Full opinion text
MEMORANDUM AND ORDER ROSENTHAL, District Judge. Lummus Global Amazonas, S.A. (“LGA”) designed and built natural gas pipeline, gathering, and processing facilities in Peru for the project owner, Aguay-tia Energy Del Peru S.R. Ltda. (“Aguay-tia”). The contract between LGA and Aguaytia contained a broad arbitration provision, providing for “final and binding arbitration” under the Rules of Arbitration of the International Chamber of Commerce. In September 1998, the parties began arbitration proceedings to resolve a number of claims and counterclaims under the contract. The proceedings, conducted in two phases, ended in June 2001. The arbitration panel issued three detailed written decisions and an addendum, resolving LGA’s claims for unpaid bonuses, change orders, and contract price adjustments, and Aguaytia’s counterclaims for liquidated damages for delays, the cost of remedying alleged defects in the construction, payment for pipe paid for but not purchased or installed, and a number of other disputed items. The panel concluded that LGA was required to pay Aguaytia a net amount of $13.4 million, exclusive of interest. In this lawsuit, LGA moves to vacate, modify, or amend the final and interim arbitration awards, asserting a number of defects in the arbitration process and result. Aguaytia asks this court to confirm and enforce the award, but to enter judgment that reduces the award by an offset of approximately $5.2 million that the parties have stipulated is owed to LGA. The parties have presented starkly different characterizations of the claims and of the arbitration itself. LGA asserts that it delivered “a working, viable and commercially profitable facility” by the agreed-upon date, that has exceeded the parties’ projections of profit. Aguaytia contends that “LGA failed to complete, test and deliver the facilities at the times specified in the Agreement” and delivered the facilities months late, with material defects. LGA asserts that the arbitration represents a “mockery of justice,” in which the three-member panel, dominated by one arbitrator LGA challenges as biased, acted in “manifest disregard” of the governing law. Aguaytia asserts that the panel of recognized experts in construction law assembled and painstakingly analyzed a thorough and exhaustive record involving a number of very technical issues; correctly stated and applied the law; and based the specific findings that LGA challenges on the detailed technical facts disclosed in the record and the parties’ contract provisions. Aguaytia denies any arbitrator bias and emphasizes that LGA did not raise this claim until after the panel issued its award in favor of Aguaytia. This court applies the standard for reviewing arbitration awards under the Federal Arbitration Act, 9 U.S.C. §§ 10, 11, and 12, to the extensive record, the arbitration panel’s detailed findings, and the parties’ contentions. LGA also invokes the Inter-American Convention on International Commercial Arbitration (the “Inter-American Convention”), 9 U.S.C. § 301 et seq., and the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”), 9 U.S.C. §§ 201 et seq. Most of the arguments LGA makes for vacating or modifying the awards challenge specific aspects of the awards. Two arguments, arbitrator bias and the panel’s refusal to grant the parties’ joint request to incorporate the stipulation as to credits and payments owing to LGA, are alleged as a basis for vacating the entire award. Each of the grounds LGA asserts, with Aguaytia’s response, raises the same set of issues: does LGA assert a sufficient basis to permit this court, under the narrow and deferential standard of review mandated by statute, to vacate the results of the already prolonged process that the parties agreed would be final and binding upon them? Based on the pleadings, the motions and responses, the evidence, the arguments of counsel, and the applicable law, this court concludes that LGA has met the burden that the law imposes to vacate the results of contractually binding arbitration only as to two discrete aspects of the award. One is the award for certain IGV, or Peruvian value-added, taxes. This court vacates the portion of the award addressing LGA’s liability for certain IGV taxes and remands that issue to arbitration for a determination as to the amount of taxes owed. The second aspect is the status of the joint stipulation of certain payments and credits owed to LGA. The narrow scope of review does not permit this court to include the stipulation in the final judgment. This court remands the narrow issue of the effect of the stipulation as to payments and credits on the arbitration award to be resolved in arbitration. This court confirms all other aspects of the arbitration award. Specifically, this court DENIES LGA’s motion for discovery on the issue of evident partiality or bias; DENIES LGA’s motions to vacate the award in its entirety; GRANTS, in part, and DENIES, in part, LGA’s motion to vacate specific aspects of the award; DENIES LGA’s supplemental petition and motion to vacate the award; GRANTS, in part, and DENIES, in part, Aguaytia’s motion to confirm and enforce the arbitration award; DENIES, without prejudice, Aguaytia’s motion for final judgment; and DENIES Aguaytia’s request for bond. This court also ORDERS the parties to appear for a status conference on April 12, 2002, at 9:00 a.m., to discuss the most efficient method of proceeding. The reasons for these rulings are set out below. I. Background Aguaytia is organized and has its principal place of business in Peru. (Docket Entry No. 9). LGA is a Peruvian corporation with its principal place of business in Houston, Texas. (Docket Entry No. 1). LGA is a subsidiary of ABB Lummus Global, Inc., a Delaware corporation with its principal place of business in Houston, Texas. (Id.). In February 1995, Aguaytia issued an invitation to bid for the design and construction of natural gas and natural gas liquid gathering, processing, and pipeline facilities in what the parties both describe as a “jungle” area in Peru. LGA submitted its bid in May 1995. Effective May 31, 1996, Aguaytia and LGA entered into an Agreement to design and construct a gas processing facility, a fractionation facility, and pipelines from wellheads to the gas plant and from the gas plant to other facilities. The pipelines connected the fractionation facility and a newly constructed power plant that was not part of the Agreement. Clause 24.02(a) of the Agreement required the parties to submit “all disputes arising in connection with or relating to this Agreement” to “final and binding arbitration,” “pursuant to the rules of Arbitration of the International Chamber of Commerce.” (Docket Entry No. 9, Ex. 7). The Agreement provided that “[t]he substantive law applied in such arbitration shall be the law of New York.” (Id.). LGA initiated arbitration proceedings in September 1998. Under the ICC Rules, LGA appointed one of the arbitrators, Robert Rubin, a recognized authority in New York construction law. Aguaytia appointed Michael Jaffe as the second arbitrator. Jaffe is a practicing lawyer with a recognized expertise in construction litigation and experience as an arbitrator. The parties agreed to Allen Overcash as the third, presiding, arbitrator. Overcash teaches and practices construction law and also had experience as an arbitrator. The parties negotiated and reached an agreement, approved by the