MR. MAYER: [unintelligible]
MR. MAMRY: I’m sorry?
MR. BEN DAVID: Nothing, Mr. Arbitrator. In addition, although Mrs. Mayer is technically a co-owner of the business, we would stipulate, and I believe Mr. Jordan will agree, that she is not an active manager. She worked principally in a support and bookkeeping capacity.
MR. JORDAN: Yes, we would so stipulate.
MR. MAMRY: I will so accept your so stipulation. May I inquire, however: wouldn’t bookkeeping be relevant to the matter under dispute here? This is a financial matter, no?
MR. JORDAN: I think, Mr. Arbitrator, that I will be able to illuminate that in my opening statement. And in short, the accounting is not under dispute here. Rather, it is the question of whether or not an agreement, implicit or otherwise, was breached.
MR. MAMRY: That’s right. You were giving an opening statement. We do seem to have wandered afield. Please, continue.
MR. JORDAN: Mr. Arbitrator, my client, MH Partners LLP consists of two principals, Ms. Veronica Mayer—
MR. MAMRY: Any relation?
MR. JORDAN: I’m sorry?
MR. MAMRY: To Mr. Mayer.
MR. JORDAN: Yes, I was getting to that.
MR. MAMRY: Please.
MR. JORDAN: Ms. Mayer is also the older sibling of Mr. Mayer.
MR. MAMRY: Older!
Ms. Mayer: Thank you, Mr. Arbitrator.
MR. JORDAN: Ms. Mayer is an attorney herself, but her principal business is in real estate development.
MR. MAMRY: My goodness, is anyone not a lawyer in here? I’m sorry, go on.
MR. JORDAN: Yes. Ms. Mayer’s business partner is Mr. Phillip Harrow, also here. Mr. Harrow is also the proprietor and CEO of a major construction firm based in Morgantown, West Virginia, which is called Harcon. Over the last approximately nine years, beginning in 1981, Ms. Mayer and Mr. Harrow have, under the auspices of a limited partnership, MH Partners, engaged in a number of development projects together and with other companies and partners. These include residential and commercial developments, as well as a more recent series of projects involving transportation infrastructure. In 1987, Mr. Mayer, an architect by training and profession, approached Ms. Mayer about a potential relocation from his then-current residence in New York City to Western Pennsylvania and further proposed that he would join her business as an additional partner. As MH Partners was, at the time, engaged in a significant residential development project, Ms. Mayer and Mr. Harrow concluded that an architect-planner would be a strategically advantageous partner in their business. They also believed that it would significantly reduce their costs associated with design, site-planning, and environmental and wastewater remediation, etc. Mr. Mayer’s specialty was in what is called sustainable design, which is to say, environmentally sound building.
Mr. Mayer did, in fact, subsequently move to Pittsburgh and did likewise join his business with MH Partners. I emphasize he joined his business, not his person. Mr. Mayer continued to operate as a private architect and designer, and his firm became, in effect, a contractor for MH Partners. Over the next approximately three years, Mayer Design Lab acted as architect and planner for MH Partners. We have—this is Joint Exhibit 1. It is a schedule of projects over that period, along with invoices.
MR. MAMRY: I’m sorry, I’m going to interject again, here. First of all, Mr. Ben David, you have seen this exhibit and it is a joint exhibit?
MR. BEN DAVID: Yes, Mr. Arbitrator.
MR. MAMRY: Good. And Mr. Jordan, let me see if I understand. You are saying that although there was some, some discussion of the possibility of Mr. Mayer joining MH Partners—I suppose that would have made it MMH Partners, no? I give Mr. Harrow some credit, here. Harcon. That’s rather more clever, wouldn’t you all agree? So your contention is that Mr. Mayer and MH Partners discussed a formal business partnership, decided against it, and Mr. Mayer became a vendor for MH Partners?
MR. JORDAN: Partially, Mr. Arbitrator. But in fact, it is our contention that the voluminous nature of the schedule and invoices shows a de facto partnership existed between the businesses even if no formal document exists to formalize or memorialize such an understanding. As you know, a great deal of private development work is done on a quote handshake basis. That is the situation here.
MR. MAMRY: The voluminous nature of the schedule and invoices! Speak of angels and hear them flutter their wings. Mr. Ben David, would you . . . Actually, no. Strike that. Well, don’t strike that. It can remain in the record. I meant it in the common usage only. I’m sure you’ll address the issue of voluminousness in your opening, Mr. Ben David.
