Nakae v. Marks
Published: Nov. 12, 2002 | Result Date: Jul. 2, 2002 | Filing Date: Jan. 1, 1900 |Case number: 011507ER Arbitration – $1,570,520
Court
Case Not Filed
Attorneys
Experts
Facts
This action involved the performance by Nakae & Associates (Nakae) of an all-inclusive landscape contract dated
Aug. 13, 1998, in the amount of $943,837 between Nakae, and the defendants, Stuart and Marsha Marks
(Marks), for a 10.5 acre parcel in Calabasas, upon which a 10,600 square foot residence was constructed.
Marks paid $895,927 to Nakae. Nakae claimed that $95,737 was still owed to it on the contract, plus interest.
Nakae recorded a mechanicÆs lien for that amount.
Marks disputed that they owed any money to Nakae, and contended that they were owed over $400,000 by
Nakae because they were entitled to (a) offsets and/or credits for work not performed; (b) credits for
unauthorized change orders; (c) reimbursement of out of pocket expenses; (d) damages due to construction
defects; (e) damages due to a substantial delay by Nakae in performance and (f) damages due to material
misrepresentations as to the time the contract would take to perform.
The construction contract contained a binding arbitration clause. After the conclusion of the arbitration, the
arbitrator requested closing briefs in lieu of oral argument. At the arbitration, Nakae failed to prove the
mechanic's lien or breach of contract. The arbitrator awarded Marks $502,320 plus costs.
The arbitratorÆs award included a finding of fraud by intentional misrepresentation and/or concealment against
Nakae by clear and convincing evidence. At the request of Marks, the arbitrator corrected his ruling to add
punitive damages. The arbitrator gave Nakae an opportunity to provide proof of its financial condition. Nakae
refused to do so on the ground that the arbitrator did not have the authority to correct the award. The arbitrator
issued a final binding arbitration award adding $1 million in punitive damages.
The Superior Court confirmed the award as final, and judgment in the amount of
$1,570,521 was entered in favor of Marks. This judgment was later vacated pursuant to a
reduced satisfaction of judgment in the amount of $1.3 million.
Settlement Discussions
Marks offered a "walkaway" if Nakae would guarantee that the boulder wall would not fall or that Nakae would be responsible for any damages. Nakae refused.
Other Information
A petition to confirm the final arbitration award was granted and judgment for $1,570,521 was entered on Aug. 5, 2002.
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