Voelkel Mcwilliams Constr., LLC v. 84 Lumber Co.
| Decision Date | 13 March 2015 |
| Docket Number | CIVIL ACTION No. 13-6789 SECTION "L" (4) |
| Parties | VOELKEL MCWILLIAMS CONSTRUCTION, LLC v. 84 LUMBER COMPANY, ET AL. |
| Court | U.S. District Court — Eastern District of Louisiana |
Before the Court is Plaintiff's Motion for Partial Summary Judgment (Rec. Doc. 27) and Defendants' Motion for Summary Judgment. (Rec. Doc. 28). The Court has reviewed the briefs and applicable law and now issues this order and reasons.
This case involves a project to construct the new Alexander Milne Home for Women in Waldheim, Louisiana (the "Project"). In mid-November of 2012, the Sulzer Group sent out invitations to general contractors to bid on construction of the Project. (Rec. Doc. 28-3 at 1). On November 28, 2013, Plaintiff Voelkel McWilliams Construction, LLC ("VMC") attended a pre-bid meeting for potential general contractors held by the Sulzer Group. (Rec. Doc. 28-3 at 1). Following that meeting, VMC sent out invitations to various subcontractors to bid on portions of the Project. (Rec. Doc. 28-3 at 1; Rec. Doc. 29-2 at 8). Subcontractors who received VMC's invitations could access the Project's plans and specifications by using either the provided hyperlink or by going to the VMC office and looking at the physical documents. (Rec. Doc. 29-2 at 8).
On December 12, 2012, 84 Lumber received an invitation to bid on the Project from Landis Construction, another general contractor. Landis Construction's invitation included a link and password to its file transfer protocol ("FTP") site, which contained the plans andspecifications for the Project. (Rec. Doc. 28-3 at 2). 84 Lumber prepared its bid based on Landis Constructions' plans and specification. (Rec. Doc. 28-3 at 3). Unbeknownst to anyone at the time, Landis Construction's FTP site included only addenda nos. 1-3 for the Project's specifications, but there were six total addenda at the times the bids were submitted. (Rec. Doc. 28-3 at 2). VMC therefore prepared its bid and excluded addenda nos. 4-6.
VMC subscribes to Bid Clerk, a service that circulates jobs that are being bid on by general contractors. (See Rec. Doc. 27-1 at 2). On December 20, 2012, David Voelkel, an employee of VMC, received an unsolicited email from Bid Clerk notifying VMC that Defendant 84 Lumber Company ("84 Lumber") had shown interest in bidding on the Project. (Rec. Doc. 27-3 at 2). Voelkel received identical, unsolicited emails from Bid Clerk on December 24, 27, and 31, 2012. (Rec. Doc. 27-3 at 2). At the instruction of Voelkel, Sandy Lotspeich, another VMC employee, called vendors who had shown interest via Bid Clerk to see if they were bidding on the Project. (Rec. Doc. 27-14 at 2).
On the morning of January 7, 2013, prompted by Bid Clerk, Lotspeich called 84 Lumber Company and spoke with Leslie Lamonte, the Commercial Installed Sales Coordinator for 84 Lumber. Lamonte confirmed that 84 Lumber was bidding on the project, and Lotspeich asked Lamonte to send VMC a proposal. At 11:31 a.m., Lotspeich received an email from Lamonte that said "Sandy, Please see the attached proposal for Alexander Milne Home for Women" and included the proposal as an attachment. (Rec. Doc. 27-8). 84 Lumber submitted its bid that it had prepared for Landis Construction, even forgetting to change the general contractor information from Landis Construction to VMC on the bid's cover page. (Rec. Doc. 28-4 at 31). The proposal included the following Term and Condition:
84 Lumber performed an accurate take-off from drawings and specifications provided using standard procedures. Customer must have their estimator contact 84 Lumber to verify the quantities required, material waste allowance, adherence of products to specification, or to clarify any part of the estimate. 84 Lumber does not guarantee quantities will be sufficient to complete the job unless this is an installed 84 Lumber project.
At 2:00 p.m. on that same day, VMC submitted its bid for the project. (Rec. Doc. 27-3 at 4). VMC used 84 Lumber's proposal to compile VMC's final bid. (Rec. Doc. 27-3 at 4; Rec. Doc. 27-5). Shortly after VMC submitted its bid, the owner of the Project invited VMC to a post bid interview. (Rec. Doc. 27-2 at 5).
On January 9, 2013 and January 10, 2013, Voelkel and Sean Horton, 84 Lumber's Outside Commercial Installed Sales Manager, engaged in discussions via telephone about the Project and 84 Lumber's proposal. Voelkel and Horton discussed whether 84 Lumber could perform the amount of work outlined in the proposal; whether 84 Lumber could adhere to the schedule; how the materials would be delivered and stored at the site; and 84 Lumber's experience with other developments similar to the Project. (Rec. Doc. 27-3 at 5; Rec. Doc. 27-15 at 8-10; Rec. Doc. 27-12). On or about January 11, 2013, VMC attended the post bid interview with the owner. (Rec. Doc. 27-3 at 6). The following day, the owner notified VMC that it was the successful bidder and that the owner intended to enter into a formal contract with VMC for its bid price. (Rec. Doc. 27-3 at 6; Rec. Doc. 27-13).
