Unreported / Non-Citable
Background
Frankenmuth Mutual Insurance Company issued a performance bond for a contractor working on a 2022 construction project in Garland, Texas. After the contractor stopped work and its contract was terminated, Frankenmuth entered a takeover agreement with the project owner. Frankenmuth then ratified a subcontract with Bullnose Masonry, LLC, which agreed to complete flashing, trimming, and other work within its original scope.
Frankenmuth alleged that Bullnose improperly installed window flashing, incorrectly sealed windows, and failed to complete other required work, causing damage and delay. Frankenmuth paid replacement subcontractor Vaden Plastering and Masonry, LLC $294,715 to remediate defective work and $210,525 to finish incomplete work. After crediting $56,800 that Frankenmuth had paid Bullnose for unperformed work, Frankenmuth claimed $448,440 in damages. Bullnose was served but did not answer, leading to a clerk’s default and Frankenmuth’s motion for default judgment.
The Court’s Holding
The court granted default judgment. Applying the Fifth Circuit’s Lindsey factors, it found no material factual dispute, clear grounds for default, no indication of good-faith mistake or excusable neglect, and no apparent basis to set the default aside. Because Frankenmuth supported its damages request with sworn declarations, the court concluded that no evidentiary hearing was necessary.
Taking the well-pleaded liability allegations as admitted, the court held that Frankenmuth sufficiently alleged each element of a Texas breach-of-contract claim. It did not evaluate the negligence claim because the contract claim afforded full recovery. The court awarded $448,440 in actual damages and $22,208.15 in prejudgment interest, calculated at 7.5% from October 7, 2024, through June 4, 2025. It also awarded post-judgment interest at 4.12% on the damages and prejudgment interest, allowed court costs, and directed Frankenmuth to file any bill of costs and attorney-fee motion within 14 days.
Key Takeaways
- A defendant’s failure to answer admits well-pleaded allegations of liability, but the plaintiff must still plead a legally sufficient claim.
- Sworn evidence establishing damages allowed the court to enter default judgment without conducting a hearing.
- The final judgment awarded $470,648.15 in actual damages and prejudgment interest, plus statutory post-judgment interest; attorney’s fees and costs required separate, timely filings.
Why It Matters
The decision illustrates that default does not automatically entitle a plaintiff to judgment: the court still evaluates procedural fairness, the sufficiency of the pleaded claim, and the evidentiary support for damages. Here, detailed allegations and declarations were enough to establish both liability and a definite damages amount.
For construction and surety litigants, the ruling also shows how documented replacement and remediation costs—reduced by payments attributable to unperformed work—can support contract damages after a subcontractor defaults in litigation.