Walterboro, City of v. AECOM, No. 2:2019cv00493 - Document 44 (D.S.C. 2021)
Court Description: ORDER granting in part and denying in part 34 Defendant's Motion for Summary Judgment. Details set forth in Order. Signed by Honorable Bruce Howe Hendricks on 3/22/2021.(vdru, )
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Walterboro, City of v. AECOM 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 1 of 14 Doc. 44 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF SOUTH CAROLINA CHARLESTON DIVISION City of Walterboro, ) ) Plaintiff, ) ) v. ) ) AECOM Technical Services, Inc. d/b/a ) AECOM and URS Corporation f/k/a ) B.P. Barber & Associates, Inc. d/b/a ) AECOM, ) ) Defendant. ) ________________________________ ) Civil Action No. 2:19-493-BHH ORDER This matter is before the Court upon the motion for summary judgment filed by Defendant AECOM Technical Services, Inc. d/b/a AECOM and URS Corporation f/k/a B.P. Barber & Associates, Inc. seeks summary judgment on Plaintiff City of Wa for (1) breach of contract, (2) breach of implied warranty of sufficiency of plans and specifications, (3) promissory and equitable estoppel, (4) negligent misrepresentation, and (5) professional negligence/malpractice. Specifically, Defendant asserts that Plaintiff cannot establish its damages with sufficient certai barred by the three-year statute of limitations. of contract claim, Defendant asserts that Plaintiff has not presented any evidence of a breach of the operative agreement, and with res warranty claim, Defendant asserts that Plaintiff has not presented any evidence that the plans and specifications were insufficient. Fi promissory and equitable estoppel, Defendant asserts that Plaintiff has not presented any Dockets.Justia.com 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 2 of 14 evidence of: a false representation or concealment by Defendant, a promise unambiguous in its terms, or reasonable reliance. he facts and incorrectly applies the law to the facts. In support of its arguments, Plaintiff attaches the declarations of Jeffrey P. Molinari the City of Walterboro, and Wa Director of Public Works for the City of Walterboro. In its reply brief, Defendant argues that the declarations of Molinari and Crosby are improper and cannot create a material issue of fact because the declarations contradict imony. Defendant reiterates its position that sserts that the declarations of Molinari and Crosby do not create a genuine issue of material fact as to damages. With respect to hat it may seek a refund of all of the fees paid to Defendant, Defendant contends that the case law upon which Plaintiff relies is inapposite, and that, even if Plaintiff could maintain a claim for the refund of fees, which Defendant disputes, Plaintiff would be limited to seeking the cost incurred pursuant to Task Order 33. In addition to the foregoing, Defendant contends that the declarations of Molinari and Crosby do not create a genuine issue of material fact as to the statute of limitations because the r, clear testimony on this issue. Finally, Defendant asserts that the declarations of Molinari and Crosby do not create a genuine each of contract or breach of warranty claims because both Molinari and Crosby testified that Task Order 33 was a full description of the services they requested from Defendant at the time. 2 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 3 of 14 After consideration, and for the following reasons, the Court grants in part and BACKGROUND Plaintiff initially filed this action in January of 2019 in the Colleton County Court of Common Pleas. Defendant removed the action to this Court in February of 2019, and Plaintiff filed an amended complaint on May 8, 2019. In its amended complaint, Plaintiff alleges that Defendant entered into a contract with the City on August 21, 2008, called a General Agreement for Professional Engineering Services. (ECF No. 17 ¶ 5; ECF No. 351.) According to this agreement, Defendant would serve as consulting engineers for the City in the preparation of vari Id.) On February 11, 2015, the parties agreed 33"), which described the Pr Agronomic Loading Rate Worksheet and Land App study and Preliminary Engineering Report (PER) In connection with Task Order 33, Defendant aluating the feasibility of biosolids handling improvement and identifying necessary upgrades. (ECF No. 35-6.) This Technical Memorandum construction costs for the proposed sludge holding improvement and sludge Id. at 4.) Also in connection with [Walterboro Wastewater Treatment Plant] to provide additional biosolids storage for optional flexibility and sludge dewatering improvements for 3 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 4 of 14 35-7 at 6.) Don Lee, the Technical Memorandum and Preliminary Engineering Report on behalf of Defendant. In both the Technical Memorandum and the Preliminary Engineering Report, all of the improvement