R.L. Schafer & Associates v. Agee Construction Corp.

MEMORANDUM *

R.L. Schafer & Associates (“Schafer”) appeals from the judgment of the district court denying its claim against Agee Construction Corporation (“Agee”) and Safeco Insurance Company under the Miller Act, 40 U.S.C. § 270b, now 40 U.S.C. § 3133 . Schafer argues that the district court erred (1) in not finding its subcontract ■with Agee to be ambiguous, and (2) by not applying the protections of the Miller Act. We have jurisdiction pursuant to 28 U.S.C. § 1291 , and we affirm.

Agee claims that Schafer did not raise the issue of contract ambiguity in district court. We disagree. State substantive law applies in Miller Act cases when, as here, the United States is not a party. See, e.g., United States ex rel. Bldg. Rentals Corp. v. Western Cas. and Sur. Co., 498 F.2d 335 , 338 n. 4 (9th Cir.1974). Schafer and Agee presented the district *31 court with opposing interpretations of the subcontract. Under California law, “[w]hen the parties dispute the meaning of a contract term, the trial court’s first step is to determine whether the term is ambiguous.” Curry v. Moody, 40 Cal.App.4th 1547, 1552 , 48 Cal.Rptr.2d 627 (1995).

Schafer argues that the district court failed to…