Fisk Electric Company v. Winter Park Construction Company

Filing 11

ORDER AND REASONS granting in part and denying in part 6 Motion to Dismiss for Failure to State a Claim. Signed by Judge Ivan L.R. Lemelle. (ijg)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
FISK ELECTRIC COMPANY

CIVIL ACTION

VERSUS

NO. 15-700

WINTER PARK CONTRUCTION CO.

SECTION "B"(3)

ORDER AND REASONS
I.

NATURE OF THE MOTION AND RELIEF SOUGHT
Before the Court is a Fed. R. Civ. P. 12(b)(6) Motion to

Dismiss by Defendant, Winter Park Construction Company (“Winter
Park”).1 Plaintiff, Fisk Electric Company (“Fisk”), has filed a
response in opposition.2 The motion, set for submission on June
10, 2015, is before the Court, on the pleadings, without oral
argument. Accordingly, and for the reasons enumerated below,
IT IS ORDERED that the Motion to Dismiss is GRANTED, in
part, and DENIED, in part.
II.

FACTS AND PROCEDURAL HISTORY
This

action

filed

pursuant

to

the

Court’s

diversity

jurisdiction under 28 U.S.C. § 1332, et seq., arises out of a
contract
entered

1
2

dispute.
into

an

Plaintiff,
agreement

Fisk
with

Electric
Benetech,

Company
LLC

(“Fisk”)

(“Benetech”)

Rec. Doc. No. 6.
Rec. Doc. No. 9.

1

wherein

Fisk

would

provide

electrical

work

on

project.3

a

Benetech contracted as a primary contractor with the U.S. Army
Corps of Engineers (“USACE”) on a drainage project.4 Benetech was
subsequently removed as a contractor, and replace by defendant,
Winter Park Construction Company (“Winter Park”).5 On or around
May 31, 2012, Fisk and Winter Park entered into an agreement for
the completion of outstanding work on the project (“Agreement”),
which was comprised of a subcontractor agreement and a release
and assignment agreement.6
Fisk

claims

that

under

the

terms

of

the

Release

and

Assignment agreement, it would release claims against the bond
company
invoices

in

exchange

for

work

for

Winter

completed

on

Park
the

paying
project

all
and

outstanding
for

damages

incurred before May 31, 2012; however, due to a miscalculation
on

the

part

$146,276.00

on

of

both
its

parties,

outstanding

Winter
invoice,

Park
or

failed
for

to

pay

additional

damages in the amount of $24,292.79.7 Further, as a result of
project delays, Fisk incurred additional expenses in the amount
of $306,203.00. Lastly, Fisk contends that Winter Park received
payment from the project owner, USACE, for work completed by

3

Rec. Doc. No. 1 at 2.
Rec. Doc. No. 1 at 2.
5
Rec. Doc. No. 1 at 2.
6
Rec. Doc. No. 6-2 at 1, 2.
7
Rec. Doc. No. 1 at 3.
4

2

Fisk, which payment has not been transmitted to Fisk.8 On March
4, 2015, Fisk filed the instant action, asserting claims for
breach of contract and unjust enrichment under Louisiana law,
and seeking $476,772.04, plus interest and damages under the
Agreement, as well as costs, penalties, and attorneys’ fees.
Here, Winter Park moves the Court for dismissal of the unjust
enrichment claims under Fed. R. Civ. P. 12(b)(6). Winter Park
also contends that under Louisiana law, Fisk is not entitled to
attorneys’ fees and/or penalties.
III.

LAW AND ANALYSIS
a. Fed. R. Civ. P. 12(b)(6) Standard for Dismissal
Federal

Rule

of

Civil

Procedure

12(b)(6)

allows

for

dismissal of an action “for failure to state a claim upon which
relief can be granted.” While a complaint attacked by a Rule
12(b)(6) motion need not contain detailed factual allegations,
in order to avoid dismissal, the plaintiff’s factual allegations
must “state a claim to relief that is plausible on its face.”
Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). A claim has
facial plausibility when the plaintiff pleads factual content
that allows a court to draw the reasonable inference that the
defendant is liable for the misconduct alleged. Id.

8

Rec. Doc. No. 1 at 5.

