Dennis Allen Construction Co., Inc. v. Secretary of Army Corps of Engineers et al
MEMORANDUM OPINION AND ORDER granting in part and denying in part 7 Motion to Dismiss for Lack of Jurisdiction, as set forth. Therefore, the case is remanded to the Circuit Court of Baxter County, Arkansas, where it was originally filed, for further disposition. Signed by Honorable P. K. Holmes, III on August 2, 2012. (lw)
IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
DENNIS ALLEN CONSTRUCTION CO., INC.
Case No. 3:12-CV-03061
SECRETARY OF ARMY CORPS OF ENGINEERS,
LITTLE ROCK DISTRICT; BUZZARD ROOST HARBOR, INC.;
CHARLES W. THITOFF; PAULA K. THITOFF; and
MEMORANDUM OPINION AND ORDER
Currently before the Court are Defendant Secretary of the United States Army Corps of
Engineers’ (“the United States”) Motion to Dismiss for Lack of Jurisdiction (Doc. 7) and Brief in
Support (Doc. 8) and Plaintiff Dennis Allen Construction Co., Inc.’s (“Dennis Allen”) Response
(Doc. 9) and Brief in Support (Doc. 10). For the reasons stated herein, Defendant the United States’
Motion to Dismiss (Doc. 7) is GRANTED IN PART AND DENIED IN PART, and this case shall
be remanded, sua sponte, to the Circuit Court of Baxter County, Arkansas.
Plaintiff Dennis Allen first filed its Complaint (Doc. 3) on September 19, 2011, in the Circuit
Court of Baxter County, Arkansas, alleging that under an oral agreement with Defendants Charles
W. and Paula K. Thitoff, doing business as Buzzard Roost and/or Buzzard Roost Harbor, Inc.
(collectively, “the Buzzard Roost Defendants”), Dennis Allen supplied materials and labor for a
construction project from April 2, 2011 through May 27, 2011 on real property located in Mountain
Home, Arkansas. At the time Plaintiff entered into the contract, the property in question was owned
by Defendant the United States and leased by the Buzzard Roost Defendants. Plaintiff contends that
it performed a number of jobs on the property, including placing gravel, re-grading slopes, installing
a concrete flume, culvert, and boxed inlet, and installing a structure called a “Rip Rap.” (Doc. 3, p.
3). Despite making a demand for payment in the amount of $290,699.60, Plaintiff asserts it was not
paid for its services and now sues for breach of contract and enforcement of its materialman’s lien.
Defendant the United States removed the case to this Court on May 11, 2012. In lieu of an
answer, the United States filed a Motion to Dismiss (Doc. 7) pursuant to Federal Rules of Civil
Procedure 12(b)(1) and 12(b)(6). The United States contends that the Court lacks jurisdiction due
to the government’s sovereign immunity, which the United States has not waived and which
mandates its dismissal from this action. The United States also argues that Plaintiff has failed to
state a claim upon which relief can be granted because Plaintiff’s materialman’s lien cannot attach
to the property named in the lawsuit, as no lien can attach to property that is owned by the federal
Plaintiff responds that it does not seek to attach its lien to the underlying fee estate of the
United States. Instead, Plaintiff seeks to attach its lien to the leasehold interest of the tenants of the
property, Buzzard Roost. Further, with regard to the United States’ claim of sovereign immunity,
Plaintiff insists that Arkansas law requires it to name the United States as a party to this lawsuit;
otherwise, Plaintiff cannot perfect its materialman’s lien. According to Plaintiff, its lawsuit will
have “no effect on the title or reversionary interest held by the Corps of Engineers.” (Doc. 10, p. 5).
Plaintiff further pleads that it seeks no damages or monetary relief from the United States, but names
the government “solely for the purpose of ensuring that any foreclosure judgment on the leasehold
[Plaintiff] received would be binding against all interested parties.” Id.
II. Legal Standard
The Motion to Dismiss now before the Court is brought pursuant to both Rule 12(b)(1), for
lack of subject matter jurisdiction, and Rule 12(b)(6), for failure to state a claim upon which relief
can be granted. “A motion to dismiss for lack of jurisdiction under Rule 12(b)(1) which is limited
to a facial attack on the pleadings is subject to the same standard as a motion brought under Rule
12(b)(6).” Mattes v. ABC Plastics, Inc., 323 F.3d 695, 698 (8th Cir. 2003) (citation omitted). In
ruling on a Rule 12(b)(6) motion to dismiss, the Court accepts as true all of the factual allegations
contained in a complaint and reviews the complaint to determine whether its allegations show that
the pleader is entitled to relief. Schaaf v. Residential Funding Corp., 517 F.3d 544, 549 (8th Cir.
