Intl Assn of Bridge, Structural and Ornamental Iron Workers et al v. Boh Bros. Construction Co., L.L.C. et al

Filing 61

ORDER AND REASONS - Motion 48 for Default Judgment is GRANTED. Judgment will be entered against QPL in favor of Boh for the delinquent contributions, interest, costs, and attorney's fees awarded to Use Plaintiffs in this action, as well as its attorneys fees and costs associated with this matter. Boh has until October 31, 2013 to file a motion for attorney's fees demonstrating the sum to which it is entitled.. Signed by Chief Judge Sarah S. Vance on 10/17/13. (jjs, )

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
UNITED STATES OF AMERICA FOR
THE USE AND BENEFIT OF REGIONAL
LOCAL UNION NO. 846,
INTERNATIONAL ASSOCIATION OF
BRIDGE, STRUCTURAL, ORNAMENTAL
AND REINFORCING IRON WORKERS,
AFL-CIO, et al.,

CIVIL ACTION

VERSUS

NO: 12-1918

BOH BROS. CONSTRUCTION CO.,
L.L.C., et al.,

SECTION: R

DEFAULT JUDGMENT AGAINST DEFENDANT QPL, INC.
Defendant Boh Brothers Construction Company, Inc. ("Boh")
moves the Court to enter a default judgment against defendant in
cross-claim QPL, Inc. (“QPL”) in an amount equal to Boh's
liability to Use Plaintiffs in this action, plus attorney’s fees
and costs associated with this matter.

Because Boh presents

evidence that QPL failed to answer or otherwise respond to the
petition, the Court GRANTS Boh's motion without an evidentiary
hearing.

The Court hereby orders QPL to indemnify Boh in the

amount awarded to Use Plaintiffs in this action.

The Court also

orders QPL to pay Boh's reasonable expenses, costs, and
attorney’s fees incurred as a result of this action.

I. BACKGROUND
A. Factual Background
In August 2010, defendant Boh entered into a prime contract
with the U.S. Army Corps of Engineers ("USACE") to perform
construction work on the Causeway Bridge in Jefferson Parish.1
The value of the contract exceeded $100,000.2

Under 40 U.S.C. §

3131, commonly known as the Miller Act, contractors must obtain a
payment bond for contracts with a value of more than $100,000 for
construction of public buildings or works.
3131(b)(2).

40 U.S.C. §

Boh obtained a payment bond with defendants Fidelity

Deposit Company of Maryland and Zurich American Insurance Company
as sureties.3

The stated liability limit of the bond is

$16,093,000.00.4

Boh then subcontracted a portion of the work to

defendant QPL.5
QPL is a signatory to a Collective Bargaining Agreement with
Plaintiff Regional Local Union No. 846.6

The Agreement requires

QPL to file reports of hours worked by its employees and to pay
contributions at specified rates to the Union and to the Welfare

1

R. Doc. 49-1 at 2.

2

Id.

3

Id.

4

Id.

5

Id.

6

R. Doc. 47-7.
2

Trust, Retirement Trust, Training Trust, and Vacation Trust for
each hour worked by each employee covered by the Agreement.7
Under the Agreement, interest is due on delinquent contributions
at a rate of 1.5% per month.

The Agreement also provides that

QPL will be liable for accounting fees, attorney’s fees, auditing
fees and expert fees in the event of litigation to recover
delinquent contributions.8
Between April 23, 2011, and June 30, 2012, QPL performed
work on the Project but failed to report the hours worked by each
employee to the Regional Local Union and failed to pay
contributions to the fringe benefit funds.9

QPL did submit

Certified Payroll records to Boh on a weekly basis.10

Each

Certified Payroll document lists the number of hours each QPL
employee worked on the Project for that week.11

On each

document, QPL certifies that the record is “correct and complete”
and that “payments of fringe benefits as listed in the contract
have been or will be made to appropriate programs for the benefit
of such employees.”12

Each Certified Payroll document bears the

7

Id.

8

Id.

9

R. Doc. 1 at 21.

10

R. Docs. 47-5 and 47-6.

11

Id.

12

Id.
3

signature of the QPL President.

Based on those records and the

contribution rates specified in the Agreement, QPL owed
$30,233.69 in fringe benefit contributions to Use Plaintiffs.13
In August 2011, while QPL’s work on the project was still
ongoing, Use Plaintiffs provided Boh with notice of their claim
for payment by certified mail.14
on this notice.