panel and the ICC, for a two-phase arbitration. Phase 1 addressed “delay issues, associated damages claims, completion bonus claims, certain pipeline credit issues, a discreet number of defective construction issues and certain claims for extra work (‘variances’) -” (Docket Entry No. 36, Ex. A, p. 2). Phase 2 addressed “warranty issues and claims of defective work.” (Id.). Although the Agreement specified Miami, Florida as the place for arbitration, the Terms of Reference the parties and the arbitrators signed specified Houston, Texas as the place for arbitration and stated that the award “shall be considered as having been made at the place of the arbitration, namely Houston, Texas.” (Docket Entry No. 12, Ex. E(A)). The panel began by issuing a set of rulings on legal and contractual issues that did not turn on factual disputes and did not require the presentation of evidence. In the Interim Award on Issues Proposed for Summary Disposition (the “Summary Disposition”), issued on January 21, 2000, the panel held that under New York law, extrinsic evidence of the parties’ intent was not admissible to interpret unambiguous contract provisions; interpreted provisions of the Agreement addressing delays by Aguaytia that could provide LGA a right to extend contractual deadlines and preclude liquidated delay damages for the additional time; and ruled that the Agreement did not impose a $500,000 limit to Aguaytia’s right to recover money it had paid LGA for pipe that was not used in the project (the “pipe credit”). The panel deferred consideration of other issues for factual development. (Docket Entry No. 45, p. 2; Aguaytia Ex. 6). The Phase 1 hearing record included over fifty witness statements, three hundred exhibits, extensive briefs, live testimony from fourteen witnesses taken in nine days of hearings, and post-hearing briefs and exhibits. (Docket Entry No. 19, p. 1). On June 14, 2000, the panel circulated a draft written opinion on the Phase 1 issues. The panel denied most of LGA’s claims that Aguaytia’s own delays made the liquidated damages provisions inapplicable, finding that Aguaytia was entitled to liquidated damages for LGA’s delays, in the amount of $6.7 million. The panel denied LGA’s claims for $6.1 million in contract price adjustments; denied LGA’s claims for $720,000 in proposed change orders; denied LGA’s claims for an early completion bonus; granted Aguaytia a pipe and pipe installation credit of $1.5 million; and found that Aguaytia was entitled to recover from LGA amounts necessary to remedy pipeline corrosion caused by carbon dioxide. On July 10, 2000, LGA filed a motion to vacate the arbitration panel’s draft award. The ICC denied LGA’s motion, (Aguaytia Ex. 9), and issued the Phase 1 award (the “Interim Award”) on August 16, 2000. The Interim Award addressed each of the parties’ arguments in a lengthy and detailed opinion. (Docket Entry No. 36, Ex. A). The Interim Award granted Aguaytia $8,394,678.40 and LGA $600,713.00, for a net award to Aguaytia in Phase 1 of $7,793,765.40. The panel also found LGA liable for certain design and construction defects, deferring determination of the damage amounts to Phase 2. On October 30, 2000, LGA filed this petition to vacate, modify, or amend the Interim Award. (Docket Entry No. 1). As legal grounds for vacating the award, LGA alleged that the arbitration panel “manifestly disregarded” the applicable law; the panel failed to allow LGA to present evidence; and one member of the panel was biased as a result of an undisclosed conflict of interest, which “tainted” the “entire proceedings.” (Docket Entry No. 1, p. 2). Aguaytia challenged the timeliness and effectiveness of service and moved to dismiss or transfer venue; this court denied those motions. (Docket Entry No. 9,16). Shortly after entering the Interim Award, the panel began the proceedings related to the Phase 2 issues. After receiving legal memoranda, numerous documents, over thirty witness statements, and expert reports, the panel held seven days of evidentiary hearings, which included oral examination of witnesses. The panel met with each party’s counsel to review that party’s argument as to each Phase 2 claim and received additional submissions. On April 23, 2001, the panel issued its Final Award, (Docket Entry No. 36, Ex. B), which incorporated the Interim Award. In the Final Award, the panel granted additional awards of $5,786,738.00 to Aguaytia and $383,419.00 to LGA, resulting in a net Phase 2 award to Aguaytia of $5,403,319.00. The panel also awarded Aguaytia $2,691,088.00 in attorney fees and $525,000.00 in costs. The panel held that Aguaytia was entitled to be reimbursed for IGV taxes that it had paid or would pay in connection with remedying LGA’s defective design and work and with employing attorneys and consultants for the arbitration. The panel could not determine the total amount of IGV taxes that Aguaytia would be entitled to seek from LGA. In the award, the panel established a procedure for Aguaytia to claim reimbursement from LGA if, and when, it paid those taxes. The panel held that Aguaytia was entitled to receive preaward and postaward interest and determined the dates from which interest would accrue. On June 1, 2001, the parties submitted a Joint Application for Correction of Final Award to the panel under Article 29(2) of the ICC Rules of Arbitration. In the Joint Application, the parties asked the panel to amend the Final Award by incorporating a stipulation that Aguaytia owed LGA $5.2 million in credits. The parties signed the stipulation in May 2001 and notified the panel before the panel entered the Final Award. On June 4, 2001, Aguaytia also filed a separate application for Correction and Interpretation of the Final Award under Article 29(2). On September 4, 2001, the panel issued an Addendum to the Final Award (the “Addendum”). (Aguaytia Ex. 60). In the Addendum, the panel denied the parties’ Joint Application to incorporate the stipulation and reduce the Final Award, stating that “[a]s matters contained in the May 2001 Stipulation were resolved by the parties and are not subject to resolution by the Tribunal, there is no proper basis for ‘correcting’ or ‘interpreting’ the Final Award.” (Id.). The panel granted, in part, and denied, in part, Aguaytia’s separate request for interpretation and correction. LGA filed a First Amended Petition and Motion to Vacate, Modify or Amend Arbitration Awards in this court. (Docket Entry No. 36). LGA challenges the following specific aspects of the award: (1) The award of liquidated damages to Aguaytia for LGA’s failure to achieve interim deadlines under the Agreement. (2) The “pipe credit” awarded to Aguay-tia for unused labor and materials for pipeline that LGA did not purchase or install on the project. (3) The award of damages to Aguaytia for remedying pipeline corrosion from carbon dioxide. (4) The award to Aguaytia for a defect in the “as built” drawings. (5) The establishment of a procedure for Aguaytia to claim reimbursement for IGV taxes. (6) The award of attorney fees and costs to Aguaytia. LGA does not specifically challenge the many other rulings and findings that the panel made. LGA does not specifically challenge the Interim Award rulings granting and denying LGA’s claims for unpaid bonuses and contract adjustments. The Final Award not only incorporated the Interim Award, but specifically addressed twenty-nine separate items, of which LGA