U.S. for use of Wallace v. Flintco Inc.
| Decision Date | 29 June 1998 |
| Docket Number | No. 96-11360,96-11360 |
| Citation | 143 F.3d 955 |
| Parties | 42 Cont.Cas.Fed. (CCH) P 77,324 The UNITED STATES of America for the Use of Marshall E. WALLACE d/b/a Wallace Construction Company, et al., Plaintiffs, Marshall E. Wallace, doing business as Wallace Construction Company, Plaintiff-Counter Defendant Appellee-Cross-Appellant, v. FLINTCO INC.; American Home Assurance Co., Defendants-Counter-Claimants Third Party Plaintiffs Appellants-Cross-Appellees, v. VICTORE INSURANCE COMPANY, Third-Party Defendant-Appellee-Cross-Appellant. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Roger L. Mandel, Marc R. Stanley, Stanley, Mandel & Iola, Dallas, TX, for Wallace and Victore Ins. Co.
William Lewis Sessions, Christopher Michael Cain, Sessions & Sessions, San Antonio, TX, for Flintco Inc. and American Home Assur. Co.
Robert Leland Magrini, Hayes & Magrini, Oklahoma City, OK, for Victore Ins. Co.
Appeals from the United States District Court for the Northern District of Texas.
Before KING and JONES, Circuit Judges, and WERLEIN *, District Judge.
This case presents cross-appeals by a contractor and a subcontractor, and their respective bond sureties, from an Amended Judgment entered after a two-week jury trial. After a careful review of the trial proceedings, we conclude that those portions of the Amended Judgment of the district court that award costs to both sides against their respective adversaries, should be VACATED and REMANDED for further proceedings, and that the Amended Judgment, as reformed herein for clarification, should otherwise be AFFIRMED.
The United States Army Corps of Engineers ("Corps") engaged Flintco, Inc. ("Flintco"), a general contractor, to build an enlisted dormitory at Sheppard Air Force Base, Texas, ("the Project"). Flintco, in turn, subcontracted with Marshall E. Wallace d/b/a Wallace Construction Company ("Wallace") for Wallace to perform dirt and paving work on the Project. Flintco and American Home Assurance Co. ("AHAC"), Flintco's surety, furnished a payment bond pursuant to the Miller Act, 40 U.S.C. § 270a; Wallace and Victore Insurance Co. ("Victore"), Wallace's surety, furnished private payment and performance bonds.
Wallace began work on the Project in March 1992. In July 1992, August 1992, and January 1993, Wallace submitted change orders No. 1, No. 2, and No. 3, respectively, for additional compensation. Each was approved, and pursuant to each, Wallace was compensated.
In July 1993, the Corps issued a directive that the compaction of the subgrade of the parking lots be increased from 90% to 95% density. Wallace began this work before submitting a claim to the Corps, through Flintco, for additional compensation. Wallace later submitted the claim, but before the claim was fully processed, Wallace ceased work on the Project and left the Project site on December 23, 1993, leaving his own subcontractors unpaid to the extent of approximately $101,000. Flintco contracted with another dirt and paving subcontractor to complete the unfinished work.
In April 1994, Wallace submitted a "Request for Equitable Adjustment" in which he sought $ 215,292.50 in compensation for the increased compaction. The Corps responded with an award of only $7,000.00. Wallace later submitted an amended claim which was denied.
Wallace filed this suit against Flintco and AHAC for breach of contract and for quantum meruit. Wallace alleged that Flintco, the Corps, and other subcontractors interfered with his work on the Project, and caused him "productivity impact" damages. Flintco and AHAC counterclaimed against Wallace for breach of the subcontract, and filed a third party action against Victore on the performance and payment bonds.
A two-week jury trial resulted in a special verdict for Wallace on all questions submitted. Among other things, the jury found that Flintco breached its contract with Wallace; that Wallace was entitled to a quantum meruit recovery; that Wallace had fulfilled all contractual conditions precedent to filing suit against Flintco and AHAC; and that Flintco and AHAC had breached the Miller Act bond by failing to pay Wallace. Conversely, the jury also found that Wallace had not breached his contract with Flintco; that Wallace was not negligent in performing his work; that Wallace had not waived his claims against Flintco; that Flintco had not fulfilled all contractual conditions precedent to filing suit against Wallace and Victore; that Flintco did not acquire from Wallace's subcontractor creditors their claims against Victore; and that Wallace and Victore did not breach their obligations to Flintco under the payment bond. The jury awarded $197,777.00 to Wallace and awarded nothing to Flintco.