3

Threadbare recitals of the elements of a cause of action,
supported by mere conclusory statements, do not suffice.” Id.
(citing Bell Atlantic Corp. v. Twombly, 127 S.Ct. 1955 (2007).
In determining whether a plaintiff has pled factual allegations
to state a claim that is plausible, the Court may not evaluate
the

plaintiff’s

likelihood

of

success

but

must

construe

the

complaint liberally and accept all of the plaintiff’s factual
allegations in the complaint as true. See In re Katrina Canal
Breaches Litigation, 495 F.3d 191, 205 (5th Cir. 2009); see also
Twombly, 550 U.S. at 555 (factual allegations, which taken as
true,

must

be

enough

to

raise

a

right

to

relief

above

the

Unjust

Enrichment

speculative level, even if doubtful in fact).
b. Whether Fisk States
under Louisiana Law

a

Claim

for

Federal jurisdiction in this case is premised on diversity
of citizenship. Therefore, Louisiana substantive law applies,
including its principles of contract interpretation. Bayou Steel
Corp. v. Nat’l Union Fire Ins. Co. of Pittsburgh, Pa., 642 F.3d
506,

509

(5th

Cir.

2011).

The

parties

do

not

dispute

the

interpretation of the Agreement and the obligations flowing from
it according to Louisiana substantive law.9

9

La. Rev. Stat. Ann. § 2780.1(D). The Subcontract Agreement concerns the performance of an obligation within
Louisiana.

4

1. Unjust Enrichment
Article

2298

of

the

Louisiana

Civil

Code

codifies

Louisiana’s doctrine of unjust enrichment:
A person who has been enriched without cause at the
expense of another person is bound to compensate that
person...The remedy declared here is subsidiary and
shall not be available if the law provides another
remedy for the impoverishment or declares a contrary
rule.
La. Civ. Code art. 2298 (emphasis added). To support a claim for
unjust enrichment under Louisiana law, a plaintiff must show
five elements:
(1)

There must be enrichment;

(2)

There must be an impoverishment;

(3)

There

must

be

a

connection

between

the

enrichment and the resulting impoverishment;
(4)

There must be an absence of “justification”
or

“cause

for

the

enrichment

and

impoverishment; and
(5)

There

must

be

no

other

remedy

at

law

available to the plaintiff.
JP Mack Industries, LLC v. Mosaic Fertilizer, LLC, 970 F.Supp.2d
516, 520-1 (E.D. La. Sept. 4, 2013)(citing Carriere v. Bank of
Louisiana, 702 So.2d 648 (La. 12/13/96)). The complaint alleges:

5

Winter Park’s refusal to pay Fisk the amounts due and
owing ($476,772.04) on the project constitutes a
breach of contract and renders Winter Park liable for
damages, including interest, costs and attorneys’ fees
for the reasons stated above.
Alternatively, Fisk avers that Winter Park has been
enriched without cause...Fisk provided valuable labor,
material and equipment necessary for Winter Park to
complete its obligations on the Project, and Winter
Park benefitted from this labor, materials, and
equipment, especially when Fisk performed work that
was outside the scope and term contemplated in the
contract, and therefore Fisk is entitled to judgment
under
the
doctrine
of
unjust
enrichment.
Alternatively, upon information and belief, Winter
Park received payment from the project owner USACE,
for work completed by Fisk, which payment has not been
transmitted to Fisk.10
In sum, Fisk seeks the following

sums, which amount to

$476, 722.04:
1. $146,276.00

Winter

outstanding

invoice

Park
due

failed
to

a

to

pay

miscalculation

on
on

its
the

part of both parties in executing the May 31, 2012,
Release and Assignment agreement;
2. $24,292.79 for additional damages Fisk incurred as a
result of delays that occurred prior to the May 31,
2012, Subcontract Agreement; and,
3. $306,203.00 in additional expenses Fisk incurred as a
result

of

project

delays

after

the

parties

entered

into the Subcontract Agreement appointing Winter Park
to the Project;
10

Rec. Doc. No. 1 at 5.

