Aggregate Technologies, Inc. v. Benetech, LLC et al

Filing 39

ORDER AND REASONS denying 25 Motion for Partial Summary Judgment. Signed by Judge Susie Morgan. (bwn)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
AGGREGATE TECHNOLOGIES, INC.,
Plaintiff

CIVIL ACTION

VERSUS

NO. 13-5893

BENETECH, LLC, ET AL.,
Defendants

SECTION “E”

ORDER AND REASONS
Before the Court is a Motion for Partial Summary Judgment filed by plaintiff,
Aggregate Technologies, Inc. ("ATI").1 Defendants Western Surety Company ("Western
Surety") and Benetech, LLC ("Benetech") each filed an opposition to ATI's motion.2 ATI
filed replies to Western Surety's opposition3 and to Benetech's opposition.4
BACKGROUND
The United States Army Corps of Engineers ("USACE") awarded a construction
contract to Benetech for the OSP 08 Pump Stations in New Orleans, Louisiana (the
"Project"). Because the Project involved a public work, Benetech and Western Surety
executed a payment bond as required by 40 U.S.C. § 3131, et seq. (the Miller Act) "for the
benefit of all persons supplying labor and materials in the prosecution of work provided in
the contract."5
Benetech awarded a subcontract to ATI for "wall sawing, core drilling and roof

1

R. Doc. 25.

2

R. Doc. 30; R. Doc. 31.

3

R. Doc. 35.

4

R. Doc. 37.

5

R. Doc. 1, p. 3.

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removal" at the Project.6 Upon commencing work, ATI encountered various obstacles to
drilling on the Project. Ultimately, the Project was not completed and ATI drilled only 86
of 1600 total holes. ATI filed suit against Western Surety and Benetech, alleging ATI
performed its obligations under the subcontract, yet Benetech failed to pay ATI in the
amount of $375,454.80 for the labor, equipment and materials ATI supplied to the Project.7
ATI claims Western Surety is obligated under the Miller Act and the payment bond to pay
ATI the labor, materials and services it furnished for the Project. ATI also claims Benetech
breached the subcontract agreement by failing to compensate ATI for work performed on
the Project.
ATI moves for partial summary judgment (1) that it is "entitled to recover its
increased costs for labor and materials associated with delays due to unforeseen conditions
and extra work [it] performed" caused by differing site conditions and (2) that its costs for
certain drilling equipment are subject to coverage under the Miller Act payment bond as
"materials." Benetech and Western Surety oppose ATI's motion, arguing ATI is not entitled
to any increased costs resulting from delays and unforseen site conditions because ATI
failed to comply with the subcontract's requirements for adjustments based on differing site
conditions. Benetech and Western Surety also argue ATI's request for compensation for the
drilling equipment contradicts the terms of the subcontract because the cost of all
equipment was included in the unit-price for the Project for which ATI was already paid.

6

R. Doc. 1, p. 4.

7

Id.

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SUMMARY JUDGMENT STANDARD
Summary judgment is appropriate when "the pleadings, the discovery and disclosure
materials on file, and any affidavits show that there is no genuine issue as to any material
fact and that the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c)(2);
Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); Little v. Liquid Air Corp., 37 F.3d
1069, 1075 (5th Cir. 1994). When assessing whether a dispute as to any material fact exists,
the Court considers "all of the evidence in the record but refrains from making credibility
determinations or weighing the evidence." Delta & Pine Land Co. v. Nationwide
Agribusiness Ins. Co. 530 F.3d 395, 398 (5th Cir. 2008). All reasonable inferences are
drawn in favor of the nonmoving party, but "unsupported allegations or affidavits setting
forth ultimate or conclusory facts and conclusions of law are insufficient to either support
or defeat a motion for summary judgment." Galindo v. Precision Am. Corp., 754 F.2d 1212,
1216 (5th Cir. 1985)(internal quotations and citations omitted).
If the dispositive issue is one on which the moving party will bear the burden of proof
at trial, the moving party "must come forward with evidence which would 'entitle it to a
directed verdict if the evidence went uncontroverted at trial.'" Int'l Shortstop, Inc. v. Rally's
Inc., 939 F.2d 1257, 1263-64 (5th Cir. 1991). The nonmoving party can then defeat the
motion by either countering with sufficient evidence on its own, or "showing that the
moving party's evidence is so sheer that it may not persuade the reasonable fact-finder to
return a verdict in favor of the moving party." Id. at 1265.
If the dispositive issue is one on which the nonmoving party will bear the burden of

