The Rhode Island Supreme Court has upheld a $716,001 judgment against Victor Costa and Costa Companies Inc., ruling that a Superior Court judge acted within his discretion after the defendants repeatedly failed to comply with court orders in a dispute over work at the Church Street Marina in Bristol.

In a unanimous opinion issued Tuesday, July 7, the state’s highest court rejected arguments that Costa and his company were improperly notified of motions that ultimately led to a default judgment in favor of Reagan Marine Construction LLC.

The case stems from a marina expansion project in Bristol, where Reagan Marine served as the general contractor.

According to court records, Reagan hired Costa Companies in November 2021 to perform electrical work on the project. The company later agreed to expand the scope of that work, but Reagan alleged Costa Companies failed to meet project schedules and did not provide required written notice of delays.

Reagan ultimately terminated the subcontract and hired another electrical contractor, then sued Costa and his company in Providence County Superior Court. The lawsuit alleged breach of contract, negligent misrepresentation, fraud and conversion.

The appeal, however, focused less on the underlying construction dispute than on what happened afterward.

Court records show Reagan repeatedly sought documents and information through the discovery process. When the defendants failed to provide requested materials, Superior Court judges issued multiple orders directing them to comply.

Costa Companies’ attorney withdrew from the case in 2023. The court granted the company additional time to obtain new counsel and ordered the defendants to respond to outstanding discovery requests.

According to the Supreme Court opinion, those deadlines came and went without compliance.

After months of missed deadlines, Superior Court Judge Brian P. Stern issued a conditional order of default in March 2024. The order gave the defendants another opportunity to comply before a final judgment would be entered.

Instead, Costa argued he had not received proper notice because communications should have been sent to the company’s registered agent rather than to him electronically.

Too late, court rules

The Supreme Court found that argument came too late.

Writing for the court, Justice Erin Lynch Prata noted Stern repeatedly advised Costa that if he believed notice had been defective, he needed to file a motion seeking to vacate the default order. Costa never did so, the court said.

Because the issue was never properly raised before the trial court, the Supreme Court ruled it could not be considered on appeal.

“It is well settled” that issues not properly presented in the lower court cannot be raised for the first time on appeal, Lynch Prata wrote.

The justices also found no abuse of discretion in the trial court’s decision to enter default judgment.

The opinion notes that Costa and his company were given multiple extensions, opportunities to comply with discovery requests and time to obtain legal representation. Despite those opportunities, the defendants repeatedly failed to comply with court orders.

“While the drastic remedy of judgment by default is not to be employed lightly,” Lynch Prata wrote, the trial judge gave the defendants “every opportunity” before taking that step.

The court also rejected Costa’s claim that his due-process rights were violated when the Supreme Court previously required a cash bond as a condition for remanding the case so he could pursue additional motions in Superior Court.

The judgment awarded Reagan Marine $535,357 in damages, $133,766 in prejudgment interest, nearly $47,000 in attorney’s fees and court costs, for a total of $716,001.83.

The Supreme Court’s ruling leaves that judgment in place.