Morelite Construction Corp. v. New York City District Council Carpenters Benefit Funds

Morelite Construction Corp. (Morelite) (defendant) was a construction contractor. In 1978 and 1980, Morelite was engaged as a contractor to perform two construction projects in New York City. Morelite entered job agreements with the New York branch of the United Brotherhood of Carpenters and Joiners of America (the district union) (plaintiff), which incorporated the union’s collective-bargaining agreement providing for arbitration of disputes. In 1980, the New York City District Council Carpenters Benefit Funds (the benefit fund) (plaintiff) alleged that Morelite was delinquent in about $80,000 of contributions. The benefit fund sought to arbitrate its dispute with Morelite, the district union joined the arbitration as a party, and Patrick Campbell Jr. (Jr.) was selected as the arbitrator. In district court, Morelite moved to disqualify Jr. as the arbitrator because Jr.’s father, Patrick Campbell Sr. (Sr.), was then vice president of the United Brotherhood of Carpenters and Joiners of America, an international union of which the district union was a local. Sr. also served as the trustee of the district union. The court denied Morelite’s motion, and the arbitration proceeded. Jr. found that Morelite was delinquent in payments and awarded over $128,000 to the district union. During the pendency of the arbitration, Sr. had been named president of the international union. Morelite filed a motion in court to set aside the arbitration award, which was denied. The district court entered a judgment confirming the arbitration award. Morelite appealed, arguing that the arbitration award must be vacated due to the arbitrator’s evident partiality.