A Youngsville construction firm that has closed down blames the failure of a Maryland homebuilder and is suing federal court.
CMB Construction Co. has filed a lawsuit against Maryland-based DRB Homes (also known as Dan Ryan Builders), claiming that the defendants' purported failures to pay their bills regularly contributed to the demise of the company.
DRB is a major player in the counties that surround the Triangle. It has plans for Johnston, Harnett and Franklin counties. It recently made headlines for proposing a Knightdale development of 146 homes. In 2021, the company was the fourth-largest residential builder in this region with almost 1,000 completed homes.
CMB Construction describes themselves as a family business that provides grading, clearing concrete utilities, and septic service. It had an arrangement with DRB Morrisville to provide these services to North Carolina homes. According to the lawsuit, CMB'regularly performed services for which they weren't paid'.
The lawsuit states that 'CMB was forced to permanently close' as a consequence.
CMB has filed a lawsuit against DRB in federal court. This week, the case was transferred from Franklin County to North Carolina’s Eastern District.
CMB's allegations are still unanswered for now, as DRB is yet to respond and its lawyer has not responded to a request for comment.
CMB accuses DRB for ignoring invoices relating to additional work. DRB allegedly waited for subcontractors to arrive on site before asking them to perform additional work.
The lawsuit claims that the defendants systematically refused payment to subcontractors including CMB for these services. It calls this practice "intentional and irresponsible."
The lawsuit alleges that this could be due to bonuses DRB site managers were given if they kept variance purchase orders (VPOs), at less than 1% of the sale price. VPOs allow the company to keep track of changes in job costs and manage them.
CMB says that it was "effectively bleeding money every day in hopes that [DRB] will pay CMB for the variance work it performed and the materials it provided to further that work."
CMB claims DRB owes it more than $115,000 when DRB forced its business to close.
On March 31, attorneys Ryan Oxendine, James Barnes IV and Victoria Hanafin of Edwards Beightol filed the initial lawsuit in Franklin County. DRB is represented by Kyle Andrew Medin of Ellis Winters, Michelle Liguori of Thomas Segars and Luke Farley from Edwards Beightol.