
USCA1 Opinion

	




                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ____________________        No. 93-1011                             WESTCOTT CONSTRUCTION CORP.,                                Plaintiff, Appellant,                                          v.                            FIREMEN'S FUND OF NEW JERSEY,                                 Defendant, Appellee.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                           FOR THE DISTRICT OF RHODE ISLAND                     [Hon. Francis J. Boyle, U.S. District Judge]                                             ___________________                                 ____________________                                        Before                               Torruella, Circuit Judge,                                          _____________                            Oakes,*, Senior Circuit Judge,                                     ____________________                               and Cyr, Circuit Judge.                                        _____________                                 ____________________            Peter  Lawson   Kennedy  with   whom  Adler   Pollock  &   Sheehan            _______________________               ____________________________        Incorporated was on brief for appellant.        ____________            Shelia High King  with whom Bert J.  Capone, Michael P. Duffy  and            ________________            _______________  ________________        Peabody & Arnold were on brief for appellee.        ________________                                 ____________________                                    June 25, 1993                                 ____________________        _____________________        *Of the Second Circuit, sitting by designation.                       OAKES,   Senior   Circuit    Judge.       Westcott                                _________________________             Construction Co.  ("Westcott") appeals from an  order of the             United  States  District Court  for  the  District of  Rhode             Island, Francis  J. Boyle, Judge, denying  Westcott's motion                                        _____             for  summary  judgment  and  granting   defendant  Firemen's             Insurance ("Firemen's") cross-motion  for summary  judgment.             Westcott  sought to enforce the  terms of a performance bond             executed by Firemen's on behalf of Westcott's subcontractor,             Crouse Combustion  Systems ("Crouse"), in which Westcott was             named  as  obligee.   In particular,  Westcott sought  to be             indemnified for payments made to the City of Cranston, Rhode             Island ("Cranston"), for  damages suffered by the  town as a             result of Crouse's delays.                        Westcott,  Crouse  and  Cranston   previously  had             participated in lengthy arbitration proceedings in which the             arbitrators  had  established  damages  owed  by  Crouse  to             Westcott and by Westcott to Cranston, as well as by Cranston             to Westcott.   Westcott argues that the arbitrators were not             asked  to  consider Crouse's  duty  to  indemnify and  that,             therefore,  this question is  open to the  courts to decide.             Westcott initially petitioned  the arbitrators to reconsider             the  award.    After   that  request  was  denied,  Westcott             unsucessfully sought  to vacate or  modify the award  in the             Rhode  Island state  courts  on the  ground  that the  award             failed  to consider Westcott's indemnification claim against                                         -2-                                          2             Crouse.    Westcott then  sought  relief against  Firemen's,             Crouse's  surety  on the  performance  bond,  in the  United             States District Court for the  District of Rhode Island, and             after losing there,  now seeks  redress in this  court.   We             find Westcott's appeal  clearly foreclosed by res  judicata,             in  fact so clearly that we award  double costs on behalf of             Firemen's.                                      BACKGROUND                                      __________                       In  November, 1981, Firemen's issued a performance             bond  to subcontractor  Crouse, with  Westcott, the  general             contractor,  as  obligee, for  a wastewater  treatment plant             being built for the city of Cranston, Rhode Island.   When a             dispute  arose  over  the  project,  Westcott,  Crouse   and             Cranston submitted  their damage claims to  arbitration.  On             April 25,  1989, the  arbitrators issued their  findings and             award.   After finding  Crouse responsible  for much  of the             delay  damages, the  arbitrators  awarded Cranston  $314,000             from Westcott and awarded  Westcott $384,000 from Crouse and             $117,600  from Cranston  (for  delays caused  by the  city).             Westcott  filed a  motion on  May 10,  1989, requesting  the             arbitrators to  reconsider the award as  it allegedly failed             to require Crouse to  make good on its performance  bond and             thus  to  indemnify  Westcott   for  the  $314,000  paid  to                                         -3-                                          3             Cranston.    The arbitrators  denied  Westcott's motion  for             reconsideration and modification of their decision.                          Westcott then sought to modify or vacate the award             in  state court, arguing that  the award had  failed to pass             through the  $314,000 in  damages to  Crouse.   The Superior             Court's  denial of  Westcott's  motion was  affirmed by  the             Rhode Island Supreme  Court,  Westcott Constr. Corp. v. City                                           ______________________________             of  Cranston, 586 A.2d  542 (R.I. 1991)  (per curiam), which             ____________             concluded  that   Westcott  had  submitted  its  claims  for             additional  damages to  the  arbitrators  and therefore  the             claim was not open to the court to decide.                       Westcott  then brought  suit against  Firemen's as             Crouse's  surety in the District of Rhode Island.  The claim             was dismissed.  Westcott now appeals.                                      DISCUSSION                                      __________                       Westcott,  on this  appeal, requests  us to  award             indemnification damages against Firemen's,  maintaining that             the question  of indemnication  was never considered  by the             arbitrators  or by  the state  courts.   The  district court             ruled against Westcott, finding this claim foreclosed by res             judicata.    As  the  district  court  stated,  "[i]t  seems             abundantly clear to  me that the Rhode  Island Supreme Court             has  already considered  and decided  the controversy."   We             agree with the  district court's assessment.  That the Rhode                                         -4-                                          4             Island Supreme Court considered this issue is clear from the             language of  the opinion.   As that  court noted,  "Westcott             argues that the $1,000-per-day award to the city should have             been  'passed through'  to Crouse  and that,  therefore, the             arbitrators' award  is  imperfect."   