Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Raeis Constructors, LLC v. Circle K Stores, Inc.

United States District Court, E.D. North Carolina, Western Division

December 13, 2019

RAEIS CONSTRUCTORS, LLC, Plaintiff/Counter-Defendant,
v.
CIRCLE K STORES, INC., Defendant/Counter-Plaintiff/ Third-Party Plaintiff,
v.
MECO BUILDERS, INC., Third-Party Defendant.

          ORDER

         This matter is before the court on defendant's motion to dismiss for failure to state a claim (DE 33), third-party defendant's motion to dismiss for lack of jurisdiction and to compel arbitration (DE 45), and plaintiff's notice of adoption of third-party defendant's motion to dismiss (DE 57), which the court construes as including a motion to compel arbitration and for voluntary dismissal of its claims in favor of arbitration. The motions have been briefed fully, and the issues raised are ripe for ruling. For the following reasons, defendant's and third-party defendant's motions are granted, and plaintiff's motion is denied.

         STATEMENT OF THE CASE[1]

         Plaintiff commenced this action on May 25, 2018, and filed a first and second amended complaint on June 29, 2018, asserting a claim of fraud against defendant arising from plaintiff's provision of labor and materials for the construction of a Circle K store in Hope Mills, North Carolina (the “store”). Plaintiff asserted diversity jurisdiction, sought damages in excess of $75, 000.00, and a trial by jury.

         Defendant initially moved to dismiss the amended complaint on October 3, 2018, for failure to state a claim. Plaintiff responded in opposition and moved for leave to file a third amended complaint. The court allowed plaintiff to file its third amended complaint and found moot defendant's initial motion to dismiss.

         Plaintiff filed the operative third amended complaint on January 28, 2019, asserting claims of breach of contract and a claim of quantum meruit/unjust enrichment, again on the basis of plaintiff's provision of labor and materials for the construction of the store. Plaintiff no longer asserts a claim of fraud. Plaintiff seeks damages in excess of $377, 357.00, and trial by jury.

         Defendant filed the instant motion to dismiss on February 25, 2019, as corrected February 26, 2019, relying upon 1) publications by the North Carolina Licensing Board for General Contractors and 2) an “Agreement for Construction - Lump Sum Contract.” (DE 34-3). Defendant also filed an answer with counterclaim for breach of contract against plaintiff, as well as a third-party complaint for breach of contract against third-party defendant.

         In its counterclaim and third-party complaint, defendant asserts that plaintiff and third-party defendant breached contracts for the construction of the store, causing damages for completion costs, delay costs, legal fees, and expenses. In support thereof, defendant relies upon 1) an “Agreement for Construction - Lump Sum Contract” with each plaintiff and third-party defendant (DE 32-2, 32-3); 2) a project engineer field report; 3) waiver of lien documents and releases of liens; and 4) termination letters.

         Plaintiff responded in opposition to defendant's instant motion to dismiss for failure to state a claim on April 1, 2019, and defendant filed a reply in support thereof on April 15, 2019. In the meantime, third-party defendant filed the instant motion to dismiss for lack of jurisdiction and motion to compel arbitration on April 11, 2019.

         Upon consent motion of all parties, on May 20, 2019, the court stayed all proceedings, including briefing on third-party defendant's motion and ruling on defendant's motion to dismiss, for 90 days to allow the parties to engage in mediation.

         The case returned from mediation, resulting in impasse. On August 12, 2019, defendant filed a response to third-party defendants motion to dismiss for lack of jurisdiction and to compel arbitration, relying upon 1) AAA Arbitration Rules, 2) Rules of Arbitration in North Carolina courts, and 3) the “Agreement for Construction - Lump Sum Contract” between defendant and third-party defendant. (DE 55-2). Third-party defendant replied in support of its motion on August 14, 2019.

         On August 15, 2019, plaintiff filed the instant notice, adopting third-party defendant's motion to dismiss and to compel arbitration. Upon consideration thereof, on August 22, 2019, the court entered the following text order construing the notice as including the instant motion for voluntary dismissal:

TEXT ORDER regarding plaintiff's 57 Notice of adoption of motion to dismiss and compel arbitration. The court construes plaintiff's notice, in part, as a motion under Federal Rule of Civil Procedure 41(a)(2) for voluntary dismissal of its claims in favor of arbitration of the same, where it asserts “all of the claims of all of the parties in this lawsuit . . . are arbitrable.” (DE57 at 5). Defendant Circle K. Stores, Inc., is DIRECTED to file a response to plaintiff's notice, so construed, within 14 days of the date of this order.

