Moseley v. Electronic & Missile Facilities, Inc.

PETITIONER: Moseley
RESPONDENT: Electronic & Missile Facilities, Inc.
LOCATION: Clauson's Inn

DOCKET NO.: 401
DECIDED BY: Warren Court (1962-1965)
LOWER COURT: United States Court of Appeals for the Fifth Circuit

CITATION: 374 US 167 (1963)
ARGUED: Apr 16, 1963 / Apr 17, 1963
DECIDED: Jun 17, 1963

Facts of the case

Question

Media for Moseley v. Electronic & Missile Facilities, Inc.

Audio Transcription for Oral Argument - April 17, 1963 in Moseley v. Electronic & Missile Facilities, Inc.

Audio Transcription for Oral Argument - April 16, 1963 in Moseley v. Electronic & Missile Facilities, Inc.

Earl Warren:

Number 401, United States for the use of H.W. Moseley and Moseley Plumbing and Heating Company, petitioners, versus Electronic and Missile Facilities, Incorporated.

Mr. Grant.

George C. Grant:

Mr. Chief Justice, may it please the Court.

This Court granted certiorari to review a decision of the Fifth Circuit Court of Appeals which had reversed a decision of the District Court for the Middle District of Georgia.

The suit was brought by Moseley or United States for the use of Moseley against Electronic and Missile Facilities, a defendant who had performed a contract at one of Robins Air Force Base and Turner Air Force Base in Georgia for the construction of Nike Hercules facilities, anti-missile missile, as I understand the construction was to afford the site for the launching of that type of missile.

Suit was brought by Moseley to -- who was a subcontractor of the prime contractor to recover balances due to him and unpaid for his construction work. Moseley had entered into a subcontract with the prime contractor.

We point out in the brief that the subcontract was 13 pages of fine print.

In the record it takes about 40 pages or so to print that.

It's a printed form except for pa -- a piece of one page which described the work to be done and some slight changes on another page and writing in their mouths, otherwise it's a printed, small print form.

Arthur J. Goldberg:

[Inaudible]

George C. Grant:

This is a photo stat of the contract if Your Honor please.

Arthur J. Goldberg:

[Inaudible]

George C. Grant:

I'll be glad to test to the collect, if I may.

At the time the suit was brought in the middle -- in the District Court in Macon, Georgia, it was alleged that the defendant prime contractor had begun purported arbitration proceedings in the City of New York in connection with the balance due to Mr. Moseley.

Our petition was brought in -- our complaint brought in six counts, two of them seeking to recover directly on the contract, the next -- and the two contracts, one at Robins, one at Turner Air Force Base.

The next two counts seeking to rescind those contracts because of fraud of the prime contractor as detailed in the complaint, and seeking thereunder to recover on quantum meruit for the value of the work done, and the other two counts with respect to the two contracts saying, “Even if we're not entitled to recover on the letter of the contract, even if we can't show enough fraud to rescind it and recover in quantum meruit, we are nevertheless entitled to recover the value of the work that was done, less was been paid and any damage sustained by defendant.”

It was alleged that the complainant could not possibly present his case before an Arbitration Board in the City of New York, some six or seven hundred miles from Macon, Georgia where the plaintiff lived, where his witnesses resided, where the Government records were available by which he could prove his case, and that he just simply could not properly present his case before an arbitration panel even if it could be properly presented if the evidence were there.

The trial judge found that enforcement of a contract provision purporting to provide that any claim or dispute be settled by arbitration was contrary to the public policy of Miller Act, and refused to grant the motion of the defendant for a stay of the District Court suit while arbitration was undertaken in New York, and continued to enforce an injunction against him, proceeding with the arbitration in New York.

Upon appeal by the defendant to the Fifth Circuit, the District Court was reversed in a two to one decision, two judges holding that the stay for arbitration should have been granted and Judge Reeves dissenting, agreeing with the trial judge that enforcement of an arbitration provision was in violation of the public policy of the Miller Act.

With that factual background --

William J. Brennan, Jr.:

[Inaudible]

George C. Grant:

Yes.

William J. Brennan, Jr.:

There's no plain here that this arbitration [Inaudible] were obtained [Inaudible]

George C. Grant:

Not insofar as not permitting him to read it, if Your Honor please, but there is an allegation that the prime contractor conceived a scheme to defraud this subcontractor as well as all other subcontractors.

That he entered into the prime -- the subcontract with the intention at that time of not performing the one obligation which he had --

William J. Brennan, Jr.:

There's never been any decision [Inaudible]

George C. Grant:

No, sir.

William J. Brennan, Jr.:

The whole case is turned, is it not?

George C. Grant:

The case has proceeded on the pleadings up this point.

William J. Brennan, Jr.:

Well I see.