the same day, the plaintiff filed a notice of arbitration. Tata Steel sought a stay of the litigation on the basis the plaintiff could not proceed in two separate forums simultaneously. At issue was whether the mechanics' lien action should be stayed pending arbitration to determine any monies owed under the parties' contract. The plaintiff opposed a stay on the basis it never contracted to forego its lien claim rights, the litigation addressed matters and sought remedies outside of the arbitrator's jurisdiction, and that they were one of several lien claimants involving the defendant.

HELD: Application allowed. The plaintiff failed to produce evidence that other lien claims were intertwined with its claim for payment under its contract with the defendant. This was not an instance of consolidated proceedings involving multiple lien claimants. The plaintiff's intent was to arbitrate its dispute and thereafter, enforce the lien in its own action with notice to other lien claimants, or in another claimant's action should a notice of trial be issued. The plaintiff failed to establish sufficient reason the matter should not be referred to arbitration. The parties' dispute was clearly within their contract's dispute resolution provision. It would be inappropriate to permit the plaintiff to maintain two live proceedings to adjudicate quantum. The plaintiff's action was stayed pending the arbitration proceeding.

AECOM Consultants Inc. v. Tata Steel Minerals Canada Ltd., [2017] N.J. No. 129, Newfoundland and Labrador Supreme Court, D.J. Paquette J., April 11, 2017. Digest No. TLD-May152017008