Justia Construction Law Opinion Summaries

A sub-subcontractor, Diamond Services Corporation, entered into a contract with Harbor Dredging, a subcontractor, to perform dredging work in the Houston Ship Channel. The prime contract for the project was awarded to RLB Contracting by the U.S. Army Corps of Engineers, and RLB obtained a surety bond from Travelers Casualty and Surety Company of America. During the project, unexpected site conditions, including the presence of tires, caused delays and increased costs. Diamond continued working based on an alleged agreement that it would be compensated through a measured-mile calculation in a request for equitable adjustment (REA) submitted by RLB to the Corps. However, RLB later settled the REA for $6,000,000 without directly involving Diamond in the negotiations and issued a joint check to Harbor and Diamond for $950,000.The United States District Court for the Southern District of Texas dismissed some of Diamond's claims, including those for unjust enrichment and express contractual claims against RLB, but allowed Diamond's quantum meruit claim to proceed. The court also denied Travelers' motion to dismiss Diamond's Miller Act claims but required Diamond to amend its complaint to include proper Miller Act notice, which Diamond failed to do timely. Subsequently, the district court granted summary judgment in favor of RLB and Harbor, dismissing Diamond's remaining claims and striking Diamond's untimely second amended complaint.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court affirmed the district court's summary judgment against Diamond's quantum meruit claims, holding that the express sub-subcontract covered the damages Diamond sought and that Diamond failed to provide evidence of the reasonable value of the work performed. The court also affirmed the dismissal of Diamond's Miller Act claim, as the damages sought were not recoverable under the Act. The court dismissed Diamond's appeal regarding the tug-expenses claim due to untimeliness. View "Diamond Services v. RLB Contracting" on Justia Law