Frost Brown Todd (FBT) represented a general contractor in a breach of contract case before the U.S. District Court for the Southern District of Ohio, which found in favor of FBT’s client, granting a final monetary judgement of $3.5 million. Pioneer Mechanical Services, LLC v. HGC Construction, Co., 2022 WL 16964172. The ruling was issued July 7, 2023, and also included attorneys’ fees along with pre-judgment and post-judgment interest.
The general contractor, HGC Construction, had entered into a prime contract for the construction of a senior living facility in the greater Pittsburgh area. The general contractor subcontracted with Pioneer Mechanical Services, LLC to provide electric, plumbing and HVAC for the Project. The subcontractor was bonded by the Endurance Reinsurance Corporation of America. The general contractor declared the subcontractor in default and subsequently issued a notice of termination. The general contractor also made demand upon the surety under the performance Bond.
Subsequently, the subcontractor filed a lawsuit against the general contractor in State court in Pennsylvania, asserting claims for: (1) breach of contract; (2) violation of Pennsylvania’s prompt payment act on a public project; and (3) unjust enrichment. The general contractor answered the complaint and asserted counterclaims against the subcontractor for: (1) breach of contract; (2) unjust enrichment; and (3) promissory estoppel. The general contractor also filed a third-party complaint against the surety, asserting a claim against the performance bond. The surety counterclaimed against general contractor for unjust enrichment.
Significantly, the general contractor removed the case to a federal court in Pennsylvania, and then transferred the case to the U.S. District Court for the Southern District of Ohio. The general contractor defeated a motion for temporary restraining order and preliminary injunction. The surety and general contractor settled with each other, but not the subcontractor. The general contractor was granted summary judgment on all claims between the general contractor and subcontractor (dismissing all the subcontractor’s claims and granting the general contractor’s claims).
The result was a judgment in favor of FBT’s client amounting to approximately $3.5 million, including attorney fees as well as pre-judgment and post-judgment interest.
For more information about this case or assistance resolving construction disputes, please reach out to the authors or any member of FBT’s Construction Practice.