Smith Marine, Inc. v. Kyle Conti Constr., LLC, Civil No. 11-11537-LTS
| Decision Date | 15 July 2013 |
| Docket Number | Civil No. 11-11537-LTS |
| Parties | SMITH MARINE, INC., Plaintiff, v. KYLE CONTI CONSTRUCTION, LLC, Defendant. |
| Court | U.S. District Court — District of Massachusetts |
SOROKIN, C.M.J.
The plaintiff, Smith Marine, Inc. ("SMI"), provided barges and other work boats to the defendant, Kyle Conti Construction, LLC ("KCC"), in connection with a bridge remediation project on the Delaware River. In this action, SMI claims KCC breached its contract with SMI by failing to pay monies due thereunder. KCC has counterclaimed, alleging SMI's failure to perform as required and in good faith delayed the project and entitles KCC to certain "back charges." SMI has moved for summary judgment and, for the reasons that follow, its motion is ALLOWED.
Many of the facts identified by the parties in their lengthy statements of material fact are not material to the resolution of SMI's motion, which largely turns on the undisputed language of the contract at issue. The Court will recount only those facts which are necessary to its summary judgment determination.
KCC, a New Jersey construction company, was awarded a contract by the Delaware River Joint Toll Bridge Commission ("the Commission") to perform repairs on five bridges spanning the Delaware River between Pennsylvania and New Jersey. Doc. No. 36 at ¶¶ 1, 3; Doc. No. 44 at ¶ 1. Trumbull Corporation ("Trumbull") managed the project on behalf of the Commission. Doc. No. 36 at ¶ 2. Three of the five bridges required "scour remediation," a process which involved reinforcing and protecting from erosion the portions of the bridges' piers that are submerged in the water. Doc. No. 36 at ¶ 6; Doc. No. 44 at ¶ 11. In order to perform such work, KCC needed barges and support vessels to transport people and materials (such as large sandbags) between the shoreline and the piers, and to provide work platforms on the water. Doc. No. 36 at ¶ 8; see Doc. No. 44 at ¶ 12; cf. Doc. No. 46 at ¶ 8.
KCC's equipment manager identified SMI as a potential supplier of barges and work boats. Doc. No. 32 at 5-7;1 Doc. No. 36 at ¶ 9. In early September 2010, SMI provided KCC with information about its barges, including the need for a water depth of at least two feet to operate the barges while loaded with standard SMI equipment. Doc. No. 36 at ¶ 10; Doc. No. 31-1 at 2-4, 6-9. A few weeks later, SMI sent KCC a contract entitled "Time Charter Party," with associated "Time Charter Party Terms," pursuant to which SMI would provide KCC with a barge equipped with an articulating lift and a knuckleboom crane, as well as a work boat and vessel operators. Doc. No. 36 at ¶ 14; Doc. No. 31-1 at 11-16. KCC's senior project manager, Reginald Elsman, was responsible for negotiating terms and signing the contract. Doc. No. 28-1;Doc. No. 44 at ¶ 19; Doc. No. 54 at 12-14; see Doc. No. 52 at 18 (); Doc. No. 53 at 19 ().
The Time Charter Party ("the Charter"), which Elsman executed on September 28, 2010, contained the following relevant provisions:
5. The entire operation, navigation, and management of the Vessel shall be in the exclusive control and command of [SMI], [its] Master, Officers and Crew. The Vessel will be operated and the services hereunder will be rendered as requested by [KCC], subject always to the exclusive right of [SMI] or the Master of the Vessel to determine whether operation of the Vessel may be safely undertaken.
Doc. No. 28-1 at 2 (emphasis added).
8(e). Payments - Payments . . . shall be received within [thirty] days . . . from the date of receipt of the invoice. If payment is not received by [SMI] within 10 banking days following due date, [SMI] shall have the right to withdraw the Vessel [or] . . . to suspend the performance of any and all of [its] obligations hereunder . . . . If payment is not received by [SMI] within 10 banking days following due date, [SMI is] entitled to charge interest at the rate [of 18% annually] on the amount outstanding from and including the due date until payment is received. [KCC] agrees to pay any and all legal fees and costs incurred in securing or collecting any amount owed hereunder.
18. This Charter Party shall be governed by and construed in accordance with the General Maritime Law of the United States, and to the extent not applicable, the laws of the Commonwealth of Massachusetts . . . .
