Judge Orders Contractors Back Into Mediation

(CN) - A federal judge ordered two contractors squabbling over mine clearance work performed at the Bagram Air Base in Afghanistan to continue their mediation efforts, despite one side's claims that the other is abusing the judicial process to get a better settlement.

UXB International Inc. hired 77 Construction Company as a subcontractor for a U.S. government contract at Bagram in 2010, but allegedly improper billing practices led UXB to deny payment for much of 77 Construction's work, according to court documents.

The two parties had a productive settlement conference on Feb. 6, 2014, but in the following months the agreement stalled. UXB filed a motion in November to enforce the settlement agreement or apply summary judgment to the disputed claims. 77 Construction argued that the settlement agreement was not complete or formal enough for the court to enforce, and in a ruling on Wednesday, Chief U.S. District Judge Glen E. Conrad agreed with 77 Construction.

As outlined by Conrad, the settlement agreement addressed some of the disputed invoices from 2010 and set forth requirements for how 77 Construction would proceed in re-submitting invoices and costs in order to be paid by UXB. 77 Construction did not accomplish everything set forth in the agreement before UXB filed its motion to enforce, but the subcontractor counter-argued that UXB has not paid it for the invoices it has taken care of since the agreement.

While both parties willingly approved the agreement, Conrad held that the agreement itself was never enough to be deemed a court-enforceable settlement. The agreement never addressed all the disputed invoices, and it was acknowledged in a joint letter from both parties that the agreement would "narrow the scope of the disputed issues, and should facilitate the resumption" of settlement discussions, Conrad said.

Therefore the judge said, he could not force either party to uphold their side of the agreement. Instead, the two parties need to continue their mediation efforts.

Accusations made by UXB that 77 Construction has used the stays of litigation to hire a new expert and write a new report rather than meeting its agreement obligations are troubling, according to Conrad, but unable to be punished by the court. The court cannot enforce an unenforceable agreement simply as a sanction against bad behavior, the judge said.

UXB's motion to enforce and motion for summary judgment were denied, and an additional motion for a protective order was granted in part to preclude UXB from responding to discovery until the case's next hearing. The two parties will appear before the court again on March 16.

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