MR. BEN DAVID: Yes, Mr. Arbitrator.
MR. MAMRY: Then I am assured, voluminously. Go on, Mr. Jordan.
MR. JORDAN: Yes. I’m getting to the end. Mr. Arbitrator, beginning approximately two years ago, in 1989, MH Partners along with Mayer Design Lab became significantly involved in a major highway construction project, termed in local media the Mon-Fayette Expressway.
MR. MAMRY: As a point of correction, I believe it was termed by local politicians the Mon-Fayette Expressway. I believe the local media, such as they are, termed it the Highway to Nowhere.
MR. JORDAN: Well, be that as it may—
MR. MAMRY: Don’t worry, Mr. Jordan. I’m only kidding. The fact that this project may or may not be a public boondoggle, white elephant, or what have you, has no probative value here and won’t affect my decision or award. Contracts, implied or otherwise, are contracts regardless of the, how shall I put it, the ethical genealogy of their origin. I never begrudge another man—or woman—his successful scam.
MR. JORDAN: Thank you, Mr. Arbitrator. That’s a memorable expression of a principle. To conclude, the parties to this dispute became involved in two significant and interrelated projects. First, Mr. Harrow’s own company, Harcon, contracted with the Pennsylvania Department of Transportation to construct several major portions of the aforementioned highway, with MH Partners acting as Harcon’s agent in the bidding and contracting phases.
MR. MAMRY: They, Harcon, I’m sorry, were literally building this Roman road?
MR. JORDAN: No, uh. They would have been the general contractor. And, let me see, second, MH Partners, in association with Mayer Design Lab, acquired significant land acreage contiguous with or congruent to the right-of-way of the highway. The purpose of this land acquisition was for the construction of a number of housing developments—bedroom communities, Mr. Arbitrator, located in proximity to highway exits, entrances, and interchanges. Because MH Partners’ explicit involvement in the bidding process for highway construction would constrain them from making these purchases directly, owing to certain rules of that bidding process, Mayer Design Lab, which created a subsidiary LLC known as MDL—
MR. MAMRY: I am sensing a naming convention. Go on.
MR. JORDAN: —and Mr. Mayer personally were engaged as agents for these purchases. Here we will submit our Exhibits 1 and 2, which are records of correspondence to this effect as well as bank records indicating transfers of funds to MDL and to Mr. Mayer for this purpose.
MR. MAMRY: All right. I am a bit idiosyncratic here. I don’t like having multiple exhibits ones and twos and so forth floating around. I’ll mark these MH Partners Exhibits 2 and 3. And the numbers will go up from there.
MR. JORDAN: Very good, Mr. Arbitrator.
MR. MAMRY: You said you were wrapping it up, but I admit, I find myself still in the dark middle portion of the tunnel here. Will we soon emerge into daylight?
MR. JORDAN: Yes, of course. In 1990, Ms. Mayer approached Mr. Mayer about the creation of a new business entity for the purpose of developing housing on these properties. In effect, she proposed the creation of a general contracting business that would construct homes on spec and ultimately sell them through a real estate partner to be determined. Mr. Mayer then informed Ms. Mayer that this would not be possible, because he—that is to say, his company, MDL—had sold the properties to one Arthur B. Imlak, who is also present today; rath
er, actually, in fact, to a holding company controlled by Mr. Imlak.
MR. MAMRY: I shudder to think the holding company is called ABI.
MR. IMLAK: Close, but no cigar. ILH. That was originally Imlak Land Holdings.
MR. MAMRY: Yes, thank you, Mr. Imlak. That was a joke, and you’ll have your turn. I’ll reserve the cigar.
MR. JORDAN: It is our contention that Mr. Mayer violated a clear, historic, and mutually understood oral contract in so doing. This matter was previously adjudicated before a judge in civil court, and we would submit the records of those proceedings as Joint Exhibit . . . I’m afraid I’m not sure what number we’re on.
MR. MAMRY: Joint Exhibit 4. Entered. But, I’m sorry. You’ve already been to trial? How in the many Names of the Lord did you manage that? That was fast! God’s justice may be swift, but civil court tends to move at a more naturally geologic and less divinely Let-There-Be sort of pace.
