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Utility Line Services, Inc. v. Washington Gas Light Co.

United States District Court, Fourth Circuit

July 9, 2013

UTILITY LINE SERVICES, INC., Plaintiff,
v.
WASHINGTON GAS LIGHT COMPANY, Defendant.

MEMORANDUM OPINION

PAUL W. GRIMM, District Judge.

This Memorandum Opinion and accompanying Order address Defendant Washington Gas Light Company's ("Washington Gas") Motion to Dismiss Count II and Count III of Plaintiff's Complaint, ECF No. 6, Plaintiff Utility Line Services, Inc.'s ("Utility Line") Opposition to Defendant's Motion to Dismiss, ECF No. 10; and Defendant's Reply, ECF No. 17; Plaintiff's Motion to Dismiss Count II and Count IV of Defendant's Counterclaim, ECF No. 12, and accompanying Memorandum in Support, ECF No. 13; Defendant's Opposition to Plaintiff's Motion to Dismiss, ECF No. 18; and Plaintiff's Reply, ECF No. 21. This Memorandum Opinion and Order also address Plaintiff's Motion to Strike Defendant's Affirmative Defenses, ECF No. 14, and accompanying Memorandum in Support, ECF No. 15; Defendant's Opposition to Plaintiff's Motion to Strike Affirmative Defenses, ECF No. 19; and Defendant's Motion for Leave to File Amended Answer and Counterclaim, ECF No. 20. Plaintiff has not filed a reply to its Motion to Strike Affirmative Defenses; nor has it filed an opposition to Defendant's Motion for Leave to Amend. The time for doing so has passed, see Loc. R. 105.2.a, and a hearing is not necessary, see Loc. R. 105.6. For the reasons stated herein, Defendant's Motion to Dismiss Count II and Count III of Plaintiff's Complaint is DENIED; Plaintiff's Motion to Dismiss Count II and Count IV of Defendant's Counterclaim is DENIED, in part, and GRANTED, in part; Plaintiff's Motion to Strike Affirmative Defenses is DENIED, as MOOT; and Defendant's Motion for Leave to File Amended Answer and Counterclaim is GRANTED, in part, and DENIED, in part.

I. BACKGROUND

By way of background, on November 21, 2012, Plaintiff brought suit against Defendant, alleging breach of contract, unjust enrichment/breach of implied-in-law contract, and breach of the statutory duty to make prompt payment pursuant to Md. Code Ann., Real Prop. § 9-302. See Compl. ¶¶ 17-32. Plaintiff's claims stem from a construction project and Master Construction Agreement ("Agreement") executed between the parties on April 19, 2007. Id. ¶¶ 5-6. Specifically, Defendant "contracted to pay [Plaintiff] for its services" on the project, which involved, " inter alia, the managing, scheduling, and performance" of natural gas pipeline construction work for Defendant, including "pipeline maintenance and replacement work, market enhancement, and new construction of gas facilities." Id. Plaintiff alleges that although it completed all of the work required for the project, as well as additional repair work that arose after Plaintiff "struck an 8 [inch] natural gas pipeline while installing a shoring system in an excavation, "[1] Defendant has refused to pay it the amount owed under the contract and for the repair work authorized by Defendant. Id. ¶¶ 7-16.

In response to Plaintiff's suit, Defendant filed the pending Motion to Dismiss, an Answer to Count I, asserting sixteen affirmative defenses, as well as a Counterclaim. See Ans. & Countercl. Defendant alleges that Plaintiff's work under the Agreement was unsatisfactory, that Plaintiff's unsatisfactory work caused Defendant damages, and that, pursuant to the Agreement, Defendant is permitted to "withhold payment for any [u]nacceptable [w]ork." Id. ¶¶ 11-29. Thus, Defendant seeks relief under four theories of liability: breach of contract, contractual indemnification, negligence, and punitive damages. Id. ¶¶ 30-49.

On December 21, 2012, Defendant moved to dismiss Count II and Count III of Plaintiff's Complaint. Def.'s Mot. to Dismiss 2. Defendant argues that Count II, the claim for unjust enrichment/breach of implied-in-law contract, must be dismissed "because Plaintiff alleges the existence of an express contract between the parties" and that Count III, the claim pursuant to the Maryland Prompt Pay Act, must be dismissed because Plaintiff failed to allege that the construction project was "for or about a building" and failed to plead factual support showing that the amounts due are undisputed. Id. at 3-7. In opposition, Plaintiff argues first that it "may plead both a breach of express contract and breach of implied contract in the alternative where the existence of a contract... may be in dispute" and second, that it has sufficiently pleaded that it is a permissible claimant under the Maryland Prompt Pay Act. Pl.'s Opp'n to Def.'s Mot. to Dismiss 7.

