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Paul Reed Construction & Supply, Inc. v. Arcon, Inc.

United States District Court, D. Nebraska

February 13, 2014

PAUL REED CONSTRUCTION & SUPPLY, INC., a Nebraska corporation, Plaintiff and Counter Defendant,
v.
ARCON, INC., a Colorado corporation, Defendant and Counter Claimant. ARCON, INC., a Colorado corporation, Third-Party Plaintiff,
v.
WS COMPANY, a South Dakota corporation, Third-Party Defendant.

MEMORANDUM AND ORDER

LAURIE SMITH CAMP, Chief District Judge.

This matter is before the Court on the Motion for Leave to Amend and Motion for Reconsideration (Filing No. 124) filed by Third-Party Defendant Western Surety Company ("WS") on January 22, 2014; the Motion to Strike (Filing No. 131) filed by Third-Party Plaintiff Arcon Inc. ("Arcon") on February 5, 2014; and the Motion for Leave (Filing No. 132) filed by WS on February 6, 2014, through which WS seeks leave to supplement certain filings so as to render Arcon's Motion to Strike moot. For the reasons stated below, WS's Motions for Leave to Amend and for Reconsideration will be denied, and Arcon's Motion to Strike and WS's Motion for Leave will be denied as moot.

BACKGROUND

The Nebraska Department of Roads ("NDOR") had a construction project in Keith County, Nebraska (the "Project"). NDOR and Upper Plains Contracting, Inc. ("UPCI") entered into a contract, in which UPCI served as general contractor for the Project. Subsequently, UPCI entered into a subcontract with Paul Reed Construction & Supply, Inc. ("PRC"), for the performance of a certain portion of UPCI's scope of work on the Project. Thereafter, PRC entered into a subcontract with Arcon for the performance of certain aspects of the Project. WS furnished payment and performance bonds with UPCI as the principal, NDOR as an obligee, and the Project subcontractors and suppliers as additional obligees.

On February 3, 2012, Arcon filed a Third-Party Complaint against WS (Filing No. 3) seeking damages for breach of WS's payment bond with UPCI. On April 6, 2012, WS filed its Answer to Arcon's Third-Party Complaint (Filing No. 27). In its Answer WS included the following paragraph under the heading "AFFIRMATIVE DEFENSES":

Third-Party Defendant [WS] hereby submits the following affirmative defenses to Arcon's Third-Party Complaint, and reserves the right to amend and supplement any further affirmative defenses that may be supported by discovery herein as follows: Breach of subcontract duties and obligations owed Plaintiff Paul Reed; waiver; estoppel; unclean hands; barratry; violation of Federal Rule of Civil Procedure 11; failure to name the real party in interest; and as mentioned for such other and further affirmative defenses as may become apparent during discovery.

(Filing No. 27 at 4.)

On April 23, 2012, the Court adopted and entered a Scheduling Order requiring WS to file any motions to amend pleadings by July 11, 2012. (Scheduling Order, Filing No. 30, 3, ¶7(c).)

On October 10, 2013, WS filed a Motion for Summary Judgment. (Filing No. 80). In its supporting Brief, under the heading "Defective Notice, " WS argued that Arcon failed to provide adequate notice of its claim under Neb. Rev. Stat. § 52-118.01. (WS's Summary Judgment Br., Filing No. 81, 8.)

On November 19, 2013, Arcon filed its brief in opposition to WS's Motion for Summary Judgment ("Arcon's SJ Br.") in which Arcon argued that WS did not properly plead untimely notice in its Answer and that "[a]ny such belated argument at this stage regarding an alleged defective notice' has been effectively waived." (Filing No. 100, 26.) In the argument section of WS's Summary Judgment Reply Brief ("SJ Reply Br., " Filing No. 104), WS did not respond to Arcon's assertion that the untimely notice defense was waived. The only response WS provided regarding Arcon's claim that the defense of untimely notice had been waived was in a section of the SJ Reply Br. labeled "Reply to Arcon's Response and Objections to WS's Statement of Material Facts, " wherein WS asserted that:

Arcon's alleged Material Fact No. 17 [stating that WS "does not allege, plead or assert any... allegation in its Answer regarding Arcon's notice or the timeliness of Arcon's notice" (Filing No. 100 at 17)] relates to [WS's] affirmative defenses. Arcon would have this Court overlook that part of [WS's] affirmative defenses which states that its affirmative defenses include "such other and further affirmative defenses as may become apparent during discovery." [WS's] Summary Judgment Motion is based upon facts developed during discovery. Arcon's objections are based almost exclusively on discovery matters.

(Filing No. 104 at 2, 8.)

On January 16, 2014, the Court denied WS's Motion for Summary Judgment stating that while it appeared that Arcon had not complied with the requirements of Neb. Rev. Stat. § 52-118.01, and "such deficiencies may provide [WS] with an affirmative defense to Arcon's claim, [WS] raised no such affirmative defense in its Answer (Filing No. 27) and such a defense may not be asserted otherwise. See Fed.R.Civ.P. 8(c)." (Memorandum and Order, Filing No. 121, 17.)

In its Motion for Leave to Amend and Motion for Reconsideration, WS now claims that it "asserted the defense and/or affirmative defense of defective notice by (a) expressly denying the notice element of Arcon's claim, (b) raising estoppel and/or waiver in the Answer, and (c) underpinning its estoppel and/or waiver ...


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