Anna Thomas v. Travelers Casualty and Surety Company of America

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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
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No. 14-15408
Non-Argument Calendar
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D.C. Docket No. 2:12-cv-01080-WKW-SRW
ANNA THOMAS,
Plaintiff-Appellant,
versus
MICHAEL F. BURKHARDT,
Defendant,
TRAVELERS CASUALTY AND SURETY
COMPANY OF AMERICA,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Middle District of Alabama
________________________
(January 13, 2016)
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Before HULL, MARCUS, and ROSENBAUM, Circuit Judges.
PER CURIAM:
Anna Thomas, proceeding pro se and as substitute appellant for Alvin
Thomas (“Thomas”) 1, appeals the dismissal with prejudice of Thomas’s civil
complaint alleging breach of contract and seeking specific performance against
Travelers Casualty and Surety Company of America (“Travelers”). This case
concerns Thomas’s work as a subcontractor on a federal project, for which he was
not fully paid by the contractor. He obtained a judgment against the contractor in
state court and, unable to collect on the judgment, filed a claim with Travelers,
which had issued bonds at the request of the contractor to ensure payment of those
who furnished materials and labor for the project.
Travelers denied the claim on the basis that it was untimely under the Miller
Act, 40 U.S.C. §§ 3131–3134. Thomas then filed suit in federal court against
Travelers. The district court granted summary judgment to Travelers, concluding
that Thomas’s claim was time barred.
On appeal, Thomas argues that the district court erred in granting summary
judgment to Travelers because the Full Faith and Credit Clause imposed a duty on
the district court to give effect to the state-court judgment. Thomas also argues
that the principals of res judicata and collateral estoppel preclude Travelers from
1
Thomas passed away while this appeal was pending. We granted Anna Thomas’s
construed motion to be substituted as the appellant.
2
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raising a statute-of-limitations defense because a judgment against a principal (the
contractor) establishes a surety’s (Travelers’s) liability as long as the surety had
notice of the action against its principal. Thomas maintains that Travelers had
notice and an opportunity to contest the contractor’s liability in the state-court
action. After careful review, we affirm.
I.
Thomas was hired by Thorington Electrical and Construction Company
(“TECC”) as a subcontractor to perform drainage work for a project at Maxwell
Air Force Base in Montgomery, Alabama. Thomas completed work on the project
in March 2006. 2 For this work, TECC paid Thomas $90,696.47, about half of
what he was owed. Thomas brought suit against TECC in Alabama state court in
January 2008 to collect the remaining amount due. In October 2008, the state
court entered judgment in favor of Thomas and ordered TECC to pay Thomas the
remaining $99,172.77 owed under the subcontract.
In September 2008, Thomas notified Travelers that he intended to file a
claim on payment bonds Travelers had issued for the construction projects. In
accordance with federal law, TECC had engaged Travelers to execute a series of
2
The district court stated that Thomas completed work on the project on January 26,
2006, which is the date Thomas alleged in his complaint. However, there is some indication in
the record that Thomas worked through March 2006. We construe this ambiguity in Thomas’s
favor and assume that Thomas completed performance in March 2006. Nonetheless, it makes no
difference to the outcome.
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performance and payment bonds in favor of the United States for the project at
Maxwell Air Force Base.
Thomas submitted a claim form, along with the October 2008 state
judgment, to Travelers in February 2009. After some additional communications
between Travelers and Thomas, Travelers notified Thomas in August 2009 that it
was denying his claim primarily because it was not timely filed under the terms of
the Miller Act. Believing that his claim was wrongfully denied, Thomas filed suit
in federal court against Travelers in December 2012, seeking to recover the amount
of the state-court judgment he obtained against TECC.
The district court granted summary judgment to Travelers, concluding that
Thomas’s action was time-barred under the Miller Act because he had not brought
the action within one year of the date on which he last performed labor under the
contract. Consequently, the court dismissed Thomas’s complaint with prejudice as
time barred. After unsuccessfully moving for reconsideration of the judgment,
Thomas now brings this appeal.
II.
We review a district court’s grant of summary judgment de novo, viewing
the evidence and drawing all reasonable inference in favor of the non-moving
party. Burger King Corp. v. E-Z Eating, 41 Corp., 572 F.3d 1306, 1313 (11th Cir.
2009). Under Federal Rule of Civil Procedure 56(a), summary judgment should
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be granted “if the movant shows that there is no genuine dispute as to any material
fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56.
III.
Here, the contract the parties entered into was for construction of a federal
project and therefore properly governed by the Miller Act. 3 The Miller Act
requires a contractor to furnish performance and payment bonds to the United
States “[b]efore any contract of more than $100,000 is awarded for the
construction, alteration, or repair of any public building or public work of the
Federal Government.” 40 U.S.C. § 3131(b). The purpose of the Miller Act is to
ensure that those who furnish labor and materials for public construction projects
will be paid. Graybar Elec. Co. v. John A Volpe Constr. Co., 387 F.2d 55, 58 (5th
Cir. 1967). 4 Because the Miller Act is “highly remedial in nature,” it is to be
liberally construed “to effectuate the congressional intent to protect those whose
labor and materials go into public projects.” Id. (quotation omitted).
