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Construction Contract Is 'evidence Of Indebtedness'

Monday, January 03, 2011 03:06 am

 

Attorneys' Fees -- Miller Act

United States, for the use and benefit of SCCB, Inc. v. P. Browne & Associates, Inc., 2010 U.S. Dist. Lexis 119192 (D. N.C. Nov. 9, 2010)

A sub proved that it was wrongfully terminated. Then,as a post-judgment remedy, it requested attorneys' fees since the unpaid contract balance was a "debt" owed to it.

On a Greensboro, North Carolina construction project for the U.S. Navy, a subcontractor, The Broadband Companies, LLC and Broadband Construction Services, LLC (collectively, Broadband) terminated its subcontract with another sub, Stewart Construction Company (SCCB). A jury found this act constituted a breach and awarded damages to SCCB. The jury also found the general contractor, P. Browne & Associates (Browne) and its surety, Arch Insurance Company (Arch), liable to SCCB. In the instant case, the court further determined that SCCB was entitled to attorneys' fees despite the defendants' contention that there was no "evidence of indebtedness."

Under North Carolina law (N.C. Gen. Stat. 6-21.2), "[o]bligations to pay attorneys' fees upon any note, conditional sale contract or other evidence of indebtedness" are valid and enforceable. Thus, the question was whether a construction contract serves as such "other evidence."

The precedent set by [...]

 
 
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