COMMISSIONER OF TRANSPORTATION v. WHITE OAK CORPORATION et al., SC 17828

 Judicial District of Hartford

      Public Works Contracts; Scope of Waiver of Sovereign Immunity as to Public Works Contracts Claims Under General Statutes § 4-61; Whether Trial Court Properly Concluded that Contractor was Entitled to Seek Further Arbitration; Applicability of Res Judicata Principles in Arbitration Proceedings Under § 4-61. In 1994, White Oak Corporation (White Oak) contracted with the state to replace a bridge over the Quinnipiac River in New Haven, to be completed in January, 1998.  Because White Oak experienced delays in construction, a dispute arose between the parties, eventually resulting in White Oak's assigning its contract to another corporation in 2000.  In 1998, White Oak, claiming wrongful termination of the contract, among other things, sought arbitration pursuant to General Statutes § 4-61 (b), which permits a party having a claim under a public works contract to seek arbitration as an alternative to bringing an action against the state under General Statutes § 4-61 (a).  In 2004, the arbitration panel rejected White Oak's wrongful termination claim and awarded damages to the state on its counterclaim.  In March, 2006, White Oak filed another demand for arbitration in connection with the 1994 contract, seeking damages for delay.  In response, the state filed this action seeking to enjoin White Oak from conducting further arbitration proceedings.  The state argued that its waiver of sovereign immunity pursuant to § 4-61 permitted only one lawsuit and, in addition, that the arbitration alternative did not expand this limited consent to be sued.  The state also contended that any further arbitration on the issue of delay was barred by the principles of res judicata and collateral estoppel because that issue already had been submitted to and decided by the arbitration panel.  Moreover, taking the position that the contract was terminated on the date it was assigned, the state claimed that the demand was untimely because it was not brought within three years of termination as required by § 4-61 (b).  The court refused to enjoin further arbitration.  In reaching this decision, it found that although White Oak chose to pursue only the issue of wrongful termination in its first arbitration, it had raised other issues, including delay, in its demand.  Further, concluding that this court's decision in LaSalla v. Doctor's Associates, Inc., 278 Conn. 578 (2006), applied to arbitration proceedings under § 4-61, it ruled that the doctrines of claim preclusion and issue preclusion did not bar White Oak's claims.  In addition, the court rejected the state's timeliness claim.  The state has now appealed.