Polote Corp. v. Metric Constructors, Inc.

• Decision Date: 25 January 1995
• Docket Number: Civ. A. No. CV494-051.
• Citation: 880 F. Supp. 836
• Parties: The POLOTE CORPORATION, Plaintiff, v. METRIC CONSTRUCTORS, INC., Defendant.
• Court: U.S. District Court — Southern District of Georgia

880 F. Supp. 836

The POLOTE CORPORATION, Plaintiff, v. METRIC CONSTRUCTORS, INC., Defendant.

Civ. A. No. CV494-051.

United States District Court, S.D. Georgia, Savannah Division.

January 25, 1995.

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Ronald G. Robey, Hubert J. Bell, Jr., Smith, Currie & Hancock, Atlanta, GA, for plaintiff Polote Corp..

Victoria Soto Tobin, David R. Hendrick, Hendrick, Spanos & Phillips, Atlanta, GA, for defendant Metric Constructors, Inc.

ORDER

EDENFIELD, Chief Judge.

Before the Court is Defendant's motion for partial summary judgment on Counts I and III of the Complaint. Count I alleges Defendant engaged in several instances of racial discrimination against the Plaintiff that are actionable under 42 U.S.C. § 1981. Count III alleges Defendant tortiously interfered with Plaintiff's existing and potential contractual relationships with third parties. Because genuine issues of material fact exist as to some, but not all of Plaintiff's claims, the Court DENIES the Defendant's motion for summary judgment in part and GRANTS it in part.

I. BACKGROUND

The Plaintiff and Defendant are not strangers to one another. Plaintiff, the Polote Corporation ("Polote"), a minority owned Georgia construction company, has served in a subcontractor or 25 percent joint venture capacity with the Defendant, Metric Constructors, Inc. ("Metric"), a North Carolina construction company, on four major construction projects. By working with Polote on these projects, Metric was attempting to foster a long-term relationship between the two companies. One that would ensure Metric always had a reliable minority subcontractor available when it bid on contracts having minority participation requirements.

The companies appeared to have a strong working relationship until the very close of their most recent joint endeavor, the Santee Cooper-Cross Generating Station project (Santee Cooper). Under its contract with the project owner, Metric was to construct portions of a large power facility in South Carolina. On January 15, 1992, Metric hired Polote under a $431,761 subcontract to do all the sitework or earth moving work for the project. Metric faced a tight schedule for the project and a $5,000 a day liquidated damages penalty for every day it remained onsite beyond the contract deadline.

The work seemed to be progressing well throughout most of the project. Polote and Metric were even discussing bidding together on a future project Georgia Power was developing. However, problems soon developed between Polote and Metric on the Santee Cooper project. First, a dispute arose over Polote's scope of work. Metric contended that Polote was responsible for all sitework on the project, while Polote contended it had not contracted to do backfill work around the project's circulating water pit. Second, another subcontractor obstructed Polote's work area for a time, making it impossible for Polote to complete a section of the sitework. Finally, heavy rains made certain stockpiles of backfill unusable, further delaying the project.

These problems caused Polote to be on-site longer than anticipated, and as a result its insurance expired before the project was completed. A new policy, allegedly, would have cost $10,000; a sum Polote was not willing to pay. It is unclear from the record that Metric was aware that Polote had encountered this insurance problem. Nonetheless, Polote left the job, leaving both the area around the circulating water pit to be backfilled and the spoil piles and borrow areas to be dressed-up. Metric, however, facing liquidated damage penalties, wanted Polote back on the job. Aside from not being insured, Polote could not make an immediate return to the job site because the project guidelines required all workers reentering the site after an absence be retested for drug use — a three day procedure.

Although the record does not provide an entirely clear picture of the succeeding events, it appears Metric performed the backfill work around the circulating water pit to avoid incurring liquidated damages for that portion of the project. Metric also sent Polote a notice of default explaining that if Polote did not return to the job site and dress up the borrow areas and spoil piles, Metric would declare Polote in default, do the work itself and backcharge Polote in accordance with their subcontract. Apparently, upon receipt of the notice of default, Polote asked Metric not to do the unfinished work, and requested a meeting. At the meeting the project superintendent's from both companies discussed the work remaining and the amount Metric would backcharge Polote if Polote did not return to the project. Allegedly, a dispute arose over the amount of the backcharge, and Metric felt compelled to declare Polote in default to guarantee that it would be able to collect the backcharge under the terms of the contract. The backfill work around the circulating water pit and the dressing up of the spoil piles and borrow pits cost Metric $9,412 and $4,902 respectively. Needless to say, Polote and Metric did not leave the Santee Cooper project on amiable terms. Polote left the project feeling it had been a victim of Metric's animus.

