United States District Court, E.D. Wisconsin
DECISION AND ORDER DENYING DEFENDANT'S MOTION FOR
WILLIAM C. GRIESBACH, CHIEF UNITED STATES DISTRICT JUDGE.
Badger Sheet M Works of Green Bay, Inc., a Wisconsin
corporation located in Green Bay, Wisconsin, sued Defendant
Process Partners Inc., a Michigan corporation located in
Zeeland, Michigan advancing claims of breach of contract,
promissory estoppel, and unjust enrichment. The action was
commenced in Brown County Circuit Court, but Process Partners
removed the matter to federal court. The parties are citizens
of different states, and the amount in controversy exceeds
$75, 000. Federal jurisdiction therefore exists under 28
U.S.C & 1332. The case is presently before the court on
Process Partners' motion for summary judgment. For the
reasons set forth below, Process Partners' motion will be
Partners, a company that designs food production processes,
placed a bid to construct an Iowa food production plant in
October 2013. (Defendant's Proposed Findings of Fact
(DPFOF) ¶¶ 5, 12.) Part of the plant's
construction included creating an egg cooker oven.
(Id. ¶ 14.) Process Partners and Badger Sheet M
had previously collaborated in 2011 on a similar project
which entailed constructing an oven in a different plant.
(Id. ¶ 13.) Based on its previous dealings with
Badger Sheet Metal, Process Partners contacted the company
again to provide oven components for the egg cooker portion
of the food production plant. (Id. ¶¶
better gauge the estimated total for its bid, Process
Partners' lead designer Mike Raymond sent Badger's
representative Paul Weyers a drawing of an oven created by
another manufacturer to demonstrate the type of oven Badger
would be contracted to build if Process Partners was awarded
the plant construction contract. (Id. ¶ 15.)
Weyers submitted a budgetary proposal for the oven to
Raymond, which was nearly identical to the model drawing.
(Id. ¶¶ 15-17.) Although the proposal did
not contain exact specifications, it listed the price of the
oven at $424, 000, including labor and materials, but failed
to mention whether the contract was a fixed contract or time
and materials contract. (Id. ¶ 17.) This
distinction is important: a fixed price contract allows
parties to negotiate a lump sum for the work performed on a
project, with the possibility of price adjustments based on
changes or delays made by one party. 2 Bruner &
O'Connor Construction Law §6:71 (2016). A time and
materials contract, in contrast, allows a contractor to be
reimbursed for labor at an hourly rate that includes profit
and overhead. Id. § 6:83.
months after Weyers submitted the proposal to Raymond,
Process Partners was awarded the contract to build the
processing plant, which prompted Raymond to send Weyers a
purchase order for the oven in the amount of $400, 000.
(DPFOF ¶¶ 18-19, 22.) Weyers responded to the
purchase order with a "Quotation Response Form" and
"Order Verification" form that referenced the
purchase order and set the purchase price at $400, 000.11.
(Id. ¶ 23.) The two documents created by Weyers
included the language "budgetary proposal contains labor
and materials" from the original budgetary proposal and
added the statement "individual sections of project will
be bid as drawings become available." (Id.) It
thus appears that even at this time, the parties still had
not formally agreed whether they were entering into a fixed
contract or time and materials contract.
there were inconsistencies in the purchase price, the $400,
000 figure was used on multiple occasions, including all
progress billing invoices sent by Badger. (Id.
¶ 26.) Process Partners asserts Weyers, the primary
Badger contact for Process Partners, always understood the
contract to be a fixed price contract, though he had
represented to other Badger employees, through internal
documentation containing specific phrases like
"budgetary proposal" and oral communications, that
the contract was for time and materials. (Pis.' Response
to DPFOF ¶ 26.)
August 26, 2014, Weyers created a spreadsheet detailing the
change orders made during the construction process, which
totaled $25, 762.50. (DPFOF ¶¶ 42-43.) The
spreadsheet listed the original contract price as $424, 000
and did not mention whether the contract was calculated based
on a fixed or time and materials basis. (Id. ¶
43.) Weyers presented the spreadsheet to Raymond in an August
28, 2014 meeting and emailed Raymond the spreadsheet on
September 3, 2014. (Id. ¶¶ 46-47.)
created a second spreadsheet with additional line items and
presented it to Raymond on September 15, 2014. (Id.
¶49.) This second spreadsheet echoed the same
information contained in the first spreadsheet but increased
the change order and stated that the "project total with
change order requests" equaled $457, 952.91.
(Id. ¶ 50.) During this September 15, 2014
meeting, Raymond agreed to the $457, 952.91 price.
(Id. ¶ 51.)
an internal meeting at Badger on September 15, 2014,
Weyers' supervisor, Samuel Thomas, informed Raymond that
the contract price would increase. (Id. ¶ 53.)
On September 16, 2014, Badger sent Raymond a third
spreadsheet with an increased project total of $603, 000.
(Id. ¶ 54.) This third spreadsheet was
calculated on a time and materials analysis. (Id.)
Raymond immediately rejected the new price and instead
reviewed all the change order documentation and calculations.
(Id. ¶¶ 56-57.) Upon review, Raymond
concluded an additional $6, 172.51 should be added to the
price agreed upon at the September 15, 2014 meeting, making
the new total $464, 125.42. (Id. ¶ 57.)
the next several months, Badger and Process Partners
attempted to reach a resolution but did not resolve the
dispute. (Id. ¶ 60.) In a final attempt to
settle the dispute, Raymond sought to pay the remainder of
the $464, 125.42 Process Partners agreed to pay.
(Id. ¶ 61.) Believing Process Partners had paid
$300, 000 in progress payments (rather than the actual
payment of $350, 000), Raymond authorized a check for $164,
125.42 to be issued to Badger. (Id. ¶ 62.) In
other words, Process Partners paid $514, 125.42 for the
project. (Id. ¶ 63.) Process Partners alleges
it inadvertently overpaid $50, 000 on the $464, 125.42 bill.
(Id.) Badger alleges an additional $88, 874.58 is
due on the contract based on the $603, 000 purchase price.
judgment is appropriate when the moving party shows that
there is no genuine issue as to any material fact and that
the moving party is entitled to judgment as a matter of law.
Fed.R.Civ.P. 56(a). On the outset, the moving party has the
initial burden of proving summary judgment should be granted.
Celotex Corp. v. Catrett, Ml U.S. 317, 323 (1986).
All reasonable inferences are construed in favor of the
nonmoving party. Foley v. City of Lafayette, 359
F.3d 925, 928 (7th Cir. 2004). The party opposing the motion
for summary judgment must "submit evidentiary materials
that set forth specific facts showing that there is a genuine
issue for trial." Siegel v. Shell Oil Co. , 612
F.3d 932, 937 (7th Cir. 2010) (citations omitted). "The
nonmoving party must do more than simply show that there is
some metaphysical doubt as to the material facts."
Id. For a fact to be considered "material,
" the fact under dispute must be outcome-determinative
under governing law. Contreras v. City of Chicago,119 F.3d 1286, 1291 (7th Cir. 1997). Summary judgment is
properly entered against a party "who fails to make a