6

4. Payment Winter Park received from the project owner,
USACE, for work completed by Fisk, which has not been
transmitted to Fisk.11
As Fisk has plead in the alternative, it appears that all
four sums form the basis for the

asserted

unjust enrichment

claim. In addition to attacking the individual merits of the
unjust enrichment claim, Winter Park contends that “[t]here are
other

remedies

at

law

available

to

Fisk,”12

thus

requiring

dismissal under Louisiana law.
Fisk’s

unjust

enrichment

claim

for

the

$146,276.00

and

$24,292.79 amounts cannot succeed because Fisk cannot establish
an absence of another remedy at law available to it. La. C.C.
art. 2298; Walters v. MedSouth Record Management, LLC, 38 So.3d
241, 242 (La. 6/4/10) (per curiam). As Fisk acknowledges, “Fisk
released

its

claim

(Western

Surety)

against

in

the

exchange

bond
for

company
Winter

on

Park

the

Project

paying

all

outstanding invoices for work completed on the project and for
damages incurred due to project delays that occurred before May
31,

2012.”13

Also,

“[t]he

release

(of

WPC

and

the

surety)

executed by Fisk expressly reserved its rights to pursue claims
11

Rec. Doc. No. 1 at 3.
Rec. Doc. No. 6-2 at 3. Under the terms of the partial Release and Assignment agreement, “[i]n consideration of
the sum of $318,008.75…Fisk Electric Company does hereby forever release and discharge Western Surety
Company, as Surety, and WPC III, Inc…from any and all claims, demands, cause or causes of action whatsoever that
Fisk Electric Company now has or may have for labor, material, or equipment....”
13
Rec. Doc. No. 1 at 3; see Rec. Doc. No. 6-2 at 2 (Release and Assignment agreement).
12

7

for

additional

compensation

based

on

unforeseen

conditions

arising out of the previous delays on the project. Fisk also
reserved its rights to seek compensation for future delays or
disruptions.”14 Further, “the sum of $318,008.75 is justly due
and owing by Benetech, LLC to Fisk...and Fisk Electric Company
has not released or discharged same or any part thereof.”15 Thus,
under the terms of the partial release agreement or previous
agreements,

Fisk

may

seek

to

recover

on

a

contract

theory,

either against Winter Park, the surety, or Benetech.
Specifically with regard to the $146,276.00 amount, Winter
Park correctly notes that “[e]ither Fisk released and settled
its

claim...or

WPC

(Winter

Park)

is

obligated

under

that

agreement.”16 Fisk contends that “if WPC takes the position that
it has no contractual obligation to pay Fisk for this amount,
then Fisk has a claim for unjust enrichment.”17 However, “[t]he
unjust enrichment remedy is ‘only applicable to fill a gap in
the law where no express remedy is provided.’” Id. The Louisiana
Supreme

Court

has

observed

that

“[t]he

mere

fact

that

a

plaintiff does not successfully pursue another available remedy
does

not

give

the

plaintiff

the

right

to

recover

under

the

theory of unjust enrichment.” Id. (citing Jim Walter Homes v.

14

Rec. Doc. No. 9 at 2; Rec. Doc No. 6-2 at 2 (Release and Assignment agreement).
Rec. Doc. No. 6-2 at 2 (Release and Assignment agreement).
16
Rec. Doc. No. 6-1 at 3.
17
Rec. Doc. No. 9 at 4.
15

8

Jessen, 732 So.2d 699, 706 (La. App. 3 Cir. 3/31/99) (“[t]o find
that [the plaintiff] has no other remedy and to provide it one
under

unjust

plaintiff

enrichment

who

let

his

would
cause

be

tantamount

of

action

to

allowing

prescribe,

or

any
any

plaintiff who knowingly wrote a bad contract, to recover under
an enrichment theory”)); see also Drs. Bethea, Moustoukas and
Weaver LLC v. St. Paul Guardian Ins. Co., 376 F.3d 399, 408 (5th
Cir.

