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RHI, Inc. v. Ashmark Construction, Inc.

United States District Court, D. Maryland

January 17, 2018

RHI, INC., Plaintiff,
v.
ASHMARK CONSTRUCTION, LLC, Defendant

          MEMORANDUM AND ORDER RE: SUMMARY JUDGMENT

          MARVIN J. GARBIS UNITED STATES DISTRICT JUDGE.

         The Court has before it Defendant Ashmark Construction, LLC's Cross Motion for Summary Judgment [ECF No. 8] and the materials submitted relating thereto.[1] The Court finds that a hearing is not necessary.

         I. BACKGROUND

         Plaintiff RHI, Inc. (“RHI”), a commercial flooring contractor incorporated in Maryland, brings an action for damages against Defendant Ashmark Construction, LLC (“Ashmark”), a Michigan limited liability company. Compl. ¶ 1-3. Plaintiff alleges breach of contract and, in the alternative, quantum meruit and unjust enrichment. The Court has jurisdiction pursuant to 28 U.S.C. § 1332.

         In the fall of 2015, Ashmark and AC Restaurants, LLC (“AC Restaurants”) entered into a series of prime contracts, which provided that Ashmark would be the general contractor for the construction build-out of several Tilted Kilt restaurants. Compl. ¶ 7; Def.'s Mot. at 2, ECF No. 8-1. On August 27, 2015, RHI and Ashmark entered into a Subcontractor Agreement (“Agreement”), providing that Ashmark would supply labor and materials for tile and vinyl flooring at three Tilted Kilt restaurants located in Wheaton, Maryland (“Wheaton Restaurant”), Dulles, Virginia (“Dulles Restaurant”), and Annapolis, Maryland (“Annapolis Restaurant”). Compl. ¶ 8; Def.'s Mot. Ex. 1 to Ex. A (Subcontractor Agreement), ECF No. 8-2.

         For purposes of this motion, there is no dispute between the parties that the Agreement itself was valid and enforceable and that RHI performed the requested services pursuant to the Agreement. Rather, RHI alleges that Ashmark has failed to pay for the cost of the services provided:

. On the Dulles Restaurant, RHI alleges a modified contract value of $62, 443.00, of which Defendant has paid $59, 046.20 and owes $3, 396.80. Compl. ¶ 10, ECF No. 2.
. On the Annapolis Restaurant, RHI alleges a modified contract value of $53, 880.00, of which Defendant has paid $40, 410.00 and owes $13, 470.00. Id. ¶ 11, ECF No. 2.
. On the Wheaton Restaurant, RHI alleges a modified contract value of $61, 175.00, of which Defendant has paid $0.00 and owes the full amount. Id. ¶ 12, ECF No. 2.

         RHI alleges that the total amount due in connection with all three restaurants is $78, 041.80, and seeks damages, interest, and costs. Compl. ¶¶ 25-26.

         Ashmark does not dispute these amounts and concurs that Plaintiff ultimately is entitled to payment but contends that due to “pay-when-paid” provisions within the Agreement, it has no obligation to pay RHI until after it is paid by AC Restaurants. Ashmark contends that it is proceeding reasonably to obtain payment from the customer[2] but has not yet obtained payment so that Plaintiff's claims for immediate payment are barred by the alleged “pay-when-paid” provisions:

. § III.1 Payment Schedule: Contractor shall pay the Subcontractor for the performance of the Work upon receipt of payment by the Owner and subject to additions and deductions by change order or other provisions of this Agreement . . .
. § IV Manner of Payment: . . . Contractor will pay the Subcontractor such amounts within fifteen (15) days after Contractor receives payment from the Owner.
. Exhibit B to the Agreement, entitled “Payment Schedule, ” which states: “See subsequent purchase orders: Draws Net 10 Days after payment received from Owner.” Def.'s Mot. Ex. 1 to Ex. A, ECF No. 8-2.

         II. SUMMARY JUDGMENT STANDARD

         A motion for summary judgment shall be granted if the pleadings and supporting documents “show[] 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(a).

         The well-established principles pertinent to summary judgment motions can be distilled to a simple statement: [t]he Court may look at the evidence presented in regard to a motion for summary judgment through the non-movant's rose-colored glasses, but must view it realistically. After so doing, the essential question is whether a reasonable fact finder could return a verdict for the non-movant or whether the movant would, at trial, be entitled to judgment as a matter of law. See, e.g., Celotex Corp. v. Catrett, 477 U.S. 317, 322-323 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Shealy v. Winston, 929 F.2d 1009, 1012 (4th Cir. 1991). Thus, in order to defeat a motion for summary judgment, “the party opposing the motion must present evidence of specific facts from which the finder of fact could reasonably find for him or her.” Mackey v. Shalala, 43 F.Supp.2d 559, 564 (D. Md. 1999) (emphasis added).

         When evaluating a motion for summary judgment, the Court must bear in mind that the “[s]ummary judgment procedure is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed ‘to secure the just, speedy and inexpensive ...


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