The opinion of the court was delivered by: Hon. Thomas J. Whelan United States District Judge
ORDER GRANTING IN-PART AND DENYING IN-PART DEFENDANTS' MOTION FOR PARTIAL SUMMARY JUDGMENT (DOC. 31)
Pending before the Court is Defendants Carolina Casualty Insurance Company ("CCIC") and Candelaria Corporation's ("Candelaria")(collectively "Defendants") partial summary-judgment motion. Plaintiff Ramona Equipment Rentals, Inc. ("Ramona") opposes the motion.
The Court decides the matter on the papers submitted and without oral argument. See S.D. Cal Civ. R. 7.1(d.1). For the reasons stated below, the Court GRANTS IN-PART and DENIES IN-PART Defendants' motion (Doc. 31).
Ramona's claims arise from work on a federal construction project known as ICE El Centro SPC-Perimeter Fence Replacement / Internal Devising Fence Replacement (the "Project"). (Defs.' Sep. State. [Doc. 31-2], at No. 6.) The Project was to replace and construct additional fencing at the U.S. Immigration and Customs Enforcement detention facility in El Centro, California. (Id. at No. 8.) Defendant Calendaria was the general contractor on the Project, and agreed to furnish all necessary labor, equipment, material, and supervision. (Oppo. [Doc. 45], at 2.) Defendant Otay was a subcontractor supplying labor and equipment. (Defs.' Sep. State. at No. 9.) Defendant CCIC provided a payment bond, naming Candelaria as the bond principal and the United States as the obligee. (Defs' Exhibits [Doc. 32], Ex. B.)
Otay rented equipment for the Project from Ramona under an open account rental agreement (the "Rental Agreement"). (Defs.' Sep. State. at No. 10.) The Rental Agreement included "a monthly service charge on all unpaid balances of 1-1/2% per month", and required payment of the prevailing party's attorney's fees and costs in any proceeding to enforce the agreement. (Compl. [Doc. 1], Ex. 1 at p.2, ¶¶ 6, 15.) Although Ramona owned some of the equipment rented to Otay, certain equipment Ramona rented from third-party suppliers and then re-rented to Otay at a margin. (Defs.' Sep. State. at No. 23.) Otay was aware of the arrangement. (Id. at No. 23-25.)
On or about June 6, 2008, Calendaria terminated its subcontract with Otay due to alleged mismanagement of the work and failure to pay suppliers. (Oppo. at 2.) Thereafter, Ramona notified Candelaria that Otay failed to make payments due under the Rental Agreement. (Id. at 3.) Then on or about July 25, 2008, Ramona submitted a notice of its claim on the payment bond. (Id. at 3-4.)
On September 15, 2008, Ramona initiated the instant action. The first cause of action is brought under the Miller Act, 40 U.S.C. §§ 3131, et seq., and alleges Defendants Candelaria and CCIC are liable for the unpaid balance due under the Rental Agreement.*fn1 In the pending motion, Defendants seek partial summary judgment with respect to certain portions of that claim. Ramona opposes the motion.
Summary judgment is appropriate under Rule 56(c) where the moving party demonstrates the absence of a genuine issue of material fact and entitlement to judgment as a matter of law. See Fed. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). A fact is material when, under the governing substantive law, it could affect the outcome of the case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Freeman v. Arpaio, 125 F.3d 732, 735 (9th Cir. 1997). A dispute about a material fact is genuine if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson, 477 U.S. at 248.
A party seeking summary judgment always bears the initial burden of establishing the absence of a genuine issue of material fact. Celotex, 477 U.S. at 323. The moving party can satisfy this burden in two ways: (1) by presenting evidence that negates an essential element of the nonmoving party's case; or (2) by demonstrating that the nonmoving party failed to make a showing sufficient to establish an element essential to that party's case on which that party will bear the burden of proof at trial. Id. at 322-23. "Disputes over irrelevant or unnecessary facts will not preclude a grant of summary judgment." T.W. Elec. Serv., Inc. v. Pacific Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987).
"The district court may limit its review to the documents submitted for the purpose of summary judgment and those parts of the record specifically referenced therein." Carmen v. San Francisco Unified School Dist., 237 F.3d 1026, 1030 (9th Cir. 2001). Therefore, the court is not obligated "to scour the record in search of a genuine issue of triable fact." Keenan v. Allen, 91 F.3d 1275, 1279 (9th Cir. 1996) (citing Richards v. Combined Ins. Co., 55 F.3d 247, 251 (7th Cir. 1995)). If the moving party fails to discharge this initial burden, summary judgment must be denied and the court need not consider the nonmoving party's evidence. Adickes v. S.H. Kress & Co., 398 U.S. 144, 159-60 (1970).
If the moving party meets this initial burden, the nonmoving party cannot defeat summary judgment merely by demonstrating "that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986); Triton Energy Corp. v. Square D Co., 68 F.3d 1216, 1221 (9th Cir. 1995) (citing Anderson, 477 U.S. at 252) ("The mere existence of a scintilla of evidence in support of the nonmoving party's position is not sufficient."). Rather, the nonmoving party must "go beyond the pleadings and by her own affidavits, or by 'the depositions, answers to interrogatories, and admissions on file,' designate 'specific facts showing that there is a genuine issue for trial.'" Celotex, 477 U.S. at 324 (quoting Fed. R. Civ. P. 56(e)).
When making this determination, the court must view all inferences drawn from the underlying facts in the light most favorable to the nonmoving party. See Matsushita, 475 U.S. at 587. "Credibility determinations, the weighing of evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge, ...