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Binkley v. Maros

OPINION FILED DECEMBER 10, 1979.

ROY BINKLEY, PLAINTIFF-APPELLEE,

v.

JAMES MAROS ET AL., DEFENDANTS-APPELLANTS.



APPEAL from the Circuit Court of Cook County; the Hon. ARTHUR L. DUNNE, Judge, presiding.

MR. JUSTICE MCGLOON DELIVERED THE OPINION OF THE COURT:

Rehearing denied January 14, 1980.

Plaintiff Roy Binkley received an arbitration award of $88,400 for architectural services rendered during the construction of a personal residence for defendants, James and Bessie Maros. The parties had entered into a contract whereby plaintiff was to design and supervise the construction of the home. As compensation, plaintiff was to receive 12 percent of the construction cost, plus $30 an hour for certain additional services. Subsequently, plaintiff filed a demand for arbitration on the grounds that defendants refused to pay him all that he was owed.

Defendants filed their own suit to stay arbitration, alleging that the parties entered into a subsequent agreement for a lump-sum settlement of $40,000. The trial court refused to stay arbitration and ordered proceedings to begin forthwith. Defendants then filed a counterclaim for design flaws, with the arbitrator. At the conclusion of the hearings, the arbitrator rendered an award in plaintiff's favor.

Subsequently, defendants filed a motion to vacate the award with the trial court. The motion was denied and a judgment was entered in plaintiff's favor for the full amount of the award, plus interest. Defendants appeal.

On appeal defendants argue that the arbitrator exceeded his authority by rejecting all evidence that the parties executed a subsequent, lump-sum agreement. As a result, he rendered an excessive award that compensated plaintiff two and three times for the same services.

We affirm.

In November of 1972, plaintiff Roy Binkley was introduced to co-defendant Bessie Maros by Niko Geane, an interior designer. The purpose of the meeting was to discuss the possibility of plaintiff designing a home for defendants. Mrs. Maros inquired whether a "beautiful house" could be built for $200,000. Both plaintiff and Geane assured her that such a house could be built. In subsequent meetings, a budget of $250,000 to $300,000 was set. It was also agreed that plaintiff would develop preliminary designs for the house. Though there was no written agreement between the parties at this time, plaintiff had received a retainer and was working on this basis.

After the preliminary designs were finalized, plaintiff entered into an agreement with the architectural firm of Bernheim & Kahn for the production of all future drawings. In this way, plaintiff was able to limit himself to a design capacity only. Also about this time, plaintiff and defendants executed a standard AIA owner/architect agreement which they back-dated to February 1, 1972. The contract provided that plaintiff's compensation was to be 12 percent of the cost of all work designed or specified by him, plus $30 an hour for certain additional services. The contract also contained an arbitration clause which provided that:

"All claims, disputes and other matters in question arising out of, or relating to, this agreement or the breach thereof shall be decided by arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association then obtaining unless the parties mutually agree otherwise. This agreement to arbitrate shall be specifically enforceable under the prevailing arbitration law * * * The award rendered by the arbitrators shall be final, and judgment may be entered upon it in accordance with the applicable law in any court having jurisdiction thereof." (Emphasis added.)

The construction of the residence was unusually complex and extended over several years. Included in the design were such things as an elevator, a gym room, exterior terraces, central vacuuming and fire extinguishing systems, marble bathrooms and stairways, a swimming pool and pergola, teak garage doors, and wrought iron entry gates. Involved in the construction were 30 independent contractors in addition to the general contractor. Their work was designed, specified and supervised by plaintiff. The total cost of construction, excluding the cost of the lot, eventually exceeded one million dollars. To coordinate construction, defendants requested plaintiff to devote himself to full-time, on-site supervision.

After working almost exclusively for defendants for a period of four years, plaintiff had received less than one-half of the amount he believed he was owed under the owner/architect agreement. He also had allegedly incurred substantial out-of-pocket costs for engineering services he rendered. As a result, in June of 1976, plaintiff filed a demand for arbitration.

Shortly before the arbitration hearing was to commence in December of 1976, defendants filed suit to stay the arbitration proceedings. In that suit, defendants alleged that the owner/architect agreement had been replaced by a "lump sum" agreement whereby plaintiff was to receive $40,000 for his services. The trial court dismissed the suit and ordered arbitration to proceed "forthwith." Defendants appealed the trial court's order and moved the appellate court to stay the arbitration proceedings. The motion was denied and arbitration proceedings began.

From April 19, 1977, to April 15, 1978, 20 hearings were held before the arbitrator. In addition, the arbitrator conducted an inspection of defendants' residence in connection with their counterclaim for negligent design and construction. Also presented to the arbitrator were defendants' assertions that plaintiff agreed to accept a $40,000 "lump sum" in lieu of the compensation provisions of the owner/architect agreement and that plaintiff "double-billed" his services. At the conclusion of ...


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