On January 14, 2013, Plaintiff moved to Dismiss Count II and Count IV of Defendant's Counterclaim, arguing first that Count II, the claim for contractual indemnification, is duplicative of and subsumed by the breach of contract claim. Pl.'s Mem. in Supp. of Mot. to Dismiss 3-4. Plaintiff asserts, with regard to Count IV, that punitive damages are a category of damages and not a separate and cognizable cause of action. Id. at 4. With its Motion to Dismiss, Plaintiff also filed a Motion to Strike Defendant's Affirmative Defenses. Specifically, Plaintiff argues that "affirmative defenses are governed by the same pleading standard as complaints, " and moves to strike the "laundry list" of "bare legal conclusions" asserted by Defendant. Pl.'s Mem. in Supp. of Mot. to Strike 4-9.

In response to Plaintiff's motions, Defendant moved for leave to amend its Answer and Counterclaim. Def.'s Mot. for Leave to File Am. Ans. & Countercl. Defendant's purpose for amending "is two-fold"-that is, Defendant "seeks to address [Plaintiff]'s concerns regarding the factual support for [Defendant]'s affirmative defenses" and "seeks to address [Plaintiff]'s concerns regarding [Defendant]'s punitive damages claim." Id. at 2. Defendant states that it can "plead facts supporting each of the affirmative defenses" and seeks to collapse its claim for punitive damages into the existing count for negligence. Id. Plaintiff does not oppose Defendant's attempt to amend its affirmative defenses.

II. STANDARD OF REVIEW

Federal Rule of Civil Procedure 12(b)(6) provides for "the dismissal of a complaint if it fails to state a claim upon which relief can be granted." Velencia v. Drezhlo, Civil No. RDB-12-237, 2012 WL 6562764, at *4 (D. Md. Dec. 13, 2012). This rule's purpose "is to test the sufficiency of a complaint and not to resolve contests surrounding the facts, the merits of a claim, or the applicability of defenses.'" Id. (quoting Presley v. City of Charlottesville, 464 F.3d 480, 483 (4th Cir. 2006)). To that end, the Court bears in mind the requirements of Rule 8, Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009), when considering a motion to dismiss pursuant to Rule 12(b)(6). Specifically, a complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief, " Fed.R.Civ.P. 8(a)(2), and must state "a plausible claim for relief, " as "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice, " Iqbal, 556 U.S. at 678-79; see Velencia, 2012 WL 6562764, at *4 (discussing standard from Iqbal and Twombly ). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 663.

III. DISCUSSION

The Court will address each pending motion in turn.

a. Defendant's Motion to Dismiss

At the outset, Defendant's Motion to Dismiss simply is without merit. The law is clear that while a plaintiff "may not recover under both contract and quasi-contract theories, " a plaintiff may plead both contract and quasi-contract claims in the alternative "where the existence of a contract concerning the subject matter is in dispute." See, e.g., Swedish Civil Aviation Admin. v. Project Mgmt. Enters., Inc., 190 F.Supp.2d 785, 792 (D. Md. 2002). In support of its Motion to Dismiss, Defendant argues that the existence of a contract is not in dispute here and that the express contract between the parties, namely, the Agreement, precludes Plaintiff from pleading both theories. Def.'s Reply to Mot. to Dismiss 2-4. At the motion to dismiss stage, the Court accepts all well-pleaded facts as true, see Aziz v. Alcoac, 658 F.3d 388, 390 (4th Cir. 2011), and Plaintiff claims that the Agreement is in dispute and that portions of the work Plaintiff performed "may be deemed outside the original scope of work or extra-contractual, " Pl.'s Opp'n to Mot. to Dismiss 3-4. Moreover, Defendant's assertions to the contrary create the epitome of a factual dispute not to be determined at this early stage of litigation. See Horlick v. Capital Women's Care, LLC, 896 F.Supp.2d 378, 394 (D. Md. 2011) ("The construction of a contract is a question of fact which, if disputed, is not susceptible of resolution under a motion to dismiss for failure to state a claim.") (internal quotation marks omitted). The parties disagree as to their respective ...


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