1

This sum was later adjusted downward by agreement to $32,052,760.40.

 IN THE UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF TEXAS

FORT WORTH DIVISION

JAMES CONSTRUCTION GROUP, §

§

Plaintiff, §

§

VS. § NO. 4:05-CV-345-A

§

DALLAS/FORT WORTH INTERNATIONAL §

AIRPORT BOARD, ET AL., §

§

Defendants. §

MEMORANDUM OPINION

and

ORDER

On September 28, 2006, plaintiff, James Construction Group

f/k/a Angelo Iafrate Construction, LLC, ("James Construction"),

moved for partial summary judgment on the counterclaim asserted

by defendant and counter-plaintiff, Dallas/Fort Worth

International Airport Board ("DFW"). Having considered the

motion, the response, the reply, the summary-judgment evidence,

the applicable legal authorities, and the joint pretrial order

submitted by the parties on October 20, 2006, the court concludes

that the motion should be denied. 

I.

Case Overview

This is a breach-of-contract case. In September 2000, DFW

contracted with James Construction to construct an approximately

2,000-foot extension of Runway 18L, a holding apron, and

connecting taxiways (hereinafter, "the Contract"). In return,

DFW was to pay James Construction $32,687,636.25.1 When DFW

 

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DFW has also sued National Fire Insurance Company ("NFIC"), who

provided a performance bond for James Construction. NFIC, however, has not

moved for summary judgment.

2

refused to give final acceptance of the work and retained

$650,800 from payment, James Construction filed this suit. In

response, DFW counterclaimed for approximately $3,668,021.20 in

damages, complaining about James Construction's allegedly shoddy

installation of a spiral ribbed metal pipe ("the SRMP") and

certain manholes, as well as damage to a water main during the

installation of the SRMP.2 

II.

Grounds for Summary Judgment

James Construction seeks summary judgment on DFW's

counterclaim regarding the installation of the SRMP, generally

claiming that, as a matter of law, DFW cannot prove the elements

of breach of contract with respect to this claim. More

specifically, it alleges that: (A) the deflection criteria

allegedly relied upon by DFW in asserting faulty installation of

the SRMP is not part of the contract; (B) any breach of contract

respecting the SRMP was not material; (C) DFW has not suffered

any damage; and, alternatively, (D) DFW cannot recover damages

for the cost of replacing the SRMP but is instead limited to the

cost of repairing it. See Pl.'s Br. in Supp. of Mot. for Partial

Summ. J. ("Pl.'s Br.") at 1-2. James Construction also argues

that DFW may not recover attorney's fees, because DFW failed to

present its counterclaim in accordance with Section 38.002 of the

Texas Civil Practice and Remedies Code. Id. 

 

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III.

Undisputed Facts

The SRMP, which is approximately 3,150-feet long, provides

storm-water drainage for large sections of the DFW International

Airport. Some of James Construction's contractual

responsibilities as to the SRMP included the excavation for the

installation of the SRMP, the actual installation, the placement

of embedment around the SRMP, and the placement of backfill above

the SRMP. Among other things, the Contract provides that:

"Unacceptable work, whether the result of poor workmanship, use

of defective materials, damage through carelessness, or any other

cause found to exist prior to the final acceptance of the work,

shall be removed immediately and replaced in an acceptable manner

in accordance with the provisions of the subsection titled

CONTRACTOR'S RESPONSIBILITY FOR WORK of Section 70." See Def.'s

App. in Support of Resp. to Mot. for Summ. J. ("Def.'s App.") at

8 (Contract at § 50-10.1).

After installation, the SRMP exhibited some deflection or

bending. In March of 2001, James Construction removed and

replaced various sections of the SRMP at its expense. In 2002,

upon receipt of a letter concerning problems with the SRMP, James

Construction, however, informed DFW that it would not repair or

replace it at its expense. In 2003, in an effort to resolve the

dispute, DFW requested that James Construction provide it with a

5-year extended warranty promising that James Construction would,

at its expense, complete repair of any joint separation within

 

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the SRMP and replace any pipe section equal to or exceeding a

certain degree of deflection. See Def.'s App. at 55. James

Construction refused. Deflections of the SRMP were measured

through inspections performed from March 2001 through April 2005.

IV.

