807 F.3d 725 (5th Cir. 2015), 15-60251, JSI Communications v. Travelers Casualty & Surety Company of America
|Citation:||807 F.3d 725|
|Opinion Judge:||HAYNES, Circuit Judge:|
|Party Name:||JSI COMMUNICATIONS, Plaintiff - Appellant v. TRAVELERS CASUALTY & SURETY COMPANY OF AMERICA, Defendant - Appellee|
|Attorney:||For JSI COMMUNICATIONS, Plaintiff - Appellant: Christopher Solop, Biggs, Ingram & Solop, P.L.L.C., Jackson, MS. For TRAVELERS CASUALTY & SURETY COMPANY OF AMERICA, Defendant - Appellee: David J. Krebs, Esq., Attorney, Krebs, Farley & Pelleteri, P.L.L.C., New Orleans, LA; Justin Wade Sweat, Alec M...|
|Judge Panel:||Before JOLLY, HAYNES, and COSTA, Circuit Judges.|
|Case Date:||December 04, 2015|
|Court:||United States Courts of Appeals, Court of Appeals for the Fifth Circuit|
JSI appealed the district court's grant of summary judgment for Travelers on JSI's payment bond and bad faith claims. The court concluded that Travelers remains liable to JSI on the payment bond, requiring reversal of the summary judgment granted to Travelers on this claim; JSI is entitled to recovery under the bond and summary judgment on liability for the invoiced amount should have been... (see full summary)
Appeal from the United States District Court for the Southern District of Mississippi.
Plaintiff JSI Communications appeals the district court's grant of summary judgment in favor of Defendant Travelers Casualty & Surety Company of America on
JSI's payment bond and bad faith claims. We REVERSE and RENDER in part, REVERSE and REMAND in part, and VACATE and REMAND in part.
McMillan-Pitts Construction Company, LLC was selected as the prime contractor on a public project to construct the New Stoneville Office Building, Mississippi State University Delta Research and Extension Center, located in Stoneville, Mississippi (the " Project" ). McMillan-Pitts was required to procure payment and performance bonds as surety for the Project, and McMillan-Pitts obtained these bonds from Travelers. Under their agreement, McMillan-Pitts and Travelers were jointly and severally liable for the covenants in the bonds. The agreement further specified that the bonds were " governed by and shall be construed in accordance with Mississippi law. Any inconsistency with these Bonds and any provision of Mississippi law shall be remedied by deleting the inconsistent portion of these Bonds and leaving the remaining consistent portions in full force and effect."
Tackett Electric Company LLC was a subcontractor to McMillan-Pitts on the Project, and Tackett subcontracted with JSI to install and test voice and data cabling as well as fiber optic cabling. JSI completed its work on the Project on July 31, 2012, and invoiced Tackett for $36,346.09. It is uncontested that JSI has not been paid this sum.
JSI is apparently not the only entity to which Tackett owes money. In March 2012, a Tackett creditor unrelated to the Project served a writ of garnishment on McMillan-Pitts, seeking access to any funds McMillan-Pitts owed Tackett. In response, McMillan-Pitts commenced an interpleader action in Mississippi chancery court, which named as defendants Tackett, the unrelated Tackett creditor, and two Tackett subcontractors (not JSI) on the Project with which McMillan-Pitts and Tackett had joint check agreements. According to the complaint for interpleader, McMillian-Pitts believed these four defendants were " the only persons who may be interested in the subject proceeds or who may assert claims to the proceeds of McMillan-Pitts'[s] contract with Tackett." In connection with the interpleader action, McMillan-Pitts tendered $19,445.16, the amount of money it still owed Tackett for its work on the Project, into the court's registry. On August 30, 2012, McMillan-Pitts obtained a judgment releasing it from any further liability on its subcontract with Tackett, on the two joint check agreements, and on the writ of garnishment.
On or about October 3, 2012--shortly after McMillan-Pitts obtained this judgment in the interpleader action--JSI notified both McMillan-Pitts and Travelers that it was seeking payment under the Project's payment bond due to Tackett's nonpayment of JSI's invoice. On October 25, 2012, McMillan-Pitts amended its complaint for interpleader to include JSI and " all persons or entities supplying materials and/or labor to Tackett" on the Project. That same day, McMillan-Pitts obtained an amended judgment extending the previous release of liability to " any claim made by any other claimant made a party to this action for sums due and owing from [Tackett] for materials, supplies and/or labor provided to [Tackett] on the [Project]."
On November 8, 2012, Travelers denied JSI's claim on the bond on the grounds that McMillan-Pitts had received a judgment releasing it of any obligations under
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