American Constructors, Inc. v. The Hanover Insurance Company

Filing 9

INITIAL CASE MANAGEMENT ORDER: Discovery due by 4/16/2012. Dispositive Motions due by 6/15/2012. Joint Mediation Report due by 5/18/2012. Telephone Conference set for 3/5/2012 at 9:30 AM before Magistrate Judge Joe Brown. To participate in the confer ence call, parties shall call 615-695-2851 at the scheduled time. After consulting with Judge Nixon's courtroom deputy, this matter is set for Trial on 11/6/2012 at 9:00 AM. Judge Nixon will conduct the Final Pretrial Conference on 10/26/2012 at 10:00 AM. Judge Nixon will issue a separate order covering his requirements for the final pretrial conference and the trial. Signed by Magistrate Judge Joe Brown on 8/10/11. (dt)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF TENNESSEE
AT NASHVILLE
AMERICAN CONSTRUCTORS, INC.,
Plaintiff
v.
THE HANOVER INSURANCE COMPANY,
Defendant

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Case 3:11-0495
Judge Nixon/Brown

INITIAL CASE MANAGEMENT ORDER
Pursuant to Local Rule 16(d), the following Initial Case
Management Plan is adopted.
1.

Basis of Jurisdiction. The Plaintiff initially filed

this lawsuit in Williamson County Chancery Court.

Hanover removed

this case to Federal Court pursuant to 28 U.S.C. § 1332(a) because
the matter in controversy exceeds the sum or value of $75,000.00,
exclusive of interest and costs, and the matter in controversy is
between citizens of different states.

Jurisdiction is not disputed

by the Plaintiff.
2.

Magistrate

Assignment.

This

case

is

currently

assigned to Magistrate Brown.
3.

Status of Service of Process.

Hanover has been

served and service of process is not disputed. Neither does Hanover
dispute venue or personal jurisdiction.
4.

Special Procedures.

There is no need for adopting

special procedures due to the complexity of the issues, multiple
parties, difficult dispositive issues, or unusual proof problems.

5.

Status of Pleadings.

The Complaint was originally

filed in Williamson County Chancery Court on April 26, 2011.
Hanover filed a Notice of Removal on May 25, 2011, and filed an
Answer on June 2, 2011.
6.

Parties’ Overview of the Case.
a.

Plaintiff’s Overview. Plaintiff asserts that

this cause of action arose out of the failure of Hanover to perform
pursuant to the terms of a Performance Bond issued in connection
with improvements to real property located in Williamson County and
known as the Spring Hill Area High School, Williamson County,
Tennessee (“the “Project”). American entered into an agreement with
Williamson County Schools (“Williamson County”) to perform the labor
and

provide

the

material

necessary

to

construct

the

Project.

Thereafter, American entered into a Subcontract Agreement, with
Thomas & Associates, Inc. (“Thomas & Associates”) to perform certain
site work.

In connection with the Subcontract Agreement of Thomas

& Associates, Hanover provided a Payment Bond, naming American as
the obligee and Thomas & Associates as the principal.
issued

a

Performance

Bond,

naming

as

its

Hanover also

principal

Thomas

&

Associates and as the obligee, American.
Thomas & Associates failed to pay its subcontractors
and suppliers from funds that it received from American, and then
failed to adequately provide manpower to the Project site.

Thomas

& Associates ultimately abandoned the Project, removed all equipment
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and manpower from the site, and made no effort to cure its default.
American provided notice to Thomas & Associates of the breach of
contract, the default of contract obligations, and the termination
of the Subcontract Agreement.
Pursuant to the terms of the Performance Bond,
American made demand upon Hanover to perform. Hanover refused to
perform pursuant to the terms of the Performance Bond because of an
alleged

overpayment

defense

remaining defenses.

while

continuing

to

reserve

any

Hanover refused to perform pursuant to the

terms of the Performance Bond because American supplemented manpower
and equipment on an emergency basis without the consent of Hanover.
Additionally, Hanover failed to perform pursuant to the terms of the
Performance Bond because of an alleged improper termination of
Thomas & Associates from the Subcontract Agreement.

The failure of

Hanover to perform pursuant to the Performance Bond constitutes a
breach of performance bond obligations and as a result of the
breach, American has been damaged in the approximate amount of
$370,000.00 plus attorney’s fees, interest, and administrative
costs.
b.

Hanover’s Overview.

Hanover asserts that its

potential liability to Plaintiff under the Performance Bond has been
discharged, in whole or in part, as a result of Plaintiff’s conduct
including,

but

not

necessarily

limited

to,

(1)

Plaintiff’s

substantial supplementation of Thomas & Associates’ forces under the

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Subcontract Agreement without Hanover’s knowledge or consent, (2)
Plaintiff’s substantial overpayment to Thomas & Associates under the
Subcontract Agreement, and (3) other conduct through which Plaintiff
deprived

Hanover

performance

of

options

Performance Bond.

the

opportunity

clearly

and

to

exercise

unambiguously

any

of

the

granted

by

the

In fact, correspondence authored by Plaintiff

confirms that, before Hanover received notice of any potential claim
against the Performance Bond, Plaintiff had previously engaged in,
and intended to continue engaging in conduct that deprived Hanover
of the opportunity to exercise any of the performance options
clearly and unambiguously set forth in the Performance Bond.

