liquidated, that setoff will substantially eliminate the amounts owed to Castle, Bouie has raised
as part of its affirmative defenses that Castle’s lawsuit is premature under paragraph 20 of the
subcontract because Bouie has not yet completed the project or received final payment from the
owner.

DISCUSSION

Rule 42(a), Fed. R. Civ. P., provides, in pertinent part, that:

When actions involving a common question of law or fact are pending before

the court, it may order a joint hearing or trial of. any or all the matters in issue in

the actions; it may order all the actions consolidated; and it may make such

orders concerning the proceedings therein as may tend to avoid unnecessary

costs or delay.

In applying this rule, courts which have discussed the issue of consolidation have
stressed that the purpose of joining actions is to promote convenience and judicial economy.
Johnson v. Manhattan Railway Co., 289 U.S. 479, 496-497, 53 S. Ct. 721, 727-28, 77 L. Ed.
1331 (1973). Consolidation of cases like the ones before the court will promote the aims of all
the partes, economize time and effort without circumscribing the opportunity for full litigation of
all relevant claims. As Castle has stated, it is the discretion of the court whether or not to
consolidate cases when there are common questions of law or fact. See EEOC v. HBE
Corporation, 135 F.3d 543, 550-51 (8th Cir, 1998).

The applicable Local Rule of the Northem District of Ilinois is LR40.4, which provides
for the reassignment of cases as related. Under Local Rule 40.4(2), cases may be related if they
involve any one of the following conditions: (1) the same property; (2) similar issues of fact or

law; or (3) the same transaction or occurrence... LR. 40.4(a). Once relatedness has been

determined, the case or cases may be reassigned if all four of the following criteria are met: (1)


the propriety of the alleged eviction and breach of contract we find that all the requirements of

LR 40.4(b) have not been satisfied.

CONCLUSION
For the reasons set forth above, Castle’s motion to consolidate is denied without

prejudice (#5-1) to be renewed after the close of discovery and after decision of any dispositive

motions.

SO ORDERED: dd '7/o4 ENTER:

DGE RONALD A.
United States Judge


On or about February 23, 1998, Crouch-Walker entered into a written subcontract with
Castle, whereby Crouch-Walker agreed to provide all labor, materials, equipment, tools,
supervision, and other items necessary to “install” the masonry work outlined in the subcontract.
Crouch-Walker performed all of its labor and materials, except as it was allegedly prevented
from doing so by Castle, as required under the Crouch-Walker subcontract, but Castle has failed,
and continues to fail, to pay $148, 724.17 due and owing to Crouch-Walker. Crouch-Walker has
sued both Castle and Bouie under the Miller Act and alleges a breach of contract claim against
Castle only.

Castle moves to consolidate the two cases, arguing that numerous common questions of
law and fact predominate in both cases and in the interest of judicial economy they should be
consolidated. Castle contends that both cases will require the court to address the common issue.
of law of which party breached the contract. Castle further points out that there is likely to be
significant overlap in witnesses deposed and documents exchanged during discovery between
all the parties.

Bouie objects to the proposed consolidation of the two cases arguing that the motion is
premature in light of the fact that an answer had not yet been filed in the Crouch-Walker case.
This argument is now moot in light of the fact that an answer was filed in the Crouch-Walker
case on June 21, 2001. Bouie further argues that the case before this court, is a relatively
complicated contract and bond dispute which requires resolution of the amounts owed , the costs
subject to setoff, whether Bouie breached its contract with Castle when Castle was evicted, and
whether Bouie is liable to Castle for the Joss of anticipated profits or any special or

consequential damages. Bouie claims that although the amount of Bouie’s setoff is yet to be


all cases are pending in this court; (2) reassignment will result in judicial economy; (3)
reassignment will not cause a substantial delay; and (4) it is possible to dispose of all the cases in
a single proceeding. L.R. 40.4(b). Bouie argues that while the cases are related they should not
be consolidated under L.R. 40.4(b).

