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Judds Brothers Construction Co. v. Mersino Dewatering, Inc.

United States District Court, D. Nebraska

September 18, 2017

JUDDS BROTHERS CONSTRUCTION CO., a Nebraska Corporation; Plaintiff,
v.
MERSINO DEWATERING, INC., a Michigan Corporation; Defendant.

          MEMORANDUM AND ORDER

          Laurie Smith Camp Chief United States District Judge

         This matter is before the Court on the Motion for Reconsideration, ECF No. 92, filed by Defendant Mersino Dewatering, Inc. (Mersino). For the reasons stated below, the motion will be denied.

         BACKGROUND

         In 2015, the City of Council Bluffs, Iowa, hired Plaintiff Judds Brothers Construction, Co. (Judds), as general contractor on the Mosquito Creek South Sewer Relocation Project. Judds sought and received bids from two subcontractors to dewater the project-Mersino and Griffin Dewatering Corp. (Griffin). Mersino proposed drilling 33 wells to a depth of 40 feet, while Griffin proposed drilling 14 wells to a depth of 90 feet. Judds selected Mersino to dewater the Mosquito Creek Project. Mersino's proposal for the project (First Proposal), as signed by Judds, stated “the dewatering system shall sufficiently lower the ground water level below the sub-grade elevations except where silts, clays, rock or other impervious material may be encountered” and that “[i]f additional dewatering systems should be required or requested of Mersino in excess of that which is quoted above, additional systems will be provided at additional costs.” ECF No. 70-3, Page ID 1896-98.

         On April 28 and 29, 2015, Mersino installed three wells, which terminated in “gray-ish looking clay” and did not achieve the anticipated groundwater drawdown. On May 8, 2015, Mersino submitted a second proposal (Second Proposal), [1] this time proposing the installation of a well-point system to aid in dewatering. Judds directed Mersino to install a test run of 500 feet of well points. When the well-point system was ineffective, Judds undertook several actions on its own to attempt to dewater the site, such as installing sump pumps in a trench, electric pumps in the Mersino wells, and an additional shallow well.

         In mid-July of 2015, Judds informed Mersino that it was engaging Griffin to install three wells at a depth of 90 feet to dewater the site. Mersino asked for the opportunity to install deep wells, but Judds refused. The deep wells installed by Griffin eventually achieved the desired drawdown and Judds completed the sewer relocation project. Due to delays in project completion, the City of Council Bluffs imposed liquidated damages on Judds per the terms of their contract.

         Judds brought suit against Mersino in the District Court of Douglas County, Nebraska, on November 24, 2015. ECF No. 1. Mersino removed the case to this Court on January 4, 2016. In its complaint, Judds asserted claims for breach of contract, negligence, breaches of implied and express warranties of fitness for a particular purpose, and unjust enrichment. Id., Page ID 5-14. In its answer, ECF No. 7, Mersino asserted counter-claims against Judds for breach of contract and quantum meruit. Id., Page ID 38-39.

         On February 24, 2017, Mersino moved for summary judgment, ECF No. 60, in its favor on all claims and counter-claims. On May 26, 2017, the Court entered an order, ECF No. 87, granting the motion in part, and entering summary judgment in favor of Mersino on all Judds's claims except breach of contract. Regarding that claim, the Court held that the undisputed evidence showed there had been no breach of the express terms of the First and Second Proposals; but, because Judds introduced evidence that Mersino may have suggested the well-point system despite its unlikelihood of success and in order to prolong billing Judds, the Court allowed the claim to proceed solely on the grounds that Judds may have breached its common-law duty to perform the contract with reasonable care, expedience, and good faith. ECF No. 87, Page ID 3033-36. For this same reason, the Court did not grant summary judgment on the clause in the agreement prohibiting damages for delay in Mersino's performance, as such a clause had been held unenforceable in cases where the delay resulted from concealment, misrepresentation, fraud, bad faith, or malicious intent. Id., Page ID 3036.

         Mersino has moved for reconsideration as to the breach of contract claim and the no-damages-for-delay clause.

         STANDARD OF REVIEW

         “A ‘motion for reconsideration' is not described in the Federal Rules of Civil Procedure, but such a motion is typically construed either as a Rule 59(e) motion to alter or amend the judgment or as a Rule 60(b) motion for relief from judgment.” Auto Servs. Co. v. KPMG, LLP, 537 F.3d 853, 855 (8th Cir. 2008) (citing Sanders v. Clemco Indus., 862 F.2d 161, 168 (8th Cir. 1988)). The Eighth Circuit Court of Appeals has stated that “motions for reconsideration are ‘nothing more than Rule 60(b) motions when directed at non-final orders.'” Elder-Keep v. Aksamit, 460 F.3d 979, 985 (8th Cir. 2006) (quoting Anderson v. Raymond Corp., 340 F.3d 520, 525 (8th Cir. 2003)).

         Certain district court opinions have taken issue with Elder-Keep's holding, citing a district court's “inherent authority to reconsider interlocutory orders.” Garrett v. Albright, No. 4:06-CV-4137-NKL, 2008 WL 268993, at *2 (W.D. Mo. Jan. 30, 2008) (citing 15B Wright and Miller, Federal Practice and Procedure § 3914.28); see also Lustgraaf v. Sunset Fin. Servs., Inc., No. 8:08CV335, 2012 WL 5996968, at *2 n.3 (D. Neb. Nov. 28, 2012) (citing Garrett; Disc. Tobacco Warehouse, Inc. v. Briggs Tobacco & Specialty Co., Inc., No. 3:09-CV-05078-DGK, 2010 WL 3522476, at *2 (W.D.Mo. Sept.2, 2010)) (recognizing courts' disagreement with Elder-Keep). Indeed, Federal Rule of Civil Procedure 54(b) states that any order that adjudicates fewer than all the claims in a pending action “does not end the action . . . and may be revised at any time before the entry of a judgment adjudicating all the claims and all the parties' rights and liabilities.” Fed.R.Civ.P. 54(b); see Birge v. Smeall, No. 8:13CV136, 2013 WL 6631653, at *2 (D. Neb. Dec. 17, 2013) (quoting K.C.1986 Ltd. P'ship v. Reade Mfg., 472 F.3d 1009, 1017 (8th Cir. 2007)) (“District courts have ‘the inherent power to reconsider and modify an interlocutory order any time prior to the entry of judgment.'”).

         Even district courts that have criticized Elder-Keep as too restrictive of a district court's discretion have noted that a court's interest in judicial economy and respect for the finality of court decisions “would be undermined if [a court] were to routinely reconsider its interlocutory orders.” Disc. Tobacco, 2010 WL 3522476, at *2. These courts have required the moving party to show “(1) that it did not have a fair opportunity to argue the matter previously, and (2) that granting the motion is necessary to correct a significant ...


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