The opinion of the court was delivered by: HARRY LEINENWEBER, District Judge
MEMORANDUM OPINION AND ORDER
Before the Court is Batteast Construction Company's Motion for
Partial Summary Judgment on PBC's Counterclaim and Employers Insurance of
Wausau's Motion for Summary Judgment on the Third-Party Complaint
(collectively, the "Motions"). For the following reasons, the Motions are
These Motions arise out of a construction project gone awry. Batteast
is a construction contractor that was awarded a lump-sum contract to
build the Midwest Center for Green Technology Project (the "Project").
Employers provided the performance bond covering Batteast's work. The
Public Building Commission of Chicago ("PBC") terminated Batteast's
contract on May 30, 2001, before completion of the Project. (The parties
differ sharply in the purported reasons for the termination of the
contract, and such reasons are not pertinent to the present Motions.)
Batteast claims that the termination was wrongful and seeks to recover
amounts it claims were due pursuant to the contract. PBC, in turn, filed
a counterclaim seeking recovery of the costs to complete the Project that
were over and above the contract amount. (PBC also filed a third-party
complaint against Employers that contains essentially equivalent
allegations as its counterclaim, but seeks recovery from Employers as a
The Motions seek summary judgment on PBC's claim for costs over and
above the initial contractual amount because PBC failed to obtain
certification from the Project architect of these additional expenses.
Summary judgment is appropriate if "the pleadings, depositions, answers
to interrogatories, and admissions on file,
together with the affidavits, if any, show that there is no genuine
issue as to any material fact and that the moving party is entitled to a
judgment as a matter of law." FED. R. Civ. P. 56(c). A fact is "material"
if it could affect the outcome of the suit under the governing law; a
dispute is "genuine" where the evidence is such that a reasonable jury
could return a verdict for the nonmoving party. Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 248 (1986).
The burden is initially upon the movant to demonstrate the absence of a
genuine issue of material fact. Celotex Corp. v. Catrett,
477 U.S. 317, 323 (1986). In assessing the movant's claim, the court must
view all the evidence and any reasonable inferences that may be drawn
from that evidence in the light most favorable to the nonmovant.
Miller v. Am. Family Mut. Ins. Co., 203 F.3d 997, 1003 (7th Cir.
2000). Once the moving party has met its burden, the nonmoving party "may
not rest upon the mere allegations" contained in its pleading, but rather
"must set forth specific facts showing that there is a genuine issue for
trial." FED. R. Civ. P. 56(e); Becker v. Tenenbaum-Hill Assoc.,
Inc., 914 F.2d 107, 110 (7th Cir. 1990); Schroeder v. Lufthansa
German Airlines, 875 F.2d 613, 620 (7th Cir. 1989). The nonmovant
"must do more than simply show that there is some metaphysical doubt as
to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 586 (1986).
Batteast claims that governing contract requires, among other things,
that PBC obtain architect certification for any expenses incurred to
complete the Project after Batteast's termination. Batteast contends that
without this predicate act, PBC cannot prevail on its counterclaim as a
matter of law. Specifically, Batteast points to testimony indicating that
the Project architect was not involved in reviewing or approving the
payment applications from the replacement contractor (or any of the
subcontractors) after Batteast was terminated from the Project.
PBC responds in three ways. First, PBC contends that it is premature to
require architect certification because the Project is still not
complete, and thus final costs are unavailable. Second, PBC claims that
"it is never too late to present an architect certificate in order to
secure payment." Third, PBC argues that any absence of certification is
excused by Batteast's own fraudulent conduct. Specifically, PBC claims
that Batteast "willfully" submitted false schedules of values and
statements that have "completed frustrated any attempt to comply with
architect certification of excess completion costs."
Batteast replies by contending that it is not premature to require
architect certification because the Project was substantially complete as
of May 2002. Batteast further notes that PBC never raised this timing
issue until the present motion.
Moreover, Batteast points to interrogatory responses to show that
the last payment purportedly related to excess completion costs was in
June 2002, more than 19 months ago. Thus, according to Batteast, the
undisputed facts show that PBC had the ability to have the totality of
excess costs certified well before the present Motions.
Batteast also argues that its accounting practices are irrelevant to
PBC's counterclaim. Specifically, Batteast claims (in somewhat conclusory
fashion) that the architect certification clause is "necessary in part
because of the potentially infinite ways that PBC might decided to
complete the work," and has "no connection" to the way that Batteast
accounted for its pre termination work.
PBC appears to be raising a contractual defense akin to the doctrine of
wrongful prevention, which generally holds that nonperformance may be
excused where expected performance was prevented by the other party to a
contract. See, e.g., Barrows v. Maco, Inc., 94 Ill. App.3d 959
(1st Dist. 1981), PBC advances the argument that Batteast's purported
fraudulent concealment of certain subcontracts made it impossible to
determine the "true plan, if any, Batteast had for completing the work
within the adjusted contract price" and that therefore the "Architect
cannot certify that work performed by subcontractors or substitute
contracts is within the scope of work under Batteast's contract."
In essence, PBC's argument appears to ...