At a

minimum, Plaintiff failed to clearly, directly, and unequivocally
declare Thomas & Associates to be in default under the Performance
Bond

before

Plaintiff

began

engaging

in

such

conduct,

which

discharged Hanover’s potential liability under the Performance Bond
in

whole

or

in

part.

Plaintiff

further

discharged

Hanover’s

potential liability under the Performance Bond by substantially
overpaying Thomas & Associates under the Subcontract Agreement using
funds in which Hanover possesses a legal and equitable interest,
which

substantially

prejudiced

Hanover’s

interests

under

the

Performance Bond.
Moreover, Thomas & Associates, the principal under the
Performance

Bond,

adamantly

disputes

(1)

that

it

failed

to

adequately provide manpower under the Subcontract Agreement, (2)

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that it removed equipment and manpower from the Project, (3) that
it failed to provide adequate supervision or authority under the
Subcontract Agreement, or (4) that Plaintiff validly terminated
Thomas & Associates’ right to complete the Subcontract Agreement.
Thus,

Hanover

denies

any

liability

to

Plaintiff

under

the

Performance Bond or otherwise.
7.

Contested and Uncontested Issues.

The parties are

unable at this time to advise the Court of any issues that are
uncontested other than jurisdiction and venue. However, the parties
will endeavor to enter into stipulations at a later date.
8.

Discovery Plan.
a.

Mandatory Initial Disclosures. Pursuant to Fed.

R. Civ. P. 26(a)(1), all parties must make their initial disclosures
within 14 days after the initial case management conference.
b.

Initial Written Discovery. Any initial written

discovery requests, other than requests for admissions, shall be
served in time to be answered by April 2, 2012.
c.

Motions to Compel.

Any motions to compel

compliance with written discovery requests shall be filed by April
16, 2012.

No motions concerning discovery are to be filed until

after the parties have conferred in good faith and, unable to
resolve their differences, have scheduled and participated in a
conference telephone call with Magistrate Judge Brown.

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d.

Depositions. All depositions of expert and non-

expert witnesses shall be completed by May 1, 2012.
e.

Experts.

By the close of business on February

1, 2012, Plaintiff shall declare to all other parties (but not file
with the Court) the identity of its expert witnesses and provide all
the information specified in Rule 26(a)(2)(B) of the Federal Rules
of Civil Procedure.
By the close of business on March 2, 2012, Hanover
shall declare to all other parties (but not file with the Court) the
identity of its expert witnesses and provide all the information
specified

in

Rule

26(a)(2)(B)

of

the

Federal

Rules

of

Civil

Procedure.
By the close of business on March 15, 2012, Plaintiff
and Hanover shall provide (but not file with the Court) all the
information specified in Rule 26(a)(2)(B) of the Federal Rules of
Civil

Procedure

with

respect

to

any

rebuttal

expert

witness

testimony they may have.
f.

Interrogatories. Each party may serve upon any

other party a maximum of 40 interrogatories, including subparts,
unless the parties agree otherwise.
g.

Discovery

is

not

stayed

during

dispositive

motions, unless ordered by the court.
h.

The parties will endeavor to create admissions

of facts and/or stipulations regarding the authenticity of documents
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in order to avoid unnecessary discovery or proof if and when
appropriate.
i.

Though the parties reserve the right to request

that electronically stored information be produced in its native
format, all electronically stored information subject to discovery
shall first be printed out and provided in that form.
9.

Dispositive Motions.

The parties shall file all

dispositive motions on or before June 15, 2012.

Responses to

dispositive motions shall be filed within 28 days after the filing
of the motion, or July 13, 2012.

Optional replies may be filed

within 14 days after the filing of the response, or July 27, 2012.
Memoranda in support of a dispositive motion or in response to such
a motion shall not exceed 25 pages. If a reply memorandum is filed,
it shall be limited to five pages absent Court permission for a
longer reply.

If dispositive motions are filed early, the response

and reply dates are moved up accordingly.
10.

Witnesses.

Until

initial

discovery

has

been

answered, the parties cannot adequately identify what witnesses will
be necessary for purposes of trial.
11.

Settlement.

The parties have not yet determined at

this stage of the proceedings whether a voluntary mediation or
judicial settlement conference would be productive.

If the parties

elect to participate in a voluntary mediation, the parties shall
file a joint mediation report on or before May 18, 2012.
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12.
suggest

that

Subsequent Case Management Conference.
this

case

be

set

for

a

second

case

The parties
management

conference on March 5, 2012, at 9:30 a.m., which is 60 days before
the scheduled date for completion of discovery.
the

conference

call,

parties

shall

call

To participate in

615-695-2851

at

the

scheduled time.
13.

Trial Date. The parties estimate that this bench

trial will take three days, depending on what issues remain for
trial.

After consulting with Judge Nixon’s courtroom deputy, this

matter is set for trial on November 6, 2012, at 9:00 a.m.

Judge

Nixon will conduct the final pretrial conference on October 26,
2012, at 10:00 a.m.

Judge Nixon will issue a separate order

covering his requirements for the final pretrial conference and the
trial.
It is so ORDERED.
/s/ Joe B. Brown
JOE B. BROWN
United States Magistrate Judge

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