2004)

(affirming

plaintiff's

unjust

district

enrichment

court's

claim

for

dismissal
failure

to

of

the

state

a

claim, noting “Louisiana law provides that no unjust enrichment
claim shall lie when the claim is based on a relationship that
is controlled by an enforceable contract”); see also Servicios
Azucareros de Venezuela, C.A. v. John Deere Thibodaux, Inc., 922
F.Supp.2d 567, 580 n. 2 (E.D. La. Feb. 6, 2013) (Feldman, J.)
(citing Walters and noting that unjust enrichment “shall not be
available if the law provides another remedy”); General Accident
Ins.

Co.

of

America

v.

Aggreko,

LLC,

No.

11–1682,

2012

WL

6738217 (W.D. La. Dec. 28, 2012) (holding that the existence of
a

breach

of

contract

remedy

precludes

pursuit

of

unjust

enrichment claim and references other cases in federal district
courts

in

Louisiana

that

interpret

Walters

to

bar

unjust

enrichment claims that accompany alternative claims); Pinegrove
Electrical Supply Co., Inc. v. Cat Key Constr., Inc., 88 So.3d
1097 (La. App. 5 Cir. 2/28/12) (holding that the supplier had
9

available to it a remedy against the property owner under the
Private Works Act and, thus, the supplier was precluded from
asserting

an

unjust

enrichment

claim

against

the

property

owner). The plaintiff's unjust enrichment claim for $146,267.00
against Winter Park must therefore be dismissed.
Similarly, to the extent Fisk may be seeking $306,203.00 in
compensation

for

“additional

job

related

expenses

incurred”

under an unjust enrichment theory, that claim must be dismissed.
According to Fisk, “subsequent to Winter Park’s appointment as
general contractor...the Project was not timely completed. As a
result

of

the

delayed

completion...[a]dditional

job

related

expenses incurred, including project supervision, overhead and
profit, total $306.203.00.”18 In is undisputed that the parties’
relationship was governed by the Subcontractor Agreement when
these damages were incurred; therefore, a breach of contract
claim

may

provide

a

basis

for

recovery.

Fisk

contends

that

“[t]he contract does not address changes in the scope of work or
time for completing work...the scope of work changed and the
project finished late.”19 However, an unjust enrichment claim
cannot lie simply because a contract was poorly written. Jim
Walter Homes, 732 So.2d at 706.

18
19

Rec. Doc. No. 1 at 4.
Rec. Doc. No. 9 at 5.

10

Lastly, Fisk argues that “Winter Park received payment from
the project owner, USACE, for work completed by Fisk, which
payment

has

not

been

transmitted

to

Fisk.”20

Fisk

does

not

address the issue of whether another remedy is unavailable at
law. “The unjust enrichment remedy is ‘only applicable to fill a
gap in the law where no express remedy is provided.’” La. Civ.
Code

art.

2298.

Walters,

38

So.3d

at

242.

precedent, strongly instruct dismissal. See

State

law,

and

Westbrook v. Pike

Elec., LLC, 799 F.Supp.2d 665, 672 (E.D. La. June 30, 2011)
(“Thus, considering plaintiff has alleged causes of action based
on breach of contract, breach of implied duty of good faith and
fair dealing...a claim for unjust enrichment cannot lie and must
be dismissed.”). It is undisputed that the parties entered into
a contractual agreement, which covers each party’s rights and
obligations in completing the Project. As discussed below, Fisk
may assert a claim for violation of the Louisiana Prompt Pay
Act, La. Rev.
available
against

at

law

Winter

Stat. 9:2784.
because
Park.

it

Thus,

has,

Regardless

Fisk

has

at

a

of

whether

an

minimum,

adequate
a

Fisk

contract
is

remedy
claim

ultimately

successful on its available claims, Louisiana law bars Fisk's unjust
enrichment claims against Winter Park because Fisk has other remedies
available.

20

Rec. Doc. No. 1 at 5, Rec. Doc. No. 9 at 5.

