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United States v. Triangle Construction Co., Inc.

United States District Court, S.D. Mississippi, Northern Division

January 4, 2018

UNITED STATES OF AMERICA f/u/b/o Metro Mechanical, Inc. PLAINTIFF
v.
TRIANGLE CONSTRUCTION CO., INC. and U.S. SPECIALTY INSURANCE COMPANY DEFENDANTS

          ORDER AND OPINION

          DAVID BRAMLETTE, UNITED STATES DISTRICT JUDGE.

         This cause is before the Court on a Motion to Dismiss for Lack of Subject-Matter Jurisdiction [Doc. 7] filed by Defendant Triangle Construction Company, Inc. (“Triangle”) and a Motion to Lift Stay and Allow Jurisdictional Discovery [Doc. 13] filed by Plaintiff United States of America for use and benefit of Metro Mechanical, Inc. (“Metro”). Having considered the motions, the responses, and applicable statutory and case law, and being otherwise fully informed in the premises, the Court finds as follows:

         I. BACKGROUND

         A sub-contractor on four south and southwest Mississippi construction projects sued a prime contractor and its surety for non-payment of amounts due under the sub-contract. The sole basis for federal jurisdiction is the Miller Act. The prime contractor insists that the Court is without Miller Act jurisdiction because the projects and contracting parties are private. The subcontractor rejoins that the projects were federally-funded and so Miller Act jurisdiction exists. The Court's jurisdiction turns on whether federally-funded construction projects to which the United States was not a contracting party constitute “public work[s] of the Federal Government.” See 40 U.S.C. § 3131(b) (formerly 40 U.S.C. § 270(a)).

         A. The Prime Contract

         Triangle contracted with Mississippi Portfolio Partners III, LP to perform work on four apartment complex construction projects located in Hattiesburg, Natchez, and Fayette, Mississippi (collectively, the “Projects”). [Doc. 1, ¶4] Defendant U.S. Specialty Insurance Company (“U.S. Specialty”) issued payment bonds on each of the Projects. [Doc. 1, ¶4]

         B. The Sub-Contract

         Metro sub-contracted with Triangle to “perform certain HVAC and plumbing renovations” on the four apartment complexes. [Doc. 1, ¶5] Metro completed the work required of it under the subcontract, but was not paid the $150, 555 it contends it is owed. [Doc. 1, ¶¶7-8] Metro sued Triangle and U.S. Specialty in this Court, pinning federal jurisdiction on the Miller Act. [Doc. 1, ¶2]

         Triangle moves to dismiss for lack of subject-matter jurisdiction under Federal Rule of Civil Procedure 12');">12(b)(1). [Doc. 7] The Court is without jurisdiction, Triangle contends, because the Miller Act -- the sole source of federal jurisdiction -- does not cover payment disputes attendant to private construction projects. [Doc. 8, p. 2]

         Metro opposes dismissal, arguing that the Miller Act applies because the Projects are federally-funded. [Doc. 12');">12, p. 3] And Metro suspects that the Projects are covered by the Miller Act because Triangle secured payment bonds for them. [Doc. 12');">12, p. 3] Metro reasons that, because Mississippi law does not require a contractor on a private project to obtain a payment bond, and because such bonds can be costly, Metro must have obtained payment bonds on the Projects to fulfill the Miller Act's bond requirement.[1] [Doc. 12');">12, p. 3]

         II. DISCUSSION

         In determining its jurisdiction, the Court looks to the allegations of Metro's complaint and presumes them to be true. Paterson v. Weinberger, 644 F.2d 521, 523 (5th Cir. 1981). Subject-matter jurisdiction turns on the applicability of the Miller Act. If it applies, the Court has jurisdiction; if it does not apply, the Court must dismiss the case.

         The Miller Act requires contractors on “public work[s] of the Federal Government” to obtain performance and payment bonds. See 40 U.S.C. § 3131. And the Act creates a civil action in favor of any “person that has furnished labor or material in carrying out work provided for” under a Miller Act contract and “that has not paid in full within 90 days.” 40 U.S.C. 3133(b)(1).[2]

         The Act does not define “public work of the Federal Government.” See 40 U.S.C. §§ 3131-3134. And besides interpreting the phrase to include a congressionally-authorized project for construction of a library at Howard University, see United States ex rel. Noland Co. v. ...


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