Applicable Summary Judgment Principles

A party is entitled to summary judgment on all or any part

of a claim as to which there is no genuine issue of material fact

and as to which the moving party is entitled to judgment as a

matter of law. Fed. R. Civ. P. 56(c); Anderson v. Liberty Lobby,

Inc., 477 U.S. 242, 247 (1986). The moving party has the initial

burden of showing that there is no genuine issue of material

fact. Anderson, 477 U.S. at 256. The movant may discharge this

burden by pointing out the absence of evidence to support one or

more essential elements of the non-moving party's claim "since a

complete failure of proof concerning an essential element of the

nonmoving party's case necessarily renders all other facts

immaterial." Celotex Corp. v. Catrett, 477 U.S. 317, 323-25

(1986). Once the moving party has carried its burden under Rule

56(c), the non-moving party must do more than merely show that

there is some metaphysical doubt as to the material facts. 

Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S.

574, 586 (1986). The party opposing the motion may not rest on

mere allegations or denials of pleading, but must set forth

specific facts showing a genuine issue for trial. Anderson, 477

U.S. at 248, 256. To meet this burden, the nonmovant must

 

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James Construction also generally alleges without discussion that DFW

cannot prove the elements of its breach-of-contract claim. The elements of

breach of contract under applicable Texas law are: (1) the existence of a

valid contract; (2) performance by the plaintiff (DFW); breach of contract by

the defendant (James Construction); and (4) damages sustained by plaintiff

(DFW) as a result of the breach. See Sport Supply Group, Inc. v. Columbia

Cas. Co., 335 F.3d 453, 465 (5th Cir. 2003). The court is satisfied that DFW

has come forward with sufficient facts to survive summary judgment on each

element of its breach-of-contract claim. Further discussion is thus

unwarranted.

5

"identify specific evidence in the record and articulate the

'precise manner' in which that evidence support[s] [its]

claim[s]." Forsyth v. Barr, 19 F.3d 1527, 1537 (5th Cir. 1994). 

An issue is material only if its resolution could affect the

outcome of the action. Anderson, 477 U.S. at 248. Unsupported

allegations, conclusory in nature, are insufficient to defeat a

proper motion for summary judgment. Simmons v. Lyons, 746 F.2d

265, 269 (5th Cir. 1984).

V.

Analysis

Below, the court examines each of the specific grounds3

raised by James Construction in its motion for partial summary

judgment. 

A. Deflection Criteria

James Construction frames DFW's counterclaim as urging

breach of the Contract, because the deflection of the SRMP

exceeds 5%. So framed, James Construction urges that summary

judgment is proper, because deflection in excess of 5% being

unacceptable was not an industry standard at the time of the

 

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Contemporaneously with its reply of October 23, 2006, James

Construction filed objections and a motion to strike certain of DFW's summaryjudgment evidence (collectively, "the Objections"). Putting aside any issue

concerning the timeliness of the Objections, in ruling on the motion for

partial summary judgment, the court has taken into account the contents of the

Objections in evaluating what weight, if any, to afford the evidence in

dispute.

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Contract's inception and hence not part of the Contract. See

Pl.'s Br. at 8. 

James Construction has erected a straw man only to knock him

down. DFW does not contend that excessive deflection of the SRMP

is a project specification in the Contract. See Def's Br. in

Supp. of Resp. ("Def.'s Br.") at 11. Rather, DFW -- which, by

its counterclaim, asserts, inter alia, joint separation that has

allowed dirt and other foreign material into and water out of the

SRMP, improper placement of the trench in which the SRMP was

installed, and improper placement of embedment material on top of

the SRMP -– merely contends that the deflection is evidence of

these defects that are, in turn, encompassed by the Contract. 

And, frankly, common sense would seem to dictate that DFW is

correct in this assertion. Regardless, however, this issue is

obviously a fact question not properly disposed of by summary

judgment.

In its reply,4 James Construction attempts, mostly in

conclusory fashion, to suggest that DFW is just now alleging the

problems with the SRMP noted above. The summary-judgment record,

however, indicates that this is not the case. For example, DFW's

expert report of June 30, 2006, notes the following defects:

! Excessive deflection due to inadequate compaction of

 

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The manner in which DFW's expert articulated this defect further

demonstrates that DFW is merely alleging deflection to be a mere symptom of

other problems with the SRMP.

7

bedding material.5

! Installed pipe that exhibits crimps through the ribs,

gouges, and holes.

! Pipe joints have separated and settled.

! Significant rust is apparent on the observed inside

of the pipe.

 

See, e.g., Pl.'s App. in Supp. of Partial Summ. J. ("Pl.'s App.")

at 209 (emphasis added). In addition, in a December 5, 2003,

letter wherein DFW requested the 5-year warranty from James

Construction, DFW notes joint separation. See Def.'s App. at 55. 

