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Sanact, Inc. v. U.S. Pipelining LLC

United States District Court, D. Hawaii

July 26, 2018

SANACT, INC., Plaintiff,
v.
US PIPELINING LLC, Defendant.

          FINDINGS OF FACT, CONCLUSIONS OF LAW, AND ORDER

          HELEN GILLMORE JUDGE

         Plaintiff Sanact, Inc., doing business as Roto Rooter, (“Sanact”) filed a Complaint against Defendant U.S. Pipelining LLC (“US Pipelining”).

         Defendant U.S. Pipelining served as a subcontractor to the general contractor, Johnson Controls, Inc., on a construction project at the Kaanapali Alii condominium complex on the island of Maui.

         Plaintiff Sanact provided Defendant U.S. Pipelining with specialized subcontractor work and is seeking to recover payment for services that were furnished to Defendant U.S. Pipelining.

         The Parties stipulated to submit the case for decision by the Court based on their Trial Briefs and a set of 20 jointly filed Exhibits.

         To the extent any findings of fact are more properly characterized as conclusions of law, or any conclusions of law are more properly characterized as findings of fact, they shall be so construed.

         FINDINGS OF FACT

         THE PARTIES

         1. Sanact, Inc. (“Sanact”), a California corporation, is registered to do business in the State of Hawaii as a foreign corporation, and does business under the tradename “Roto Rooter.” 2. Defendant U.S. Pipelining LLC (“US Pipelining”), a Pennsylvania limited liability company, is registered to do business in the State of Hawaii as a foreign limited liability company.

         3. The Association of Apartment Owners of Kaanapali Alii, a condominium complex on the island of Maui, hired Johnson Controls, Inc. as the general contractor to do a renovation on the complex.

         4. Johnson Controls, Inc. retained U.S. Pipelining as a subcontractor to internally reline more than 27, 000 feet of vertical stacks of plumbing pipes. The work involved four buildings, each at least ten floors high.

         CONSTRUCTION PROJECT

         5. The work was performed at 50 Nohea Kai Drive, Lahaina, Maui, Hawaii 96761, otherwise identified as Tax Map Key No. (2)4-4-008-022-0000 (“the Property”) in the County of Maui, State of Hawaii.

         6. The plumbing pipes at the Property were in poor condition. The pipes required extensive hydro-jetting and other specialty cleaning methods prior to lining and repair by U.S. Pipelining.

         COMMUNICATIONS BETWEEN U.S. PIPELINING AND SANACT

         7. During the course of the Project, U.S. Pipelining found it necessary to retain the services of Sanact in support of U.S. Pipelining's work at the Property.

         8. Jeremy Bowman was U.S. Pipelining's President and was the primary person responsible for engaging Sanact.

         9. In August 2015, Jeremy Bowman asked Rodney Wray, the President of Sanact, to perform pipe cleaning services on the Property. The pipe cleaning services required Sanact to provide labor and equipment to operate drain cleaning machines, a trail-jetter, a hydro-jetter, and to perform plumbing repair services.

         10. Specifically, Sanact was instructed by U.S. Pipelining to clean out all of the rust and calcium deposits on all of the lines in the Project. Sanact was required to use a camera to verify that the lines were clean and to present U.S. Pipelining with a DVD containing photographic evidence that each line was cleared so that U.S. Pipelining could reline the pipes.

         11. The Parties agreed that Sanact would bill U.S. Pipelining on a time-basis for actual work performed, in return for which U.S. Pipelining agreed to pay Sanact in full per the invoices.

         12. Sanact's cleaning process was an essential step necessary before U.S. Pipelining could reline the pipes.

         13. No written contract was entered into between U.S. Pipelining and Sanact.

         PERFORMANCE BY SANACT

         14. Sanact performed as requested by providing manpower, materials, and equipment for the Project, dedicating laborers during both day and night shifts. Sanact completed the work by operating drain cleaning machines, a trail-jetter, a hydro-jetter, and conducting various plumbing repair services at the Property from September 2, 2015 through November 9, 2015 as requested by U.S. Pipelining.

         15. U.S. Pipelining has admitted that there were no significant deficiencies in Sanact's work for U.S. Pipelining, “other than minor issues which were addressed and rectified in the course of ordinary business.” (Defendant U.S. Pipelining's Answers to Interrogatories at p. 10, Exhibit 8).

         16. There has been no objection by Johnson Controls, Inc. to any of the work performed by Sanact.

         17. Sanact performed all the work on the Property requested by U.S. Pipelining.

         INVOICES SENT FROM SANACT TO U.S. PIPELINING

         18. Sanact regularly presented invoices to U.S. Pipelining and sought payment for its work on the Property. (Exhibits 1-4).

         19. The invoices charged for each laborer at a rate of $150.00 per hour for the first eight hours per day and $172.50 per hour after eight hours of work. (Exhibit 2).

         20. The invoices provided that, “[i]f not paid within 30 days following the date indicated above, a service charge of 11/2% per month will be charged on overdue accounts, which is 18% annually.” (Exhibit 3).

         21. Sanact sent U.S. Pipelining invoices for each day of work performed. The date on the invoice was the same date that the work was performed.

         22. Sanact sent U.S. Pipelining invoices for all of the work performed from September 2, 2015 through November 9, 2015. (Exhibits 1-3).

         US PIPELINING PAID SANACT FOR WORK SANACT COMPLETED FROM SEPTEMBER 2, 2015 TO OCTOBER 5, 2015 IN ACCORDANCE WITH THE INVOICES

         23. U.S. Pipelining paid Sanact a total of $94, 639.60 for work Sanact performed during the time period from September 2, 2015 through October 5, 2015. (Exhibit 4).

         24. On October 1, 2015, U.S. Pipelining made a payment of $9, 140, 65 for the invoices dated September 14, 17, 18 and 21, 2015. (Exhibit 4).

         25. On October 5, 2015, U.S. Pipelining made a payment of $4, 114.59 for the invoices dated September 2 and 10, 2015. (Exhibit 4).

         26. On October 28, 2015, U.S. Pipelining made a payment of $81, 384.36 for the invoices dated September 21, 22, 23, 25, 26, 28, 29, and 30, 2015, and October 1, 2, 3, and 5, 2015. (Exhibit 4).

         US PIPELINING DID NOT PAY SANACT FOR WORK SANACT COMPLETED FROM OCTOBER 6, 2015 TO NOVEMBER 9, 2015

         27. U.S. Pipelining has not paid for work performed by Sanact from October 6, 2015 through November 9, 2015.

         28. U.S. Pipelining has not made any further payments to Sanact after its last ...


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