Management and Technical Consultants S.A. v. Parsons-Jurden International Corp.

Management and Technical Consultants S.A. (MTC), a Liberian corporation (plaintiff), and Parsons-Jurden International Corp. (PJ) (defendant), a United States corporation, entered into an agreement whereby MTC was to assist PJ in obtaining a contract or contracts with the government of Iran to develop mining facilities in Iran. The agreement provided that if PJ was awarded such a contract, PJ would pay MTC 5 percent of PJ’s gross billings to the Iranian mining company. A dispute arose regarding the meaning of the term gross billings. The parties reached a settlement agreement under which PJ paid MTC a certain amount, but which also contained a proviso that if PJ’s gross billings exceeded a total of $350 million, MTC would be entitled to additional compensation, the terms of which would be negotiated by the parties. The settlement agreement also contained an arbitration clause stating that any dispute between the parties would be resolved by arbitration. Thereafter, the disputes about the term gross billings continued, and MTC initiated arbitration proceedings. The arbitral panel issued an award in favor of MTC for $1.85 million plus interest and issued a separate award for costs. MTC filed an action in United States district court for enforcement of the awards. PJ opposed enforcement under Article V of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention), on the ground that the arbitrators had exceeded their authority in issuing a monetary award. Specifically, PJ argued that under the arbitration clause of the settlement agreement, the arbitrators had authority to decide whether the gross billings exceeded $350 million; however, once that decision was made, the arbitral panel lacked the authority to determine the amount of additional compensation due because the settlement agreement stated that the terms of such compensation would be negotiated by the parties. The district court granted MTC’s petitions to enforce the awards. PJ appealed.