MR. JORDAN: No, Mr. Arbitrator. We had several preliminary hearings before a judge. We’d asked for an injunction. Our intention was to overturn the illegal sale of the properties and compel their return to MH Partners for the purpose of their original intended use. Regrettably, the judge ruled the sales were legitimate—that is to say, that they were not, strictly speaking, illegal. We considered going forward seeking monetary damages in a civil forum, but at that point, both parties felt it was in their best interests, in terms of publicity and, frankly, cost, to submit to arbitration instead.
MR. MAMRY: Strictly speaking, everything is illegal. Broadly, though, nothing is. Who was the judge? Actually, never mind. Forget it. Arbitration was probably wise, and yes, certainly cheaper than litigation. Go on.
MR. JORDAN: Very good, Mr. Arbitrator. We contend that, although the sales may technically have been legal, they violated a clearly understood oral contract, and that Mr. Mayer unfairly and unjustly profited from the sale to the sole benefit of his business and person and to the express detriment of his partners, who have suffered grievous economic harm as a result. We submit this to you, Mr. Arbitrator, and ask you to determine that such a violation did occur, and as a remedy to award the full proceeds of such sales to my clients, MH Partners LLP.
MR. MAMRY: Excellent. That all seems clear. Let’s recess for five minutes. I’ve been drinking coffee all morning, if you know what I mean. Mr. Ben David, you may take your place in the batter’s box.
[RECESS]
MR. MAMRY: We are back on the record. Thank you for indulging my brief intermission there. Mr. Ben David, if you please.
MR. BEN DAVID: Thank you. Mr. Arbitrator, the issue here is straightforward.
MR. MAMRY: That seems fairly anti-prophetic to me, Mr. Ben David. But please, go on.
MR. BEN DAVID: Yes. Our position is straightforward. In the first part—
MR. MAMRY: I’m sorry, Mr. Ben David. Again, the first part? I’m going to go out on a limb here and suggest that the first part implies a minimum of one subsequent part, possibly more, which rather mitigates against the straightforwardness of this position, does it not?
MR. BEN DAVID: I don’t believe so, Mr. Arbitrator. The way is straight, if not narrow. If you would hear me out.
MR. MAMRY: Oh, yes. I am the recording angel, the man clothed in linen with the writing instrument at his side. Go on.
MR. BEN DAVID: I’ll revise. Our position is twofold. First, that Mr. Mayer had every legal right to sell this property, as opposing counsel’s own exhibit demonstrates, and two, that Mr. Mayer in point of fact generously offered to evenly divide the proceeds of said sales with Ms. Mayer and Mr. Harrow, an offer they refused in order to pursue the outrageous claim that Mr. Imlak should be compelled to return his legally acquired property, or, failing that, that Mr. Mayer should be required to pay the total proceeds of the sales to MH Partners and retain nothing for himself.
MR. MAMRY: Let’s leave the outrageousness for the courts, counselors. We don’t need any of those sorts of antics. You’re both paying me to be here to arbitrate this dispute. Consider me therefore suitably pre-impressed by the heroic outrage you all feel at the terrible thing that has occurred.
MR. BEN DAVID: Of course.
MR. MAMRY: Go on.
MR. BEN DAVID: That’s really it, Mr. Arbitrator. We submit, in effect, the same question as the opposing side. Did a contract exist and was it violated? If so, what should the remedy be? If not, well, not.
MR. MAMRY: I do appreciate brevity. I assume, from the phrasing, that you believe no violation occurred, and therefore no remedy is required.
MR. BEN DAVID: That’s correct, Mr. Arbitrator.
MR. MAMRY: All right, then. I have a question, before we examine witnesses. You mentioned, Mr. Ben David, that Mr. Mayer offered to evenly split, I believe were your words, the proceeds of these real estate transactions with his sister and her partner over there. By evenly split you mean?
MR. BEN DAVID: Fifty-fifty.
MR. MAMRY: Wonder of wonders. And I am going to once again venture out onto the thinner branches here to speculate that this offer was proffered . . . excuse me, that sounds ridiculous. That he made this offer orally and no written record of it exists.
MR. BEN DAVID: Mr. Mayer will testify that he made that offer.
MR. MAMRY: I think we can read that as a yes, no? Good. We will swear in all the witnesses at once, I think, for the sake of efficacy, and then begin examination.