challenges only six. LGA challenges the other points only to the extent LGA asserts that arbitrator bias requires the entire award to be vacated and resubmitted to a new panel. LGA’s specific challenges are based on the following grounds: (1) Certain aspects of the award are arbitrary and capricious. (2) In awarding certain damages to Aguaytia, the panel abused and exceeded its authority in the Agreement, issues submitted, and Terms of Reference. (3) Aspects of the award failed to draw their essence from the contract. (4) Certain aspects of the award show manifest disregard for New York law. (5) The panel failed to hear and consider evidence pertinent and material to certain aspects of the case. (6) The panel failed to issue a final and definite award. LGA challenges the entire award on the ground that one of the panel members, Jaffe, was partial and engaged in misconduct. (Docket Entry No. 48, pp. 5-6; Docket Entry No. 36). After the panel issued the Addendum, LGA filed a Supplemental Petition and Motion to Vacate Arbitration Awards, asserting that the panel’s refusal to incorporate the parties’ stipulation as to credits and payments owed LGA, reducing the amount of the award, was, in itself, a sufficient ground for vacating the entire award. (Docket Entry No. 48). LGA asserted that in refusing to incorporate the stipulation, the panel “deliberately engaged in acts of misconduct and violated their duties — all to the prejudice of LGA.” (I'd, p. 2). Aguaytia has filed a Motion to Confirm and Enforce International Arbitration Awards, for Judgment and for Posting of Bond. (Docket Entry No. 45). Aguaytia asks this court to enter judgment that includes the $5.2 million the parties stipulate is owing to LGA as an offset. Aguay-tia asks this court to confirm the $13.4 million award but enter judgment in the amount of $7,821,539.00, exclusive of interest. Aguaytia also asks this court to order LGA to post a bond for $9,100,000.00, representing the principal and interest due. Aguaytia asserts that this court has authority to require a bond under Article 6 of the Inter-American Convention and Article VI of the New York Convention. LGA opposes the motion to confirm and the bond request. LGA argues that this court lacks authority to modify the Final Award by reducing it to reflect the parties’ Stipulation. (Docket Entry No. 49). LGA also argues that this court lacks authority to order a bond and, in the alternative, that a bond is unnecessary. (Docket Entry No. 50). The parties have submitted a voluminous record, including the evidence submitted -to the arbitration panel, motions and correspondence filed with the ICC, the panel’s awards, and excerpts of the transcripts from the arbitration proceedings. This court has carefully read each of the parties’ briefs and responses, as well as the evidence submitted, and has analyzed the parties’ arguments in light of the relevant law. This court addresses each of the issues presented below. II. The Applicable Legal Standard A court considering an arbitration award under the FAA applies a deferential standard of review. Gulf Coast Indus. Workers Union v. Exxon Co., 991 F.2d 244, 248 (5th Cir.1993); Psarianos v. Standard Marine, Ltd., 790 F.Supp. 134, 135 (E.D.Tex.1992), aff'd, 12 F.3d 461 (5th Cir.), cert. denied, 511 U.S. 1142, 114 S.Ct. 2164, 128 L.Ed.2d 887 (1994). The party moving to vacate an arbitration award has the burden of proof. Spector v. Torenberg, 852 F.Supp. 201, 206 (S.D.N.Y.1994). Judicial review of arbitrators’ decisions is “extraordinarily narrow” under the Federal Arbitration Act. In the Matter of the Arbitration Between Trans Chem. Ltd. & China Nat’l Mach. Import & Exp. Corp., 978 F.Supp. 266, 303 (S.D.Tex.1997)(citing Gulf Coast Indus. Workers Union v. Exxon Co., 70 F.3d 847, 850 (5th Cir.1995), and Forsythe Int’l. S.A. v. Gibbs Oil Co. of Texas, 915 F.2d 1017, 1020 (5th Cir.1990)); see also Executone Info. Sys., Inc. v. Davis 26 F.3d 1314, 1320 (5th Cir.1994). The Federal Arbitration Act provides four grounds for vacating an award: (1) Where the award was procured by corruption, fraud, or undue means. (2) Where there was evident partiality or corruption in the arbitrators, or either of them. (3) Where the arbitrators were guilty of misconduct in refusing to postpone the hearing, upon sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy; or of any other misbehavior by which the rights of any party have been prejudiced. (4) Where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made. 9 U.S.C. § 10(a). The Fifth Circuit has held that an arbitration award may be vacated if (1) the award is contrary to public policy; (2) the award is arbitrary and capricious; (3) the award fails to draw its essence from the underlying contract; or (4) the award displays manifest disregard of the law. Williams v. Cigna Fin. Advisors Inc., 197 F.3d 752, 758-61 (5th Cir.1999). Review on these grounds is necessarily narrow, limited to determining whether the arbitration proceeding was fundamentally unfair. Id. Courts repeatedly admonish that “severely limited” judicial review is an essential, and inherent, feature of contractually agreed binding arbitration, necessary to avoid undermining the “twin goals of arbitration ... settling disputes efficiently and avoiding long and expensive litigation.” In the Matter of the Arbitration Between Trans Chemical Limited and China Nat’l Machinery Import and Export Corp., 978 F.Supp. 266, 303 (S.D.Tex.1997), aff'd, 161 F.3d 314 (5th Cir.1998). A district court should “interpret the arbitrator’s award and the contract broadly so as to uphold the award.” Manville Forest Prods. Corp. v. United Paperworkers Intern. Union AFL-CIO, 831 F.2d 72, 74 (5th Cir.1987)(citing United Steelworkers of America v. Enterprise Wheel & Car Corp., 363 U.S. 593, 598, 80 S.Ct. 1358, 4 L.Ed.2d 1424). A district court must accept the arbitrator’s factual findings and the arbitrator’s interpretation of the contract even if it disagrees with the arbitrator’s interpretation of the underlying contract, as long as the arbitrator’s decision “draws its essence” from the contract. Executone, 26 F.3d at 1320 (citing United Paperworkers Int’l Union v. Misco, Inc., 484 U.S. 29, 36, 108 S.Ct. 364, 98 L.Ed.2d 286 (1987)). A district court “must affirm the arbitrator’s decision if it is rationally inferable from the letter or the purpose of the underlying agreement.” Id. (citing Anderman/Smith Operating Co. v. Tennessee Gas Pipeline Co., 918 F.2d 1215, 1218 (5th Cir.1990)). An award is “arbitrary and capricious” only if “a ground for the arbitrator’s decision cannot be inferred from the facts of the case.” Ainsworth v. Skurnick, 960 F.2d 939, 941 (11th Cir.1992)(vacating award where, despite district court’s instruction that Florida law required award of statutory damages, arbitration panel failed to award such damages without explanation). In First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995), the Supreme Court stated that a court may set aside an arbitration award “only in very unusual circumstances,” and that “parties [are] bound by [an] arbitrator’s decision not in ‘manifest disregard’ of the law.” Id. at 942, 115 S.Ct. 1920 (citing Wilko v. Swan, 346 U.S. 427, 436-37, 74 S.Ct. 182, 98 L.Ed. 168 (1953), overruled on other grounds, Rodriguez de Quijas v. Shearson/American Express, Inc., 490 U.S. 477, 109 S.Ct. 1917, 104 L.Ed.2d 526 (1989)). The Fifth Circuit has described First Options as the