Allied Fire Protection v. Diede Construction Inc.
Opinion
Opinion
Morrison, J.
Plaintiff Allied Fire Protection (Allied) appeals from a judgment in favor of defendants Diede Construction, Inc., and Wayne Diede on a fraud action after the trial court granted defendants’ motion for summary judgment on the basis of res judicata. Allied contends the fraud claim was not barred by res judicata because it did not accme until after the prior federal complaint had been filed. We agree and reverse the judgment.
FACTUAL AND PROCEDURAL BACKGROUND
Diede Construction, Inc., entered into a construction contract with the United States Department of the Air Force (USAF). Diede subcontracted the fire protection system for the project to Allied. The project was delayed by the USAF. The USAF and Diede negotiated a settlement for delay damages; the USAF agreed to pay Diede $495,000 for delays up to August 7, 1997, and $1,600 per day from August 8, 1997, until project completion. Diede and Allied settled Allied’s delay damages for $90,000.
In March 1999, Allied brought suit in federal court against Diede and a surety corporation for damages. Allied alleged Diede had breached the subcontract. During discovery, Allied found the letter from the USAF to Diede describing…