United States District Court, District of Columbia
UNITED STATES OF AMERICA, for the use and benefit of AMERICAN CIVIL CONSTRUCTION, LLC, Plaintiff,
HIRANI ENGINEERING & LAND SURVEYING, P.C., et al., Defendants.
P. Mehta, United States District Judge.
court did not anticipate that it would need to draft another
memorandum opinion in this case-not after issuing a 69-page
Findings of Fact and Conclusions of Law (“FFCL”).
All that remained after the FFCL was for the parties to
submit their respective positions as to a final damages award
“consistent with” the FFCL. See FFCL,
ECF No. 91, at 69. But apparently by giving the parties an
inch, they have decided to take a mile. Instead of relatively
straightforward position statements on a final damages
calculation, the court received more than 40 pages of
detailed legal briefing, with citations to dozens of cases
and to Plaintiff's counsel's scholarship. The court
already has rejected most of the arguments. Others were not
raised until now. The court will not dwell on these arguments
for long. But to ensure that the D.C. Circuit fully
understands the final award in this case, the court will
address the parties' various contentions one last time.
FFCL, the court asked Plaintiff American Civil Construction
LLC (“ACC”) to determine whether any sums sought
in Exhibits 32, 33, and 34, involved costs incurred before
April 4, 2011. See FFCL, ECF No. 91, at 49 n.10. ACC
confirms that “none of the invoices included [in those
exhibits] are for work done or material supplied prior to
April 4, 2011.” Pl.'s Reply to Defs.'
Objections, ECF No. 95 [hereinafter Pl.'s Reply], at 2;
see also Pl.'s Corrected Revised Damages
Calculations, ECF No. 93 [hereinafter Pl.'s Cals.], at
3-4. The court likewise has reviewed the exhibits in
question, and based on ACC's explanation, agrees that no
pre-April 4, 2011 costs are included. Accordingly, the court
will not reduce the award amount for costs that predate the
parties' subcontract (“Subcontract”).
Hirani Engineering & Land Surveying, P.C. and Colonial
Surety Company take the opportunity to dissect the damages
sought in Exhibits 32, 33, and 34, and ask the court to do
the same. See Defs.' Objections, ECF No. 94
[hereinafter Defs.' Objs.]. The court declines to do so.
See FFCL at 56 (stating that quantum meruit damages
“embrace a rough calculation”) (citation
omitted). At this juncture, the court will not flyspeck a
million-dollar-plus award to determine whether the costs of
items such as water and Gatorade are compensable. In any
event, the costs that Defendants find objectionable-including
basic provisions for field personnel- reasonably qualify as
“labor or material in carrying out work provided for
in” the Subcontract under the Miller Act. 40 U.S.C.
object to ACC's asserted amount for field labor, claiming
that over $1 million in costs for on-site personnel for 25
months is not reasonable. See Defs.' Objs. at
3-4. Defendants ask the court to reduce that component of the
award by 33%. See Id. This contention, however, goes
beyond the court's limited direction to the parties
following the FFCL. Moreover, although Defendants generally
objected to “the necessity or reasonableness of having
eight on-site personnel, ” Defs.' Rebuttal, ECF No.
86, ¶ 257, they neither made the specific contentions
they do now nor demanded a percentage reduction in
recoverable labor costs. Defendants arguments thus come too
event, the court is satisfied based on the certified payroll
records, the testimony of Irene Stephen, and ACC's Daily
Reports that ACC did substantiate its requested labor costs.
The certified payroll records can be found at ACC's
Exhibit 35. For each such record, Ms. Stephen attested to the
accuracy of the information contained therein and the amounts
sought by ACC. Ms. Stephen acknowledged that a false
statement on the certified payroll could subject “the
contractor or subcontractor to civil or criminal prosecution
[under] section 1001 of Title 18 and Section 231 of title 31
of the United States [Code].” See, e.g.,
Pl.'s Ex. 35 at 32, 56, 78, 142. Additionally, at trial,
Ms. Stephen testified that the amounts sought as labor costs
comprised salary, taxes, and insurance for on-field
personnel, and that the amounts billed were for
“productive work.” See Day 3 A.M. at
79:18-82:23. The court found Ms. Stephen to be credible.
See FFCL ¶ 126. Finally, both the certified
payroll and ACC's Daily Reports show that ACC did not use
eight workers on the site each work day. Take, for example,
October 4, 2011. Payroll records show that only two men
worked that day, and ACC's Daily Report shows that other
crew members were assigned to another job on that date.
See Pl.'s Ex. 35 at 53; Pl.'s Ex. 31 at 540
(showing workers assigned to “Otis Str” project).
Such records are consistent with Ms. Stephen's testimony
that ACC assigned personnel to the Project worksite when
productive work was available but would assign workers to
other jobs when there was down time. See Day 3 A.M.
At 81:5-82:6 (noting “Otis Street near Catholic
University” as another job to which ACC assigned its
workers); see also Ex. 31 at 424-25 (showing all
personnel assigned to “Ft Lincln” or “Otis
Str” projects on July 28, 2011; “ACC Crew #1 NOT
ON SITE today; No. productive work available at site”);
Ex. 35 at 33-35 (claiming no payroll for July 28, 2011). In
short, the court is satisfied that ACC carried its burden of
showing compensable labor-related expenses of $1, 024,
Defendants assert that ACC should receive $0 for standby
equipment costs, as such “costs are not recoverable as
a matter of law.” Defs.' Objs. at 5. The court
extensively addressed this issue already in the FFCL.
See FFCL at 53-57. Defendants offer nothing that
would warrant the court's reconsideration of its prior
also object to the court awarding a 35% markup on the
reasonable value of ACC's services. See
Defs.' Objs. at 5-6. Defendants challenge both the legal
and factual basis for the court's ruling. The court
rejects both contentions.
federal appeals courts have recognized that when, as here, a
subcontractor fully performs its obligations but is not paid
by the prime contractor, a subcontractor may recover
reasonable profits from sureties. See generally U.S. for
Use & Benefit of Eastern Waterproofing & Restoration
Co., Inc. v. Berkley Regional Ins. Co., 986 F.Supp.2d
660, 665 (D. Md. 2013) (summarizing authorities and
explaining that profits are recoverable under the Miller Act
when the subcontractor fully performs but is not paid). The
Fourth Circuit has said: “[T]he surety is obligated to
pay the compensation to which the parties have agreed,
although this amount exceeds the costs of labor, materials,
and overhead.” U.S. for Use & Benefit of
Woodington Elec. Co., Inc. v. United Pac. Ins. Co., 545
F.2d 1381, 1383 (4th Cir. 1976). Similarly, the Fifth Circuit
has explained: “If the [subcontractor] has to sue the
surety company, the amount of his recovery is measured by the
contract sum, and of course the contract sum includes the
contractor's profit. If such a contractor cannot include
a profit, he would not be in ...