Supreme Court’s “clear approval of the ‘manifest disregard’ of the law standard in the review of arbitration awards under the FAA.” Williams v. Cigna Fin. Advisors Inc., 197 F.3d 752, 759 (5th Cir.1999)(citing, accord, Montes v. Shearson Lehman Bros., Inc., 128 F.3d 1456, 1459 (11th Cir.1997); Barnes v. Logan, 122 F.3d 820 (9th Cir.1997), cert denied, 523 U.S. 1059, 118 S.Ct. 1385, 140 L.Ed.2d 645 (1998); Cole v. Burns Int’l Sec. Servs., 105 F.3d 1465, 1486 (D.C.Cir.1997); M & C Corp. v. Erwin Behr GmbH & Co., KG, 87 F.3d 844 (6th Cir.1996)). A party asserting “manifest disregard” of the law must meet a heavy standard. The Fifth Circuit applies a two-step test: First, where on the basis of the information available to the court it is not manifest that the arbitrators acted contrary to the applicable law, the award should be upheld. Second, where on the basis of the information available to the court it is manifest that the arbitrators acted contrary to the applicable law, the award should be upheld unless it would result in significant injustice, taking into account all the circumstances of the case, including power of arbitrators to judge norms appropriate to the relations between the parties. Williams, 197 F.3d at 762 (quoting Ian R. Macneil et al., 4 Federal Arbitration Law § 20.7.2.6, 40:95 (Supp.1999)(footnote omitted)). The Second Circuit has described the reach of the “manifest disregard” doctrine as “severely limited.” Halligan v. Piper Jaffray, Inc., 148 F.3d 197, 202 (2d Cir.1998)(quoting Government of India v. Cargill, Inc., 867 F.2d 130, 133 (2d Cir.1989)). That court stated, “[Un-deed, we have cautioned that manifest disregard ‘clearly means more than error or misunderstanding with respect to the law.’ ” Id. (quoting Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Bobker, 808 F.2d 930, 933 (2d Cir.1986)). To modify or vacate an award on this ground, “a court must find both that (1) the arbitrators knew of a governing legal principle yet refused to apply it or ignored it altogether, and (2) the law ignored by the arbitrators was well defined, explicit, and clearly applicable to the case.” Id. (citing DiRussa v. Dean Witter Reynolds, Inc., 121 F.3d 818, 821 (2d Cir.1997)). In deciding whether an arbitration panel exceeded its authority, the district court resolves all doubts in favor of arbitration. Executone, 26 F.3d at 1320-21 (citing Valentine Sugars, Inc. v. Donau Corp., 981 F.2d 210, 213 (5th Cir.1993)). In reviewing an award, a court is not limited to the panel’s explanation of the award. Id. at 1325. A district court “looks only to the result reached. The single question is whether the award, however arrived at, is rationally inferable from the contract.” Id. (quoting Anderman/Smith Operating Co., 918 F.2d at 1219 n. 3). This standard of review must be applied to each argument LGA makes to vacate or modify the award. III. The Award of Liquidated Damages for LGA’s Failure to Meet Interim Deadlines The arbitration panel awarded Aguaytia $6.8 mill inn in liquidated damages for LGA’s failure to meet “interim milestones” set in the Agreement. These “interim milestones” are dates by which LGA had to achieve particular “intermediate construction progress.” (Docket Entry No. 36, p. 21). The Agreement defined criteria for three “milestones”: (1) “First Completion” (Section 1.01 at p. 5); (2) “Second Completion” (Section 1.01 at p. 12); and (3) “Commercial Operation” (Section 1.01 at p. 2). The panel awarded Aguaytia liquidated damages for LGA’s failure to meet requirements for the First and Second Completions. (Docket Entry No. 36, Ex. A, p. 3). The Agreement provided that if LGA faded to achieve First Completion by the Guaranteed First Completion Date of December 30, 1997, LGA would pay liquidated damages of $43,000 per day until it achieved First Completion. If LGA failed to achieve Second Completion by the Guaranteed Second Completion Date of January 30, 1998, LGA would pay liquidated damages of $20,000 for each day of delay, subject to a maximum. The Agreement also provided that LGA would be paid a bonus for each day it saved on these contractual deadlines. LGA does not dispute that delays occurred. Instead, LGA argues that under the New York law governing “concurrent delay,” Aguaytia’s own delays entitled LGA to an extension of time and abrogated Aguaytia’s right to obtain contractual liquidated damages. In arbitration, LGA asserted that it was entitled to an extension of the contractual deadlines; delay damages; and an early completion bonus. Aguaytia contended that none of the acts or omissions LGA asserted met the contractual requirements for a delay that could extend the contract deadlines and preclude liquidated damages for that period. The arbitration panel considered each of Aguaytia’s acts and omissions that LGA claimed caused its own delay in achieving the First and Second Completions. The panel found that as to one area, LGA was entitled to an extension of time for Aguay-tia’s concurrent delay. As to the remaining areas, the panel concluded that LGA had not proven the elements necessary to show a “Company Delay” as defined by section 13.01(a) of the Agreement. LGA asserts that the panel acted in “manifest disregard” of New York law governing “concurrent delay” and indefinite contract terms, which resulted in an “arbitrary and capricious” liquidated damages award. (Docket Entry No. 36, p. 10). A. Concurrent Delay During Phase 1 of the arbitration, both LGA and Aguaytia presented witness statements, cross-examined witnesses, presented experts, and argued about whether Aguaytia’s own acts and omissions contributed to LGA’s failure to meet the interim construction deadlines, so as to relieve LGA of the liquidated damages provided under the Agreement. LGA asserted that Aguaytia’s “Company Delays” caused LGA to be delayed in achieving both the First and Second Completions. Section 13.01(a) of the Agreement defines a “Company Delay,” as follows: If (i) Contractor is delayed in performing any aspect of the Work due to a delay of Company in performing its obligations under this Agreement, (ii) the cause of such delay does not arise from Force Majeure, and (iii) Contractor is unable to proceed with other portions of the Work so as not to cause a delay in the First Completion Date, the Second Completion Date, and/or the Commercial Operation Date, the Contractor shall give Company notice of the occurrence of such condition as soon as it becomes aware thereof (a “Company Delay”). Section 16.02 of the Agreement provided that the contract deadlines could be adjusted as: a result of Company Delay ... that will cause a delay in the Project Schedule such that there will be a corresponding delay in Contractor achieving the First Completion Date, the Second Completion Date, ... in which event Contractor shall be entitled to a one day extension ... for each such day of delay .... In the Interim Award, the panel explained why it concluded that there was one “Company Delay” on the part of Aguaytia that, under the doctrine of concurrent delay, extended the First Completion Date by almost one month, in LGA’s favor. The panel also explained why it concluded that the other acts and omissions LGA asserted were not “Company Delays” by Aguaytia and did not warrant extensions of the completion dates or preclude liquidated damages for the days LGA failed to meet the deadlines. (Docket Entry No. 43). LGA asserts that the panel “manifestly