Court Opinion

ID: 8909295
Source: CourtListenerOpinion
Date Created: 2022-11-27 02:25:21.61981+00
Date Added: 2024-06-11T17:08:24.222770
License: Public Domain

TRASK, Circuit Judge,
dissenting.
I respectfully disagree. I would find that jurisdiction existed pursuant to 28 U.S.C. § 1331(a) defining the scope of “federal question” jurisdiction. Trans-Bay Engineers & Builders, Inc. v. Hills, 179 U.S.App. D.C. 184, 551 F.2d 370 (1976); that Boise-Cascade is entitled to recover the contractually retained percentages under the Prairie State Bank rule, Prairie State Bank v. United States, 164 U.S. 227, 17 S.Ct. 142, 41 L.Ed. 412 (1896), awarding ten percent contract retainages to the completing, surety, Pearlman v. Reliance Ins. Co., 371 U.S. 132, 83 S.Ct. 232, 9 L.Ed.2d 190 (1962); Henningsen v. United States Fidelity & Guaranty Co., 208 U.S. 404, 28 S.Ct. 389, 52 L.Ed. 547 (1908), and that the merger of Boise-Cascade and Burnett Construction Company does not defeat that right of recovery.
I find no merit to the contention that this litigation would involve a suit against the United States in derogation of its sovereign immunity. Home Savings and Loan Association is the mortgagee here or the lender of the funds. It is not a government entity. Burnett Construction Company is the prime contractor. Neither of them is subject to a claim that a suit against one or both of them violates the doctrine of sovereign immunity. Home Savings and Loan Association not only supports jurisdiction by reason of its relationship to the governmental entities but also by reason of the special contractual relationship it insisted on apart from and beyond the HUD contractual relationship to which it was a party.
On the merits, the general contractor has gone ahead and completed the project using its own funds to do so. It now faces a loss of those funds while Home Savings and Loan Association and the governmental entities obtain the project completed at the builder’s expense. Trans-Bay Engineers & Builders, Inc. v. Hills, supra.
I would hold that Burnett Construction Company is entitled to recover all of the retained funds together with any funds representing progress payments due and unpaid. I would reverse and remand for a determination of those amounts.