Fidelity and Zurich were copied

The notice included a demand for payment of all

amounts due, stated with substantial accuracy, as required by 40
U.S.C. § 3133(b)(2).15

Plaintiffs updated the amount of their

claim as additional amounts came due.16

B. Procedural Background
Plaintiffs initiated this action by filing a complaint
against QPL, Boh, Fidelity, and Zurich on July 24, 2012.

Boh

filed a cross-claim against QPL on June 21, 2013, seeking
indemnity against liability, expenses, fees, and litigation
costs.

The record shows that QPL was properly served with a copy

of the Summons and Cross-Complaint in this action on or about
June 21, 2013.17

QPL failed to appear or otherwise plead, and

13

R. Doc. 47-2 at 4.

14

R. Doc. 49-1 at 6-7.

15

Id.

16

R. Doc. 47-2 at 4.

17

R. Doc. 29.
4

Boh filed a Motion for Entry of Default on August 9, 2013.18

The

Court granted the motion on August 12, 2013.19
On August 22, 2013, the Court granted Use Plaintiffs'
separate motion for default judgment against QPL in the amount of
$40,933.51 in delinquent contributions and interest, plus
attorney’s fees and costs.

The Court also granted Use

Plaintiff's motion for summary judgment against the remaining
defendants, including Boh, holding them liable for the full
$40,933.51, plus additional accrued interest and Use Plaintiffs'
attorney's fees and costs.

In this motion for default judgment,

Boh seeks indemnity from QPL for all amounts for which it is
liable.

Boh also seeks indemnity for its own attorney's fees and

costs.

II. LEGAL STANDARD
Under the Federal Rules of Civil Procedure, a default
judgment may be entered against a party when it fails to plead or
otherwise respond to the plaintiff's complaint within the
required time period. Fed.R.Civ.P. 55(b). A plaintiff who seeks a
default judgment against an uncooperative defendant must proceed
through two steps. First, the plaintiff must petition the court
for the entry of default, which is simply “a notation of the

18

R. Doc. 35.

19

R. Doc. 37.
5

party's default on the clerk's record of the case.” Dow Chem.
Pac. Ltd. v. Rascator Mar. S.A., 782 F.2d 329, 335 (2d Cir.
1986); see also United States v. Hansen, 795 F.2d 35, 37 (7th
Cir. 1986)(describing the entry of default as “an intermediate,
ministerial, nonjudicial, virtually meaningless docket entry”).
Before the clerk may enter the defendant's default, the plaintiff
must show “by affidavit or otherwise” that the defendant “has
failed to plead or otherwise defend.” Fed.R.Civ.P. 55(a). Beyond
that requirement, however, the entry of default is largely
mechanical.
Once the default has been entered, the plaintiff's wellpleaded factual allegations are deemed admitted. See Nishimatsu
Const. Co. v. Houston Nat. Bank, 515 F.2d 1200, 1206 (5th Cir.
1975). At the same time, the defaulting defendant “is not held to
admit facts that are not well-pleaded or to admit conclusions of
law.” Id. After the defendant's default has been entered, the
plaintiff may request the entry of judgment on the default. If
the plaintiff's claim is for a sum certain and the defendant has
not made an appearance in court, the request for a default
judgment may be directed to the clerk. Fed.R.Civ.P. 55(b)(1). In
all other cases, “the party must apply to the court for a default
judgment.” Fed.R.Civ.P. 55(b)(2). No party is entitled to a
default judgment as a matter of right. Lewis v. Lynn, 236 F.3d
766, 767 (5th Cir. 2001)(per curiam). The disposition of a motion

6

for the entry of default ultimately rests within the sound
jurisdiction of the district court. Mason v. Lister, 562 F.2d
343, 345 (5th Cir. 1977).