         Defendant responded to the court's text order on September 19, 2019, urging the court to find that plaintiff waived its right to proceed to arbitration, and urging the court to grant its motion to dismiss. Plaintiff replied to defendant's response on September 23, 2019.

         STATEMENT OF FACTS

         The court summarizes in turn below the factual allegations in the complaint, [2] the factual allegations of the third-party complaint, and the alleged facts pertaining to the arbitration agreements pertinent to the instant motions.

         A. Complaint

         Plaintiff alleges that it is a limited liability company with a principle place of business in Georgia and defendant is a Texas corporation with principal place of business in Arizona.

         In February 2017, Mike Raeisghasem (“Raeishghasem”), plaintiff's owner, met with defendant's managers, Dennis Patterson (“Patterson”) and Wes Williams (“Williams”). Williams suggested that plaintiff start bidding projects to build Circle K stores in North Carolina. Raeisghasem informed Williams and Patterson, allegedly, that “he was not a licensed general contractor in the state of North Carolina, but that he would look into the possibility of getting licensed.” (Compl. ¶ 8).

         On June 10, 2017, Williams contacted Raeisghasem and asked that plaintiff bid for the construction of the store. According to plaintiff, Raeisghasem informed Williams that “he had not taken any steps towards getting licensed in North Carolina.” (Id. ¶ 10). Williams told Raeisghasem, allegedly, that “his lack of a license was not an issue and that he should bid the Project and apply for his license and by the time construction started everything would be in order.” (Id. ¶ 11).

         On June 28, 2017, plaintiff submitted a bid for construction of the store (the “Project”). On July 11, 2017, defendant informed plaintiff that it was the successful bidder, and plaintiff allegedly “entered into an ‘Agreement for Construction - Lump Sum Contract'” with defendant relating to the Project. (Id. ¶ 14).

         Prior to entry into said contract, Raeisghasem allegedly informed Williams that “he was still waiting on the State of North Carolina to issue [plaintiff] a $500, 000 project limit general contractor's license.” (Id. ¶ 15). Williams allegedly told Raeisghasem that “it was not an issue, and as long as the State issued the license before construction began [plaintiff] would be in compliance with North Carolina law.” (Id.).

         According to the complaint, defendant was “aware that [plaintiff] was unlicensed when it signed [said contract] and that when North Carolina ultimately issued [plaintiff's] license it would be limited to $500, 000.” (Id. ¶ 16). According to the complaint, defendant “misrepresented the value of the [P]roject on [a] permit application because it knew the city of Hope Mills would not allow Raeis to pull a permit for a project valued in excess of $500, 000.” (Id. ¶ 17).

         On July 31, 2017, the town of Hope Mills issued a building permit, but the State of North Carolina “still had not issued [plaintiff's] general contractor license.” (Id. ¶ 19). Defendant allegedly “was in a hurry to begin construction and was pressuring [plaintiff] to get the licensing and permitting issues fixed and get started on the work.” (Id. ¶ 20).

         July 27 2017, Raeisghasem contacted his previous employer, the owner of third-party defendant, which has an unlimited North Carolina General Contractor's License, and contemplated an agreement whereby third-party defendant “would pull the permit and oversee and supervise the [P]roject on a cost basis.” (Id. ¶ 21). Third-party defendant allegedly “was initially hesitant about this arrangement. However, [third-party defendant and plaintiff] communicated the proposed agreement via email to [Patterson and Williams].” (Id. ¶ 22). Patterson and Williams allegedly “stated that the arrangement was a good solution and that it would put [plaintiff and third-party defendant] in compliance with the North Carolina General Contractor Statute.” (Id.).

         Plaintiff then began work on the Project. According to the complaint, plaintiff “did good work on the store and performed its work as agreed.” (Id. ¶ 24). After plaintiff had “substantially completed the store, ” defendant allegedly “refused to pay it the hundreds of thousands of dollars it owed and forced [plaintiff] to leave the job.” (Id. ¶ 25). According to the complaint, plaintiff furnished ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.