Wallace moved for entry of judgment; and Flintco and AHAC filed a "Motion for Judgment Notwithstanding the Verdict" under Fed.R.Civ.P. 50(b). 1 The trial court granted in part Flintco's and AHAC's Rule 50(b) motion, holding as a matter of law that they were entitled to recover from Wallace and Victore approximately $101,000 that they had paid to Wallace's subcontractors whom Wallace had not paid when he ceased work on the Project. The trial court ultimately signed an Amended Judgment, which is summarized as follows:
Judgment for Wallace against Flintco on Wallace's state law quantum meruit claim for:
R. Vol. 13 at 3776-77 (footnotes omitted).
A take nothing Judgment on Wallace's claim for breach of contract against Flintco; 2
Judgment for Wallace and against Flintco and AHAC, jointly and severally, on Wallace's Miller Act payment bond claim for:
Id. at 3777. 3
A take nothing judgment on Flintco and AHAC's breach of contract claim against Wallace;
Judgment for Flintco and AHAC and against Wallace and Victore, jointly and severally, on their third-party payment bond claim in the amount of $101,187.30, plus pre-judgment interest in the amount of $30,834.13, and post-judgment interest at a rate of 5.90%;
A take nothing Judgment on Flintco and AHAC's third party performance bond claim against Victore $73,778.43 in costs recoverable by Flintco and AHAC from Wallace and Victore, jointly and severally;
$90,091.00 in costs recoverable by Wallace from Flintco and AHAC, jointly and severally;
$256,338.00 in attorneys' fees recoverable by Wallace from Flintco; and
$183,425.78 in attorneys' fees recoverable by Flintco from Wallace.
It is this Amended Judgment that is the subject of the cross appeals in almost every respect.
Flintco and AHAC first challenge the sufficiency of the evidence to support a judgment for Wallace on his quantum meruit and Miller Act claims because the Flintco-Wallace subcontract contained a "no damages for delay" clause. In response, Wallace contends that Flintco failed to move for a "directed verdict" 4 at the close of the evidence and thereby waived its right to appellate review of the sufficiency of the evidence. Wallace therefore contends that this Court must review Flintco's and AHAC's arguments as if they are presented for the first time on appeal, under the plain error standard.
Challenges to the sufficiency of the evidence must be raised in a Fed.R.Civ.P. 50(a) motion for judgment as a matter of law before submission of the case to the jury. If the trial court does not grant a motion for judgment as a matter of law made after the close of all the evidence, then the movant may renew its request for judgment as a matter of law after the entry of judgment. Fed.R.Civ.P. 50(b). A party that fails to move for judgment as a matter of law under Rule 50(a) on the basis of insufficient evidence at the conclusion of all of the evidence waives its right to file a renewed post-verdict Rule 50(b) motion, and also waives its right to challenge the sufficiency of the evidence on appeal. Bay Colony, Ltd. v. Trendmaker, Inc., 121 F.3d 998, 1003 (5th Cir.1997) (); Polanco v. City of Austin, Tex., 78 F.3d 968, 974 (5th Cir.1996) (); Allied Bank-West, N.A. v. Stein, 996 F.2d 111, 114-115 (5th Cir.1993) ().
The Rule serves two purposes:
to enable the trial court to re-examine the sufficiency of the evidence as a matter of law if, after verdict, the court must address a motion for judgment as a matter of law, and to alert the opposing party to the insufficiency of his case before being submitted to the jury.
MacArthur v. University of Tex. Health Ctr. at Tyler, 45 F.3d 890, 897 (5th Cir.1995). Rule 50(b) is to be examined and applied " 'in the light of the accomplishment of [its] particular purpose[s] as well as in the general context of securing a fair trial for all concerned in the quest for truth.' " Bay Colony, 121 F.3d at 1003 (quoting McCann, 984 F.2d...
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