2008). All reasonable inferences from the complaint must be drawn in favor of the non-moving
Crumpley-Patterson v. Trinity Lutheran Hosp., 388 F.3d 588, 590 (8th Cir. 2004).
Complaints should be liberally construed in the plaintiff’s favor and “should not be dismissed for
failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in
support of his claim which would entitle him to relief.” Rucci v. City of Pacific, 327 F.3d 651, 652
(8th Cir. 2003) (quoting Conley v. Gibson, 355 U.S. 41, 45-46 (1957)).
Taking the facts asserted in the Complaint as true, it appears that Plaintiff and the Buzzard
Roost Defendants entered into an oral contract for Plaintiff to provide materials and services to
improve the property at Buzzard Roost Harbor. After Plaintiff completed its work, and its attempts
to collect payment from the Buzzard Roost Defendants were unsuccessful, Plaintiff sought to file
a lien against the property. As the Buzzard Roost Defendants did not own the property in question,
Plaintiff sued the owner of the property, the United States, as well as the renters of the property, the
Buzzard Roost Defendants.
Under the doctrine of sovereign immunity, the United States cannot be sued without its
express consent. Miller v. Tony and Susan Alamo Foundation, 134 F.3d 910, 915 (8th Cir. 1998).
Further, “[d]istrict courts lack subject-matter jurisdiction over claims against the Government to
which Congress has not consented.” Id. at 916. There is no exception to the sovereign immunity
doctrine that is applicable to the set of facts alleged by Plaintiff. It does not matter that Plaintiff
describes the United States as a “nominal party” or that Plaintiff maintains it “is not seeking to
interfere with the Corps of Engineers interest in the fee estate or in its reversionary interest in the
leasehold.” (Doc. 10, p. 5). The fact is that the United States has not waived its sovereign immunity,
and because of this, it cannot be subject to suit and must be dismissed with prejudice from this
However, the Court observes that dismissing the United States from the lawsuit does not
necessarily result in a dismissal of Plaintiff’s lien claims. Even though real property owned by the
government is ordinarily not subject to claims of private parties, under Arkansas law a lien may
attach to the interest of a leasehold estate on a contract between the lessee and the supplier of
materials and/or labor. Dow Chemical Co. v. Bruce-Rogers Co., 255 Ark. 448 (Ark. 1973).
Accordingly, Plaintiff may assert its lien interest against the leasehold estate of the Buzzard Roost
Defendants, which rented the subject property from the government and contracted with Plaintiff for
goods and services.
Plaintiff is not required to make the United States a party to its lawsuit in order to perfect its
lien interest and recover against the Buzzard Roost Defendants’ leasehold estate. Pursuant to Ark.
Code Ann. § 18-44-123, “the parties to the contract and all other persons interested in the
controversy and in the property charged with the lien may be made parties to the suit” (emphasis
added). Plaintiff is, therefore, not required to join the United States as a party in order to enforce its
materialman’s lien. However, the statute provides that “[t]hose that are not made parties shall not
be bound by the proceedings” to collect on the lien. Id. If the United States were truly a nominal
or “notice party,” as Plaintiff contends, named solely for the purpose of complying with Arkansas
lien law, then the United States’ absence as a party to the lawsuit should not preclude Plaintiff from
enforcing its lien rights against the remaining Defendants to the extent practicable under Arkansas
Accordingly, as the controversy between the remaining parties to the lawsuit still persists,
and no basis for federal jurisdiction remains after dismissal of the United States from this action, this
case shall be remanded to state court for further disposition.
For the foregoing reasons, IT IS HEREBY ORDERED that Defendant Secretary of the
United States Army Corps of Engineers’ Motion to Dismiss for Lack of Jurisdiction (Doc. 7) is
GRANTED IN PART AND DENIED IN PART. The Motion is GRANTED with respect to the
United States’ request that it be dismissed from the case with prejudice due to its sovereign
immunity. The Motion is DENIED in that dismissal of the United States does not mandate
dismissal of Plaintiff’s entire case. Arkansas law provides that Plaintiff may still enforce its lien
rights against the leasehold estate of the Buzzard Roost Defendants, and the United States is not
required to be a party to that enforcement action.
As Plaintiff’s claims do not involve a federal question, and no diversity of citizenship exists
among the remaining parties, there is no basis for this Court to retain federal jurisdiction over this
matter. Therefore, the case is remanded to the Circuit Court of Baxter County, Arkansas, where it
was originally filed, for further disposition.
IT IS SO ORDERED this 2nd day of August, 2012.
/s/P. K. Holmes, III
P.K. HOLMES, III
CHIEF U.S. DISTRICT JUDGE
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