III. DISCUSSION
A. Jurisdiction
Before entering judgment, the district court must “look into
its jurisdiction both over the subject matter and the parties.”
Sys. Pipe & Supply, Inc. V. M/V Viktor Kurnatovskiy, 242 F.3d
322, 324 (5th Cir. 2001)(quoting Williams v. Life Sav. & Loan,
802 F.2d 1200, 1203 (10th Cir. 1986)). The court must refrain
from entering judgment if its jurisdiction is uncertain because
judgment entered in the absence of jurisdiction is void.
In this case subject matter jurisdiction is founded upon
federal question jurisdiction under 28 U.S.C. § 1331. This case
arises under the Miller Act, 40 U.S.C. § 3131, et seq., which
requires all contractors who are awarded “any contract of more
than $100,000 for the construction, alteration, or repair of any
public building or work” to furnish a payment bond for the
protection of the people who supply labor or materials for the
completion of the contract. 40 U.S.C. § 3131. The contract
between Boh and the USACE meets these requirements and is subject
to the Miller Act. Therefore, the Court finds that it has
jurisdiction to enter this default judgment.

7

B. Entry of Default Judgment
The record shows that QPL failed to appear or otherwise
plead in response to the cross-complaint filed on July 21,
2013.20

Although default judgments are generally disfavored,

Lindsey v. Prive Corp., 161 F.3d 886, 893 (5th Cir. 1998), the
Court finds that QPL’s failure to appear has made it impossible
to achieve the “just, speedy, and inexpensive disposition” of
this case on the merits.

Sun Bank v. Pelican Homestead & Sav.

Assoc., 874 F.2d 274, 276 (5th Cir. 1989). Accordingly, the Court
will enter default judgment against QPL.
Although a default judgment “conclusively establishes a
defendant’s liability,” it “does not establish the amount of
damages.”

United States ex rel. M-CO Const., Inc. V. Shipco

Gen., Inc., 814 F.2d 1011, 1014 (5th Cir. 1987).

A court may, in

its discretion, conduct an evidentiary hearing to determine the
amount of damages.

Fed. R. Civ. P. 55(b)(2)(B); James v. Frame,

6 F.3d 307, 309-10 (5th Cir. 1993).

Unliquidated damages usually

are not awarded by default judgment without an evidentiary
hearing, except where the amount claimed is capable of
mathematical calculation. James, 6 F.3d at 310.

Plaintiffs seek

damages that are mathematically calculable. Therefore, no
evidentiary hearing is necessary.

20

R. Doc. 35.
8

Section 9 of the subcontract between Boh Bros. and QPL
provides in part:
Subcontractor shall . . . pay all taxes and contributions
imposed or required by law for any employment insurance,
pensions, old age retirement funds, or similar purposes, in
respect to the work under this contract and the employees of
Subcontractor in the performance of said work.
Subcontractor shall indemnify Contractor from any costs or
liability for noncompliance with the foregoing, . . .21
The Collective Bargaining Agreement between QPL and the Union
required QPL to make contributions to the various fringe benefit
funds at specified hourly rates.

QPL was required by law to make

the contributions in accordance with the terms of the Agreement.
See 29 U.S.C. § 1145 (requiring employers who are obligated to
contribute to multiemployer plans under the terms of a collective
bargaining agreement to make such contributions in accordance
with the terms of the agreement).

QPL failed to comply with that

obligation, and Boh was held liable for the unpaid contributions,
interest and attorney’s fees as a direct result.

According to

the terms of the subcontract, QPL is obligated to indemnify Boh
for the full amount of its liability.
Section 23 of the subcontract further provides:
Should Contractor employ an attorney to enforce any of the
provisions hereof, or to protect its interest in any matter
arising under this contract . . . or to prosecute or defend
any suit resulting from this contract, . . . Subcontractor
and his surety, jointly and severally, agree to pay
Contractor all reasonable costs, charges, and attorney’s

21

R. Doc. 48-2 at 5.
9

fees expended or incurred therein.22
This action arose out of QPL’s failure to make contributions to
the fringe benefit funds based on work it assigned to its
employees as a result of its contract with Boh.

The litigation

therefore can be characterized as “resulting from” the contract.
Accordingly, QPL is liable for Boh's reasonable costs, charges,
and attorney’s resulting from this litigation.

IV. CONCLUSION
For the foregoing reasons, the motion is GRANTED.

Judgment

will be entered against QPL in favor of Boh for the delinquent
contributions, interest, costs, and attorney's fees awarded to
Use Plaintiffs in this action, as well as its attorney’s fees and
costs associated with this matter. Boh has until October 31, 2013
to file a motion for attorney's fees demonstrating the sum to
which it is entitled.

17th

New Orleans, Louisiana, this

day of October, 2013.

SARAH S. VANCE
UNITED STATES DISTRICT JUDGE

22

Id. at 9.
10