On January 16, 2013, VMC notified 84 Lumber via email that the owner had accepted VMC's bid. (Rec. Doc. 27-3 at 6). Specifically, Voelkel emailed Horton and noted that VMC was "currently evaluating all pricing and proposals/scopes in preparation for project buyout and subcontracts." (Rec. Doc. 28-4 at 35). Voelkel then outlined ten questions regarding the scopeof 84 Lumber's proposed work; a potential roofing price increase; and similar projects undertaken by 84 Lumber. (Rec. Doc. 28-4 at 35). In response to these questions, 84 Lumber submitted a revised proposal on January 24, 2013. (Rec. Doc. 28-4). Voelkel received the revised proposal and emailed Lamonte and Horton and stated that (Rec. Doc. 28-4 at 82).
On January 31, 2013, at a meeting attended by Horton, Voelkel, and VMC's owner, Norman Voelkel, Horton learned for the first time that there were six addenda to the project plans and specifications. (Rec. Doc. 28-3 at 3). On February 6, 2013, VMC sent 84 Lumber a letter and accepted 84 Lumber's bid-day proposal. (Rec. Doc. 28-4 at 71). The following day, on February 7, 2013, 84 Lumber sent VMC an official bid retraction. (Rec. Doc. 28-4 at 76; Rec. Doc. 28-3 at 3).
VMC moves for partial summary judgment on its claim of detrimental reliance and argues that the three elements of detrimental reliance are met pursuant to La. Civ. Code art. 1967. VMC contends that "to establish detrimental reliance, a party must prove three elements: a representation by conduct or word; justifiable reliance on the representation; and a change in one's position to one's detriment as a result of the reliance." (Rec. Doc. 27-1 at 7) (citing Suire v. Lafayette City-Parish Consol. Gov't, 907 So. 2d 37, 59 (La. 2005)). Looking to the first element, VMC argues that 84 Lumber made a "representation by conduct or word" because 84 Lumber emailed VMC a proposal, thus representing to VMC that 84 Lumber "would perform acertain scope of work for a certain price." (Rec. Doc. 27-1 at 9). VMC avers that 84 Lumber knew that VMC would rely on the proposal, as 84 Lumber had relied on subcontractors and suppliers to generate their proposal. (Rec. Doc. 27-1 at 9). VMC then argues that it "reasonably relied on the 84 [p]roposal, incorporating it into VMC's irrevocable bid to the owner." (Rec. Doc. 27-1 at 9). VMC argues that after 84 Lumber refused to perform the work included in its proposal, VMC was forced to hire alternative contractors and suppliers at a higher price. (Rec. Doc. 27-1 at 10). VMC likens the instant case to Percy J. Matherne Contractor, Inc. v. Grinnell Fire Protec. Sys. Co., a case where the court awarded damages under a theory of detrimental reliance when a subcontractor's bid failed to include all of the addenda and the subcontractor notified the general contractor of this error after the owner had accepted the general contractor's bid. (Rec. Doc. 27-1 at 10).
84 Lumber opposes the motion and argues that VMC's reliance was unreasonable and therefore does not satisfy the second element of detrimental reliance. (Rec. Doc. 31 at 3). 84 Lumber avers that it was patently unreasonably for VMC, an experienced contractor, to rely on a subcontractor's bid for a multi-million dollar project when VMC had never worked with 84 Lumber and VMC had received the bid a mere three hours before the submission deadline. (Rec. Doc. 31 at 3). 84 Lumber argues that this unreasonableness "is further compounded by the fact that the proposal contained a provision requiring VMC to contact 84 Lumber to review the specifications, which was never done." (Rec. Doc. 31 at 3). The continued negotiations after bid day between 84 Lumber and VMC, 84 Lumber asserts, further undermines any finding that VMC's reliance was reasonable. Specifically, 84 Lumber contends that the clarifications VMC sought after bid day signify "red flags" and any reliance on the proposal was therefore unreasonable.
84 Lumber further argues that any reliance was unreasonable because Louisiana Law limits detrimental reliance "to those instances in which a promise relied upon is in the form contemplated by the parties." (Rec. Doc. 31 at 8). Here, 84 Lumber argues, reliance is unreasonable because VMC clearly contemplated a separate subcontract to formalize any agreement. (Rec. Doc. 31 at 9). Because no contract was ever executed, 84 Lumber contends that any reliance on the part of VMC is unreasonable. (Rec. Doc. 31 at 10). 84 Lumber distinguishes the instant case from Matherne, noting that "[i]n holding that Matherne proved its claim of detrimental reliance, the Court expressly...
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