disregarded” New York law on concurrent delay in reaching these conclusions. LGA argues that the panel applied a more rigorous “total time” standard, set out in federal Court of Claims cases addressing the burden on a party seeking to recover liquidated damages on government contracts. The panel recognized in both the Summary Disposition and the Interim Award that New York law on concurrent delay applied. In the Summary Disposition, the panel stated that in order to receive an extension under the parties’ Agreement, LGA had to demonstrate: (1) the existence of a “Company Delay” by Aguaytia, as defined in Section 13.01(a) of the Agreement, and (2) that the Company Delay actually impaired LGA’s ability to meet the deadlines under Section 16.02(a)(ii) of the Agreement. (Aguaytia Ex. 6, p. 3). The panel stated that “[ljiquidated damages will not be recovered by [Aguaytia] for LGA’s delays where, and to the extent, there are concurrent Company Delays that impaired LGA’s achieving the relevant contract milestone.” (Id., p. 13). LGA does not dispute this statement of the concurrent delay rule. The panel noted that LGA had conceded that it had to “[establish a causal link between the claimed Company Delay and its inability to progress the work necessary to achieve the particular contract milestone for which it seeks a Target Schedule Adjustment.” (Aguaytia Ex. 6, p. 4). The panel cited to New York law and rules. (Id., p. 12)(citing Cushman & MEYERS, CONSTRUCTION LAW HANDBOOK, § 23.01[D], p. 825 (Aspen Law 1999)). LGA agrees that the panel correctly stated the applicable New York law on concurrent delay and that the panel correctly applied the law when it granted LGA a twenty-seven day extension of the First Completion Date based on a shared responsibility for a pressure control valve that was not timely installed. LGA argues that except as to as to this one area, the panel failed to apply New York law on concurrent delay and instead applied a more stringent federal law standard that uses a “total time” analysis. Under a “total time” analysis, LGA had to prove the following elements: a causal connection between Aguaytia’s improper conduct and a specific amount of delay; that other methods (other than the one prohibited by Aguaytia) to achieve the same result were not available; or that such methods, if used, would have been unavailing. (Docket Entry No. 36, Ex. A, p. 8)(citing WRB Corp. et al. v. United States, 183 Ct.Cl. 409, 427 (Ct.Cl.1968)). The panel specifically addressed five areas that LGA asserted as “Company Delays”: Aguaytia’s denial of right of way access to LGA; Aguaytia’s announced plan to shut down two wells; Aguaytia’s inspectors’ refusal to allow LGA to use tack welds to close pipe ends, resulting in dirty pipes that slowed LGA’s pipe cleaning; Aguaytia’s failure to control inlet pressure of gas into the plant; and Aguaytia’s rejection of LGA’s pipeline tests. The record reveals that the arbitration panel considered each of these arguments and found that LGA had failed to show a Company Delay by the project owner, Aguaytia, as defined in Section 13.01(a) of the Agreement. The record supports these findings. As to the claim of failure to provide access to the right of way, the panel found that Aguaytia had not breached any obligation under the parties’ “early start agreement” or under the Agreement itself to make right-of-way access available before a certain date. The panel also concluded that LGA did not show that its inability to have right of way access before that date was a “critical path delay.” The panel did not, as LGA contends, apply federal law to this issue. Instead, the panel examined the Agreement provisions on access; heard the disputed evidence as to the effect of obstructed right of way access; and concluded that LGA had not met the contractual criteria for a “Company Delay” that would trigger the application of the concurrent delay rule. (Docket Entry No. 36, Ex. A, pp. 5). Federal case law involving a “total time” analysis played no role in the panel’s decision on this issue. The panel cited federal case law, and referred to a “total time” analysis, as to only two of the “Company Delay” claims. The panel did not cite federal law, or refer to a “total time” analysis, in analyzing the right of way access delay claim; the claim of delay from Aguaytia’s planned shutdown of two wells; or the claim of delay from the failure to control inlet pressure of gas into the plant. The panel did cite federal cases and law, and refer to a “total time” analysis, in its decision on LGA’s claim that Aguaytia’s refusal to allow tack welded end caps on open sections of pipeline caused dirt and debris to gather in the pipelines and delayed the pipeline cleaning work. The panel also referred to a “total time” analysis in discussing LGA’s claim of delay arising from Aguaytia’s rejection of certain tests LGA performed. A review of the record reveals that in neither section of the award did the panel manifestly disregard controlling New York law. In its discussion of the impact of Aguay-tia’s refusal to allow LGA to tack weld end caps on pipes during construction, the panel first examined whether the refusal amounted to a “Company Delay” under the Agreement. The panel concluded that the evidence showed that LGA had a number of alternatives available to mitigate the effect of Aguaytia’s refusal to allow tack welds and that LGA had failed to show that there was a causal connection between Aguaytia’s “improper refusal ... and a specific amount of delay later in the cleaning and testing process.” The panel found no Company Delay as defined in section 13.01 of the Agreement. The panel went on to note that, in addition to the inability to show a “Company Delay,” LGA had not shown the prerequisites to a total time claim, citing federal cases. However, the panel did not deny this delay claim by manifestly disregarding the New York law of concurrent delay. Rather, the panel based its denial on the conclusion that LGA had not made the necessary showing under the contractual definition of “Company Delay.” LGA also challenges the panel’s rejection of the claim that Aguaytia had improperly rejected test results as based on a “total time” theory. The panel’s discussion states that “LGA approached the issue as a total time claim”; the panel concluded that LGA had not met the requirements. (Docket Entry No. 36, Ex. A, p. 11). In one of its briefs in support of its petition, LGA stated that “[assuming without conceding that LGA employed a ‘total time analysis’, New York courts permit the use of the ‘total cost method’ where it is ‘prohibitively difficult or speculative to follow the ordinary measures of damages.’” (Docket Entry No. 25, p. 20). The panel rejected LGA’s total time basis for claiming that Aguaytia’s test result rejection had delayed LGA’s work by fifty-one days. The panel went on to analyze the evidence showing problems with LGA’s testing and with its work on the pipeline, which caused problematic test results. The panel concluded, again relying on the contractual definition of “Company Delay” in section 13.01 and the evidence in the record, that LGA had not shown a Company Delay that would trigger application of the concurrent delay rule. The panel did not apply a federal law “total time” standard, in manifest disregard of New York law on concurrent delay. LGA’s citation to New York cases applying the doctrine of concurrent delay do not