The present cases meets the requirements of L.R. 40.4(a) for relatedness. It is
undisputed that both cases stem from the same construction project at the National’s Veterans’
Cemetery in Joliet and both cases involve monies due and owing on the project. Thus, elements
(1) and (3) have been satisfied. It is unclear, however, whether both cases truly involve similar
issues of fact or law (element 2) but more about this element later. Because L.R. 40.4(a) uses
“or” between its elements the fact that elements (1) and (3) have been satisfied moves this Court
into the reassignment analysis under LR. 40.4(b).

The first requirement under L.R. 40.4(b) is that both cases must be pending in this
Court. In the present case, both cases are pending in this court and both are proceeding relatively
at the same pace, thereby satisfying the requirements under subsection (1) of LR 40.4(b).
Plaintiff argues that both cases stem from a common transaction and occurrence, the contract for
the cemetery project and the defendants’ failure to pay. This is correct, but this is only important
in considering whether the cases are related and does not bear on the decision as to whether or
not consolidation is beneficial. Castle must show that consolidation will result in a substantial
saving of judicial time and effort, not cause substantial delay, and it is possible to dispose of all
the cases in a single proceedings. LR 40.4(b)(2)-(4).

As to the remaining considerations we find that Castle has not established that these

factors will be satisfied if the cases are consolidated and reassigned. Bouie appears to have


Minute Order Form (06/97)
United States District Court, Northern District of Illinois
Name of Assigned Judge Sitting Judge if Other
or Magistrate Judge Ronald A. Guzman than Assigned Judge
CASE NUMBER 01 C774 DATE 9/17/2001
CASE USA vs. BOUIE CONSTRUCTION, et al
TITLE
Un the following box (a) indicate the party filing the motion, e.g., plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the nature
MOTION: of the motion being presented.} ;
DOCKET ENTRY:
(1) im Filed motion of [ use listing in “Motion” box above.]
(2) im Brief in support of motion due
(3) oa Answer brief to motion due. . Reply to answer brief due :
(4) Oo Ruling/Hearing on___set for at
(5) im} Status hearing[held/continued to] (set for/re-set for] on set for at
(6) Oo Pretrial conference[held/continued to] [set for/re-set for] on set for at :
(7) im Trial[set for/re-set for] on at
(8) Q [Bench/Jury trial] [Hearing] held/continued to at
(9) Oo This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]
OFRCP4(m) O General Rule 21 CFRCP41(a)(1) CO FRCP4i(a)(2).
qo) i [Other docket entry) | ENTER MEMORANDUM OPINION AND ORDER: Castle’s motion to
consolidate is denied without prejudice [5-1] to be renewed after the close of discovery and after decision
of any dispositive motions.
(1) [For further detail see order attached to the original minute order.]
No notices required, advised in open court.
No notices required. umber of notices
Notices mailed by judge's staff. _
Nott ; SEP 1g 2eat,
tified counsel by telephone. date docketed
a { Docketing to mail notices.
° eting to mail notices. @
Mail AO 450 form. docketifig deputy initials
Copy to judge/magistrate judge.
courtroom eESEP ET PH St 16 Saletan
TBK deputy’s
initials

Date/time received in
central Clerk’s Office

rmiling deputy initials



oon eames cermennerts pa

several justifiable motives for wanting to keep the cases separate. To be sure, Crouch-Walker’s
subcontract with Castle contains a “pay when paid” clause. Castle argues that Crouch-Walker
will have to prove either: (1) that Castle was paid by Bouie and is withholding payment from
Crouch-Walker; or (2) that Castle is responsible for the termination of the Castle-Bouie
subcontract through some type of improper conduct.