Westcott  Construction                                                   ______________________             Corp., 586 A.2d at 543.  We fail to see how Westcott's state             _____             court  claim differs from its federal one.  Indeed, it seems             clear  that this issue  was submitted to  the arbitrators as             well.  Westcott itself, in its motion to the arbitrators for             reconsideration and modification of their decision, admitted             that  "[t]he  parties  agreed  at  the  initial  hearing  on             September  5,  1986  that  all   matters  between  Cranston,             Westcott,  Crouse  and  the  other  subcontractors would  be             decided."   As Firemen's notes,  this statement demonstrates             that the  arbitrators  were  to  consider  Westcott's  claim             against Crouse.                          Res Judicata bars Westcott's claim.  See Coates v.                                                            ___ _________             Coleman, 51 A.2d 81,  85 (1947).  "[A] state  court judgment             _______             commands the same res judicata effects in federal court that             it would  have in the court that entered it."  18 Charles A.             Wright,  Arthur  R.  Miller  &  Edward  H.  Cooper,  Federal                                                                  _______             Practice and Procedure   4469, at 659-60 (1981).  In Griffin             ______________________                               _______             v.  State of R.I., 760  F.2d 359 (1st  Cir.) (applying Rhode             _________________             Island law),  cert. denied, 474  U.S. 845 (1985),  the First                           _____ ______             Circuit explained that res  judicata operates as an absolute                                         -5-                                          5             bar  to the relitigation of the same cause of action between             parties  (or  their  privies)  and  that  a  prior  judgment             rendered  on the merits is conclusive not only to the issues             which were determined but as to all matters which might have             been determined as well.   Id. at  360; see also Corrado  v.                                        ___          ________ ___________             Providence Redevelopment Agency, 320 A.2d 331, 332 (1973).               _______________________________                       All the requirements for applying res judicata are             met  in this case.   As in Griffin,  the appellant "contends                                        _______             that the  'causes of  action' in  Rhode  Island and  federal             courts differed, and thus argues that  res judicata does not             bar her federal court action."  760 F.2d at 360.  And, as in             Griffin, "[a]n analysis of  the cause of action here  and in             _______             the  prior state proceedings  clearly establishes  that both             are essentially the  same."  Id. at  361.  The  federal case                                          ___             involves the same subject matter and the same parties as did             the state  case,  and  contests the  same  point:  that  the             arbitrators  did  not  consider  Westcott's  indemnity claim             against Crouse.                        Firemen's, as surety, is only liable to the extent             its  principal, Crouse, is  liable.  See  Rhode Island Hosp.                                                  ___  __________________             Trust  Nat'l Bank v. Ohio Cas.  Ins. Co., 789 F.2d 74, 77-79             ________________________________________             (1st  Cir. 1986).   Firemen's benefits  just as  Crouse does             from the  application of res  judicata.   Id. at 77.   Thus,                                                       ___             Firemen's, as surety for Crouse, is not legally bound to pay             the $314,000 Westcott seeks.                                          -6-                                          6                       This   application  of  res  judicata  effects  no             injustice.   None of  the grounds justifying  departure from             the doctrine of  res judicata are present in this case.  See                                                                      ___             Restatement (Second) of Judgments   20 (1982); 18 Charles A.             Wright,  Arthur  R.  Miller  &  Edward  H.  Cooper,  Federal                                                                  _______             Practice and Procedure    4435-4447 (1981) (earlier judgment             ______________________             entered without jurisdiction; improper venue; non-joinder or             misjoinder  of  parties;  prematurity;  failure  to  satisfy             condition precedent; and dismissal without prejudice).                       After examining the history of this litigation and             Westcott's repeated presentation of  the same issue, we find             it appropriate to assess a  monetary penalty of double costs             against  Westcott for a frivolous  appeal.  Fed.  R. App. P.             38.  Rule  38 provides that "[i]f  a court of  appeals shall             determine that  an appeal is  frivolous, it  may award  just             damages and single  or double  costs to the  appellee."   As             this  Circuit  stated  in  Natasha,  Inc.  v.  Evita  Marine                                        _________________________________             Charters,  Inc., 763  F.2d 468,  471 (1st Cir.  1985), "[a]n             _______________             appeal  is  frivolous when  the  result is  obvious,  or the             arguments  are 'wholly without merit.'"  Id. at 472 (quoting                                                      ___             NLRB v. Catalina Yachts,  679 F.2d 180, 182 (9th  Cir. 1982)             _______________________             (citations  omitted)).   There are two  reasons to  assess a             penalty for  frivolous appeals.   First, such suits  must be             deterred  in order  to  ease the  burden  on the  courts  of             appeals  and, second,  in order  to protect  against "strike                                         -7-                                          7             suits"  or  appeals brought  to delay  paying damages.   See                                                                      ___             Natasha Inc., 763 F.2d  at 471-72 (discussing policy reasons             ____________             for imposition of penalties by the court); cf. Bankers Trust                                                        ___ _____________             Co.  v. Publicker Indus., Inc., 641 F.2d 1361 (2d Cir. 1981)             ______________________________             (awarding  double costs  and up  to $10,000  damages against             client and counsel for frivolous appeal).                       Westcott   has   engaged  in   repeated  frivolous             appeals, requiring  Firemen's to litigate the  same claim in             different fora.  Westcott's attempt to distinguish its state             court claims from those brought in the federal courts has no             merit  as res  judicata clearly  foreclosed  its claim.   In             light  of  this  determination,  we award  double  costs  to             Firemen's.                                      CONCLUSION                                      __________                       We affirm  the district  court's grant of  summary             judgment  to Firemen's on  the grounds  of res  judicata and             award double costs.                                         -8-                                          8
