No settlement reached in lawsuit against school district
No settlement has been reached in a $1.9 million lawsuit by Servpro against the Minot Public School District.
A settlement hearing was held Tuesday in U.S. District Court in Bismarck, but court documents show the two sides failed to reach an agreement.
The Minot Public School Board met in executive session Thursday to discuss the lawsuit, but business manager Scott Moum failed to immediately return a phone call from the Minot Daily News on Friday seeking information on the case.
Storm Team Robbins, LLC, doing business as Servpro of the Seacoast, filed a $2 million lawsuit against the Minot Public Schools in 2015. The company alleges that the school district has not paid its expenses in full. The school district hired Servpro to do flood cleanup following the Souris River flood of 2011. It paid about $7 million of Servpro’s bill, the amount that it was reimbursed by the Federal Emergency Management Agency. Servpro claims that Minot Public Schools is responsible for the remaining $1.9 million. The school district has contended that Servpro told the district it would seek payment only for charges approved by FEMA.
Last year, in a motion to amend its counterclaim to the lawsuit, the school district stated that both parties mistakenly believed that FEMA would fully compensate Servpro for the cleanup efforts or, alternately, that Servpro should have known that the school district believed FEMA would fully reimburse Servpro. Lawyers for Servpro deny the claim that there was a mutual mistake of fact.
Judge Daniel Hovland granted the school district’s motion for partial summary judgment in its favor on Jan. 23. Hovland ordered that Servpro cannot claim it should win the case by a claim of “unjust enrichment” in the school district’s favor.
Servpro is alleging breach of contract and had claimed there was a breach of implied covenant of good faith and fair dealing on the part of the school district. Servpro withdrew that claim after the Minot Public Schools argued that that only applies to insurance contracts.
Hovland also ruled against Servpro on an unjust enrichment claim against the Minot Public Schools.
“It is clear and undisputed the parties entered into an express agreement for flood remediation services,” Hovland wrote in his order. “While the specific terms and extent of the contract are disputed by the parties, the fact that an express contract between MPS and Servpro was formed is not in dispute. The Court finds, as a matter of law, that Servpro is not entitled to recover under a theory of unjust enrichment because there is an express written contract between the parties relative to the same subject matter as the alternative unjust enrichment claim. Thus, the Court grants MPS’ motion for summary judgment regarding that claim.”
Hovland issued an order for the failed settlement conference on Jan. 25.
For now, no further hearings have been scheduled.