United States v. Hirani Eng'g & Land Surveying, P.C.

• Decision Date: 28 November 2018
• Docket Number: Case No. 14-cv-00745 (APM)
• Parties: UNITED STATES of America, FOR the USE AND BENEFIT OF AMERICAN CIVIL CONSTRUCTION, LLC, Plaintiff, v. HIRANI ENGINEERING & LAND SURVEYING, P.C., et al., Defendants.
• Court: U.S. District Court — District of Columbia

345 F.Supp.3d 11

UNITED STATES of America, FOR the USE AND BENEFIT OF AMERICAN CIVIL CONSTRUCTION, LLC, Plaintiff,

v.HIRANI ENGINEERING & LAND SURVEYING, P.C., et al., Defendants.

Case No. 14-cv-00745 (APM)

United States District Court, District of Columbia.

Signed November 28, 2018

Herman M. Braude, Braude Law Group, PC, Washington, DC, Edward D. Manchester, Braude Law Group, PC Rockville, MD, for Plaintiff.

Christopher A. Taggi, David A. Edelstein, Asmer, Schor & Mckenna, PLLC, Washington, DC, Florina A. Moldovan, Pro Hac Vice, Michael C. Delaney, Pro Hac Vice, Richard Brant Forrest, McElroy, Deutsch, Mulvaney & Carpenter, LLP, Morristown, NJ, for Defendants.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

Amit P. Mehta, United States District Judge

This dispute between Plaintiff American Civil Construction, LLC ("Plaintiff" or "ACC") and Defendants Hirani Engineering & Land Surveying, PC ("Hirani") and Colonial Surety Company ("Colonial") arises out of ACC's work as a subcontractor to Hirani on a federal government construction project located on the National Mall in the District of Columbia.

ACC brought this action against Colonial under the Miller Act, 40 U.S.C. § 3133, and also brought a state law claim against Hirani for breach of contract. As to both claims, Plaintiff seeks $2,172,285.23 in money damages, plus prejudgment interest, attorney's fees, and costs. Colonial, in turn, brings a variety of counterclaims against ACC and asserts that it incurred losses in the amount of $723,049.14 to finish the project that ACC failed to complete.

After denying Defendants' motion for summary judgment, the court conducted a five-day bench trial in March 2018. After the bench trial concluded, the parties submitted proposed findings of fact and conclusions of law, as well as briefs in rebuttal. The court held a final oral argument on June 14, 2018.

As required by Federal Rule of Civil Procedure 52(a)(1), the court now makes its Findings of Fact and Conclusions of Law. The court has reviewed the parties' submissions, carefully considered the evidence presented at trial, weighed the credibility of the witnesses, and applied the applicable law. For the reasons set forth below, the court has determined that Plaintiff has met its burden of proof with respect to its Miller Act claim against Colonial and its breach of contract claim against Hirani. On the other hand, the court finds that Defendant Colonial has not sustained its burden of proof on its counterclaims.

Accordingly, the court will enter final judgment in favor of ACC. It will formally do so, however, only after ACC submits a final damages calculation that is consistent with these Findings of Fact and Conclusions of Law.

BACKGROUND

To provide clarity and context for these findings of fact and conclusions of law, the court provides a brief overview of the undisputed facts underlying this case and then summarizes the case's procedural history.

A. Factual Background

In June 2010, the United States Army Corps of Engineers ("USACE") issued a solicitation for bids to construct a levee wall across 17th Street, N.W. in the District of Columbia, south of Constitution Avenue, N.W. (the "Project"). Flanked on the west side by the National World War II Memorial and on the east side by the Washington Monument, the 380-foot-long levee wall was designed to prevent the Potomac River from flooding across the National Mall into downtown Washington, D.C. As designed, the 17th Street levee wall consists of two permanent stone-clad levee stem wall sections, one on the east side and the other on the west side of 17th Street, which sit on a curved grade beam foundation supported by twenty-four reinforced concrete caissons running underground across the street. The grade beam foundation running across 17th Street contains eight "post pockets." In the event of a 100-year flood, these pockets are filled with an eight-foot-tall temporary metal post and aluminum panel system that connect to the east and west levee stem walls to block surging floodwaters. The images below illustrate the Project.

Images: completed stone-clad levee stem walls (Source Pl.'s Ex. 5)

Drawing of 17th Street levee (Source: Washington Post)

Following a bid process, on September 16, 2010, the USACE awarded Hirani the contract ("the Prime Contract") to construct the 17th Street levee wall for the amount of $3,833,097.00. The USACE subsequently awarded "Option 1" to Hirani on December 16, 2010, requiring Hirani to install stone veneer cladding and coping on the permanent levee walls for $641,369.00. As required by Hirani's contract with the USACE, Colonial issued performance and payment bonds on behalf of Hirani.

On April 4, 2011, ACC and Hirani entered into a fixed-price subcontract ("the Subcontract") for $2,845,600.00, under which ACC agreed to perform most, but not all, of Hirani's obligations under the Prime Contract. ACC began performing under the Subcontract a week later, and Hirani subsequently subcontracted Option 1 to ACC in the amount of $613,650.00.