options include a cake conveyance system despite story screw press structure. (ECF No. 35-6 at 6-7; ECF No. 35-7 at 14; ECF No. 35-5 at 13; ECF No. 35-2 at 14; and ECF No. 35-3 at 16-17.) In addition, Dr. Lee calculated the volume of sludge in an existing equalization basin, estimating the probable cost for sludge disposal as $200,000.00. (ECF No. 35-6 at 14.) Ultimately, Dr. Lee estimated the total construction costs for Plaintiff as $3,076,000.00 with a ten percent contingency of $308,000.00. (Id. Following receipt of the Technical Memorandum and Preliminary Engineering Report, the City submitted an application for federal grant funding through the United 15; ECF No. 35-8 at 2.) The Lowcountry Council of Governments prepared the grant application on behalf of the City, and the the cost estimate provided by Defendant. (ECF No. 35-3 at 19; ECF No. 35-2 at 17.) On June 16, 2015, the parties agreed to rboro Wastewater Treatment Plant (WWTP) Biosolids Upgrade as proposed in Technical Me This Task Order required Defendant to prepare construction plans and specifications and submit an opinion of the probable cost for the Project. (Id. at 2-3.) Task Order 36 provides guarantee that proposals, bids, or the Project construction cost will not vary from 4 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 5 of 14 Id. at 3.) The City received tentative approval of the EDA grant on July 31, 2015, and final approval on January 4, 2016. (ECF No. 35-12; ECF No. 39-3.) The EDA agreed to provide 60 percent of the submitted project cost estimate of $3,400,000.00 to the City, with the City obligated to make up the remainder. (ECF No. 35-2 at 18.) The City also received a grant from the South Carolina Rural Infrastructure the South Carolina State Revolving Fund. (Id.) Following the completion of the design phase, Defendant provided the City with an updated, pre-bid estimate of $3,942,400.00. (ECF No. 35-10.) The City moved forward with the bidding process for the Project and selected a contractor. During construction, however, more sludge had to be removed than the 200 dry tons previously estimated by Dr. Lee, resulting in a change order indicating an increase of 457 dry tons and a $400,000.00 increase in the cost for sludge removal. (ECF No. 35-11.) estimates were crucial to the success of expertise in preparing bid documents and in applying for funds (ECF No. 17 ¶ 9.) Plaintiff alleges that De aluate and estimate the cost of the removal of existing sludge waste from an existi Id. ¶¶ 12-13.) ilure to create accurate plans and estimates resulted in Plaintiff receiving a federal grant based on inadequate calculations and Plaintiff incurring significant and unforeseen cost overruns in excess of $1,000,000.00, which Plaintiff asserts could have been avoided if Defendant properly performed its work. (Id. 5 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 6 of 14 ¶¶ 14-15.) STANDARD OF REVIEW A court shall grant summary judgment if a party shows that there is no genuine dispute as to any material fact and the party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). The judge is not to weigh the evidence, but rather to determine if there is a genuine issue of fact. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986). If no material factual disputes remain, then summary judgment should be granted against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which the party bears the burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). All evidence should be viewed in the light most favorable to the non-moving party. See Perini Corp. v. Perini Constr., Inc., 915 F.2d 121, 123-24 (4th Cir. 1990). DISCUSSION As an initial matter, the Court notes that Plaintiff has agreed not to pursue its cause of action for promissory and equitable estoppel. (ECF No. 38 at 17.) Thus, the Court mmary judgment with respect to action. are too speculative for Plaintiff to proceed with as all of its claims, the Court is not convinced. Defendant argues ertain, contingent, or speculative because Plaintiff has not shown that it would have received additional federal grant funds if it had oversimplifies and misconstrues the nature of 6 2:19-cv-00493-BHH Date Filed 03/22/21 Court to resolve factual questions. Entry Number 44 Page 7 of 14 In addition, the Court agrees with Plaintiff that professional negligence, a recognized method of damages is the cost of the fees paid to the professional. In all, the Court finds that it would not be appropriate to grant summary judgment at this time based for summary judgment is denied in this regard. Next, however, the Court is convinced that the statute of of a one-story conveyor system (as opposed to two-story screw press) waste transfer facility in the Technical Memorandum and Preliminary Engineering Report. Specifically, the Court finds that the declaration of Crosby, submitted in connecti motion for summary judgment, cannot create