J.C. Gury Co. v. Nippon Carbide Industries (USA) Inc.

SUMMARY

An arbitration clause provided that any controversy arising out of the parties’ sales contract would be settled by arbitration, but specified the arbitrator had no power to make an award that had the effect of changing, modifying or altering any provision of the parties’ contract. The arbitrator’s award concluded that a clause disclaiming warranties and excluding consequential damages was unconscionable and unenforceable, and awarded damages to the buyer on that basis. The seller contends the arbitrator exceeded his powers because the award altered, indeed nullified, a contractual provision. We affirm the judgment confirming the award, because the seller expressly responded to the buyer’s claim of unconscionability and failed to assert, at any time before or during the arbitration proceeding, that the arbitrator’s power to find the clause unconscionable or unenforceable was limited by the arbitration clause. A party cannot wait until after an award is made to claim that an issue expressly presented to the arbitrator for decision is beyond his authority.

FACTUAL AND PROCEDURAL BACKGROUND

J.C. Gury Company (Gury) is a family-owned business engaged in the…