Moreover, even had DFW not raised all of the specific defects now

before the court, James Construction fails to articulate or cite

to any legal authority whatsoever as to why DFW, in response to

its motion for summary judgment, cannot come forward with such

evidence at this time. Regardless, the court is satisfied that

summary judgment on the deflection issue is inappropriate. 

B. No Material Breach

Because, according to James Construction, the SRMP currently

continues to function for what it is designed to do, James

Construction next argues that summary judgment should be granted,

because any breach of the Contract is not material. See Pl.'s

Br. at 8, ¶ 20. Putting aside that this argument is a nonsequitur, whether a breach of contract is material is a fact

question. See, e.g., Hensley v. E.R. Carpenter Co., Inc., 633

F.2d 1106, 1110 (5th Cir. 1980). Hence, summary judgment is not

 

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Because cost of replacement is the remedy set forth in the Contract for

breach, James Construction also fails, by argument or citation to any

applicable legal authority, to persuade the court that DFW was required to

specially plead cost-of-replacement damages under Rule 9(g) of the Federal

Rules of Civil Procedure. See Pl.'s Br. at 30, ¶ 30.

8

proper on this ground either.

C. No Damages

James Construction also urges that summary judgment is

proper, because DFW cannot prove that it has suffered damages as

a result of the deflection of or other problems with the SRMP. 

See Pl.'s Br. at 11, ¶ 26. James Construction is incorrect. 

DFW has submitted controverting evidence that the SRMP is

defective, that, under the Contract, as discussed below, it is

entitled to cost-of-replacement damages, and that those damages

are approximately $2.4 million. See Def.'s App. at 14-22. This

summary-judgment ground is thus without merit as well.

 D. Measure of Damages 

If, however, DFW has suffered damages, James Construction

contends that it is only entitled to the cost of repairing the

SRMP and not to the cost of replacing it. In so urging, James

Construction completely ignores that the Contract expressly

provides for a cost-of-replacement measure of damages. See

Def.'s App. at 8 (Contract at § 50-10.1).6 As correctly pointed

out by DFW, James Construction equally ignores that, under

applicable law, parties to a contract may agree to the remedy to

be applied in the event of breach, just as they have done here. 

See Sowell v. Natural Gas Pipeline Co. of America, 604 F. Supp.

371, 380 (N.D. Tex. 1985), aff'd, 789 F.2d 1151 (5th Cir. 1986). 

 

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James Construction's reliance on the "landmark" New York, 1921,

opinion of Jacob & Youngs v. Kent, 129 N.E. 889 (N.Y. 1921) and

the Fifth Circuit opinion of Ferrell v. Secretary of Defense, 662

F.2d 1179, 1181 (5th Cir. 1981) is completely misplaced. See

Pl.'s Br. at 9-10. Neither involves a situation where, as here,

the parties contractually agreed to a certain remedy.

To the extent that James Construction in its reply now

argues that DFW's interpretation of the Contract regarding the 

appropriate measure of damages is incorrect, this assertion at

best renders the Contract ambiguous. Consequently, summary

judgment on this issue remains improper. See Geoscan, Inc. v.

Geotrace Technologies, Inc., 226 F.3d 387, 390 (5th Cir. 2000)

("If a contract is ambiguous, 'summary judgment is inappropriate

because the interpretation of a contract is a question of

fact.'") (citation omitted). 

E. DFW's Attorney's Fees

Finally, the court concurs with DFW that it has properly

presented its claim for attorney's fees under Section 38.002 of

the Texas Civil Practice and Remedies Code. In order to recover

attorney's fees under that section: "(1) the claimant must be

represented by an attorney; (2) the claimant must present the

claim to the opposing party or duly authorized agent of the

opposing party; and (3) payment for the just amount owed must not

have been tendered before the expiration of the 30th day after

the claim is presented." See Tex. Prac. & Rem. Code § 38.002.

DFW, the claimant, is represented by an attorney. James

 

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Construction concedes that DFW, on June 30, 2006, presented a

claim for $2.4 million in damages for the cost to replace the

SRMP. See Pl.'s Br. at 12, ¶ 31. As evidenced by James

Construction's September 28, 2006, motion for summary judgment on

this very claim, James Construction did not pay the amount owed

within 30 days of the claim's presentment. Therefore, DFW did

present its claim as required, and summary judgment is denied. 

VI.

Order

For the reasons discussed above, the court concludes that

James Construction's motion for partial summary judgment be, and

is hereby, denied. 

 SIGNED October 25, 2006.

 /s/ John McBryde 

JOHN McBRYDE

United States District Judge

 

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