The Charter restricted the vessels' area of operation to "any place where the Vessel[s] can safely lie always afloat." Id. at 2. It defined the services involved as: Id. at 7. The "period of hire" was an estimated two months, but wouldextend to include "[d]ays necessary to complete bridge rehabilitation operation." Id. After setting out daily charges that decreased as the number of working days increased, the Charter included a $450-per-day "Standby/Lay Day Charge," to be imposed as follows:
If for reasons beyond [SMI's] control, i.e. wind, ice, weather, we cannot work, a lay day fee will be incurred. Lay day fee will also be incurred if barge is held or reserved by client for storing client's equipment or materials[]. Operator is not included on standby/lay days. [SMI] is not responsible for ice breaking services, should they apply. A lay day will be charged for day(s) the equipment is unable to operate due to river freezing.
Id. (emphasis added).
The day KCC executed the Charter, McQuaid met SMI's vice president of operations at the job site in New Jersey to inspect the work area. Doc. No. 36 at ¶ 20; Doc. No. 44 at ¶ 17. The next day, SMI assembled its barge on site (it had been transported there by truck, in pieces). Doc. No. 36 at ¶ 21; Doc. No. 44 at ¶ 20.
The barge was moored at a staging area on Thursday, September 30, 2010 due to heavy rains that continued through the following morning. Doc. No. 36 at ¶¶ 22-23. The rains caused the river to flood, and the barge was swept more than a mile downstream, where it later was located and recovered ("the October 1st incident"). Doc. No. 36 at 25; see Doc. No. 29 at ¶ 15. As a result of the October 1st incident, SMI instituted strict protocols for monitoring the river depth using nearby gauges maintained by the United States Geological Survey ("USGS") and documented on the National Oceanic and Atmospheric Administration website, and requiring twenty-four-hour supervision of the vessels when the river rose to "action stage."2 Doc. No. 36at ¶¶ 26-29; Doc. No. 44 at ¶¶ 25-26.
SMI put the barge back in service on October 8, 2010.3 Doc. No. 62 at ¶ 23. During the week of standby time, KCC executed an amendment to the Charter's terms. Doc. No. 28-1 at 9. The amendment made the following changes: it added a second barge (which SMI secured from a company in Maryland), three additional work boats, and additional vessel operators; it altered the applicable rate schedule to reflect longer shifts and to eliminate changes in daily rates over time; it amended the lay day rate to $450 per barge, per shift (rather than per day); and it changed billing from monthly to biweekly, with payments required within fifteen days instead of thirty. Compare id., with id. at 7.
The second barge arrived at the job site on October 12, 2010. Doc. No. 36 at ¶ 38. Work continued until November 2, 2010, with the exception of one day when a storm was expected, and certain weekend days when KCC placed the barges on standby. Doc. No. 36 at ¶ 39; Doc. No. 44 at ¶ 27; see Doc. No. 30-1 at 7-9; Doc. No. 31, Ex. 41 at 1-2.4 From November 2 through 9, 2010, SMI placed its barges on standby due to its determination that water levels were too low to operate them.5 Doc. No. 44 at ¶ 27; see Doc. No. 31-1 at 9. The barges were back in serviceon November 10, 2010. Doc. No. 44 at ¶ 27. That day, SMI's push boats struck rocks and required propeller repairs. See Doc. No. 36 at ¶ 46; Doc. No. 44 at ¶ 29. Nonetheless, the barges remained in service and work continued until KCC placed the barges on standby from November 18 through 28, 2010. Doc. No. 36 at ¶¶ 47, 50. During that time, KCC made the first of two requests to Trumbull that the project deadline be extended. Doc. No. 36 at ¶¶ 49, 77.
The barges were moved on November 29, 2010 to begin work at a different bridge. Id. at ¶ 50. On November 30th, after both barges were loaded with equipment and materials, SMI determined it could not safely navigate them over a sandbar between the shore and the pier where work was occurring. Doc. No. 36 at ¶¶ 54-55; see Doc. No. 30-1 at 11. Thereafter, SMI secured the barges due to rain and concern for rising water levels. Doc. No. 36 at ¶¶ 55-56. The barges were reassembled and loaded on December 6, 2010, when SMI determined the water levels had decreased sufficiently. Id. at ¶ 57; Doc. No. 44 at ¶ 31. Work continued through December 23, 2010, except for one Sunday when KCC did not work and one other day when SMI determined water levels were dangerously high. Doc. No. 36 at ¶ 58; Doc. No. 44 at ¶ 31.
Due to the holidays, KCC placed the barges on standby from December 24 through 26, and a snow storm prevented work on December 27, 2010. Doc. No. 36 at ¶¶ 59-60. Work briefly resumed on December 28, 2010, as one barge loaded with equipment was moved into place near a pier, but SMI suspended operations later that day after determining water levels had dropped too low to maneuver the second barge past a shallow area created by a rocky shoal between the shore and the pier. Doc. No. 36 at ¶¶ 61-62, 70-71; Doc. No. 44 at ¶¶ 32, 36. Thebarges remained on standby until January 21, 2011 based on SMI's assessment that there was...
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