Southern Constructors, Inc. vs. Loudon Co. Bd. of Education

The issue in this case is whether a county board of education has the authority to arbitrate a dispute arising out of a school construction contract. After the parties completed arbitration, the plaintiff filed suit to vacate the award, arguing that the defendant, a county board of education, lacked the statutory authority to agree to arbitration. The defendant unsuccessfully moved for summary judgment, and it sought interlocutory appeal with the trial court's permission. The intermediate court, however, denied the interlocutory appeal, finding that the trial court's decision was consistent with prior cases from the Eastern Section Court of Appeals. We granted permission to appeal and hold that the rule of strict construction of local governmental powers should be retained. We also hold, though, that the power to arbitrate construction contract disputes is fairly implied from the express authority to enter into construction contracts. We therefore reverse the trial court's denial of summary judgment and dismiss the case.