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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND CAPITOL INDEMNITY CORPORATION : v. : Civil Action No. DKC 99-3195 : THE MOUNTBATTEN SURETY COMPANY, INC. : : MEMORANDUM OPINION In this dispute over payment, Plaintiff Capitol Indemnity Corporation ("Capitol") has filed a second motion1 for partial summary judgment2 against Defendant The Mountbatten Surety :

Company, Inc. ("Mountbatten").

The issues have been fully Local Rule 105.6.

briefed, and no hearing is deemed necessary.

For the following reasons, the court shall GRANT Plaintiff's motion for partial summary judgment. I. Background3 Mountbatten is the general contractor of a project at the Quince Orchard Library in Gaithersburg, Maryland. Capitol is

This court denied Capitol's first motion for partial summary judgment on November 22, 2000. See Paper No. 25. Capitol is not seeking summary judgment on Mountbatten's obligation to pay the remaining retainage or on the quantum meruit claim. For a more extensive recitation of the facts, see a prior opinion issued by this court. See Paper no. 25.
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one of the subcontractors on the project.

According to the

terms of the contract, Capitol is to receive monthly payments from Mountbatten for work completed and approved by Montgomery County ("County"). Mountbatten The record unequivocally reflects both that and received payment for specific

certified

subcontractor work and that no payment has been made to Capitol. This court issued an opinion on November 22, 2000, finding that Mountbatten owed Capitol payment. See Paper No. 25. Based

on the existing record at that time, the court was unable to identify payment. Capitol's Thus, work for which in Mountbatten this had is received whether

the

real

issue

motion

sufficient undisputed evidence has been submitted for the court to grant summary judgment on that issue. On October 16, 2000, Capitol deposed Louis Baldasarre, the Project Manager. He testified that items identified by numbers

103 through 124 on the Application and Certification for Payment submitted by Mountbatten on December 21, 1999 represent the projects attributable to Capitol. Plaintiff's Exhibit 1,

Deposition of Baldasarre, 62-63.

Mountbatten certified, and the

County agreed, that each item, except for number 124, was 100 percent complete. Plaintiff's Exhibit 3, App. and Cert. for Payment. The total of these prime contract values on lines 103

to 124 is $463,521. 2

The total value of the mechanical subcontract on the Quince Orchard Library project was $427,000. as incomplete is item 124 valued The only item identified at $2,723. Taking into

consideration number 124, Capitol asserts the total amount owed for the mechanical work is $424,277. Capitol's predecessor,

MIC/CO, received $271,102 in payment, thus, $153,175 is still outstanding on the contract. According to the terms of the

Contract, the County withholds ten percent of retainage from Mountbatten, thus, Capitol asserts the amount it is owed minus the ten percent retainage is $137,857.50. II. Summary Judgment Standard A motion for summary judgment will be granted only if there exists no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ.

P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). The

court must draw all reasonable inferences in the light most favorable to the non-moving party. Tinsley v. First Union Nat'l A party who bears the

Bank, 155 F.3d 435, 437 (4th Cir. 1998).

burden of proof on a particular claim must factually support each element of his or her claim. "[A] complete failure of

proof concerning an essential element . . . necessarily renders all other facts immaterial." Celotex, 477 U.S. at 323. 3 Thus,

on those issues on which the nonmoving party will have the burden of proof, it is his or her responsibility to confront the motion for summary judgment with an affidavit or other similar evidence. III. Anderson, 477 U.S. at 256. Analysis A. Amount Owed to Capitol Capitol has submitted to the court sworn testimony as well as Application and Certification for Payment documents

establishing Mountbatten received payment for Capitol's work. Baldasarre's testimony identifies the specific projects

completed by Capitol.

After subtracting the prior payment to

MIC/CO, Capitol's incomplete work, and retainage amount from County's payment to Mountbatten, the court agrees with Capitol that it is owed $137,857.50. Mountbatten does not contest

either the projects classified as Capitol's or the calculations offered by Capitol. Rather, Mountbatten asserts that it does not owe Capitol any payment because the County assessed damages and Capitol's work requires remediation. However, Mountbatten does not present the To prove an

court evidence to substantiate these allegations.

assessment of actual damages, Mountbatten refers to a December 14, 2000 letter from the County but does not proffer it to the

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court.4

Consequently, the record does not contain any evidence At most, the Defendant

that the County assessed actual damages.

submitted another letter from the County dated September 15, 2000 in which the County terminates Mountbatten from the project and promises to "seek all relief to which it is entitled, including all liquidated damages." Defendant's Exhibit A. As

this court has already ruled, anticipating liquidated damages does not equal an assessment of actual damages.5 25, 10. Mountbatten also asserts that because Capitol's work See Paper no.

requires remediation, no payment is owed to Capitol or, at the very least, only a reduced payment is owed currently. Quoting

the language from the Application and Certification for Payment, Mountbatten contends that when defects are discovered subsequent to certification, payment can be withheld. The undersigned Contractor certifies that to the best of the Contractor's knowledge, information and belief the work covered in

Capitol contends that Mountbatten failed to turn over numerous documents in discovery including this December 14, 2000 letter from the County. Until Mountbatten produces evidence of actual damages, Mountbatten has no legal basis by which to withhold or reduce payment based on the belief that Capitol is responsible for anticipated damages. See Paper No. 25, 11. Thus, any argument alleging Capitol is responsible for the delay of the project is irrelevant to the issue of Mountbatten paying Capitol for work it certified as completed. 5
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this Application for Payment has been completed in accordance with the Contract documents . . . . In accordance with the Contract documents, based on on-site observations and the data comprising the application, the Architect certifies to the Owner that to the best of the Architect's knowledge, information and belief, the Work has progressed as indicated, the quality of the Work is in accordance with the Contract Documents, and the Contractor is entitled to payment of the amount certified. Issuance, payment and acceptance of payment are without prejudice to any rights of the Owner or Contractor under this contract. See Plaintiff's Exhibit 3, App. for Payment. Although this

provision preserves the Contractor's rights under the contract, it certainly does not state that the Contractor can withhold payment after certifying the work as completed and

satisfactory. However, even assuming Mountbatten can withhold funds after discovering a defect, Mountbatten has not produced evidence demonstrating Capitol's work requires remediation. Mountbatten

refers to a letter composed by Brad Rackers, service engineer for SEMCO Inc., describing the mistake made in the installation of the HVAC system, but Mountbatten does not proffer it to the court. The court has absolutely no information about the need

for remediation above and beyond Mountbatten's unsubstantiated allegations. Moreover, as Capitol pointed out, Mountbatten 6

already retains a percentage of the funds expressly for the purpose of remediation. On this record, the court shall

grant Plaintiff's motion for partial summary judgment in the amount of $137,850.50. B. Damages 1. Interest and Costs In addition to the amount owed, Plaintiff seeks interest on the amount due, costs, and attorney fees. According to MD. CODE

ANN. REAL PROP.

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