United States District Court, W.D. Louisiana, Monroe Division
REGIONAL CONSTRUCTION, L.L.C.
CITY OF MONROE
G. JAMES JUDGE.
REPORT AND RECOMMENDATION
L. HAYES UNITED STATES MAGISTRATE JUDGE.
the undersigned magistrate judge, on reference from the
district court, is a motion to dismiss for lack of subject
matter jurisdiction, Federal Rule of Civil Procedure
12(b)(1), [doc. # 8] filed by defendant City of Monroe. The
motion is opposed. For reasons assigned below, it is
recommended that the motion be GRANTED, and that
plaintiff's complaint be dismissed, without prejudice.
August 10, 2017, Regional Construction, L.L.C.
(“Regional”) filed the instant complaint against
the City of Monroe (the “City”). According to the
[the] City elected to undertake a project to rehabilitate
approximately 2300 feet of drainage piping located on the
east side of runway 18-36 [of the regional airport facility]
that began at the intersection of that runway and Taxiway D
and continued south until the piping intersected with an
abandoned runway on the south side of the airport
(“Project”) and there connected with an existing
drainage pipe owned, operated and maintained by the City . .
(Compl., ¶ 6).
City obtained funding for the Project through a grant-in-aid
program, the Airport Improvement Program (“AIP”),
administered by the Federal Aviation Administration
(“FAA”). Id., ¶ 7. Pursuant to the
City's participation in the AIP, the FAA required that
certain provisions/specifications from the Code of Federal
Regulations be incorporated into the Project contract.
Id., ¶ 8.
City contracted with Denmon Engineering
(“Denmon”) to prepare the Project bidding
documents and specifications. Id., ¶ 10. On
November 8, 2016, the City awarded the Project to Regional,
and the City and Regional entered into a construction
contract (the “Contract”), effective November 10,
2016. Id., ¶¶ 14-15. Some time after March
20, 2017, Regional commenced work on the Project.
Id., ¶¶ 16-17.
began the excavation work, Regional quickly encountered
significant amounts of groundwater that precluded the proper
bedding of pipe and prevented its ability to backfill and
stabilize the pipe. Id., ¶ 20. Regional
contends that the site condition was not reflected on the
Project plans. Id., ¶ 21. According to
Regional, investigation revealed that the City interfered
with Regional's performance under the Project by failing
to maintain and clear the Outfall Pipe, thereby causing
groundwater to back-flow into the Project. Id.,
¶ 22. Despite these findings by Regional and Denmon,
neither the City, nor Denmon, took any steps to redress the
differing site conditions. Id., ¶ 23. The
unfettered flow of water via the Outfall Pipe ultimately led
to a work stoppage by Regional. Id., ¶ 24.
one month of work, Regional submitted its payment application
for work performed and materials used in April based on
percentages of completion pursuant to section 90-06 of the
federal specifications incorporated into the Contract.
See Compl., ¶ 25. The City approved
Regional's April payment application in early May and
advised that payment would be forthcoming. Id.,
¶ 27. However, the City never made the payment.
Id. ¶¶ 27-28.
to Regional, the City claimed that payment under the Contract
could be made only pursuant to sections 701-4.1 and 701-5.1
of the federal specifications, which provide for payment on
the basis of linear feet of pipe in place, completed, and
approved. See Compl., ¶ 29; Advisory Circular,
§§ 701-4.1 and 701-5.1; Response to M/Dismiss,
Exhs. A & B.
ceased work on the Project in mid-May when the City failed to
remit the partial payment due for work performed in April.
Id., ¶ 31. Regional also submitted an
application for partial payment for the stored materials
purchased and placed on the job site. Id.,
¶¶ 33-34. The City, however, did not remit payment
for the materials to Regional, and instead, paid
Regional's suppliers directly. Id., ¶¶
of the non-payment of the April payment application, Regional
provided the City with requisite notice to terminate the
Contract. Id., ¶¶ 37-38. Despite the
notice, the City never paid any funds to Regional within the
period specified by the Contract. Id., ¶ 39.
After issuance of the notice of termination, the City
rejected Regional's work performed under the Contract
because the piping was not properly back-filled.