11

2. Attorneys’ Fees & Penalties
Louisiana law, which governs this diversity case, provides
that “attorneys' fees may not be awarded as damages in breach of
contract

actions

unless

the

contract

or

a

specific

statute

authorizes such an award.” Austin v. Parker, 672 F.2d 508, 518
(5th Cir. Unit A 1982). Further, under Louisiana law, the term
“damages,” unmodified by penal terminology such as “punitive” or
“exemplary,” has been historically interpreted as authorizing
only compensation for loss, not punishment. Vincent v. Morgan's
La. T.R. & S. Co., 140 La. 1027, 1051, 74 So. 541, 549 (1917); 2
Planiol, Treatise on the Civil Law § 221 (La. State Law Inst.
Translation
damages

are

1959).
not

Accordingly,
allowable

punitive

unless

or

expressly

other

“penalty”

authorized

by

statute. Ricard v. State, 390 So.2d 882 (La. 1980); Killebrew v.
Abbott Laboratories, 359 So.2d 1275 (La. 1978); Alexander v.
Burroughs Corp., 359 So.2d 607 (La. 1978); Romero v. Clarendon
America Ins. Co., 54 So.3d 789, 791 (La. App. 3 Cir. 12/29/10).
Fisk alleges that “Winter Park’s refusal to pay Fisk the
amounts

due...constitutes

a

breach

of

contract

and

renders

Winter Park liable for...attorneys’ fees for the reasons stated
above.”21 On the unjust enrichment claim, Fisk specifically seeks

21

Rec. Doc. No. 1 at 5.

12

penalties,

in

addition

to

fees.22

Fisk

contends

that

Winter

Park’s failure to promptly (1) pay for labor and materials on
the

project

and

(2)

transmit

funds

received

from

USACE,

constitutes a violation of Louisiana’s Prompt Pay Act, La. Rev.
Stat. 9:2784. Although Fisk has not pleaded the foregoing in its
complaint, Fisk requests an opportunity to do so in an amended
complaint.
The Louisiana Prompt Pay Act provides, in relevant part:
A. When a contractor receives any payment from the owner
..., the contractor shall promptly pay such monies
received
to
each
subcontractor
and
supplier
in
proportion to the percentage of work completed....
Further, whenever a subcontractor receives payment from
the contractor, the subcontractor shall promptly pay
such monies received to each sub-subcontractor and
supplier in proportion to the work completed.
C. If the contractor or subcontractor without reasonable
cause fails to make any payment to his subcontractors
and suppliers within fourteen consecutive days of the
receipt of payment ..., the contractor or subcontractor
shall pay ... in addition to the payment, a penalty...
In addition, the contractor or subcontractor shall be
liable for reasonable attorney fees for the collection
of the payments due the subcontractors and suppliers.
La.

Rev.

Stat.

9:2784.

Attorney

fees

and

penalties

are

expressly authorized by statute. The Court has dismissed the
unjust enrichment claims, thus, to the extent Fisk continues to
seek a penalty, in addition to attorney fees, Fisk is granted
leave to properly amend the complaint under Fed. R. Civ. P.
15(a)(2), within 14 days of this Court’s order.
22

Rec. Doc. No. 1 at 6.

13

IV.

CONCLUSION
IT IS ORDERED that the Motion to Dismiss is GRANTED, in

part, and DENIED, in part. Accordingly, Plaintiff’s claim for
unjust enrichment seeking recovery for:
(1) $146,276.00 which Winter Park purportedly failed to pay
on its outstanding invoice due to a miscalculation on the part
of

both

parties

in

executing

the

Release

and

additional

damages

Assignment

Fisk

agreement;
(2)
incurred

$24,292.79
as

a

for

result

of

delays

that

allegedly

occurred

prior

to

Subcontract Agreement;
(3) $306,203.00 in additional expenses Fisk claims to have
incurred as a result of project delays after the parties entered
into the Subcontract Agreement; and,
(4)
USACE,

Payment Winter Park received from the project owner,
for

transmitted

work
to

completed

Fisk,

is

by

Fisk,

DISMISSED

as

which
Fisk

has
has

not

been

failed

to

establish the requisite absence of an available remedy at law.
The Court having dismissed the unjust enrichment claims,
grants Plaintiff leave to properly amend the complaint under
Fed.

R.

Civ.

P.

15(a)(2)

in

order

to

assert

any

claim(s)

14

relative to the Louisiana Prompt Pay Act, within 14 days of this
Court’s order.

New Orleans, Louisiana, this 11th day of June, 2015.

____________________________
UNITED STATES DISTRICT JUDGE

15