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proof at trial, the moving party may satisfy its burden by merely pointing out that the
evidence in the record is insufficient with respect to an essential element of the nonmoving
party's claim. See Celotex, 477 U.S. at 325. The burden then shifts to the nonmoving party,
who must, by submitting or referring to evidence, set out specific facts showing that a
genuine issue exists. See id. at 324. The nonmovant may not rest upon the pleadings, but
must identify specific facts that establish a genuine issue for trial. Id. at 325; see also Little
37 F.3d at 1075 ("Rule 56 'mandates the entry of summary judgment, after adequate time
for discovery and upon motion, against a party who fails to make a showing sufficient to
establish the existence of an element essential to that party's case, and on which that party
will bear the burden of proof at trial.'")(citing Celotex, 477 U.S. at 332).
APPLICATION
ATI asserts it encountered unforseen site conditions including steel, wood, and
utility lines in the walls of the pumps it was to drill at the Project.8 As a result, ATI alleges
it incurred additional expenses attempting to drill through these obstacles.9 ATI asserts it
submitted invoices to Benetech for the increased costs associated with the unforseen
conditions but Benetech and Western Surety refuse to pay ATI for these additional costs.10
ATI argues the undisputed facts show ATI it is entitled to be compensated for its increased
costs associated with delays on the project. In their oppositions, Western Surety and

8

R. Doc. 25-5, p. 5. Affidavit of Ronnie Wills.

9

R. Doc. 25-5, p. 6. Affidavit of Ronnie Wills.

10

R. Doc. 25-5, p. 6. Affidavit of Ronnie Wills.

4

Benetech point to the Rule 30(b)(6) deposition of Benetech's corporate representative, in
which Benetech asserts ATI's delay was caused (at least in part) by ATI's choice to deviate
from the Project's specifications and use an electric drill.11.
ATI also seeks summary judgment that it is entitled to recover the costs of certain
drilling equipment from Western Surety and Benetech. ATI asserts the drilling equipment
falls within the definition of "materials" so as to make its costs recoverable against Western
Surety and Benetech under the subcontract and the Miller Act. See 40 U.S.C. § 3133(b)(1).
Western Surety and Benetech argue the subcontract agreement was a unit-price contract
and thus the contract price included the drilling equipment at issue.
The facts are in dispute with respect to most all of the factual issues to be decided in
this case, including but not limited to whether the ATI subcontract was a "unit price"
agreement, whether the subcontract was "shut down" or terminated for convenience or
"descoped," what work was completed by ATI, which provisions of the ATI subcontract
apply, whether ATI complied with its subcontract provisions with respect to differing site
conditions, whether equipment ordered by ATI was customized, and the amount of
damages suffered by ATI, if any.12 Accordingly, ATI has not carried its burden of showing
there are no disputed issues of material facts which would entitle it to judgment as a matter
of law.

11

R. Doc. 30-7, pp. 69-70.

12

See R. Doc. 30-1, Western Surety's response to ATI's Statement of Uncontested Material Facts in
support of its Motion for Summary Judgment, and R. Doc. 31-1, Benetech's Response to ATI's Statement
of Uncontested Material Facts in support of its Motion for Summary Judgment.

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CONCLUSION
Accordingly, IT IS ORDERED that ATI's Motion for Partial Summary Judgment
be and hereby is DENIED.
New Orleans, Louisiana, this 18th day of July, 2014.

_____________________________
SUSIE MORGAN
UNITED STATES DISTRICT JUDGE

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