The act provides that every person who has furnished labor or materials
under a contract for which a payment bond under 40 U.S.C. § 3131(b)(2) was
3
Although Thomas argued before the district court that his claim was not governed by
the Miller Act, he does not raise those contentions on appeal. Therefore, Thomas has abandoned
the issue. See Timson v. Sampson, 518 F.3d 870, 874 (11th Cir. 2008) (“While we read briefs
filed by pro se litigants liberally, issues not briefed on appeal by a pro se litigant are deemed
abandoned.” (citations omitted)).
4
This Court adopted as binding precedent all Fifth Circuit decisions prior to October 1,
1981. Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc).
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issued, but who has not been paid within ninety days of the last day of
performance, “may bring a civil action on the payment bond for the amount unpaid
at the time the civil action is brought and may prosecute the action to final
execution and judgment for the amount due.” 40 U.S.C. § 3133(b)(1). However,
any such action “must be brought no later than one year after the day on which the
last of the labor was performed or material was supplied by the person bringing the
action.” 40 U.S.C. § 3133(b)(4).
The last date that Thomas worked for or provided materials for the project
was in March 2006. Thomas did not file suit against Travelers until December 12,
2012, more than six years after he last performed under the contract. Even
assuming Thomas could rely on the date he filed suit against TECC in state court
in January 2008, the action still was not timely brought within the one-year
limitation period. As a result, the district court correctly concluded that Thomas’s
suit against Travelers was not timely filed under the Miller Act.
Thomas does not dispute that his claim was untimely but instead argues that
his existing state-court judgment should be recognized under the Full Faith and
Credit Clause of the United States Constitution and 28 U.S.C. § 1738. As a
general matter, full faith and credit means that “[a] final judgment in one State, if
rendered by a court with adjudicatory authority over the subject matter and persons
governed by the judgment, qualifies for recognition throughout the land.” Baker
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by Thomas v. Gen. Motors Corp., 522 U.S. 222, 232-33, 118 S. Ct. 657, 663-64
(1998).
This Circuit has established, however, that full faith and credit does not
apply to a state-court judgment that would bind a surety on its Miller Act bond.
See United States Fid. & Guar. Co. v. Hendry Corp., 391 F.2d 13, 18 (5th Cir.
1968) (“Since only federal courts may determine a surety’s liability on a Miller Act
bond, a state court judgment that would bind a surety on his Miller Act bond
offends the congressional mandate. In these circumstances 28 U.S.C. 1738 has no
application.”). The basis for this rule is that the Miller Act vests exclusive
jurisdiction for a “Miller Action” in a federal forum—“in the United States District
Court for any district in which the contract was to be performed and executed.” 40
U.S.C. 3133(b)(3); see also Hendry, 391 F.2d at 17-18. Thus, the district court
was not required to give effect to Thomas’s state-court judgment against TECC to
his federal action against Travelers.
For similar reasons, Thomas’s arguments that res judicata and collateral
estoppel preclude Travelers from asserting its statute-of-limitations defense,
because Travelers had notice and an opportunity to contest TECC’s liability, are
misguided. The usual law of suretyship “is inapposite when the plaintiff’s
recovery depends upon a Miller Act bond,” even if the surety had notice of a suit
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against its principal. Hendry, 391 F.2d at 17. The Court in Hendry explained the
reason for this rule:
[T]he doctrine of estoppel against the surety rests on the
principle that a surety with knowledge of a suit against
the principal has a “full opportunity to defend” the suit
and to protect its rights. But there is no such equitable
principle at work here. The surety cannot protect its
rights by joining in the defense of the suit. It cannot
intervene as defendant any more than it could be named
as defendant in the first place.
Id. Consequently, under Hendry, even if Travelers had notice of Thomas’s suit
against TECC, Thomas’s state-court judgment against TECC does not bind
Travelers in this federal suit under the Miller Act.
In any case, even assuming that Travelers, as surety for TECC, were bound
by the state-court judgment against TECC, we cannot conclude, on this record, that
there is a genuine dispute as to whether Travelers “had full knowledge [of the suit]
and an opportunity to defend.” Frederick v. United States, 386 F.2d 481, 485 n.6
(5th Cir. 1967). Our review of the materials in the record shows that the bench
trial on Thomas’s claim against TECC was held on September 24, 2008, and that
Thomas first notified Travelers of his claim on the payment bond only two days
beforehand, on September 22, 2008. The record otherwise is silent as to whether
Travelers had notice of the suit or an opportunity to present its statute-of-
limitations defense at that time. Consequently, based on the record before us, we
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are unable to conclude that Travelers had a full opportunity to defend the suit, such
that it could be bound by the judgment against its principal.
For the reasons stated, we affirm the district court’s grant of summary
judgment to Travelers.
AFFIRMED.
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