Both arguments raise concerns as to the resulting judicial economy and possible
substantial delay in the Crouch-Walker case. If Crouch- Walker is indeed owed money, then
Crouch-Walker will obtain that money faster by not getting bogged down in the Castle-Bouie
case. Even though Bouie is a defendant in the Crouch-Walker case, Bouie has indicated that it
would prefer to know how much it owes to Crouch-Walker in Case No. 01 C 2993 before Bouie
goes to trial with Castle in this case. The separate and faster adjudication of the Crouch-Walker
claim would benefit not only Crouch -Walker, and Bouie and National Fire, but should also
benefit Castle and the Court-by not piling additional issues into the instant case. Moreover,
Bouie correctly argues that the principle of collateral estoppel will eliminate the risk of
conflicting findings of fact. Furthermore, Bouie’s affirmative defenses raise issues as to
liquidated damages attributable to Castle’s inadequate performance as well as whether Castle’s
claim is substantially comprised of a loss of anticipated profits. One of Bouie’s affirmative
defenses to Castle’s lawsuit is that the case is premature under paragraph 20 of the subcontract
because Bouie has not completed the project and has not received final payment from the owner.
This affirmative defense could substantially delay Crouch-Walker’s recovery in its lawsuit and

could subject Crouch-Walker to complex litigation. Because Castle v. Bouie primary turns on


IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION i f KE T ED
UNITED STATES OF AMERICA, for the use and benefit of
CASTLE CONSTRUCTION CORPORATION, an Illinois SEP 18 2008
Corporation, and CASTLE CONSTRUCTION
CORPORATION, an Illinois Corporation
Plaintiffs
No. 01 C 0774

v. Judge Guzman

BOUIE CONSTRUCTION, INC. AND NATIONAL FIRE
INSURANCE COMPANY OF HARTFORD

Defendants

wwe eee we See SS SD

SEP J 8 200,

MEMORANDUM OPINION AND ORDER

This matter is before the court on the Plaintiffs, UNITED STATES OF AMERICA for
the use and benefit of CASTLE CONSTRUCTION CORPORATION and CASTLE
CONSTRUCTION CORPORATION (“Castle”), motion to consolidate and reassign the present
case with Case No. 01 C 2993, United States of America for the use and benefit of Crouch-
Walker, et. al v. Bouie Construction, Inc., et. al pursuant to Rule 42 of the Federal Rules of Civil
Procedure and Northern District Local Rule 40.4. For the reasons set forth below, the motion is
denied without prejudice.

FACTS

Crouch-Walker Corporation (“Crouch-Walker”) and Castle are plaintiffs in separate

lawsuits against the Defendant Bouie Construction, Inc. Both cases stem from the same

construction project for work done at the National Veteran’s Cemetery in Joliet, Hlinois


(“Cemetery”) and both cases were filed pursuant to the Miller Act, 40 U.S.C. §§ 270(a) and
270(b).

On or about October 15, 1997, the United States of America, acting by the Department
of Veterans Affairs; and Bouie, with the Small Business Administration, entered into a written
contract, whereby Bouie (“the Prime Contractor”) agreed to provide all labor, equipment, tools,
materials, supervision, and other items necessary to perform the work under the construction
project. On or about November 17, 1996, Bouie and Castle entered into a written subcontract
whereby Castle was to provide labor and materials for the installation of structural steel,
masonry, pumps, doors and other components of the project for the base contract price of
$5,940,300.00. In addition, Castle provided extra labor and materials for the project in the
amount of $369, 418.00.

After issuing multiple prior warnings and demands for assurance of performance, Bouie,
on June 30, 2000, issued a notice of default termination to Castle under paragraph 20 of the
subcontract. The bases for termination included Castle’s failure to keep the project free and
clear from bond claims by Castles’ subcontractors, failure to perform work on a timely basis
and/or failure to provide assurances of performance. On July 6, 2000, Bouie extended the cure
deadline until the close of business on July 12, 2000, and again demanded Castle’s cure and
assurance of performance. On July 13, 2000, with Castle still having failed to discharge bond
claims of Castles’ subcontractors, and with Castle also having failed to cure the other defaults
and/or failed to provide adequate assurance of performance, Bouie confirmed the finality of the

termination. Bouie allegedly owes Castle $832, 275.30.