support its argument that the panel manifestly disregarded New York law. In Mosler Safe Co. v. Maiden Lane Safe Deposit Co., 199 N.Y. 479, 93 N.E. 81 (1910), the court held that if an owner or the architect acts so as to delay a contractor’s work, the contractual provision for liquidated damages for delay is waived and cannot be renewed. The court relied on the general rule that damages for delays caused by mutual fault cannot be apportioned unless the contract permits substitution of another date for completion. Id. at 83-84. The court explained that while a liquidated damages clause does not have “the harshness of a penalty, it is, nevertheless, in its nature, such that its enforcement, where the party claiming the right to enforce has, in part, been the cause of delay, would be unjust.” Id. at 83. In XLO Concrete Corp. v. John T. Brady & Co., 104 A.D.2d 181, 482 N.Y.S.2d 476 (N.Y.App.Div.1984), the court described Mosler Safe as “clearly addressing a situation where the liquidated damages clause sought by the owner exceeded its actual delay damages and the court was concerned with the injustice of permitting the owner to reap the benefit of the liquidated damage clause.” Id. at 480. This case does not present such a situation. In Halligan, the court vacated an award based on manifest disregard of the law. The plaintiff had presented “overwhelming” and “strong” evidence of age discrimination, but the arbitrator denied the claim without explanation. 148 F.3d at 203-04. The court acknowledged that arbitrators are not required to explain their awards, but stated that when a court is already inclined to hold that a panel manifestly disregarded the law, the failure to explain may be taken into account to support that result, especially if all imaginable explanations would “strain credulity.” Id. at 204. In this case, unlike Halligan, the arbitration panel painstakingly explained its reasons for its decisions in awarding liquidated damages for the delays. The record in this case presents neither overwhelming evidence against the result reached nor an absence of explanation for that result. An award does not result from “manifest disregard” of the law merely because of error in understanding or applying the law. An award may not be vacated on this basis unless the arbitrators manifestly acted contrary to the applicable law, resulting in significant injustice. Williams, 197 F.3d at 762. This court finds that LGA has failed to carry its burden to show that the panel’s decisions granting liquidated damages and rejecting LGA’s claims of Company Delays resulted from “manifest disregard” of New York law on concurrent delay, under either the Fifth or Second Circuit standard. For the same reasons, this court finds that LGA failed to allege or present facts showing that the panel’s award was arbitrary and capricious. This court DENIES LGA’s motion to vacate, modify, or amend the liquidated damages award on the basis of manifest disregard of the law of concurrent delay. B. Indefiniteness of Contract Terms LGA argues that it should not be held liable for liquidated damages for its delay in obtaining the First and Second Completion Deadlines because the contract terms used to measure compliance with the Deadlines were so indefinite as to be unenforceable. LGA argues that the panel manifestly disregarded New York law making vague and indefinite contract terms unenforceable. Section 1.10 of the Agreement required LGA to perform certain tests “in accordance with Section 4.05” in order to achieve the First Completion and Second Completion Dates. Section 4.05 of the Agreement states that all performance tests must be “conducted and measured as provided in Schedule 4.05,” which, in turn, sets out the conditions for the initial performance tests required to achieve the First and Second Completion Dates. The panel imposed liquidated damages for LGA’s delay in achieving these dates, due to problems with the initial performance tests. The panel found that although LGA conducted initial performance tests on the gas plant in late December 1997, in March 1998, and in early May 1998, “[p]rior to the tests that were run on May 20-22, 1998, the requirements of the Agreement regarding First Completion were not met.” The panel found that before that date, LGA did not do some of the tests and did others improperly. The panel held LGA responsible for liquidated damages for delays to May 22, 1998 for First Completion and May 22, 1998 for Second Completion. LGA first argues that under the Agreement, it was not obligated to meet “performance guarantees” required for “complete operation” in order to meet the First and Second Completion requirements. The panel’s decision is consistent with LGA’s position. In its decision, the panel acknowledged that LGA did not have to meet the performance guarantees contained in Section 2.06 of the Agreement to meet the First and Second Completion requirements. However, according to the panel, LGA did have to meet the protocols set out in Schedule 4.05 of the Agreement. (Docket Entry No. 86, Ex. A, p. 9). The panel concluded that LGA had failed to perform some of the tests necessary to achieve the First and Second Completions and had performed others improperly by failing to comply with the protocols described in Schedule 4.05. LGA argues that the Section 4.05 protocols it failed to satisfy are too indefinite to be enforceable under New York law. LGA focuses on the provision in Schedule 4.05, requiring the contractor to establish inlet stream rates and conditions “as nearly as possible” to the design conditions and to adjust plant operation conditions to conform “as nearly as possible” to the design conditions. (Docket Entry No. 25, p. 30; Section 4.05(i)). LGA argues that these provisions are analogous to contract clauses “purporting to obligate a party to use its ‘best efforts’ in achieving an end,” which New York courts have found unenforceable for indefiniteness. (Id., p. 31)(citing Strauss Paper Co., Inc. v. RSA Exec. Search, Inc., 260 A.D.2d 570, 688 N.Y.S.2d 641, 642-43 (N.Y.App.Div.1999)). LGA’s argument is not supported by the record before the arbitration panel or . the basis of its decision. Even assuming that the phrase “as nearly as possible” is similar to the phrases in the cases cited, the panel’s decision did not turn on LGA’s failure to conduct tests “as nearly as possible” to the design conditions. The panel found that LGA failed to perform a Propane Recovery Test, which section 1.01 of the Agreement specifically required for First Completion. The panel also found that LGA had failed to run the tests for forty-eight hours, a definite part of the Schedule 4.05 protocols that LGA had to satisfy. The panel found that under the contract, LGA could not attain Second Completion until it completed the tests for the Fractionation Plant, as required in Section 1.01 of the Agreement. Again, the panel did not rest its conclusion on LGA’s failure to comply with criteria LGA faults as vague and indefinite. LGA’s final challenge to this aspect of the award is that the panel’s findings are contrary to the “essence” of the parties’ agreement. LGA argues that the forty-eight hour requirement was part of a performance guarantee set out in Section 2.06 of the Agreement, not a required protocol under Section and Schedule 4.05. LGA points to deposition testimony from an Aguaytia witness, who explained that the business purpose for the First Completion Date in the Agreement was that Aguaytia “needed to have a facility that was capable of running and supplying gas to our power plant.” (Docket Entry No. 25, p. 32). LGA argues that it provided usable gas to the plant by the First Completion deadline, meeting the purpose of the contractual requirement. The award must be sustained if the arbitrator’s decision “draws its essence” from the Agreement. Executone, 26 F.3d at 1320 (quoting United Paper- workers Int’l Union v. Misco, Inc., 484 U.S. 29, 36, 108 S.Ct. 364, 98 L.Ed.2d 286 (1987)). The Fifth Circuit has stated that an award fails the “essence” test only when it is “so unfounded in reason and fact, so unconnected with the wording and purpose of the [agreement] as to ‘manifest an infidelity to the obligation of an arbitrator.’ ” Id at 1325 (quoting Brotherhood of R.R. Trainmen v. Central Co. Ry., 415 F.2d 403, 412 (5th Cir.1969), quoting United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593, 597, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960)). LGA is correct that Section 2.06 of the Agreement, pertaining to performance guarantees, states that LGA must run the tests for two consecutive twenty-four hour periods. Section 1.01 states that LGA did not have to satisfy the performance guarantees in the performance tests necessary to achieve the First and Second Completion Dates. However, LGA did have to conduct the tests under Section 4.05 and the Schedule 4.05 protocols. Schedule 4.05 also refers to the “48 hour performance test” and the “48 hours test period.” (Agreement, Section 4.05(h) and (j)). Aguaytia notes that LGA’s start-up supervisor, Ed Munoz, “conceded at the Phase 1 hearing the necessity that LGA run the performance test for 48 hours.” (Docket Entry No. 19, p. 24). Section 4.05 could reasonably be interpreted to impose a forty-eight hour testing requirement for the tests that were clearly necessary to achieve the First and Second Completion Dates. LGA has not shown that the panel’s interpretation was so unreasonable as to be contrary to the “essence” of the parties’ agreement. The panel members interpreted the Agreement and the evidence and unanimously determined that LGA did not meet the requirements for either the First or Second Completion Dates until May 22, 1998. The panel used that date in assessing liquidated damages for delay under the Agreement. LGA has failed to allege or present facts showing that the panel’s interpretation of the contract requirements for achieving the First or Second Completion Dates manifestly disregarded New York law, that upholding that interpretation would result in significant injustice, or that the result fails to draw its essence from the contract. Williams, 197 F.3d at 762. LGA also has failed to show that the panel’s interpretation of the Agreement was not “rationally inferable from the letter or the purpose of the underlying agreement,” so as to be arbitrary and capricious. Executone, 26 F.3d at 1320. This court DENIES LGA’s motion to vacate, modify, or amend the liquidated damages award on the basis of indefinite contract terms or the panel’s interpretation of the contractual requirements for the First and Second Completion Dates. IV. The Award of Carbon Dioxide Corrosion Damages and New York Law on the Basis of Design LGA asserts that the panel acted in manifest disregard of New York law when it awarded almost $1.6 million to Aguaytia for work necessary to remedy carbon dioxide corrosion in the project pipes and plants. (Docket Entry No. 36, p. 25). The corrosion was caused by the combination of free water in the production facility and carbon dioxide in the produced gas. LGA argues that it designed and constructed the pipes on the “Basis of Design” Aguaytia furnished in Schedule 2.06 of the Agreement. LGA relies on the following description of the water content in the pipes: “Sat... LB/MMSCF.” LGA argues that this description “effectively caused LGA to design pipelines ... for saturated natural gas with no free water consistent with industry standards.” (Docket Entry No. 36, p. 26). LGA argues that the panel manifestly disregarded New York law that entitled LGA to design and construct facilities consistent with Aguaytia’s “Basis of Design.” LGA cites Young Fehlhaber Pile Co. v. State, 265 A.D. 61, 37 N.Y.S.2d 928 (N.Y.App. Div.—3d Dept.1942) for the general rule that a contract bidder may “properly rely upon the clear and unequivocal information contained in the plans, otherwise they would serve no useful purpose.” Id. at 929. In Young Fehlhaber, the court stated that plans “should reasonably depict the work to be done and where they are definite and plain the contractor is entitled to rely upon them.” Id. at 930. In Young Fehlhaber, the court held that the State could not recover damages for the costs of reconstructing a bridge because the State had provided the contractor with plans showing the river depth to be four feet shallower than the actual depth. The court found that the State knew its plans to be inaccurate and that the State had committed fraud in its representations to the project bidders. Id. at 929. In this case, the panel did not disregard New York law on the basis of design. The panel analyzed the parties’ contentions and evidence as to whether Aguaytia’s statements in Schedule 2.06 of the Agreement were “sufficient to alert [LGA] to the possibility of corrosion within the pipelines that it was designing.” (Docket Entry No. 36, Ex. A, p. 17). The parties agree that “Sat... LB/MMSCF” indicated that the gas would be saturated. (Docket Entry No. 21, Ex. 18, p. 8). During the arbitration, both parties presented evidence as to the meaning of “saturated” in Schedule 2.06 and whether that description necessarily implied the absence of free water in the system. LGA asserts that it presented “competent, unrebutted expert testimony” to the panel that the specification in the Agreement allowed LGA to assume the absence of free water in the pipe system. LGA presented testimony from its expert, William Krause, that Schedule 2.06’s specification of the gas stream at the Gas Plant inlet as “Sat.” necessarily meant that there would be no “free water” at the plant fence. However, Aguaytia presented evidence disputing Krause’s testimony. Aguaytia’s witnesses, including James McHaney and Tony Hines, presented evidence that the term “Sat.” did not address or exclude the probability of free water in the gas stream. (Docket Entry No. 21, Ex. 18, p. 8). These witnesses testified that the information available to LGA, including the information as to the composition of the gas stream, was sufficient to inform LGA that there was a likelihood of carbon dioxide corrosion in the pipes; that LGA had conducted a corrosion analysis that was inadequate for the gas plant piping and equipment; and that LGA had not included corrosion allowance or inhibitors for the gather lines, resulting in serious damage from corrosion. The panel considered the conflicting expert testimony and the exhibits. The panel concluded that the statements and information in Schedule 2.06 of the Agreement, with other information available to LGA, told LGA that both carbon dioxide and water were present in the gas stream and that changes would occur in the temperature of the gas and in the gas pressure in the pipeline from the wellhead to the Gas Plant that would likely result in water condensation. The panel concluded that LGA had information from Aguaytia