a genuine issue of material fact as to when Plaintiff knew (or should have known by the exercise of reasonable diligence) that it had of a one-story waste transfer facility because sworn testimony, which made clear that Crosby Memorandum and Preliminary Engineering Report included a one-story conveyor system. See In re Family Dollar FSLA Litig., 637 F.3d 508, 512 (4th Cir. 2011) (explaining that a dispute about a fact that is contained in deposition testimony by referring to a subsequent affidavit of the deponent contradicting t ccordingly, the Court disregards with his prior deposition testimony. Specifically, Crosby provided the following testimony when asked at his deposition about this issue: 7 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 8 of 14 Q. . . . Between February 11, 2015, when task order 33 was signed and May of 2015 when the PER and the tech memo were issued, were there any other issues that you brought to the attention of AECOM regarding this project? A. I believe it was along that same time frame that we mentioned that there was a conveyor belt mentioned in one of the technical memorandums, a conveyance system on the sludge screw press building. And that did not correspond to what we had looked at in the Town of St. George nor what we expected. (ECF No. 35-3 at 16.) Crosby also testified as follows: Q. And did you receive a copy of [the preliminary engineering report] in May of 2015? A. Yes. Q. A. Did you have an opportunity to review this document in May of 2015? Yes. Q. Did you have any questions or concerns that you expressed to AECOM or its representative following your review of [the preliminary engineering report] in May of 2015?] but if that document was the first time that I saw the conveyor system, point that it was expressed to them. (Id. at 17.) Crosby later testified: looking at here, Exhibit 5, related to the two-story dewatering facility, did you bring that issue to the attention of anybody at AECOM at that time? A. My only point of contact was Eric King, and I brought it to his attention Q. Do you recall a time frame at all when you first saw the issue you had 8 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 9 of 14 with the design of the one-story conveyor system as opposed to the two-story dewatering building? A. It was sometime in 2015. (Id. at 18.) Lastly, when again asked about his discovery of the lack of a two-story facility, Crosby testified: Q. And not to belabor this but I do want to ask one more time just to be s your testimony that you do not recall the specific time when you first noticed the lack of a two-story dewatering facility but that it would have been sometime during 2015; is that correct? A. Yes. (Id. at 19.) In his declaration, Crosby asserts that, since his deposition, he has reviewed the records and refreshed his recollection of when he became aware of the issue. (ECF No. 40 at 6.) He further states: rtainty and confidence that the earliest date I became [a]ware of the elevated structure mistake and resulting cost impact to the City . . . occurred on or about April 11, 2016; it did not happen in calendar year Id.) In support of this new statement, Crosby relies on an email chain indicating that Crosby was not happy with a cost increase that was due in part to the original estimate being based on a single story building using a conveyor. (ECF No 40-4 at 2.) Ultimately, however, the Court is not convinced that this email in any way proves when Crosby learned Preliminary Engineering Report included a one-story conveyor system rat o-story screw press system. Rather, as Defendant asserts in its reply, Crosby clearly testified on numerous occasions during his deposition that he discovered this issue in 2015, and his testimony is, in fact, 9 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 10 of 14 consistent with the language of the Technical Memorandum and Preliminary Engineering Report, which were both provided to Plaintiff in 2015. Therefore, the Court agrees with w, contradictory claim does not create a genuine issue of material fact on this point,1 and the Court finds that Defendant is entitled to summary system rather than a two-story screw press system, because Plaintiff was aware of the issue in 2015 and did not file suit until more than three years later in 2019. In contrast, the Court is not convinced that the three-year statute of limitations bars . First, the Court finds a question of fact as to exactly when Cr calculations. Second, however, even assuming that Crosby did raise questions about Dr. to 2016 or 2017 as he now claims in his declaration, it is not clear that any questions Crosby may have raised would have triggered the statute of limitations. This is becaus remove the dry sludge did not include any specific estimated quantity of dry sludge. Moreover, although a bid form dated December 14, 2016, indicates an estimated quantity of 200 dry tons