Am. Contractors Indem. Co. v. Wiggins
| Decision Date | 27 March 2023 |
| Docket Number | Civil Action 3:21-CV-2768-BH |
| Parties | AMERICAN CONTRACTORS INDEMNITY COMPANY d/b/a TEXAS BONDING COMPANY, Plaintiff, v. PAUL WIGGINS, Defendant. |
| Court | U.S. District Court — Northern District of Texas |
Consent Case[1]
Before the Court is Plaintiff's Motion for Summary Judgment, filed May 18, 2022 (doc. 24), and Defendant Paul Wiggins' Amended Motion for Summary Judgment, filed January 19, 2023 (doc. 36). Based on the relevant filings, evidence, and applicable law, the plaintiff's motion is DENIED, and the defendant's motion is GRANTED.
American Contractors Indemnity Company d/b/a Texas Bonding Company (Plaintiff) agreed to issue performance and payment bonds on behalf of NACC, Inc. (NACC) for construction projects in Texas. (doc. 37-1 at 2.)[2] On August 15, 2015, Paul Wiggins (Defendant) and other individuals associated with NACC executed an indemnity agreement to protect Plaintiff from any losses it incurred under the bonds. (Id. at 105-25.) It later demanded reimbursement from Defendant under the indemnity agreement for claims it received and paid against the bonds. (Id. at 127-36.) After he failed to comply with is demands, on July 24, 2017, Plaintiff filed an indemnity enforcement action against Defendant and the other individuals. (Id. at 96-103.)
On April 19, 2019, Plaintiff and Defendant entered into a Settlement Agreement to resolve all disputes between them in the lawsuit. (Id. at 37-1 at 7.) The agreement states, in relevant part:
(Id. at 8-10.) On June 11, 2019, the indemnity action was dismissed without prejudice. See American Contractors Indemnity Company d/b/a Texas Bonding Co. v NACC, Inc., et al., No. 3:17-CV-1955-S, (N.D. Tex.), doc. 62. After the dismissal, Plaintiff's counsel emailed Defendant's counsel on June 13, 2019, requesting that Defendant execute the Agreed Judgment under the Settlement Agreement. (doc. 28-1 at 3.) Defendant's counsel confirmed that Defendant would sign the Agreed Judgment in an email dated July 3, 2019, but counsel never received one for him to execute. (Id. at 2-3.)
Between June 2019 and December 2019, Plaintiff received seven monthly payments of $2,500, totaling $17,500, from Defendant. (doc. 37-1 at 24.) Beginning January 2020, Defendant stopped sending the monthly payments. (Id.) On April 14, 2021, a Notice of Default was mailed to Defendant; it contended that he was in default under the Settlement Agreement because he had not paid the required monthly payments for a period of 16 months, from January 2020 through April 2021, or executed the Agreed Judgment. (Id. at 36-38.) It also stated that he had fifteen days to cure the default by executing the Agreed Judgment and paying the full amount of outstanding monthly payments. (Id. at 37.) Defendant failed to timely cure the default. (Id. at 25.)
On October 22, 2020, Plaintiff sued Defendant in Texas state court for breach of contract, alleging that he had breached the Settlement Agreement by “failing or refusing to sign the agreed judgment, failing to make required payments beginning with the January 2020 payment, and failing to cure following written notice of default from [Plaintiff].” (Id. at 4.) It requested contractual damages of $215,833 and attorney's fees and expenses under Chapter 38 of the Texas Civil Practice & Remedies Code. (Id.) On July 2, 2021, Plaintiff moved for summary judgment on all claims against Defendant, arguing there was no genuine issue of material fact that he had breached the Settlement Agreement “by failing to make payments due in January 2020 and beyond” and “failing or refusing to execute the Agreement Judgment;” that the breach caused it “damages of $215,833, representing the amount of the Agreed Judgment provided for in the Settlement Agreement as a remedy for [his] default ($233,333.00) less amounts already paid ($17,500);” and that it was entitled to $18,898.01 in attorney's fees, costs, and expenses. (Id. at 19.) Attached to its motion were copies of the Settlement Agreement, Agreed Judgment, and Notice of Default, as well as an affidavit of Plaintiff's representative stating that Defendant had failed and refused to execute the Agreed Judgment and that Plaintiff had not received payments from him for January 2020 through April 2021. (Id. at 23-40.) On August 24, 2021, Plaintiff filed a supplement to its summary judgment motion to clarify that the total amount of missed monthly payments owed for the period between the date of the first missed payment (January 2020) and the date of the notice of default (April 2021) was $40,000. (Id. at 82.)
At a hearing on the summary judgment motion on August 20, 2021, Plaintiff requested entry of a judgment awarding it $40,000 in damages for the sixteen missed payments through the notice of default and $10,059.50 in reasonable and necessary attorney's fees, and the state court entered an interlocutory order that granted the motion in part as requested on September 10, 2021. (Id. at 85, 138.) On September 15, 2021, Plaintiff filed a “Motion to Dismiss without Prejudice & Entry of Final Judgment,” requesting that the remaining portion of its breach of contract claim against Defendant relating to the Agreed Judgment and the payments missed after the notice of default be dismissed without prejudice, and that final judgment be entered. (Id. at 85-86.) According to the motion, the state court had not considered Plaintiff's “breach claim as it related to the agreed judgment or any other amounts owed under the settlement agreement from May 2021 forward.” (Id. at 85.)
On September 16, 2021, the state court entered a final judgment that granted Plaintiff's motion to dismiss in full and its motion for summary judgment in part, awarded it $40,000 in damages and $10,059.50 in attorney's fees, and dismissed the portion of its breach of contract claim against Defendant that “related to (1) failure to enter into an agreed judgment; and (2) amounts due to [Plaintiff] for all claims for non-payment due and owning on or after May 1, 2021 [] without prejudice to refiling same.” (Id. at 90.)
On November 9, 2021, Plaintiff filed this action against Defendant for breaching the Settlement Agreement. (doc. 1.) The amended complaint alleges that Defendant “failed to make any payments as required by the Settlement Agreement.” (doc. 6 at 2.) It also alleges that “the Settlement Agreement required [Defendant] to execute an agreed judgment in the amount of $233,333.00, less any amount paid by [him] to [Plaintiff],” but he “has refused to enter into the agreed judgment despite proper demand.” (Id.) It seeks specific performance of the Settlement Agreement and attorney's fees under the agreement and Chapter 38 of the Texas Civil Practice & Remedies Code. (Id. at 3-4.)
On May 18, 2022, Plaintiff moved for summary judgment on its claims against Defendant. (doc. 24.) Defendant responded on June 8, 2022, and Plaintiff replied on June 22, 2022. (docs. 27, 29.) On January 19, 2023, Defendant moved for summary judgment on grounds that the claims in the current lawsuit are barred by the doctrine of res judicata. (doc. 36.) Plaintiff responded on February 9, 2023, and Defendant replied on February 22, 2023. (docs. 40, 42.)[3]
Summary judgment is appropriate when the pleadings and evidence on file show that no genuine issue exists as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). “[T]he substantive law will identify which facts are material.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A genuine issue of material fact exists “if the evidence is such that a reasonable jury could return a verdict for the non-moving party.” Id.
The movant makes a showing that there is no genuine issue of material fact by informing the court of the basis of its motion and by identifying the portions of the record that reveal there are no genuine material fact issues. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the movant bears the burden of proof on an issue, it must “establish...
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