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United States of America Ex Rel. Mle Enterprises, Inc., and Mle Enterprises, Inc. v. Vanguard Conractors

May 9, 2013

UNITED STATES OF AMERICA EX REL. MLE ENTERPRISES, INC., AND MLE ENTERPRISES, INC.
PLAINTIFFS
v.
VANGUARD CONRACTORS, LLC, AND TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA
DEFENDANTS



MEMORANDUM OPINION

This matter comes before the Court on a motion for summary judgment by Defendant Travelers Casualty and Surety Company of America. (Def.'s Mot., Docket Number ("DN") 50.) The Plaintiff responded. (Pl.'s Resp., DN 54.) The Defendant replied. (Def.'s Reply, DN 55.) Fully brief, this matter is now ripe for adjudication. Having considered the matter and being fully advised, the Defendant's motion is GRANTED.

I.

The Miller Act, 40 U.S.C. § 3131 et seq., requires any person awarded a contract "for the construction, alteration, or repair of any public building or public work of the Federal Government" to provide the government with both performance and payment bonds. 40 U.S.C. § 3131(b). Any person who "has furnished labor or material in carrying out work provided in a contract for which a performance bond has been furnished . . . and has not been paid in full . . . may bring a civil action on the payment bond for the amount unpaid at the time the civil action is brought[.]" Id. § 3133(b)(1). An action for non-payment "must be brought no later than one year after the day on which the last of the labor was performed or material was supplied by the person bringing the action." Id. § 3133(b)(4).

In the present action, Plaintiff MLE Enterprises, Inc. ("MLE"), seeks to recover for non-payment on a contract with Defendant Vanguard Contractors, LLC ("Vanguard"). Vanguard was the prime contractor on the Building 700 project at Fort Sill, Oklahoma. MLE worked as a subcontractor under Vanguard. As required by 40 U.S.C. § 3131(b), Vanguard obtained performance and payment bonds for the project. Defendant Travelers Casualty and Surety Company of America ("Travelers") served as surety on those bonds. In addition to suing Vanguard for breach of contract, MLE seeks to recover from Travelers under the payment bond for Vanguard's alleged failure to pay.

Travelers moves for summary judgment on grounds that MLE did not file suit within the one-year statute of limitations set forth in 40 U.S.C. § 3133(b)(4).

II.

Summary judgment is appropriate where "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). In determining whether summary judgment is appropriate, a court must resolve all ambiguities and draw all reasonable inferences against the moving party. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).

"[N]ot every issue of fact or conflicting inference presents a genuine issue of material fact." Street v. J. C. Bradford & Co., 886 F.2d 1472, 1477 (6th Cir. 1989). The test is whether the party bearing the burden of proof has presented a jury question as to each element in the case. Hartsel v. Keys, 87 F.3d 795, 799 (6th Cir. 1996). The plaintiff must present more than a mere scintilla of evidence in support of his position; the plaintiff must present evidence on which the trier of fact could reasonably find for the plaintiff. See id. (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986)). Mere speculation will not suffice to defeat a motion for summary judgment; "the mere existence of a colorable factual dispute will not defeat a properly supported motion for summary judgment. A genuine dispute between the parties on an issue of material fact must exist to render summary judgment inappropriate." Monette v. Elec. Data Sys. Corp., 90 F.3d 1173, 1177 (6th Cir. 1996).

III.

Upon review of the parties' arguments and the evidence, the Court finds that MLE's claims against Travelers are barred by the one-year statute of limitations founds in 40 U.S.C. § 3133(b)(4). MLE's complaint was filed on August 25, 2010, and was brought more "than one year after the day on which the last of the labor was performed or material was supplied" by MLE. Any work performed, material provided, or inspection made by MLE on or after August 25, 2009 (one year before the complaint was filed) was merely "remedial or corrective work or materials, or inspection of work already completed, [which] falls outside of the meaning of 'labor' or 'materials' under [40 U.S.C. § 3133(b)(4)]." United States v. Int'l Fid. Ins. Co., 200 F.3d 456, 460 (6th Cir. 2000). In arriving at this conclusion, the Court examined three categories of evidence: 1) MLE's Application and Certificate for Payment, 2) statements by MLE's project manager, Kenneth Bronson, and 3) statements by Keith Adams of the Army Corp of Engineers. Analysis of each category is conducted below.

1.

In the complaint, MLE alleges that it "last performed work on the Project on or about August 28, 2009[.]" (Compl., DN 1, ¶ 10.) Evidence included with Travelers's motion for summary judgment contradicts this allegation. Specifically, the "Application and Certificate for Payment" produced by MLE during the course of discovery shows that MLE subcontracted with Vanguard for $1,350,342.85 in construction goods and services. (Application & Certificate for Payment, DN 50-3, p. 1.) As of June 26, 2009, the date of the payment application, the "Total Completed & Stored to Date" amount of MLE's work was $1,350,342.85, the exact amount of the subcontract. (Id.) The application for payment itemizes the specific tasks to be completed under the subcontract. Among other things, each item is assigned a "Scheduled Value" and a "Total Completed and Stored to Date" value. Subtracting the "Total Completed and Stored to Date" value from the "Scheduled Value" produces the "Balance to Finish" in Column H of the payment application. (Id. at p. 2.) The "Balance to Finish" is a measure of the work yet to be performed by MLE. As of June 26, 2009, the "Grand Total" at the end of the payment application lists a $0.00 balance for the "Balance to Finish" for all work to be performed under the subcontract. (Id. at p. 10.) This does not mean that MLE had been paid the full amount of the subcontract. Rather, it indicates that MLE completed all the labor and materials necessary to receive full payment. Accordingly, the application for payment shows that MLE had completed all "labor" and "materials" under the subcontract by June 26, 2009, more than twelve months before it filed suit against Travelers.

2.

During discovery MLE also produced an affidavit and hotel bill for MLE project manager Kenneth Bronson. (Aff. Kenneth Bronson, DN 50-4, pp. 3-5.) According to Bronson, he "personally visited the site of the project and performed labor at the request of Vanguard and the United States Corps of Engineers on September 29, 2009 by checking doors for proper operation and making final adjustments as necessary." (Id. at p. 3.) MLE argues that summary judgment is inappropriate on statute of limitations grounds because Bronson's statements demonstrate that MLE performed "labor" or provided "materials" within the twelve month period prior to filing its complaint. Bronson's actions ...


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