of sludge (ECF No. 39-6), Crosby specifically testified that construction began in 2017, and that it was not until the first week of construction that it became clear that the sludge calculations were not accurate. (ECF No. 35-3 at 21.) Also, Molinari 1 11, 2016, when the Director of Public Works was notified of a necessary budget increase, Molinari also admits (ECF No. 39 at 4.) Moreover, because Crosby clearly testified that he knew of this alleged deficiency in Dr. Id.) 10 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 11 of 14 testified that it was not until the summer of 2017 that Crosby informed him of the issue with the additional sludge removal. (ECF No. 35-2 at 16.) As such, the Court finds that the statute of limitations sludge removal calculations. In its motion for summary judgment, Defendant also raises arguments specific to on. First, Defendant argues that it is entitled contract claim because Plaintiff has not provided any evidence of a breach of the operative agreement. After consideration, the Court agrees with Defendant. In its breach of contract claim, Plaintiff relies on the Task Order entered into on June 16, 2015 (Task Order 36), and asserts that Def altering the design of the facility to include a conveyor belt transfer station as opposed to an elevated platform transfer station, which was required by Plaintiff, . ¶ 18.) Plaintiff also asserts that Defendant estimate the required services needed to remove existing waste from a basin on the project Id.) Importantly, however, nowhere does Plaintiff point to any specific language of this Task Order that Defendant allegedly breached. In addition, to the extent Plaintiff ed in a loss of grant funds, the evidence indicates that Plaintiff applied for federal grant funding before the parties agreed to Task Order 36. ling and the master contract, and Plaintiff asserts that its breach of 11 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 12 of 14 obligations arising from a professional services contract and relationship, including the obligation of good faith and fair dealings, implied workmanship, and the duty to perform all work [ ] with a reasonable degree of care . . . 15.) However, as Defendant argues in reply, both Molinari and Crosby testified that Task Order 33 included a full description of the services owed by Defendant at the time when Plaintiff filed its application for federal funding (as the parties did not enter Task Order 36 until after Plaintiff applied for federal grant funding). Because Plaintiff has not pointed to any evidence of any ambiguity in any of the parti dealing that required additional duties from Defendant, the Court agrees with Defendant (for all of the aforementioned reasons) that it is entitled to summary judgment Defendant also argues that it is entitled to summary judgment breach of implied warranty of sufficiency of plans and specifications because Plaintiff has not produced any evidence that the plans and specifications were insufficient for their purpose, i.e., the construction of the wastewater treatment plant improvements. Defendant were sufficient for the proper construction of the desired upgrade at the Plaint, this cause In response, Plaintiff c ent improperly narrows this estimates provided and opinions of probable construction cost fall within this warranty and the law supports t 16.) After review, the Court agrees with Plaintiff that this cause of action is broader than In other words, while Defendant is correct that the record 12 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 13 of 14 does not contain evidence of any issues with the wastewater treatment plant as it was ultimately constructed, the record does contain evidence indicating that certain of he intended purpose. Accordingly, the Court finds a genuine issue of material fact m for breach of the implied warranty of sufficiency of plans and specifications, at least with respect to De does not include arguments specific to ation or professional negligence/malpractice, and the Court finds no reason to these claims with respect CONCLUSION Based on the foregoing, t motion for summary judgment (ECF No. 34). Specifically, the Court finds that the threeyear statute of limitat story conveyor system rather than a two-story screw press system in the Technical Memorandum and Preliminary Engineering Report. In addition, the Court grants contract and promissory and equitable estoppel (first and third causes of action). However, claims for breach of implied warranty of sufficiency of plans and specifications, negligent misrepresentation, and professional negligence/malpractice (insofar as they are based on sludge calculations). 13 2:19-cv-00493-BHH Date Filed 03/22/21 Entry Number 44 Page 14 of 14 IT IS SO ORDERED. /s/Bruce H. Hendricks United States District Judge March 22, 2021 Charleston, South Carolina 14
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