The opinion of the court was delivered by: Reggie B. Walton, United States District Judge
Currently before the Court is plaintiff's motion for summary judgment.
Because the Court concludes that there are material issues of fact
pertinent to the resolution of this matter, it will deny the plaintiff's
motion and permit the parties to conduct limited discovery.
The events leading to the present controversy in this case, brought
pursuant to the Miller Act, 40 U.S.C. § 270(a) — 270(f) (2000),
are somewhat contorted but the Court will attempt to state them as
succinctly as possible. The present dispute centers around a construction
contract that the United States, through the Department of the Army,
awarded to the Twigg Corporation ("Twigg"). The contract required Twigg
to complete renovations to Building 61, at Fort McNair, Washington DC
("the Project"). Compl. ¶ 2.*fn1 Twigg and Safeco Insurance Company
("Safeco"), its surety, "executed a standard government form of payment
bond to the United States of America, whereby they bound themselves
jointly and severally in the amount of the contract . . ." Id. ¶ 3. The
United States accepted the bond and awarded the construction contract to
Twigg. Id. ¶ 4.
Twigg then hired Jenkins Electric Contracting Inc. ("Jenkins") as a
subcontractor on the project. Thereafter, at some point in this series of
events, the plaintiff, Corbett Technology Solutions, Inc., ("CTSI"),
entered into a subcontract with Jenkins to provide materials and labor
for the project. Id. ¶ 5. Jenkins, however, became unable or unwilling to
perform its obligations as a subcontractor for Twigg and "CTSI (then known
as Panurgy, DC Metro) entered into a verbal agreement on or about July
28, 1999, with Twigg to become a subcontractor, complete the project and
be paid directly by Twigg." Plaintiff's Memorandum of Law in Support of
Motion for Summary Judgment ("Pl.'s Mem."), Exhibit ("Ex.") A, Affidavit
of Christopher R. Corbett, President of Corbett Technology Solutions,
Inc., ("Corbett Aff.") ¶ 7.*fn2 Thereafter, in 1998, 1999, and 2000,
CTSI supplied labor and materials to Twigg, at Twigg's request, for the
project. Compl. ¶ 8. Twigg made direct payments to CTSI (which at the time
was still known as Panurgy) for materials and labor provided for the
project on July 28, July 29, and November 19, 1999. Corbett Aff., Ex. 1.
On or about December 1, 1999, RWKS Construction Inc. purchased Twigg,
and changed Twigg's name to RWKS Construction, Inc. Pl.'s Mem, Statement
of Genuine Facts to Which There Exists No Genuine Issue ¶ 20. CTSI last
performed work on or supplied materials for the project on June 16, 2000.
Corbett Aff. ¶ 9. However, as of June 8, 2000, CTSI was still allegedly
owed a balance of $130,854.98 for labor and material provided for the
project. Corbett Aff., Ex. 3, Recap of Jenkins Electrical/Twigg
Corporation Account dated 6-08-00 ("Recap").
On June 19, 2000, CTSI informed Safeco, RWKS' surety, of RWKS' failure
to pay CTSI for the labor and materials CTSI provided for the project.
Compl. ¶ 11. On June 6, 2001, CTSI filed the present action pursuant to
the Miller Act, 40 U.S.C. § 270(b), seeking $130,854.98 in damages,
the amount it claims it was still entitled to receive from RWKS. CTSI
filed its action seeking repayment against both RWKS and Safeco jointly
and severally.*fn3 In the alternative, CTSI, "in its own right" demanded
judgment against RWKS in the full "amount of $130,854.98 with interest
from July 1, 2000, and the costs of this action." Id. ¶ 3, at 4.*fn4
RWKS filed a motion to dismiss the complaint on July 2, 2001, to which
CTSI filed an opposition on July 3, 2001.
On October 1, 2001, RWKS filed a petition for bankruptcy pursuant to
Chapter 11 of the bankruptcy code, 11 U.S.C. § 362(a)(1) (2000), in
the United States Bankruptcy Court for the District of Maryland.
Thereafter, on March 20, 2002, RWKS filed a Motion to Stay All
Proceedings in this Court, which CTSI opposed. This Court held a hearing
on this motion
on April 3, 2002, at which time the Court orally granted
RWKS's motion to stay the proceedings. At this hearing, Safeco made an
oral motion requesting that the stay be extended to the proceedings
against it. In a Memorandum Opinion dated April 30, 2002, this Court
denied Safeco's oral motion for the extension of the stay. United States
of America v. Safeco Insurance Company, No. 01-1239, slip op. at 10
(D.D.C. Apr. 30, 2002) (Walton, J.).
II. The Parties' Arguments
On March 26, 2002, plaintiff filed the instant motion for summary
judgment, arguing that there are no material facts in dispute and that
Safeco, as RWKS' surety, is obliged to pay plaintiff the $130,854.98 it
is owed by RWKS. Plaintiff's Motion for Summary Judgment ("Pl.'s Mot.")
at 1. On May 10, 2002, Safeco filed an opposition to plaintiff's motion
for summary judgment, arguing that there are several issues of material
fact that preclude this Court from granting plaintiff's motion.
Specifically, Safeco argues that there are material issues of fact in
dispute concerning whether the Court has subject matter jurisdiction over
this Miller Act claim because "CTSI has not established that it had a
direct contractual relationship with the bond principal, Twigg, that
would obviate the need for providing statutory notice to Twigg or RWKS
within ninety days after it last provided work, labor or material on the
bonded Project." Safeco Insurance Company of America's Memorandum of
Points and Authorities in Support of Its Opposition to Plaintiff's Motion
for Summary Judgment ("Safeco's Opp'n") at 3.
Second, Safeco argues that documentation pertaining to this matter
demonstrates that there is a genuine issue of fact in dispute regarding
whether CTSI "filed suit within one year of its last work, labor or
material on the Project . . ." Id. at 4. Finally, Safeco contends that
even if CTSI actually timely filed suit, there is a disputed fact as to
whether the work performed was of the type needed for the purpose of
extending the statute of limitations under the Miller Act beyond the
otherwise one year limitations period. Id.*fn5
Rule 56 of the Federal Rules of Civil Procedure sets forth the standard
for deciding a motion for summary judgment: "When a motion for summary
judgment is made and supported as provided in this rule, an adverse party
may not rest upon the mere allegations or denials of the adverse party's
pleading, but . . . by affidavits or otherwise provided in this rule, must
set forth specific facts showing there is a genuine issue for trial."
Fed.R.Civ.P. 56(e). The Court must grant the motion for summary judgment
"forthwith if the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any, show that there
is no genuine issue as to any material fact and that the moving party is
entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). Summary
judgment is mandated after there has been "adequate
time for discovery
. . . 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." Celotex Corp. v.
Catrett, 477 U.S. 317, 322 (1986). Summary judgment, nonetheless, is a
"drastic remedy, [and therefore] courts should grant it with caution so
that no person will be deprived of his or her day in court to prove a
disputed material factual ...