American Contractors Indemnity Co. v. United States

82 Fed. Cl. 774, 2008 U.S. Claims LEXIS 211, 2008 WL 3126136
United States Court of Federal Claims·Decided August 4, 2008·No. No. 07-374 C·Published·Cited by 1 cases

Opinion

OPINION AND ORDER

SWEENEY, Judge.

Before the court is plaintiffs motion for reconsideration. Plaintiff, American Contractors Indemnity Company (“ACIC”), requests that the court “grant [it] a rehearing or reconsideration and alter or amend” the court’s April 29, 2008 Opinion and Order, which granted defendant’s motion to dismiss pursuant to Rule 12(b)(6) of the Rules of the United States Court of Federal Claims (“RCFC”). See Am. Contractors Indem. Co. v. United States, 81 Fed.Cl. 682, 683, 691-93 (2008). Pursuant to RCFC 59(b), the court directed defendant to file a response to plaintiffs motion, see Order, May 13, 2008, and permitted plaintiff to submit a reply to defendant’s response, see Order, June 17, 2008. For the reasons stated below, plaintiffs motion is denied.

[776]*776I. PLAINTIFF’S MOTION FOR RECONSIDERATION1

ACIC maintains that the court’s dismissal of its complaint “was premised upon a finding of a deficiency in Plaintiffs pleading.” PI. Am. Contractors Indem. Co.’s RCFC 59 Mot. (“Pl.’s Mot.”) 3. Specifically, ACIC contends that defendant prevailed because ACIC allegedly “failed to perform a condition precedent to Defendant’s liability under the [Surety Bond Guarantee] Agreement.” Id. According to ACIC, its complaint adequately contains a “general averment that conditions precedent to the liability of the defendant have been satisfied____” Id.; accord id. at 5 (“Rule 9(c) of the RCFC clearly allows for ACIC ... to plead generally and in concluso-ry fashion the satisfaction of conditions precedent to the Defendant’s liability, which ACIC did.”); Pl.’s Reply Def.’s Resp. Pl.’s Mot. (“Pl.’s Reply”) 6 (“ACIC did[,] in faet[,] properly allege the satisfaction of conditions precedent to [the] SBA’s liability in the complaint.”). Additionally, ACIC notes that defendant “never characterized its motion to dismiss as premised on a failure by ACIC to allege satisfaction of a condition precedent. [Rather, i]t was based on [the Small Business Administration’s (‘SBA’)] contention that ACIC had[,] in fact[,] failed to satisfy that alleged condition.” PL’s Reply 4. Accordingly, ACIC moves the court “to amend its findings and alter the judgment to reflect that the Complaint states a cognizable cause of action, and to require Defendant to file an appropriate responsive pleading.” PL’s Mot. 3.

ACIC now states that the surety bond rider, which defendant appended to its motion to dismiss, was “a possibly incomplete copy.” Id. at 2. Consequently, ACIC attached an exhibit to its motion, which purportedly contains the surety bond rider together with a document it offers for the first time on reconsideration—a power of attorney.2 The power of attorney, which is dated May 25, 2004, appoints Macharl S. Zwart as ACIC’s attorney-in-fact “with full authority to execute on its behalf bonds ... and other contracts of indemnity and writings obligatory in the nature thereof, issued in the course of its business and to bind the Company thereby, in an Amount not to exceed $2,500,000.00.” PL’s Ex. at 2. It appears that ACIC provided the power of attorney in response to the court’s footnote fifteen:

Plaintiff suggests that, because the power of attorney attached to the surety rider “was executed on May 25, 2004, over a year past the stated ‘effective date’ on the Surety Rider,” the surety rider “could not have been legally effective until, at the very least, May 25, 2004.” PL’s Resp. [Def.’s Mot. Dismiss] 16. The court notes that the surety rider, as submitted by defendant in its Exhibit 1 and which states an “effective” date of March 24, 2003, contains the signature of plaintiffs attorney-in-fact. Def.’s Ex. 1. The surety rider does not contain any additional attachment. See id. Any other document purporting to contain a May 25, 2004 date was not submitted with the pleadings. Consequently, in the absence of supporting documentation, the court is uncertain of how plaintiff arrived at the May 25, 2004 date it suggests. Regardless, as discussed below, the May 25, 2004 date is not relevant to the court’s resolution of defendant’s motion.

Am. Contractors Indem. Co., 81 Fed.Cl. at 690 n. 15. Additionally, ACIC states that it “believes” this power of attorney was originally attached to the surety bond rider. PL’s Mot. 2 n. 1.

ACIC argues that it “sought to show that the dated typed onto the face of the Bond Rider and identified thereon as the ‘effective date’ was not determinative” of the date that it agreed to or acquiesced in an alteration to the bond. Id. at 2; accord PL’s Reply 3 (“[I]t is ACIC’s position, going into discovery in this case, that the date appearing on the ‘bond rider’ is neither accurate nor determinative of when ACIC ‘acquiesced’ in the change to the bond.”). According to ACIC, [777]*777defendant contends that “the recitation of an ‘effective date’ on the face of the bond rider is conclusive and dispositive, as a matter of substantive law, with respect to ACIC’s claim in this case.”3 Pl.’s Reply 8-9. As ACIC notes, it previously argued that the surety bond rider “could not have been enforceable ... until it was delivered, regardless of any recitation of ‘effective date’ on the face of the document.” 4 Pl.’s Mot. 2. Moreover, ACIC states that it lacks “all of the specific facts involved in issuance of the Bond Rider” and, as a result, “may need to conduct third party discovery to obtain them.” Id. at 2 n. 2.

Defendant asserts that ACIC’s reliance upon RCFC 59 is “misplaced” because it fails to argue that an intervening change in controlling law occurred, that there exists newly discovered evidence that warrants the court’s reconsideration of its prior ruling, or that manifest injustice has occurred. Def.’s Resp. 2. Instead, defendant emphasizes that ACIC failed to show that the SBA “did not provide written approval prior to the $240,000 increase in the bond amount.” Id. at 3. As such, defendant maintains that ACIC violated 13 C.F.R. § 115.19(e)(2) “by agreeing to a material alteration” without prior written approval from the SBA. Id. at 4, 6.

Furthermore, defendant argues that ACIC’s reliance upon RCFC 9(c) is untimely and that it “cannot now hide behind RCFC 9(c) to avoid dismissal.” Id. at 5. According to defendant, ACIC did not “overlook[ ]” the condition precedent at issue; rather, ACIC cannot satisfy the requirement. Id. at 6; accord id. (“ACIC cannot assert that it received prior written approval from the SBA because it never[,] in fact[,] received such approval.”). Moreover, defendant notes that ACIC “could have” presented its argument that it satisfied conditions precedent to defendant’s liability in its response to defendant’s motion to dismiss. Id. at 3. Instead, defendant notes, “ACIC waited until the Court granted the Government’s motion to dismiss, and then decided to present this new argument relying upon RCFC 9(c).” Id. As such, defendant characterizes ACIC’s motion as an “attempt[ ] to take a second ‘bite at the apple’ to make an argument to the Court that it failed to present in its responsive brief to the Government’s motion to dismiss.” Id. at 2.

II. STANDARD OF REVIEW

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American Contractors Indemnity Co. v. United States, 82 Fed. Cl. 774, 2008 U.S. Claims LEXIS 211, 2008 WL 3126136 (uscfc 2008).

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