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American Contractors Indemnity Co. v. R.E. Jenkins, Inc.

United States District Court, Middle District of Louisiana

May 8, 2015

AMERICAN CONTRACTORS INDEMNITY COMPANY
v.
R.E. JENKINS, INC., ET AL.

RULING AND ORDER

BRIAN A. JACKSON, CHIEF JUDGE

Before the Court are Plaintiff American Contractors Indemnity Company's ("ACIC") Motion for Summary Judgment (Doc. 19) and Motion for Confirmation of Default (Doc. 20). Pursuant to Federal Rule of Civil Procedure ("Rule") 56, ACIC seeks summary judgment against Defendant Tracy Middleton in the full sum of $138, 862.98, plus all additional losses, costs, expenses, consulting fees, and attorney fees incurred by ACIC as a result of ACIC having issued bonds to the Defendants. Pursuant to Rule 55(b)(1), ACIC also seeks the Court's entry of a default judgment against Defendant R.E. Jenkins, Inc. ("R.E. Jenkins"). Neither defendant has opposed either motion. Oral argument is not necessary. Jurisdiction is proper pursuant to 28 U.S.C. § 1332. For the reasons stated below, both motions are GRANTED.

I. BACKGROUND

A. ACIC's Allegations

ACIC alleges that on April 22, 2009, Middleton, along with Charles K. Middleton, her husband, and Kenneth W. Kendrick, executed a General Indemnity Agreement (the "Indemnity Agreement") in order to induce ACIC to issue surety bonds for R.E. Jenkins.[1] (Doc. 19-3). In reliance on the Indemnity Agreement, ACIC avers it issued bonds for two contracts for R.E. Jenkins. (Id.).

1. The Fontainebleau Project Bonds

The first bonds issued were in connection with a project for the construction of classrooms for Fontainebleau Jr. High School (the "Fontainebleau Project") where the St. Tammany Parish School Board entered into a contract with Polk Construction Corporation ("Polk"). (Doc. 19-2 at ¶¶ 1, 2, 6). Polk, as contractor, entered into a subcontract agreement (the "Fontainebleau Subcontract") with R.E. Jenkins, as subcontractor, to provide labor and materials for the heating, ventilation, and air conditioning ("HVAC") system on the Fontainebleau Project. (Id.)

R.E. Jenkins applied to ACIC to issue a payment bond[2] and performance bond[3] for the Fontainebleau Subcontract. (Id. at ¶ 7). In response to R.E. Jenkins's application, and in reliance on the Indemnity Agreement executed by Middleton, ACIC issued a subcontract payment bond and a subcontract performance bond (the "Fontainebleau Bonds") with Polk as obligee and R.E. Jenkins as principal. (Doc. 19-4). Thereafter, R.E. Jenkins issued certain purchase orders (the "Purchase Orders") to Trane U.S., Inc. ("Trane") to provide HVAC equipment for the Fontainebleau Project. (Doc. 19-2 at ¶1 9). On August 26, 2011, Trane feild a Concursus Petition in Summary Proceeding, alleging that it did not receive full payment for said services. (Id. at ¶ 12). After adjustment and credit for amounts recovered, the total losses, costs, and expenses, including attorneys' fees and consulting fees, incurred by ACIC as a result of the Fontainebleau Bonds having been issued is $138, 187.98 (Id. at ¶¶ 13-17).

2.The Progress Road Heads tart Center Bond

The second bond was issued was in connection with a project in which the City of Baton Rouge and the Parish of East Baton Rouge ("Baton Rouge"), as owner, and R.E. Jenkins, Inc., as contractor, entered into a contract for the construction of a project referred to as the "HVAC Replacement for the Progress Road Headstart Center." (Doc. 19-2 at ¶¶ 3, 18). R.E. Jenkins applied to ACIC to issue a payment and performance bond for this contract. (Id. at ¶ 19). In response to R.E. Jenkins's application and in reliance on the Indemnity Agreement executed by Middleton, ACIC issued a performance and payment bond (the "Progress Road Headstart Center Bond") with Baton Rouge as obligee and R.E. Jenkins as principal. (Doc. 19-10). Subsequently, ACIC received a claim on the Progress Road Headstart Center Bond. (Doc. 19-2 at ¶ 21). ACIC incurred total losses, costs, and expenses, including attorneys' fees, of $675.00 as a result of issuing the Project Road Headstart Center Bond. (Id. at ¶ 23).

B. Procedural History

ACIC filed its Complaint against Middleton and R.E. Jenkins on August 13, 2014. (Doc. 1). The record indicates that R.E. Jenkins was properly served on September 12, 2014 (Doc. 6), and Middleton was properly served on October 4, 2014 (Doc. 7).[4] Middleton filed an Answer on December 10, 2014. (Doc. 14).

However, R.E. Jenkins failed to file an Answer to the Complaint or a motion by the twenty-one day deadline outlined in Rule 12; nor did R.E. Jenkins request an extension of time to file an Answer or motion under Rule 12. Indeed, it is uncontested that R.E. Jenkins has not yet filed any documents in this action. As such, ACIC moved for a Clerk's entry of default against R.E. Jenkins on December 10, 2014. (Docs. 15, 16). The Clerk granted the entry of default on December 11, 2014. (Doc. 17).[5] ACIC filed ...


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