to disclose that carbon dioxide could be present and could cause corrosion in the pipelines LGA was designing. (Docket Entry No. 36, Ex. A, p. 17). The panel rejected LGA’s argument that the statement that the gas would be “Sat.” necessarily meant that there would be no free water in the pipes. That decision is supported by evidence in the record. The record supports the panel’s finding that applying New York law on the basis of design to the Agreement specification at issue did not permit LGA to assume the absence of free water in the system. The panel concluded that the information Aguaytia provided was sufficient to notify LGA of the possibility of corrosion if it did not take steps to address the presence of carbon dioxide and water in the system. (Docket Entry No. 36, Ex. A, p. 17). During Phase 2, LGA argued that the measure of corrosion damages should be limited to $432,000.00, the cost of repairing the corrosion in the pipes according to LGA’s proposed method. The panel again heard expert testimony from both sides and determined that Aguaytia’s proposed method for addressing the corrosion damage, while more costly, “can be considered prudent for the safe operation of the plant” and was “appropriate, prudent, and reasonable from a cost perspective.” (Docket Entry No. 36, Ex. B, p. 33, p. 34). In the Final Award, the panel reiterated that it had determined that, contrary to LGA’s argument, “Schedule 2.06 did not relieve LGA of responsibility for addressing the presence of C02 in the gas.” {Id., p. 34 n. 7). The panel explained its conclusion as based on its interpretation of the Agreement, the expert testimony, and the other evidence submitted. This court finds that the panel’s conclusions did not manifestly disregard New York law on the basis of design. Instead, the panel based its conclusion on an analysis of the record evidence as to the design information Aguay-tia provided to LGA to use in designing and constructing the plant and pipelines. This court DENIES LGA’s request to vacate, modify, or amend the portion of the award relating to damages for carbon dioxide corrosion. Y. The Panel’s Evidentiary Ruling: The Award for Pipe Credit LGA asserts that the panel wrongfully excluded evidence of what the parties intended Section 5.05(b) of the Agreement to mean, “in violation of the Inter-American Convention, Article 5(l)(b), the New York Convention, the FAA, 9 U.S.C. § 10(a)(3), and in violation of LGA’s due process rights.” (Docket Entry No. 36, p. 32). LGA argues that the panel’s exclusion of this evidence resulted in a wrongful award of $1,014,000.00. (Id.). Aguaytia responds that the panel properly excluded the evidence and that its ruling cannot form a basis for vacating or modifying the award. (Docket Entry No. 19, pp. 25-29). Section 5.05(b) of the Agreement states: The maximum amount of adjustment to the Contract Price that shall occur as a result of differences in pipe length is an upward or downward adjustment of U.S. $500,000, regardless of the actual required length of pipe installed. In the arbitration, and in this court, LGA asserted that Section 5.05(b) imposed a $500,000.00 limit on the amount that Aguaytia could receive as credit for the cost of pipe and for pipe installation services that LGA had never purchased or performed. In the Summary Disposition, the panel concluded that the $500,000 cap applied only to credit for amounts Aguay-tia had paid for installing pipe that was not used. The panel concluded that the $500,000 cap did not apply to limit the credit Aguaytia could receive for amounts it had paid LGA for pipe material that LGA had not purchased. The panel stated as follows: LGA’s argument is plausible only if read in isolation. Rather, Section 5.05(b) and Schedule 5.05(b), which is specifically referenced in Section 5.05(b) make it plain that the cost of the pipe material itself and the cost of the installation are treated separately. Section 5.05(b) focuses on the cost of installation, leaving the matter of material cost adjustment to the text at the top of Schedule 5.05(B), namely: if the extra pipe was ordered, it is to be delivered to [Aguay-tia] and LGA is to be paid for the pipe; if the pipe length is adjusted before the pipe was ordered, the price for the pipe material will be “the actual invoice and amount of the pipe, coating and freight.” LGA’s isolated reading of the last sentence of Section 5.5(b) [sic] is not only askew from New York law, which requires that the provisions of an agreement are to be read in the context of the entire agreement, but makes no practical sense. Imagine, for example, LGA being required to absorb the material cost associated with a huge increase in the length of the pipeline. That result would be as inequitable as a result that pays LGA for pipe that it never ordered or for which it never paid. Yet, that is precisely the result that would obtain if we were to read the last sentence of Section 5.05(b) as LGA now urges. Based on the entirety of Section 5.05(b) and Schedule 5.05(B), the Arbitral Tribunal declares: The $500,000 limitation in Section 5.05(b) of the Agreement does not preclude [Aguaytia’s] claim for a price adjustment for the pipe material as a result of a reduction in the quantity of pipe required for the Project. (Docket Entry No. 21, Aguaytia Ex. 6, pp. 13-14). LGA submitted affidavits from one of its employees who had negotiated the Agreement with Aguaytia. In the affidavits, the witness stated that during negotiations, the parties discussed the $500,000 cap as applying to the cost of both procuring pipe material and installing the pipe. The panel struck these portions of the affidavits in procedural rulings issued in February 2000. The panel excluded the evidence under rulings applying New York law included in the Summary Disposition: “before a tribunal may receive extrinsic evidence as an aid to the interpretation of an agreement, the tribunal must conclude that the provision at issue is ambiguous. And, under New York law, a provision is ambiguous if it is susceptible to at least two reasonable, competing constructions.” (Docket Entry No. 21, Ex. 6, p. 3). At the hearing, the panel followed this approach and precluded LGA from cross-examining one of Aguaytia’s witnesses on the $500,000 cap. LGA requested the panel to reconsider its ruling on the meaning of Section 5.05(b). In the Interim Award, the panel denied the motion for reconsideration, stating that “[w]hile the textual argument made by LGA is consistent with a literal reading of the particular sentence in Section 5.05(b), the result is at odds with the structure and intent of the Agreement read in its entirety, as New York law requires.” (Docket Entry No. 36, Ex. A, p. 18). LGA argues that the panel’s two rulings are inconsistent: by stating that LGA’s interpretation was consistent with a “literal reading” of Section 5.05(b), the panel acknowledged that Section 5.05(b) could be given two different interpretations, making it ambiguous and making external evidence of the drafters’ intent admissible. LGA alleges that the panel’s evidentiary rulings excluding the affidavits and the cross-examination are a refusal to hear evidence “pertinent and material to the controversy,” a statutory ground for vacating the arbitration award. The Federal Arbitration Act permits a court to vacate an award if “the arbitrators were guilty of misconduct in ... refusing to hear evidence pertinent and material to