Court Opinion

ID: 8211404
Source: CourtListenerOpinion
Date Created: 2022-10-03 18:00:45.928602+00
Date Added: 2024-06-11T16:42:03.086735
License: Public Domain

Case: 22-40240     Document: 00516492861         Page: 1     Date Filed: 10/03/2022

              United States Court of Appeals
                   for the Fifth Circuit                               United States Court of Appeals
                                                                                Fifth Circuit

                                                                              FILED
                                                                        October 3, 2022
                                  No. 22-40240                           Lyle W. Cayce
                                Summary Calendar                              Clerk

   Diamond Services Corporation,

                                                           Plaintiff—Appellant,

                                       versus

   Travelers Casualty & Surety Company of America,

                                                           Defendant—Appellee.

                  Appeal from the United States District Court
                      for the Southern District of Texas
                             USDC No. 3:21-cv-78

   Before Clement, Southwick, and Engelhardt, Circuit Judges.
   Per Curiam:*
          Diamond Services Corporation appeals the district court’s dismissal
   of this suit for damages under the Miller Act. We AFFIRM.
          The U.S. Army Corps of Engineers awarded a contract for a dredging
   project along the Texas Gulf Coast to T.W. LaQuay Marine, LLC, who, in

          *
            Pursuant to 5th Circuit Rule 47.5, the court has determined that this
   opinion should not be published and is not precedent except under the limited
   circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 22-40240      Document: 00516492861            Page: 2   Date Filed: 10/03/2022

                                      No. 22-40240

   compliance with the Miller Act, 40 U.S.C. § 3131 et seq., obtained a surety
   bond from Defendant Travelers Casualty and Surety Company of America
   (Travelers). On March 24, 2020, Plaintiff-Appellant Diamond Services
   Corporation (Diamond) completed repairs to a vessel chartered by LaQuay
   for the dredging project. Diamond claimed that LaQuay was responsible for
   payment of the repairs but LaQuay refused to pay. Diamond then submitted
   a claim to Travelers on the surety bond. On January 7, 2021, Travelers sent
   a claim form and a letter requesting additional information. On January 21,
   Diamond returned the claim form to Travelers. On March 26, Travelers
   denied Diamond’s claim. On March 29—one year and five days after
   completing the repairs—Diamond filed suit against Travelers seeking
   damages under the Miller Act and the surety bond.
          The district court dismissed Diamond’s claim under Federal Rule of
   Civil Procedure 12(b)(6), finding that the claim was barred by the statute of
   limitations and equitable estoppel did not apply. Our review is de novo. See
   Meador v. Apple, Inc., 911 F.3d 260, 264 (5th Cir. 2018). We “accept[] all
   well-pleaded facts as true and view[] those facts in the light most favorable to
   the plaintiff[].” Id. (quoting Dorsey v. Portfolio Equities, Inc., 540 F.3d 333,
   338 (5th Cir. 2008)). To survive a motion to dismiss, a complaint must
   “plead[] factual content that allows the court to draw the reasonable
   inference that the defendant is liable for the misconduct alleged.” Ashcroft v.
   Iqbal, 556 U.S. 662, 678 (2009).
          Under the Miller Act, an action on a surety bond must be commenced
   “no later than one year after the day on which the last of the labor was
   performed . . . .” § 3133(b)(4). Diamond concedes that it filed the instant
   suit four days late. Nevertheless, Diamond argues that its claim survives the
   Miller Act’s limitations provision because it relied on Travelers’ January 7
   representation of an investigation into the claim and thus, equitable estoppel
   applies. We disagree.

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Case: 22-40240      Document: 00516492861           Page: 3    Date Filed: 10/03/2022

                                     No. 22-40240

          Under the Miller Act, “a party asserting an estoppel defense must
   show that it was misled to its detriment.” United States ex rel. A & R Supply
   of Miss. v. Travelers Cas. & Sur. Co. of Am., 265 F. App’x 236, 238 (5th Cir.
   2008). Diamond fails to plead that the January 7 letter from Travelers
   requesting additional information on the claim was a representation that
   Diamond reasonably relied on in deciding not to bring suit within the
   statutory limitations period. The January 7 letter gave no promise of a
   response, made no representations that Diamond would be paid or that
   Travelers would engage in claim negotiations with Diamond, and explicitly
   reserved “all rights and defenses . . . includ[ing], without limitation, defenses
   that may be available under any applicable notice and suit limitation
   provisions.” Compare United States ex rel. Atlas Erection Co. v. Cont’l Cas.
   Co., 357 F. Supp. 795, 800 (E.D. La. 1973) (finding equitable estoppel applied
   where surety “assured [the subcontractor] that all valid invoices would be
   paid upon the completion of [its] investigation” and “requested [the
   subcontractor’s] continued cooperation in an amicable resolution of the
   claim”). Because Diamond’s reliance on the January 7 letter in delaying
   filing suit was unreasonable, equitable estoppel does not rescue its claim.
          We AFFIRM.

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