DIRECT EXAMINATION OF VERONICA MAYER
MR. JORDAN: Would you state your name for the record.
MS. MAYER: Veronica Mayer.
Q: And your relationship to the matter at hand? Your position?
A: I am one of the two principal partners in MH Partners, LP.
Q: Veronica, how would you describe your business?
A: My background is in law, as you pointed out earlier. However, I now principally work in real estate development. Originally, that was mostly commercial real estate, but in the last five or six years, I’ve become more involved in residential.
Q: And what is your relationship to Mr. Harrow?
A: Mr. Harrow and I met in West Virginia about ten years ago. I was representing a commercial property developer as part of their legal team, and Mr. Harrow was hoping to broker a land purchase deal that would allow his company to serve as the general contractor for the construction of a shopping plaza. We subsequently became involved as partners in that deal, which led to the formation of MH Partners.
Q: MH Partners is?
A: A Limited Partnership that we use for a variety of joint ventures. Mr. Harrow and I both conduct business separately as well, but we frequently work on projects together. The partnership makes it easier to acquire financing and so forth, but it allows us to act as independent agents as well.
Q: So you and Mr. Harrow have been in business . . .
A: Ten years, give or take.
Q: And what about your brother, Abbie Mayer? Is he a partner?
A: No. We discussed it but ultimately decided against it.
Q: Why?
A: Firstly, because Abbie lacked the capital. We weren’t a corporation. I didn’t want to see my brother on the hook if, God forbid, we suffered a significant loss.
Q: And secondly?
A: Secondly, Abbie is a little . . . unusual.
Q: Unusual? What do you mean?
MR. BEN DAVID: Objection.
MR. JORDAN: To what?
MR. BEN DAVID: First of all, relevance? Second of all, speculative.
MR. MAMRY: Yes, thank you, Perry Mason. I am shocked, shocked that the lawyers are objecting. Nevertheless, I remind everyone, once again, that this is not a court of law. I think you’ll just have to have faith in my ability to suss out the probative value of speculation. However, I am tempted to agree that it’s a little untoward to wildly besmirch the man’s character. Mr. Jordan, the relevance?
MR. JORDAN: Oral agreements, or lack thereof, are at issue, Mr. Arbitrator. We’d contend that Mr. Mayer’s personality must be taken into account here.
MR. MAMRY: I eagerly await your argument that you made a deal with a wild man and subsequently suffered harm when he behaved as such. All right. Go on.
MR. JORDAN: How is Mr. Mayer unusual?
A: Well, he’s temperamental, first of all. And he has a large ego. He takes stands of principle that don’t always make a lot of sense. And, well . . .
Q: It’s all right, Ms. Mayer. You can tell us.
A: Quite frankly, he has . . . religious convictions.
Q: Religions convictions? What’s wrong with that?
A: They’re unusual convictions.
MR. BEN DAVID: I really have to object again. Again, speculation, and now, hearsay as well! Is Mr. Jordan really asking Ms. Mayer to testify as to Mr. Mayer’s religious beliefs?
MR. MAMRY: Hearsay is permissible in arbitration, Mr. Ben David. Again, you’ll have to trust me to give it its due weight. Continue, Mr. Jordan.
MR. JORDAN: Thank you. Please describe what you mean, Veronica.
A: My brother thinks that he speaks directly to God. I don’t know how else to say it. He has an idea that he is some kind of prophet.
MR. MAMRY: Well, now, that’s not something you hear in a typical he-said, she-said.
Q: Indeed. But, uh. And yet, Ms. Mayer, yet you went into business with him?
A: He was my brother, and he was having financial difficulties. I wanted to help him. Plus, it never hurts to have an architect on the payroll. Anyway, I think I understood it to be metaphorical at the time.
Q: Metaphorical?
A: Yes. I mean, the beliefs. His beliefs. I didn’t want to judge him on the basis of his religiosity. I suppose a lot of people pray or talk to God, in a sense. I didn’t think he meant it so literally. It was something he mentioned early on, right when he was moving here—to Pittsburgh—from New York, but after that, he rarely mentioned it. I mean, for a time he rarely mentioned it.
Q: It didn’t interfere with your work together?
A: Not at first.
Q: But later?
A: It became . . . an issue.
Q: How? Give us an example.
A: Well, for instance, we were working on an interchange project down in Uniontown—
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