The ensuing years on the Project were beset by a series of delays, modifications to the scope of the Project, and work-related disputes. By letter dated April 26, 2013, two-and-a-half years after it awarded the Prime Contract to Hirani, the USACE gave notice of its intent to terminate Hirani. In the days following Hirani's termination, ACC left the Project site. The USACE subsequently made a demand against the Performance Bond issued by Colonial, and Colonial stepped in to complete the Project. With the assistance of Loewke Brill, a consulting firm, Colonial contracted with Akima Construction Services, LLC, Lorton Stone, LLC, and Structural Stone, LLC, to complete the Project, including Option 1, and did so around November 2014.

B. Procedural Background

ACC filed suit in this court against Hirani and Colonial on April 29, 2014. See Compl., ECF No. 1. Colonial responded by filing four counterclaims against ACC: (1) two for breach of contract, one as assignee of Hirani and one as surety; (2) one for breach of the covenant of good faith and fair dealing; and (3) one for interference with contractual relations. See Def. Colonial's Answer & Countercls., ECF No. 8. With leave of court, Plaintiff filed a Second Amended Complaint on February 16, 2016, asserting two claims: (1) breach of contract against Hirani, and (2) a payment demand under the Miller Act against Colonial, premised on the payment bond Colonial issued in connection with the Prime Contract. Plaintiff's Second Amended Complaint sought quantum meruit damages in the amount of $2,070,185.23. See Second Amended Compl., ECF No. 26.

Following discovery, Defendants jointly filed a Motion for Summary Judgment and a Motion to Strike Plaintiff's Jury Demand. See Defs.' Mot. for Summ. J., ECF No. 44; Defs.' Mot. to Strike Jury Demand, ECF No. 45. The court denied Defendants' Motion for Summary Judgment and granted Defendants' Motion to Strike the Jury Demand on June 27, 2017. See Mem. Op., ECF No. 54; Order, ECF No. 55. Following a delay in the proceedings, the parties appeared for a Pretrial Conference on February 23, 2018. See Pretrial Conf. Hrg. Tr. (February 23, 2018), ECF No. 75. The court thereafter conducted a bench trial over the course of five days from March 5, 2018, to March 9, 2018. See Trial Tr. Day 1 A.M. Session (March 5, 2018), ECF No. 76 [hereinafter Day 1 A.M. Tr.]; Trial Tr. Day 1 P.M. Session [hereinafter Day 1 P.M. Tr.]; Trial Tr. Day 2 A.M. Session (March 6, 2018), ECF No. 77 [hereinafter Day 2 A.M. Tr.]; Trial Tr. Day 2 P.M. Session [hereinafter Day 2 P.M. Tr.]; Trial Tr. Day 3 A.M. Session (March 7, 2018), ECF No. 78 [hereinafter Day 3 A.M. Tr.]; Trial Tr. Day 3 P.M. Session [hereinafter Day 3 P.M. Tr.]; Trial Tr. Day 4 A.M. Session (March 8, 2018), ECF No. 79 [hereinafter Day 4 A.M. Tr.]; Trial Tr. Day 4 P.M. Session [hereinafter Day 4 P.M. Tr.]; Trial Tr. Day 5 A.M. Session (March 9, 2018), ECF No. 80 [hereinafter Day 5 A.M. Tr.].

During the bench trial, ACC presented three witnesses: (1) Irene Stephen, owner of ACC, who also served as Hirani's on-site Contractor Quality Control Assistant on the Project; (2) Jitendra Hirani, president of Hirani; and (3) Rick Janeiro, president of Roubin & Janeiro, Inc., a local stone contractor. Ms. Stephen, ACC's primary witness, testified both as a fact witness and as an expert in cost accounting in the heavy and highway construction industry. See Day 1 A.M. Tr. at 37:14–95:1; Day 1 P.M. Tr. at 5:10–21:5; Day 2 A.M. Tr. at 6:5–125:17; Day 2 P.M. Tr. at 3:9–112:12; Day 3 A.M. Tr. at 77:1–138:11; Day 3 P.M. Tr. at 3:4–86:6. Mr. Hirani, called as an adverse witness, testified as a fact witness regarding Hirani's Prime Contract with the USACE, disputes and delays on the Project resulting from claimed failures by ACC to submit scheduling data, and Hirani's termination from the Project. See Day 1 P.M. Tr. at 21:12–107:24. Mr. Janeiro testified as a fact witness regarding his company's role as ACC's stone supplier and subcontractor to complete Option 1 of the Project. See Day 3 A.M. Tr. at 6:7–75:25.

Defendants presented two witnesses in their case: (1) Michael Vogt, an executive vice president of Loewke Brill Consulting Group, Inc., which Colonial hired in July 2013 to oversee completion of the Project after Hirani's termination; and (2) Robert Franklin, the USACE's project engineer for the Project. Mr. Vogt testified as a fact witness regarding the status of the Project upon Hirani's termination, the work remaining under the Prime Contract and Subcontract, and the costs incurred by Colonial to complete the Project. See Day 4 A.M. Tr. at 11:6–118:5; Day 4 P.M. Tr. at 3:4–85:11; Day 5 A.M. Tr. at 6:1–22:21, 98:9–130:20. Mr. Franklin testified as a fact witness regarding Hirani's and ACC's performances under the Prime Contract and Subcontract, the USACE's termination of Hirani, and Colonial's eventual completion of the Project. See Day 5 A.M. Tr. at 23:15–97:25. In its rebuttal case, ACC...