Even before the Santee Cooper project began, however, Polote was supposedly put on notice that Metric harbored racial animosity towards the minority firm. Allegedly, Charlie Davis, then group business development manager for Metric, told Benjamin Polote, Polote's president, certain people in Metric did not like Mr. Polote and did not want to work with him because of his race. Polote Aff., at ¶ 11. Evidence of this animosity apparently surfaced early in the project when Ben Polote got in an argument with Larry Tandy, Metric's construction manager, over Polote's scope of work. According to Pravin Shah, Polote's project manager who was present at the meeting, the attitude Mr. Tandy expressed to Polote was racially insulting and abusive. Shah Aff. at 79. Later in the project Metric's project superintendent, Bud Allman, also demonstrated racial animus. During a particularly heated exchange with Pravin Shah, Allman supposedly said: "You fucking Indian, you don't know your ass." Undaunted, Mr. Shah replied: "Excuse me, sir. I don't take this shit from anyone, not even from my mother." Shah Dep. at 68. At a later date, Allman allegedly called another Polote project manager "that damn Hispanic." Polote Aff., at ¶ 12.

The tension between the Metric and Polote only increased after the Santee Cooper project was completed. Metric, sans Polote, was awarded the Georgia Power contract, which Metric and Polote had discussed bidding on together only weeks before. Apparently, Metric had intended to use Polote because the contract originally had a minority participation requirement and included sitework that Metric knew Polote was equipped to perform. However, before Georgia Power awarded the contract for the project it restructured it, dropping the minority participation requirement and separating out the sitework into a stand alone contract. Metric encouraged Polote to bid on the sitework contract by itself, but Polote could not a bid because it could not post a bond.

Polote's distrust of Metric grew after Hurricane Andrew struck in the Fall of 1992, and Metric was hired by the Corps of Engineers as one of six companies to oversee the cleanup effort. Although Metric hired some minority contractors, Polote was not among them. Metric contends that it had awarded all its subcontracts before Polote had shown any interest in bidding. Furthermore, Metric contends the person in charge of awarding the contracts was not aware that Metric had declared Polote in default on the Santee Cooper project. Polote, in contrast, asserts a "senior Metric corporate representative" told Polote that the senior management at Metric was not letting Polote place bids because they thought Benjamin Polote was a "black guy who is too smart." Aff. B. Polote. Polote also contends in deposition testimony that it bid on at least two Metric subcontracts during the cleanup, but, despite being qualified, was rejected on both.

Polote has bid on other contracts since the Santee Cooper project, but contends that it has been passed over because of the Santee Cooper default and Metric's alleged discussion of the default with other contractors. Polote argues that Metric must have publicized the default or Polote would have been awarded some of the other contracts on which it bid. Metric contends that it did not discuss the Polote default with other companies unless expressly asked.

Seeking redress for the alleged injustices it suffered at the hands of Metric, Polote filed this lawsuit, complaining Metric: (1) violated 42 U.S.C. § 1981 in its contractual dealings with Polote; (2) breached its subcontract with Polote, and (3) tortiously interfered with contractual relationships Polote was developing with third parties. Metric has filed this motion for summary judgment on the counts involving 42 U.S.C. § 1981 and tortious interference.

II. SUMMARY JUDGMENT

To prevail on its summary judgment motion, the Metric must demonstrate to the Court's satisfaction no genuine issues of material fact exist and that the Court can render a judgment as a matter of law, thus obviating the need for a trial. Great Lakes Dredge and Dock Co. v. Miller, 957 F.2d 1575, 1578 (11th Cir.1992).

To counter a well supported motion for summary judgment, the nonmovant "must set forth specific facts showing that there is a genuine need for trial," Johns v. Jarrard, 927 F.2d 551, 555 (11th Cir.1991) (citation omitted), and may not rely solely on the pleadings. Celotex Corp. v. Catrett, 477 U.S. 317, 324, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986). "Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for trial." Matsushita Elec. Indus. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct....