JAAAT Technical Services, LLC ( 2021 )

ARMED SERVICES BOARD OF CONTRACT APPEALS
Appeals of - )
)
JAAAT Technical Services, LLC ) ASBCA Nos. 61792, 61793, 61794
) 61795, 61796, 61797
) 61798, 61799, 61800
)
Under Contract No. W912HN-10-D-0063 )
APPEARANCES FOR THE APPELLANT: Mr. Rickey B. Barnhill 1
Director of Finance
Andrew T. Bodoh, Esq. 2
Thomas H. Roberts & Associates, P.C.
Richmond, VA
APPEARANCES FOR THE GOVERNMENT: Michael P. Goodman, Esq.
Engineer Chief Trial Attorney
Justin P. McCorcle, Esq.
Aaron A. Bloemsma, Esq.
Engineer Trial Attorneys
OPINION BY ADMINISTRATIVE JUDGE CATES-HARMAN
Pending before the Board is the government’s motion for summary judgment,
or in the alternative, a motion to dismiss for lack of jurisdiction in all but one of the
nine appeals. The Board sua sponte raised questions relating to the subject matter
jurisdiction of the ninth and largest appeal (ASBCA No. 61792). During the period of
2014 to 2015, appellant, JAAAT Technical Services, LLC (JAAAT, appellant)
submitted nine Requests for Equitable Adjustment (REA) to the contracting officer;
the form and substance of the CO’s responses will be discussed below. On September
11, 2018, appellant filed a Notice of Appeal for each of the nine REAs based upon a
deemed denial. The government maintains that the Board lacks subject matter
jurisdiction over eight of the nine appeals because the REAs were never converted to a
claim, that each failed to request a contracting officer’s final decision, and for those
REAs exceeding $100,000, lacked a certification as required by the Contract Disputes
1 By Order dated October 3, 2018, the Board accepted Mr. Rickey B. Barnhill as
appellant’s representative. In support of these appeals, he has filed pleadings,
briefs, and an affidavit under the name of either “Rickey” or “Rick” Barnhill.
For purposes of this decision, he will be referred to as “Rickey” Barnhill.
2 Mr. Bodoh has entered an appearance on June 30, 2020, to represent appellant in
ASBCA No. 61799 only.
Act (CDA), 41 U.S.C. §§ 7101-7109. In one appeal, the government asserts that a
written claim was never submitted to the contracting officer. Where the appeals have
similar issues, they will be grouped together for decision.
STATEMENT OF FACTS (SOF) FOR PURPOSES OF THE MOTION 3
1. Contract No. W912HN-10-D-0063 (contract), was awarded to JAAAT on
September 30, 2010, by the U.S. Army Corps of Engineers, Savannah District
(USACE). This was a multiple award contract (MATOC) for the design/build or
construction type task orders (R4, tab 4a at 2030). The contract recited FAR 52.233-1,
DISPUTES (JUL 2002) and FAR 52.243-4, CHANGES (JUN 2007) (R4, tab 4a
at 2141, 2151-52).
2. On September 17, 2012, USACE issued task order DQ01 (task order) to
JAAAT for the design and construction of PN 69758 Special Operation Forces
Brigade Headquarters Facility at Fort Bragg, North Carolina. The task order was
awarded for the firm-fixed price of $15,649,974. The appellant was required to:
Design/Construct a Brigade Headquarters facility for the
95th Civil Affairs Brigade to include administrative space,
conference rooms, classrooms, sensitive compartmented
information facility, group operations center, logistics,
network operation center, headquarters company, enlarged
arms room vault, secure storage, unit storage, lockers,
toilets, showers, and required mechanical, electrical and
communication rooms, protected distribution system
(PDS), intrusion detection, surveillance, and electronic
access control.
(R4, tab 4b at 2213-15, 2220)
3. The contract also required JAAAT to furnish both performance and payment
bonds, each with good and “sufficient surety or sureties acceptable to the
Government” (R4, tab 4a at 2121). On September 21, 2012, Safeco Insurance
Company of America (Safeco) issued the Performance and Payment Bond
No. 024048098, on behalf of JAAAT, as Bond Principal, and in favor of the United
States of America as Bond Obligee in the amount of $15,649,741, on the task order
(referred to in the September 21, 2012 document as the “SOF Brigade Headquarters
Contract”). (Gov’t mot., ex. G-2 at 1-2, ¶¶ 1.2 - 1.3)
3 This decision is comprised of nine appeals, ASBCA Nos. 61792-61800. Each appeal
will have a separate statement of facts for purposes of the government’s motion.
2
4. The task order includes FAR 52.228-15(b)(3), PERFORMANCE AND
PAYMENT BONDS--CONSTRUCTION (NOV 2006), which provides for additional
bond protection and states that “[t]he Government may require additional performance
and payment bond protection if the contract price is increased. The increase in
protection generally will equal 100 percent of the increase in contract price.” (R4,
tab 4a at 2126-27)
5. FAR 52.243-4, CHANGES (JUN 2007), provides—
(a) The Contracting Officer may, at any time, without notice
to the sureties, if any, by written order designated or
indicated to be a change order, make changes in the work
within the general scope of the contract, including
changes—
(1) In the specifications (including drawings and designs);
(2) In the method or manner of performance of the work;
(3) In the Government-furnished property or services; or
(4) Directing acceleration in the performance of the work.
....
(d) If any change under this clause causes an increase or
decrease in the Contractor's cost of, or the time required
for, the performance of any part of the work under this
contract, whether or not changed by any such order, the
Contracting Officer shall make an equitable adjustment
and modify the contract in writing. However, except for an
adjustment based on defective specifications, no
adjustment for any change under paragraph (b) of this
clause shall be made for any costs incurred more than
20 days before the Contractor gives written notice as
required. In the case of defective specifications for which
the Government is responsible, the equitable adjustment
shall include any increased cost reasonably incurred by the
Contractor in attempting to comply with the defective
specifications.
(e) The Contractor must assert its right to an adjustment
under this clause within 30 days after (1) receipt of a
3
written change order . . . or (2) the furnishing of a written
notice under paragraph (b) . . .
....
(R4, tab 4a at 2151-52)
6. On September 11, 2018, JAAAT filed nine appeals based on USACE denial
of eight (8) Requests for Equitable Adjustments (REAs), ASBCA Nos. 61792, 61794,
61795, 61796, 61797, 61798, 61799, 61800; and one (1) deemed denial assigned
ASBCA No. 61793, where the government had no records. The nine REAs are dated
between September 30, 2014, and April 5, 2017, and requested an increase to the task
order totaling $10,217,851 4 and a time extension of 847 days. 5 (R4, tab 3a at 3; gov’t
mot. at 1; app. resp. at 1-2)
ASBCA NO. 61792 (STORMWATER) 6 SOF
7. On April 17, 2014, the contracting officer issued Modification No. 4
addressing work associated with the CS003 Stormwater requirements. The
modification provided for a decrease to the contract price in the amount of $75,973.61
and an extension of 156 calendar days, extending the contract to October 11, 2014
(R4, tab 4f at 2232).
8. By letter dated May 20, 2014, JAAAT submitted a request for equitable
adjustment (REA alleging a defective USACE Master Plan and a “defective
[RFP/]Specification” that did not identify the installation of roadways and stormwater
features, and estimating the cost impact to be at least $5,300,000 and a time impact of
at least 376 calendar days (R4, tab 7m at 2353, 2360, 2366, 2378, 2393, 2397, 2401).
9. In response to the Board’s April 11, 2019 Order, to address the parties’
positions on jurisdiction in Appeal No. 61792, the government responded by
4 The dollar amount of the individual requests for equitable adjustments do not total
the requested demand in the pleadings of $10,217,851. Instead, the total
calculates to $9,493,269.68. For purposes of this motion we are using the
$10,217,851 number.
5 The number of days requested in the individual appeals do not total the demand of
847 days. Instead, the number of days requested total 664 days. For purposes
of this motion we are using the requested 847 days.
6 The contract refers to “storm water” requirements while JAAAT refers to these
requirements as “stormwater.” For purposes of clarity, we will refer to
JAAAT’s equitable adjustment documents as “stormwater REA.”
4
supplementing the Rule 4 and provided documents with additional communications
between JAAAT and the contracting officer (R4, tabs 69-76).
10. By letter dated September 30, 2014, from its representative,
Mr. Eddie Cummings, JAAAT submitted a revised REA to the contracting officer
increasing the claimed damages to $8,596,261 and reducing the alleged days of delay
to 336 (R4, tab 3a at 3-4, 71). Attached to the letter was a signed certification with the
text, “Request for Equitable Adjustment” that reads:
I certify that the claim is made in good faith; that the
supporting data are accurate and complete to the best of
my knowledge and belief; that the amount requested
accurately reflects the contract adjustment for which the
JAAAT believes the Government is liable; and that I am
duly authorized to certify the Request for Equitable
Adjustment on behalf of the JAAAT.
(R4, tab 3a at 82)
11. On July 7, 2015, JAAAT questioned the status of the Stormwater REA, and
stated that while they were amenable to further discussion and potential resolution,
“please accept this correspondence as JAAAT’s formal request for a Contracting
Officer’s final decision” (R4, tab 69 at 10528).
12. Having received no response, JAAAT forwarded an email to the contracting
officer on August 14, 2017, invoking the claim certification from its original
Stormwater REA converting the REA into a certified claim (R4, tab 76 at 10566).
ASBCA NO. 61793 (RELOCATE PROJECTOR SCREEN) SOF
13. On November 8, 2016, JAAAT sent a letter to the contracting officer
requesting an “equitable adjustment” of $1,753 to relocate a previously installed
5
projector screen (compl. 7 at tab 2 at 2028).8 The letter does not request a final
decision or indicate that JAAAT views its request as a claim under 41 U.S.C. § 7103
or the Disputes clause under the contract (compl. at tab 2). The letter’s subject line is
titled, “Request for Equitable Adjustment” and JAAAT stated:
[W]e believe we should not bear the costs of this last
minute relocation, and are submitting this request for
equitable adjustment to recoup these costs. To this end,
please find attached a summary of these costs totaling
$1,753.00. We ask that a contract modification be created
to cover this amount.
(Id. at 2028) Attached to the letter was an “estimate for contract modification”
providing the direct costs associated with the “REA Relocate Projector Screen” (id.
at 2029-30).
ASBCA NO. 61794 (WEATHER DELAYS) SOF
14. By letter dated February 24, 2017, to the contracting officer, JAAAT stated
“[it] became aware that there was never a settlement for adverse weather delays. . . .
[We therefore ask that 50 days to be added to our contract” (R4, tab 9a at 2584). The
letter does not request a final decision or indicate that JAAAT views its request as a
claim under 41 U.S.C. § 7103 or the Disputes clause under the contract. Attached to
7 Attached to appellant’s complaint, and referenced throughout, are documents
appellant identified as being tabs 1-12. By Order dated November 14, 2018, the
Board advised JAAAT that exhibits to a complaint are not automatically
considered part of the record upon which the Board’s decision will be rendered,
and that in their current format, they would not be accepted to supplement the
Rule 4 file. The government objects to the use of these supplemental
documents and argues since they never received the documents they could not
adequately respond. The government seeks sanctions under Board Rule 16.
Over the government’s objection, the Board will accept the documents for
purposes of the motion to dismiss only, and they will be referenced as “compl.
at tab ___”. The Board declines to assess sanctions, under Rule 16, against
JAAAT.
8 For the tabs attached to appellant’s complaint we will use the documents’ pdf page
numbers; appellant failed to properly paginate them as required under our
Rules.
6
the letter was a breakdown of the requested adverse weather days (R4, tab 9a at 2585-
86).
15. By letter dated March 13, 2017, the contracting officer responded to
JAAAT’s request, stating “that actual adverse weather delay days must prevent work .
. . for 50 percent or more of the Contractor’s scheduled workday. The documentation
you have provided . . . only indicates the total days you are requesting for each month .
. . . [It] does not indicate the . . . activity . . . was delayed more than 50 percent during
your scheduled workday . . . .” (R4, tab 9b at 2587). The contracting officer requested
that JAAAT provide any “additional documentation on the topics” that were addressed
in this correspondence (R4, tab 9b at 2588).
ASBCA NO. 61795 (COMMAND CARPET) SOF
16. On February 28, 2017, JAAAT submitted a “request for equitable
adjustment” to the contracting officer for the replacement of the command suite carpet
in PN 69758 Brigade Headquarters facility. JAAAT requested $201,799 and a project
extension of 84 days (R4, tab 10c at 2591, 2593). The letter does not request a final
decision or indicate that JAAAT views its request as a claim under 41 U.S.C. § 7103
or the Disputes clause under the contract. The letter’s subject line is titled,
“Command Suite Carpet Replacement Request for Equitable Adjustment” (R4,
tab 10c at 2591) (emphasis in the original), and JAAAT stated it “believes it is due a
fair and equitable adjustment . . . .” (R4, tab 10c at 2593). There is no claim
$100,000. Attached to the letter is a cost sheet dated February 28, 2017, titled
“ESTIMATE FOR CONTRACT MODIFICATION” and described as being the
“Command Suite Carpet Replacement REA.” (R4, tab 10c at 2614-15)
17. By letter dated June 20, 2017, the contracting officer denied JAAAT’s
“REA ‘Command Suite Carpet Replacement Request for Equitable Adjustment’” (R4,
tab 10d at 2616).
ASBCA NO. 61796 (COMMUNICATION GROUNDING) SOF
18. On March 23, 2016, JAAAT submitted a response to RFP-0019, “Revised
OSP Copper/Fiber” seeking costs in the amount of $5,339 (R4, tab 11b at 2639). The
letter attached a document titled, “ESTIMATE FOR CONTRACT MODIFICATION”
which provided a breakdown of direct and indirect costs associated with RFP-0019
(R4, tab 11b at 2640-47).
19. On February 28, 2017, JAAAT requested an “equitable adjustment” for
changes made to the telecommunications grounding system in the amount of $5,936
(R4, tab 11a at 2618). The letter does not request a final decision or indicate that
JAAAT views its request as a claim under 41 U.S.C. § 7103 or the Disputes clause
7
under the contract. The letter’s subject line is titled, “Communications Grounding
Request for Equitable Adjustment” (R4, tab 11a at 2618) (emphasis in original) and
JAAAT stated it “believes it should be compensated for these changes and receive an
equitable adjustment. . . .” The REA also provided cost breakdowns. (Id. at 2619,
2626, 2636-47) (Emphasis in original)
20. By letter dated June 6, 2017, the contracting officer issued its decision
denying JAAAT’s “Communications Grounding Request for Equitable Adjustment”
and emphasized that there was no backup information provided with the REA that
could explain how the original design meets code (R4, tab 11c at 2648).
ASBCA NO. 61797 (NEC SWITCH DELAY) SOF
21. By letter dated February 28, 2017, to the contracting officer, JAAAT
requested an “equitable adjustment” for delays in rescheduling the installation of a
communication switch. JAAAT sought costs in the amount of $65,605 and requested
22 days to be added to the contract completion date. (R4, tab 12a at 2651) The letter
does not request a final decision or indicate that JAAAT views its request as a claim
under 41 U.S.C. § 7103 or the Disputes clause under the contract. The letter’s subject
line is titled, “NEC Switch Delay Request for Equitable Adjustment”
(id.)(emphasis in original). Attached to the letter was an “REA Cost Sheet” for the
“NEC Switch Delay REA” containing direct and indirect costs (id. at 2664-66).
22. By letter dated June 6, 2017, the contracting officer responded to the NEC
Switch Delay REA and stated that the “[g]overnment review is not possible due to lack
of critical information,” and asked JAAAT to “[p]rovide a time impact justification as
required by specification section 01 32 01.00 10 paragraph 3.7 REQUESTS FOR
TIME EXTENSIONS for the requested 22 calendar day time extension” (R4, tab 12b
at 2667).
ASBCA NO. 61798 (PERIMETER WALL) SOF
23. On March 24, 2017, JAAAT submitted a “request for equitable adjustment”
in the amount of $112,831 for the construction of an exterior perimeter wall, and
requested an extension of 55 days to the contract completion date (R4, tab 13a
at 2668). The letter does not request a final decision or indicate that JAAAT views its
request as a claim under 41 U.S.C. § 7103 or the Disputes clause under the contract.
The letter’s subject line is titled, “SCIF Perimeter Wall Request for Equitable
Adjustment” (id.)(emphasis in original). The letter does not include a claim
certification, as required by the CDA, 41 U.S.C. § 7103(b)(1), for claims over
$100,000.
8
24. By letter dated June 6, 2017, the contracting officer found JAAAT’s “SCIF
Perimeter Wall Request for Equitable Adjustment” to be without merit and directed
that if JAAAT had certain specific documentation in its possession, it should provide
that supplemental documentation as soon as possible but not later than May 12, 2017 9
(R4, tab 13 at 2687-88).
ASBCA NO. 61799 (PUNCH LIST) SOF
25. By correspondence dated November 30, 2016, the contracting officer
informed JAAAT that the government was exercising the Changes clause (FAR
52.243-4) of the contract for “CS019-Credit for Remaining Work-Building X-4647
and site” and sought an itemized proposal due no later than December 2, 2016 as
required by DFARS 252.236-7000, “[y]our proposal must contain a complete itemized
breakdown, in sufficient detail, to permit an analysis of all material, labor,
equipment, subcontract, overhead costs, (including extended overhead costs) and
profit . . .” (emphasis in original) (R4, tab 14a at 2694).
26. By email dated December 1, 2016, Mr. Eddie Cummings, JAAAT’s
Director of Projects, responded with a current update of the final punch list for the
itemized proposal credit, but stated JAAAT could not respond to the proposal by
December 2 and requested a meeting to discuss the items (id. at 2699).
27. The government’s Project Engineer emailed JAAAT on December 6, 2016,
providing a list of 83 outstanding punch list items, for work not performed adequately,
stating, in part: “missing knock box at gate”; “repair/replace –cracked [electrical]
box”; “repair grade around the SE parking lot flume to allow drainage”; “replace sign
and pole”; “Main Lobby‐Corridor Double Doors to Hallways (2 sets)‐Not smoke
sealed”; “Door hardware not complete”; “Close large gaps between ceiling grid &
walls”; “Left lavatory does not have any hotwater coming out”; “Protection plate
around refrigerator water connection missing – Inadequate workmanship”; “Hole in
door transition – Chipped tile”; “Corner guards missing”; “All Window Pan Flashing –
Not sealed to window frame @ interior window sills”; “Interior Doors – Viewing
windows – edges not finished on STC rated hollow metal doors with veneer”; “Corner
guards missing”. (Compl. ex. A-1 at 2137-40)
28. By email dated December 8, 2016, JAAAT sent an updated punch list to the
government for a conference call scheduled later that day (R4, tab 14a at 2701).
JAAAT proposed a credit of $9,880 for work not completed under the contract (id.
at 2691; R4, tab 14b at 2717).
9 The date given by the contracting officer for JAAAT to respond with further
documentation was earlier than the correspondence date. We find this
discrepancy to be immaterial.
9
29. On December 8, 2016, the teleconference occurred in two stages – in the
initial call the government reviewed the punch list and the associated construction
credits provided by JAAAT; and then in the second call, the government advised that a
construction credit of $257,896 was reasonable, and if JAAAT did not concur, a
unilateral contract modification would be immediately issued” (R4, tab 14a at 2691).
30. By correspondence identified as Serial Letter C-0132 dated December 9,
2016, the contracting officer issued Modification No. R00015 (CS019 Complete
Punch List Building X-4647) (id. at 2706). The correspondence further stated:
“Although circumstances surrounding this change have not resulted in a bilateral
agreement, I consider the modification to be fair and reasonable and to reflect an
equitable adjustment. This modification will be effective upon the date of my signature
in block 16C.” (Id.) (Emphasis in original). It included an enclosed SF 30.10 Box 16C
is dated for December 12, 2016. (id. at 2707)
31. On December 6, 2016, an updated punch list was provided by the
government project engineer to the parties. By document dated December 9, 2016, the
contracting officer provided a letter enclosing Modification No. 7, including the
complete punch list building X-4647, including the outstanding interior, exterior and
site items. Modification No. 7 is dated December 12, 2016, reducing the contract price
by $257,896 as a result of outstanding punch list items. (Id. at 2701-04, 2706, 2707-
09) Box 13D states the type of modification and the authority for the change, “FAR
52.243-4 UNILATERAL PURUANT [sic] TO THE CHANGES CLAUSE” (id.
at 2707). The CLOSING STATEMENT specified that:
It is understood that pursuant to the above, the contract
time is not affected, and the contract price is decreased as
stated above, which reflects all credits due the Government
and all debits due the Contractor. It is further understood
that this Modification is being issued on a unilateral basis
due to failure to agree on the costs to complete final punch
list items.
(Id. at 2709)
Modification No. 07 does not state that it was a final decision or provide customary
notice of appeal rights as provided for in Federal Acquistion Regulation (FAR) 33.211.
10 Box 2 of the SF 30 identifies the document as “Amendment/Modification No. 07.”
Hereinafter, we will refer to this document as Modification No. 07 or Mod.
No. 07.
10
An executed copy of Modification No. 07 was delivered to Mr. Cummings and
Mr. Barnhill on December 12, 2016, via email (gov’t br. dtd. June 30, 2020, ex. A).
32. By email dated December 13, 2016, to the contracting officer, Mr. Barnhill
acknowledged receipt of Modification No. 07 and sent a reply email requesting a copy
of “[t]he complete punch list for Bldg X-4647 identified in Section G-Contract
Administration Data, Item A-Scope of work. . . . Please send the itemized and detailed
cost list of items that are included in the $257,896 contract reduction.” (Id.)
33. In response to JAAAT’s request, on the same day, the government provided
the final list as referenced in Modification No. 07 (R4, tab 14a at 2712).
34. The same day, Mr. Barnhill acknowledged receipt of the final list and
continued to dispute the calculation of the contract reduction amount of $257,896:
Thank you for providing the Final List of items. The
attachment JAAAT received does not have the costs of the
individual line items. Please provide the USACE costing
for each of the 84 interior building items on interior pages
1-4; the 41 exterior building line items on exterior pages 1-
2; and the 40 site line items on site pages 1-2 which per
paragraph CS019 of the SF30 are included in the $257,896
contract reduction.
(Id. at 2711-12)
35. The government responded the same day, stating: “we are not required to
provide the Government IGE. If you are in disagreement with the unilateral and the
negotiations attempted on 12/8/16, there are processes outlined in your contract and
the FAR for you to follow.” (Id. at 2711)
36. On March 24, 2017, JAAAT submitted a “Request for Equitable
Adjustment” seeking an adjustment to the contract reduction established by the
contracting officer in unilateral Modification No. 07. JAAAT sought “an equitable
adjustment in the amount of $236,286.68” and stated that the “total project
construction credit [should be] $21,609.32,” not $257,896 as determined in
Modification No. 07 (id. at 2691-92). The letter does not assert any affirmative
defense(s) to the government’s unilateral Modification No. 07 to reduce the contract
price; rather, JAAAT asserts that it disagrees with the calculation of the credit amount:
JAAAT had agreed to provide a contract credit . . . for
punchlist work which JAAAT would not complete, and
attempted to negotiate a fair credit with USACE. USACE
11
did not entertain any negotiation, and issued an
unreasonable unilateral contract modification with no
justification for the contract reduction amount. As a result,
JAAAT believes it should be compensated and receive an
equitable adjustment in the amount of $236,286.68.
(Id. at 2691-92)
37. In correspondence dated June 6, 2017, the contracting officer found
JAAAT’s “Request for Equitable Adjustment” to be without merit. The contracting
officer pointed out that it was “JAAAT’s failure to promptly address the deficiency
items the Government acted under its contractual rights described in FAR 52.246-
12(g)(1) [Inspection of Construction Clause] to replace or correct the identified
deficient work and charge the costs to the Contractor. The value deducted under
unilateral modification is being utilized to contract out replacement and correction of
the listed scope.” (R4, tab 14b at 2717) The contracting officer also identified the
noncompliance with “the cost estimate provided by JAAAT . . . JAAAT’s original
offering of $9,880 was determined noncompliant with the RFP.” (Id.)
38. After receiving the government’s motion to dismiss for lack of subject
matter jurisdiction for ASBCA No. 61799, and, in the alternative, motion for summary
judgment, the Board began reviewing the parties’ briefs. Following this review, the
Board raised the question whether Modification No. 07 was a government claim
asserted against JAAAT in the amount of $257,896. Since Modification No. 07 being
construed as a government claim had not been previously raised by the Board or
addressed by either party in its briefs, by Order dated June 10, 2020, the Board
requested that the parties brief the following questions:
1) Is Modification No. 07 dated December 12, 2016, which
reduced the contract price by $257,896, a government
claim and a final decision?
2) When did the government provide the contractor a copy
of Modification No. 07?
3) If so, did the lack of appeal rights prejudice the
contractor to timely appeal?
4) Did the contracting officer’s June 6, 2017, letter in
response to appellant’s March 24, 2017, “Credit for
remaining work request for equitable adjustment” vacate
Modification No. 07?
12
5) For the dispute surrounding the punch list items, did the
contractor timely appeal to this Board?
39. By letter dated June 30, 2020, a notice of appearance for
Andrew T. Bodoh, Esq., was entered for JAAAT counsel for the appeal of ASBCA
No. 61799. Attached to the notice of appearance was JAAAT’s brief and a
Declaration of Mr. Rickey Barnhill, in response to the Board’s June 10 Order.
Appellant’s brief responded to each of the Board’s questions and it generally argues
that Modification No. 07 is a government claim, citing FAR 52.233-1(c), but was
equivocal whether it was a final decision, stating, “[t]he facts of this case may support
either ‘yes’ or ‘no’” (app. br. dtd. June 30, 2020 at 1).
40. On June 30, 2020, the government filed its brief in response to the Board’s
Order dated June 20, 2020. The government generally argues that the contracting
officer’s actions were contract administration actions that fall under the Changes
clause (FAR 52.243-4), which provides the government the unilateral right to order
changes in work within the scope of the contract, and provides for an equitable
adjustment if the changes increases or decrease the cost or time of performance (gov’t
br. dtd. June 30, 2020 at 4-5). The government argues that “FAR 52.243-4(e) further
requires the contractor to assert its right to an adjustment in contract price within 30
days of receipt of a written change order,” which JAAAT failed to do. (Id. at 5) In
addition, the government argues that JAAAT filed a request for equitable adjustment
for the punch list items on March 24, 2017, which was never presented as a claim or
certified as required for disputes in excess of $100,000 (id. at 6).
41. The parties submitted simultaneous response briefs on July 10, 2020.
ASBCA NO. 61800 (ELEVATOR) SOF
42. JAAAT submitted two documents dated April 5, 2017, and April 7, 2017, to
the contracting officer requesting an “equitable adjustment” for additional construction
costs in the amount of $272,798 associated with the government’s elevator inspection
process, to include an additional 117 days to the contract completion date. The April 5
document requested an “Equitable Adjustment (REA)” in the amount of $272,798 (R4,
tab 15a at 2718). The April 7 document provides for an increase of the “Request for
Equitable Adjustment (REA) requesting $348,898.” While this document is not found
in the government’s Rule 4 file, it was attached to JAAAT’s pleading as “Tab 9: 61800
Elevator REA, submitted 5 Apr 2017.” (Compl. at tab 9) Neither letter requests a
final decision or indicate that JAAAT views its request as a claim under 41 U.S.C.
§ 7103 or the Disputes clause under the contract. The subject line contained in each
letter are titled, “Elevator Inspection Delay Request for Equitable Adjustment.”
JAAAT requested that 117 days should be added to the contract, and “an equitable
adjustment” in the amount $272,798. (R4, tab 15a at 2718, 2722; compl.
13
at tab 9)(Emphasis in original) The letters do not include a claim certification, as
required by the CDA, 41 U.S.C. § 7103(b)(1), for claims over $100,000. Attached to
the letters are supporting documents, titled “Elevator Delay REA” (R4, tab 15a
at 2723-78; compl. at tab 9).
43. On June 6, 2017, the contracting officer informed JAAAT that it was unable
to review the elevator inspection delay request for equitable adjustment due to a lack
of critical information and requested that the “missing documentation be provided as
soon as possible . . . .” (R4, tab 15b at 2779).
SETTLEMENT AGREEMENTS SOF
44. During performance of the contract, JAAAT was experiencing financial
difficulties on several of its government contracts bonded by Liberty Mutual Insurance
Company and Safeco Insurance Company of America (collectively “Safeco”) (gov’t
mot., ex. G-2 at 1-4, G-4).
45. In 2014, Safeco began receiving numerous payment bond claims on
JAAAT’s Bonded Projects. Pursuant to its obligations under the bonds, Safeco made
payments and incurred expenses on behalf of JAAAT, in the amount of $7,459,124.41.
(Gov’t mot., ex. G-2 at 2, ¶¶ 1.5, 1.6)
46. Litigation was initiated by Safeco for satisfaction of several surety bonds
issued in connection with JAAAT’s government contracts. Suit was filed against
JAAAT in the Eastern District of Virginia (Case No. 3:15-cv-00019-JAG) (id.
at ¶ 1.6).
47. Litigation was also initiated against Tetra Tech, Inc. (“Tetra Tech”) by
Safeco for satisfaction of several surety bonds issued in connection with JAAAT’s
government contracts. Safeco filed suit on May 6, 2015, in the Central District of
California (docketed as 2:15-cv-03386-SJO-JEMx). In addition to being the defendant
in that action, Tetra Tech was also counterclaimant and third party plaintiff against
JAAAT (which was a third party defendant to that litigation). (Gov’t mot., ex. G-2
at 2, ¶ 1.6; G-4)
48. The relationships of the parties in the litigation and related disputes are
understood as follows: Safeco (surety) issued payment and performance bonds on
behalf of JAAAT, as bond principal. USACE, the bond obligee, issued five task
order/delivery order contracts under various MATOCs for construction work at federal
facilities in Georgia and North Carolina (bonded projects) to JAAAT. Tetra Tech
Tesoro, Inc. (Tesoro), was a subcontractor on each of the bonded projects. (Gov’t
mot., ex. G-2 at 1-2) JAAAT and Tetra Tech EC, Inc. (TTEC) had entered into one or
more teaming agreements with respect to the contacts issued. Tesoro and TTEC are
14
subsidiaries of Tetra Tech.11 Mr. Cummings and Mr. Barnhill are representatives of
JAAAT. (Gov’t mot., ex. G-2; app. resp. at 3)
49. A number of related and unrelated disputes arose during the pendency of
the litigation, including disputes under the task order 12 (gov’t mot., ex. G-2 at 2-4,
¶¶ 1.5, 1.6, 1.7).
50. The parties involved in the litigation, and the USACE, began negotiations in
an attempt to resolve all matters. With the assistance of a mediator, the parties entered
into a memorandum of settlement on August 30, 2017, “in which they agreed to
execute a formal agreement of settlement and release containing the material terms of
the Memorandum of Settlement . . .” (gov’t mot., ex. G-2 at 4, ¶ 1.10). After months
of discussions, an omnibus agreement was reached among the parties in the litigation.
That omnibus agreement (“JAAAT/Safeco/Tetra Tech Settlement”) entered into on or
about October 30, 2017, included an agreement in principle between JAAAT and
USACE (“Brigade Project Settlement”) to settle all disputes under the task order.13
The Brigade Project Settlement provided for compensation to Safeco consistent with
the terms of the JAAAT/Safeco/Tetra Tech Settlement and partially funded from the
proceeds of the Brigade Project Settlement. The signatories to the
JAAAT/Safeco/Tetra Tech Settlement, included JAAAT, Safeco Insurance Company
of America, Liberty Mutual Insurance Company, Tetra Tech, Tesoro, TTEC, Rickey
Burton Barnhill, and Clyde Edward Cummings. (Gov’t mot., ex. G-2 at 1, 10-12)
51. The JAAAT/Safeco/Tetra Tech Settlement incorporates the Brigade Project
Settlement reached in principle between appellant and the government. The Brigade
Project Settlement was integral to the JAAAT/Safeco/Tetra Tech Settlement by
providing funds to support the overall settlement structure of the larger litigation. The
terms of the Brigade Project Settlement are outlined with specificity in the
JAAAT/Safeco/Tetra Tech Settlement and includes the government’s agreement to
pay $3.2 million to resolve the disputes under the SOF Brigade Headquarters Contract:
1.9 Based on a meeting between Safeco, JAAAT
and Government, including respective counsel, and based
11 Consistent with FRE 201(b)(2), (c)(1) and (d), we take judicial notice of public
information identifying the subsidiaries of Tetra Tech as set forth in the SEC
Annual Report. Tetra Tech, Inc., (XX-XXXXXXX) Form 10-K, Annual Report
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, dated
October 1, 2017, Exhibit 21, Subsidiaries of the Company.
12 The settlement agreement refers to this task order as the “SOF Brigade Headquarters
Contract” (gov’t mot., ex. G-2 at 2, ¶ 1.3.e).
13 The task order was referred to in the JAAAT/Safeco/Tetra Tech Settlement as the
“SOF Brigade Headquarters Contract”.
15
on representations made by Government during that
meeting, Safeco and JAAAT have represented, but do not
warrant and the Parties assume the risk of all such
representations, negotiation of a pending settlement
involving Requests for Equitable Adjustment submitted to
the Government respecting the SOF Brigade Headquarters
Contract which resolves all contract claims, confirms
project completion and voids the Bond for the specific
contract, and which includes the Government’s agreement
to pay $3.2 million in resolution of the Request for
Equitable Adjustment, from which Safeco is to receive
$2.8 million with JAAAT to receive the balance of
$400,000.
(Gov’t mot., ex. G-2 at 4, ¶ 1.9)
52. The JAAAT/Safeco/Tetra Tech Settlement provided for payment to Safeco
from both Tetra Tech and JAAAT but JAAAT’s payment to Safeco was to be funded
through the Brigade Project Settlement. The payments were to occur in 2017. Tetra
Tech was required to make payment to Safeco in the amount of $3,850,000 (gov’t
mot., ex. G-2 at 5, section 2.4). In addition to making its own payment, Tetra Tech
guaranteed JAAAT’s payment to Safeco in the amount of $2,800,000 if “Safeco does
not receive the $2,800,000 on or before December 31, 2017, from the Government.
(Id. at 5, ¶¶ 2.1-2.2) Paragraph 2 is recited here, in its entirety, as these terms are
germane to the parties’ positions:
2. Terms of Settlement. The Recitals above are true and
correct and are made part of this Agreement.
2.1 Safeco shall receive the sum of Two Million Eight
Hundred Thousand Dollars ($2,800,000) from the
settlement proceeds of JAAAT’s Request for Equitable
Adjustment on SOF Brigade Headquarters, Ft. Bragg, NC,
Contract No. W912HN-10-D-0063/DQ01. JAAAT shall
receive any remaining settlement proceeds. The Parties
shall submit all necessary documents to and cooperate with
the Government so that the Government can issue the
$2,800,000 payment directly to Safeco. In the event that
the Government’s payment to Safeco exceeds $2,800,000,
Safeco shall pay the amount above $2,800,000 to JAAAT
within ten (10) business days from its receipt of the
payment from the Government and notify the relevant
Government offices identified by JAAAT that all future
16
REA payments should be made directly to JAAAT and not
to Safeco. If the payment is less than $2.8 million then
Safeco shall receive the amount, and Tetra Tech shall
make up the difference so that Safeco receives $2.8 million
per the guarantee in 2.2, below. Tetra Tech shall receive a
corresponding return of any payment advance it has made
on the guarantee described in 2.2, below. Since August 30,
2017, JAAAT has continued to press the Government for
finalization of the Brigade REA settlement and will
continue to maintain contact with the Government to try to
facilitate, and to cooperate and not interfere or prevent the
consummation of, the SOF Brigade settlement and the
payments as contemplated by this Agreement. Safeco will
cooperate and will not interfere with or prevent the
consummation of the SOF Brigade settlement. Any
specific request to Safeco to cooperate in connection with
the SOF Brigade settlement and the distribution of those
funds as contemplated by this Agreement shall be in
writing and presented both to Safeco and its counsel in the
Central District Indemnity Action. The Parties
acknowledge Safeco’s expectation that its costs related to
such cooperation efforts would be nominal, and in reliance,
Safeco will so cooperate.
2.2 Tetra Tech guarantees payment of the $2,800,000 set
forth in Section 2.1 by a Stipulation of Judgment, which is
attached hereto as Exhibit B, in the amount of Three
Million Six Hundred Forty Thousand Dollars ($3,640,000)
that may be filed in the Central District of California
Indemnity Action on or after January 1, 2018 in the event
that Safeco does not receive the $2,800,000 on or before
December 30, 2017 from the Government or from Tetra
Tech. Once approved by the Central District, Safeco may
proceed with execution on the stipulated judgment for
itself and for no others, including any other party to this
Agreement. Tetra Tech’s guarantee is to ensure that
Safeco receives the $2,800,000 on or before December 31,
2017, should the Government not make payment before
then. In the event that Tetra Tech makes the $2,800,000
payment to Safeco and the Government thereafter makes
another payment of $2,800,000 or in another amount to
Safeco, Safeco shall return to Tetra Tech the amount it
received from the Government up to $2,800,000 and any
17
amount over $2,800,000 shall be paid to JAAAT in
accordance with Section 2.1. The Stipulation of Judgment
shall be cancelled and returned to Tetra Tech upon the
earlier of payment of the $2,800,000 by the Government or
Tetra Tech to Safeco, at which time Safeco shall file a
dismissal with prejudice of the Central District Indemnity
Action if not already filed.
2.3 JAAAT hereby grants to Tetra Tech power of attorney
authorizing Tetra Tech to finalize all aspects of the
settlement with the Government as set forth in Section 2.1.
The power of attorney is attached hereto as Exhibit C.
Safeco consents to the power of attorney attached as
Exhibit C. Use of the power of attorney is conditioned
upon Tetra Tech making the $2,800,000 payment as
permitted in Section 2.2.
2.4 As set forth in the Memorandum of Settlement
identified in Section 1.10, and separate and apart from the
guaranty obligation set forth in Section 2.2, Tetra Tech has
made payment to Safeco of the sum of Three Million Eight
Hundred Fifty Thousand Dollars ($3,850,000).
2.5 Within 30 days of the complete execution of this
Agreement, the Parties shall file dismissals with prejudice
as to the Settled Litigation, with the exception of the
Central District of California Indemnity Action and
Eastern District of Virginia Indemnity Action. Safeco will
dismiss the Central District of California Indemnity Action
within 30 days of its receipt of the payments totaling
$6,650,000, as set forth in Section 2.1, 2.2 and 2.4.
Safeco's judgment in the Eastern District of Virginia
Action will be marked as satisfied within ten (10) days
once Safeco receives from the Government the $2,800,000
payment discussed in Sections 2.1 and/or 2.2.
2.6 JAAAT shall be responsible and assume all further
risks and costs for close out of the Bonded Projects and to
the extent JAAAT opts to prosecute at its own cost and
expense any non-Brigade or other requests for equitable
adjustments that it previously submitted to the Government
on the Bonded Projects but which have not yet been
resolved at the time of the execution of this Agreement,
18
JAAAT may do so at its own risk and cost and shall be
entitled to collect all proceeds from same (subject to
Safeco’s and/or Tetra Tech’s entitlements regarding the
Brigade REA discussed in Sections 2.1 through 2.3,
above). JAAAT and its principals and affiliated
companies, however, agree that they will not submit any
new claims or requests for equitable adjustment related to
the Bonded Projects that would create any claim against
the other Parties, and, specifically, that any new claims or
requests for equitable adjustment shall not create any
obligation on the part of Safeco under the GAI or any
related obligation on the part of Tetra Tech.
2.7 The Parties shall each bear their own attorneys’ fees
and costs incurred in connection with the Settled
Litigation, except as to any future attorneys’ fees and costs
incurred in enforcing this Agreement.
(Id. at 4-6) (Emphasis in original)
53. “Settled Litigation” refers to all litigation mentioned in the
JAAAT/Safeco/Tetra Tech Settlement and “any other payment bond or Project
Contracts litigation previously or currently filed” (gov’t mot., ex. G-2. at 4, ¶ 1.8). The
parties, including JAAAT, also represented that they were unaware of any other claims
(id.).
i. Power of Attorney
54. In exchange for the guarantee made by Tetra Tech to Safeco, JAAAT
granted Tetra Tech a Power of Attorney (POA) “to finalize all aspects of the
settlement with the Government as set forth in Section 2.1” of the
JAAAT/Safeco/Tetra Tech Settlement (gov’t mot., ex. G-2 at 5, ¶ 2.3; ex. G-3 (POA)).
The POA reaffirmed Tetra Tech’s rights “to exercise any or all of the rights and power
of attorney if Tetra Tech so makes payment to Safeco. . . .”:
R3. JAAAT has agreed, and herein reaffirms, Tetra Tech’s
right and entitlement to exercise any or all of the rights and
powers of this power of attorney if Tetra Tech so makes
payment to Safeco as necessary to meet the Guaranty
obligation aforesaid [“Tetra Tech Payment Condition”].
(Gov’t mot., ex. G-3 at 1, ¶ R3)
19
55. The POA was executed by JAAAT on November 15, 2017 (gov’t mot.,
ex. G- 3).
56. On December 11, 2017, Safeco provided a Consent of Surety which
provided as follows:
Safeco Insurance Company of America, being the surety
respecting the payment and performance bonds posted for
the SOF Brigade Project, Contract No. W912HN-10-D-
0063 DQ01; designated as Bond No. 02408098, consents
to the foregoing Special Power of Attorney.
(Id. at 3)
57. The POA was not revocable by JAAAT if the government failed to make
payment to Safeco on or before December 31, 2017, triggering the guaranty obligation
by Tetra Tech:
3. An affidavit executed by Tetra Tech and Safeco, setting
forth that Tetra Tech has made payment to Safeco as
necessary to satisfy the Guaranty, shall be conclusive proof
that the condition for its authority to exercise rights
pursuant to this power of attorney. This power of attorney
is not revocable by JAAAT, but shall become null and
void, only, if payment is made by the Government to
Safeco on or before December 31, 2017, such that Tetra
Tech has no guaranty obligation to Safeco; otherwise, this
power of attorney shall remain valid and binding.
(Id. at 2, ¶ 3)
58. Consistent with the POA, Tetra Tech guaranteed a payment of $2,800,000
to Safeco in the event the government did not finalize the settlement and make
payment prior to December 31, 2017:
R2. The Brigade Project Settlement will be divided
between Safeco and JAAAT by agreement between them,
with Safeco receiving $2,800,000 and with JAAAT
receiving the remainder. However, if that $2,800,000 is
not received by Safeco on or before December 31, 2017,
then, pursuant to the Settlement and Release Agreement of
even date herewith entered into by and among the parties,
Tetra Tech has agreed to guaranty payment of that amount
20
to Safeco should the Government not make payment
before then [“Guaranty”], and in such event Safeco and
JAAAT have agreed that any payment by the Government
shall first reimburse Tetra Tech for the amount paid to
Safeco pursuant to the Guaranty up to the $2,800,000
Guaranty amount.
(Id. at 1, ¶ R2)
59. The POA recognized that the Brigade Project Settlement had not yet been
finalized with, or the settlement amount paid by, the Government:
R1. JAAAT and the Brigade Project’s surety, Safeco
Insurance Company of America [“Safeco”], have agreed,
in principal, to settlement with the Government the
Brigade Project adjustment claims submitted
previously by JAAAT to the Government for the total
amount of $3,200,000 [“Brigade Project Settlement”];
however, the Brigade Project Settlement documentation
has not yet been finalized with, or the settlement amount
paid by, the Government.
(Id. at 1, ¶ R1) (Emphasis added)
In fact, the JAAAT/Safeco/Tetra Tech Settlement and the POA recognized that
Brigade Project Settlement would be delayed and stated in part:
Also, based on representations from the Government,
Safeco and JAAAT further represented . . . that finalization
of the agreement and payment of the monies by the
Government for the SOF Brigade Headquarters Contract
has been delayed pending resolution of a recent
Government audit.
(Gov’t mot., ex. G-2 at 4, ¶ 1.9) (Emphasis added)
60. The POA provided for Tetra Tech “to act for and/or on JAAAT’s behalf as
true and lawful agent and attorney for and in JAAAT’s name, place,” and to “finalize[]
and/or otherwise secur[e] payment” for JAAAT’s claims against the government under
the Brigade Project:
1. Tetra Tech is entitled, but not required, to act for and/or
on JAAAT’s behalf as true and lawful agent and attorney
21
for and in JAAAT’s name, place, and stead, either in
writing, electronically, or by other authorized means, as
needed to make, endorse, sign, and deliver any and all
documents or things necessary for finalizing and/or
otherwise securing payment respecting JAAAT’s
settlement of contract adjustments and/or claims respecting
that certain federal construction project let to JAAAT by
the. . . [government] and identified by the Government as
Contract No. W912HN-10-D-0063- DQ01, and relating to
the project commonly referred to as the “SOF Brigade
Headquarters Facility”. . . .
(Gov’t mot., ex. G-3 at 1-2, ¶ 1)
61. The POA also recognized that Tetra Tech would be allowed to retain
proceeds of the Brigade Project Settlement equal to the amount of payment it made to
Safeco with “any balance to be released to JAAAT. . . .”:
2. Tetra Tech is further authorized to retain so much of the
Brigade Project Settlement monies paid to it pursuant to
this power of attorney as necessary to reimburse Tetra
Tech for amounts paid by it to Safeco to meet the Guaranty
obligation; with any balance to be released by Tetra Tech
to JAAAT . . . .
(Id. at 2, ¶ 2)
62. The POA was effective only if the Government failed to make payment to
Safeco on or before December 31, 2017, triggering the Tetra Tech guaranty to make a
$2,800,000 payment to Safeco (gov’t mot., ex. G-2 at 5, ¶¶ 2.2-2.3; ex. G-3 at 2, ¶ 3).
63. The Brigade Project Settlement was not consummated in December 2017,
and the Government did not make payment to Safeco. Tetra Tech made the Brigade
Project Settlement’s payment of $2,800,000 in accordance with the terms of the
JAAAT/Safeco/Tetra Tech Settlement and the POA, thus, triggering the rights under
the non-revocable POA (gov’t mot., ex. G-2 at 4-5, ¶¶ 1.10, 2.2, 2.3; ex. G-3 at 1-2, ¶¶
R2, R3, 2, 3; ex. G-4).
64. Appellant admits that “the term claim in the POA and elsewhere clearly
refers to claims that might have been made, and/or REAs converted to claims . . . .”
(app. resp. at 5).
22
65. In accordance with the JAAAT/Safeco/Tetra Tech Settlement, JAAAT was
responsible for, and assumed all risks and costs necessary to close out the Bonded
Projects. The agreement provided:
[T]o the extent JAAAT opts to prosecute at its own cost[s]
and expense any non-Brigade or other requests for
equitable adjustments that it previously submitted to the
Government on the Bonded Projects but which have not
yet been resolved at the time of the execution of this
Agreement, JAAAT may do so at its own risk and cost and
shall be entitled to collect all proceeds from same (subject
to Safeco’s and/or Tetra Tech’s entitlements regarding the
Brigade REA discussed in Sections 2.1 through 2.3,
above).
(Gov’t mot., ex. G-2 at 6, ¶ 2.6)(Emphasis added)
66. The JAAAT/Safeco/Tetra Tech Settlement contains a “Release of Claims”
clause, which states, in part, and “Waiver of Statutory Rights” clause, which states:
3. Release of Claims. Except for the obligations set forth
in, created by, arising out of or reserved by this
Agreement, the Parties, for themselves, and for all of their
heirs, executors, administrators, successors and assigns, do
hereby fully and forever release, discharge, and dismiss
any and all present and future claims, demands, causes of
action, rights, damages, costs, expenses and compensations
whatsoever, in law or in equity, in the nature of an
administrative proceeding or otherwise (known, unknown,
contingent, accrued, inchoate or otherwise), that they have,
have had or may have, now or in the future, against one
another, and all companies, partnerships, individuals,
associated or affiliated or otherwise connected with them,
and of their agents, attorneys, servants, successors, heirs,
executors, associations or partnerships, arising out of or
relating in any way to the Bonds, the Bonded Projects,
the Teaming Agreements, the Subcontracts, and the
Settled Litigation.
....
4. Waiver of Statutory Rights. Except for the
obligations set forth in, created by, arising out of or
23
reserved by the Agreement, including those reservations as
stated in Sections 3.1 and 3.2, the Parties hereby
acknowledge that they are familiar with California Civil
Code § 1542, which provides as follows:
A general release does not extend to claims which the
creditor does not know or suspect to exist in his or her
favor at the time of executing the release, which if known
by him or her must have materially affected his or her
settlement with the debtor.
Except as provided for under the terms of this Agreement,
the Parties waive and relinquish any and all rights and
benefits which they may have under, or which may be
conferred upon them by, the provisions of § 1542 of the
California Civil Code and/or by any similar law of any
state or territory of the United States, to the fullest extent
that they may lawfully waive such rights or benefits
pertaining to the subject matter of this Agreement. In
connection with such waiver and relinquishment, the
Parties acknowledge that they are aware that they or their
attorneys may hereafter discover claims or facts in addition
to or different from those which each of them now knows
or believes to exist with respect to the subject matter of, or
any part to, this Agreement, but that it is the intention of
the Parties to hereby fully, finally and forever waive said
claims, whether known or unknown, suspected or
unsuspected, which concern, arise out of, or are in any
way connected with the Bonds, the Bonded Projects,
the Teaming Agreements, the Subcontracts, and the
Settled Litigation.
(Id. at 6-7, ¶¶ 3-4)(Emphasis added)
a. Implementation of Brigade Project Settlement
67. The Brigade Project Settlement continued to be delayed after December 31,
2017, because JAAAT was experiencing issues to a related project. The government
ultimately agreed to unencumber the related project from the Brigade Project
Settlement to allow the settlement to move forward. In addition, during the audit, the
government discovered irregularities in payment estimates resulting in an adjustment
to the settlement amount as anticipated by the settlement agreement (id.; gov’t mot.
24
at 5-7, ¶¶ 7, 11, 13; gov’t mot., ex. G-1 at 13; ex. G-2 ¶¶ 1.9, 2.1, 2.2 at 4-5; app. resp.
at 4; gov’t reply at 8).
68. Consistent with Section 1.9 of the JAAAT/Safeco/Tetra Tech Settlement,
and based upon the government’s discovery of irregularities in payment estimates for
several JAAAT projects, the government reduced the settlement amount from $3.2
million to $3.0 million, and later revised the settlement to $3.1 million. (Gov’t mot.
at 5, ¶ 7; ex. G-1 at 1, 13; G-2 at 4)
69. In May 2018, Tetra Tech sought to exercise its rights under the POA and
provided the government with a settlement agreement. JAAAT objected and Tetra
Tech filed an ex parte application for emergency relief with the United States District
Court, Central District of California, under Case No. 2:15-CV-03386-SJO-JEMx to
effectuate the Brigade Project Settlement and give effect to the POA. Tetra Tech
requested that the Court enter its Order on or before September 5, 2018, at 2 p.m.
Pacific time which is the date that the government extended its offer to settle. (Gov’t
mot. 5-6, ¶ 8; ex. G-1 at 12-14; ex. G-4, G-6)
70. While waiting for a decision from the Court on Tetra Tech’s emergency
request, JAAAT’s attorney, Wyatt B. Durrette, Jr., in an email dated July 17, 2018, to
the government’s attorney, Justin P. McCorcle, confirmed JAAAT’s agreement to
settle “the Brigade REAs for $3.1 million instead of the $3.2 million that had been
agreed to at the meeting on August 10, 2017” (gov’t mot., ex. G-1 at 1). Mr. Durrette
also included Mr. Terry Bates, Tetra Tech’s counsel on the email, “so that he receives
verification that this is acceptable to USACE, so he will know he needs to do nothing
further to receive the sums to which his client is entitled to from this resolution” (id.).
71. By email dated August 30, 2018, to Mr. McCorcle, Mr. Durrette raised the
issue of three additional claims that JAAAT believed it was entitled to under the
contract, rescinded its July 17 acceptance of 3.1 million, and proposed the amount of
3.75 million:
Justin,
In order to try to bring this to closure quickly and because
my schedule is so tight today, I thought it best to send
JAAAT’s position in an email to see if we can resolve
matters:
Based on the modification and Rick’s conversation with
Sheila Figgins, JAAAT believes it is entitled to the
following from the contract:
25
1. $75,973.51—This is the amount deducted in the
unilateral Stormwater modification that was submitted in
2014 by USACE. The deduction was included in the
settlement agreement amount of $3.2M.
2. $257,896—This is a JAAAT claim for punch list items
that should have been added to the contract but JAAAT
gave it up in the 3.2M settlement and now it has been
deducted again in the modification.
3. $757,200.92—This deduct is based on Sheila’s reporting
to Rick that this is the number of days Dennis advised
should be deducted for LDs calculated at $1423.31 per
day. JAAAT gave up the compensable $ for project day
additions in the REA settlement, but it did not agree to
give up the additional project days themselves.
Adding these three together equals $1,091,070.43, which
JAAAT believes it is entitled to. In order to resolve this
and move on, JAAAT will again compromise at $650,000
for a total payment from USACE on Brigade of
$3,750,000.
(Gov’t mot., ex. G-1 at 5-7)
72. The Government responded the next day by email dated August 31, 2018,
to JAAAT’s rescinding of its agreement of the $3.1 million settlement amount.
Mr. McCorcle rejected the counter offer for $3.75 million and agreed to hold open the
settlement offer of $3.1 million until September 5, 2018 at 5 p.m.:
To be clear, as stated in the attached email, on July
17, 2018, you accepted, on behalf of JAAAT, the
Government’s offer of final settlement of the Brigade
Headquarters contract in the amount of $3.1 million.
....
In reliance on this email, the Wilmington District
obtained $3.1M from USSOCOM, at no small difficulty.
Some of these funds are cancelling funds, and if not
expended by September 30 of this year, simply no longer
exist. The District presented JAAAT with a modification,
release of claims, and final payment document that would
26
add sufficient days to the contract completion date to allow
for us to do exactly what you asked: pay JAAAT, through
its surety, the sum of $3.1M.
Your email below, received yesterday, indicates that
JAAAT has withdrawn its July 17 acceptance of the
Government’s offer, and instead counteroffered for the
sum of $3.75M. The basis of your counteroffer appears to
be additional claims that we did not understand to be
separate from your offer to settle “the Brigade REA’s”
[sic], and the full release of all liquidated damages from
the job that JAAAT (almost) completed over 900 days late,
discounted to reach the sum of $3.75M. We do not
understand this withdrawal and counteroffer to be in
keeping with the spirit or substance of our negotiations
with you, and I question whether it reflects accurately the
value of the claim and settlement that you have disclosed
to your surety, its creditors, and applicable Federal courts.
Regardless, your counteroffer is rejected.
As I noted above, cancelling funds must be returned
to the Secretary of Defense, and from thence to the US
treasury, if not expended by September 30. In order to
allow the Department of Defense to utilize these funds
before they cease to exist, it is our duty to return them if
there is any danger that they will not be expended by
September 30. That danger exists now. As a result, the
Wilmington District will extend its offer to settle the claim
for $3.1M, as documented in the modification, release, and
final payment application in JAAAT’s hands, ONLY until
5PM EDT on Wednesday, September 5, 2018. If we have
not received the executed modification by that time, our
offer is withdrawn and we will immediately return all
funds to USSOCOM. If those funds are returned, I would
not expect us to be able to request funds from SOCOM
again without a court order.
I trust that you will immediately disclose this
communication to your surety and appropriate creditors.
(Id. at 4-5)
27
73. Later the same day, Mr. Durrette emailed Mr. McCorcle, and stated that
JAAAT would accept the $3.1 million to settle $10 million of Brigade REAs, releasing
the government of further responsibility:
On your suggestion I forwarded this to the surety
and to Tetra Tech via their counsel. JAAAT believes that
it only settled the REAs for $3.2, now $3.1 million, and is
prepared to proceed with that. USACE believes that the
final close out of the contract was included in the
settlement. Common to both positions is that over $10
million of REAs were settled. It seems it would be in both
parties’ interest therefore to consummate that. For the $3.1
payment JAAAT is prepared to accept it as full payment
for over $10 million of REAs and release the government
of any further responsibility in that regard.
(Id. at 3) (Emphasis added)
74. On September 4, 2018, the Central District of California issued an Order
granting Tetra Tech’s right to consummate the JAAAT/USACE Brigade Settlement in
accordance with the rights provided in the POA. The court provided a single page
Order that recites the clear language as set forth in clause 1 of the POA. (Gov’t mot.,
ex. G-3, ex. G-6)
75. In an email dated September 4, 2018, Mr. Bates notified the government of
the entry of the Order confirming Tetra Tech’s right to act in accordance with the POA
and conclude the Brigade Settlement. Mr. Bates requested a copy of the modification
for Tetra Tech to sign on behalf of JAAAT to settle the dispute. (Gov’t mot., ex. G-1
at 9)
76. By email dated September 5, 2018, at 4:35 p.m., Mr. Durrette, on behalf of
JAAAT, stated that its lack of response cannot be construed as an acceptance or
agreement of Tetra Tech’s position:
JAAAT and Tetra Tech have stated their positions.
At some point litigation via email must stop. That time is
now. JAAAT’s decision not to further respond cannot be
interpreted as agreement with any facts or legal positions
taken by Tetra Tech and set forth below. JAAAT chooses
to advance its position in other forums.
(Id. at 12)
28
b. Modification DQ0108 (Modification No. 08) and Payment
77. The government in reliance on the POA, the signed JAAAT/Safeco/Tetra
Tech Settlement, and the Central District of California Court’s Order, issued
Modification DQ0108 (Modification No. 08) which provides an additional 255
calendar days to the contract and $3,100,000 as a full settlement. Consistent with the
POA, Modification No. 08 was bilaterally signed by Tetra Tech’s CEO on
September 5, 2018, and the contracting officer signed September 6, 2018, having an
effective date of August 23, 2018 (gov. mot. at 7-8, ¶¶ 15, 16, 17; ex. G-1 at 9-11, 16-
19; ex. G-7). Modification No. 08, states, in part:
Provide for the full settlement of the Storm Water
Management Claim, dated 1 October 2014, submitted by
the contractor on behalf of it and its subcontractors. This
modification adds an additional 255 Calendar Days to the
contract with a revised completion date of 23 June 2015.
Provides for the full settlement of Modification 04 issued
unilaterally on 17 April 2014.
Provides for the full settlement of Modification 07 issued
on 12 December 2017.
...
The total cost of this contract was increased by
$3,100,000.000 . . .
(Gov’t mot. at 7; ex. G-7 at 1-3)
78. Modification No. 08 provides a “Release” clause to release the government
from all liability and equitable adjustments under the contract. The release clause
states, in its entirety:
RELEASE: In consideration of the modification agreed to
herein as complete, equitable adjustments for all existing
or potential claims or appeals of the contractor and its
subcontractors and suppliers arising under this contract, the
Contractor hereby releases the Government from any and
all liability under this contract for further equitable
adjustments attributable to such facts or circumstances
which gave rise to the times outlined above.
29
The Contractor hereby agrees to release, waive and forever
abandon all claims arising under the Equal Access to
Justice Act to attorney fees and other expenses arising
from the above stated contract claims under the contract.
(Gov’t mot., ex. G-7 at 12)
79. Safeco signed a consent of surety for Modification No. 08 (gov’t mot. at 8,
ex. G-1 at 10; R4, tab 43).
80. As provided in the JAAAT/Safeco/Tetra Tech Settlement and the POA, the
government issued final payment on or about September 7, 2018, a check in the
amount of $3.1 million to Safeco (gov’t mot. at 8, ex. G-1 at 19, ex. G-5 at 1, ex. G-8,
ex. G-9). The check was cashed on September 12, 2018 (gov’t mot., ex. G-9 at 2).
Statement of Undisputed Material Facts (SUMF) 1 through 19
81. SUMF 1: “JAAAT and Respondent initially agreed to settle the Brigade
REAs for $3.2 million” (gov’t mot. at 3; SOF ¶¶ 51, 68, 71, 73; gov’t mot., ex. G-1
at 1, 13). Appellant responds that the parties negotiated a settlement for the eight
REAs in the amount of $3.2 million that was contingent on JAAAT’s acceptance of
the government’s bilateral contract modification:
After thirty- five (35) months of sporadic government
unresponsiveness and intermittent requests for additional
Stormwater REA detailed cost supporting documents, the
government’s counsel and JAAAT’s surety counsel
scheduled a negotiation settlement meeting between
JAAAT and its’[sic] counsel, the government CO and
USACE counsel, and Safeco Insurance Company of
America (JAAAT’s Surety) and its’ [sic] counsel for 10
August 2017. The other eight (8) REAs issued in 2016 and
2017 which USACE had summarily rejected were to be
included in the negotiations. The meeting resulted in a
Government and Surety verbally proposed monetary
settlement of all contract W912HN-10-D-0063, Task Order
DQ01 REAs for $3.2 million contingent upon the
imminent government issuance of a bilateral accepted
contract modification to JAAAT for the proposed amount.
(App. resp. at 3)
30
JAAAT does not challenge the fact that the parties reached a settlement in the
amount of $3.2 million, contending that the agreement was contingent upon its
acceptance of a bilateral contract modification. JAAAT’s position is contrary to the
settlement terms and the POA. (SOF ¶¶ 51, 52, 54, 57-60, 62, 66)
82. SUMF 2: “On 1 November 2017, JAAAT signed a Settlement and Release
Agreement . . . with Tetra Tech . . . Safeco . . . and Liberty . . . to settle ongoing
litigation including the litigation related to the SOF Brigade Headquarters Contract”
(gov’t mot. at 3). Tetra Tech executed Modification No. 08 in accordance with
Sections 1.9 and 2.1 of the JAAAT/Safeco/Tetra Tech Settlement (SOF ¶¶ 51-52, 59;
gov’t mot., ex. G-2 at 4-5; G-7).
83. SUMF 3: “Tetra Tech signed the Settlement and Release Agreement on
31 October 2017 including a release of claims,” reciting the release of claims clause in
the JAAAT/Safeco/Tetra Tech Settlement (gov’t mot. at 4; SOF ¶ 66). Tetra Tech
executed Modification No. 08 providing a release of claims in accordance with
sections 1.9, 2.1, 2.2, 2.3, 3 and 4 of the JAAAT/Safeco/Tetra Tech Settlement, and
section 1 of the POA (SOF ¶¶ 51-52, 54, 59-60, 66; gov’t mot., ex. G-2, G-3)
84. SUMF 4: “The Settlement and Release Agreement also included a waiver
of statutory rights clause,” reciting the statutory rights clause in the
JAAAT/Safeco/Tetra Tech Settlement (gov’t mot. at 4-5). The JAAAT/Safeco/Tetra
Tech Settlement contains a “Waiver of Statutory Rights” in Section 4. (SOF ¶ 66;
gov’t mot., ex. G-2 at 6-7).
85. SUMF 5: “On 15 November 2017, JAAAT executed a special power of
attorney (“POA”) which ‘irrevocably nominates, constitutes, appoints, and designates
Tetra Tech ... , as JAAAT’s true and lawful attorney in-fact,’ reciting the POA clause 1
(gov’t mot. at 5; SOF ¶ 60). Appellant does not challenge the accuracy of the facts set
forth in SUMFs 2-5, but instead responds that the government was not a party to the
issues between JAAAT and any third party:
The Respondent’s Statement of Undisputed Facts
paragraphs 2-5 present in part statements of fact contained
in litigation documents between JAAAT, its’ [sic] Surety
(Safeco) and Tetra Tech, Inc (TTI) the parent company and
project bond co-indemnitor of JAAAT’s subcontractor
Tetra Tech Tesoro which had abandoned the project prior
to completion in December 2014. As previously
represented by USACE, the Government would not be a
party to any private issues concerning JAAAT and any
third parties. The litigation settlement was between
31
JAAAT, TTI, and Safeco, the government was not a party
to the litigation settlement.
(App. resp. at 3)
An agreement was reached among the Bond Principal (JAAAT), Surety/Bond
Insurer (Safeco), and subcontractor (Tetra Tech) concerning the bonded projects – one
of them being the SOF Brigade Headquarters Contract (Bond No. 024048098,
SOF ¶ 3). Executed copies of the settlement documents showing the parties’ terms to
the agreement were provided by the government as support for its position on
summary judgment. JAAAT did not contest the authenticity of executed
JAAAT/Safeco/Tetra Tech Settlement or POA or provided any alternative
interpretation of their terms. (SOF ¶¶ 48, 50-51, 55, 60, 66).
86. SUMF 6: “In December 2017, Tetra Tech advanced payment on JAAAT’s
behalf of the $2.8 million to Safeco” (gov’t mot. at 5, see ex. G-1 at 13, ex. G-4;
SOF ¶ 63). Appellant responds by stating “Paragraph 6 of Respondent’s Statement is
Denied. As a condition of the Surety’s indemnity agreement, TTI was obligated to
reimburse 100% of the costs of any bond expense Safeco incurred on the SOF Brigade
Headquarters project” (app. resp. at 3). Appellant provides no documentation or other
evidence to support its argument, nor an explanation of how the fact, if true, impacts
the terms and conditions of the settlement agreement and/or the POA (SOF ¶¶ 51-52,
57- 58, 62-63).
87. SUMF 7: “Based upon the government’s discovery of irregularities in
payment estimates for several JAAAT projects under contract with USACE, the
government reduced its settlement offer in this matter to $3.0 million, and later raised
that settlement offer to $3.1 million” (gov’t mot. at 5, see ex. G-1 at 1, 13, SOF ¶ 68).
Appellant responds to SUMF 7 stating, “[b]ased on the government’s assertions of
alleged cost irregularities in JAAAT’s REA submittals on other projects under contract
with USACE, the government reduced its’ [sic] settlement offer for the SOF Brigade
Headquarters REAs to $3.0 million without substantiation. After JAAAT objected the
government raised the offer to $3.1 million” (app. resp. at 4). Consistent with
SUMF 7 and JAAAT’s response, the JAAAT/Safeco/Tetra Tech Settlement at section
1.9 recognized that the finalization of the settlement “has been delayed pending
resolution of a recent Government audit” (SOF ¶ 59). The events as described by the
parties is consistent with the agreement and other supporting documentation.
88. SUMF 8:
In May 2018, Tetra Tech sought to exercise its
rights under the POA and accept the government’s
32
settlement offer; JAAAT objected to such acceptance.
Tetra Tech filed a Motion to enforce in the Central District
of California on 25 June 2018, to confirm Tetra Tech’s
rights to accept. The motion was unopposed and the Court
took it under submission, indicating it would rule on the
submission. Prior to the Court’s ruling, JAAAT changed
its position and agreed to accept $3.1 million.
(Gov’t mot. at 5-6; SOF ¶¶ 69-70)
Appellant responded to SUMF 8 by stating:
Paragraph 8 of the Respondent’s statements is corroborated
in respect to TTI’s filing in the U.S. District Court of the
Central District of California (See Appellant’s paragraph
4). The litigation settlement and sequent [sic] power of
attorney (POA) were between JAAAT, TTI, and Safeco.
The government was not a party to the litigation.
(App. resp. at 4)
Appellant does not challenge the acceptance of the $3.1 million in its response
but only points out that the government was not a party to the litigation between the
Surety, Tetra Tech (TTI) and itself. Appellant fails to provide any explanation of how
that fact, challenges the veracity of the settlement agreement and/or the POA (SOF
¶¶ 69-70, 73)
89. SUMF 9:
On 17 July 2018, JAAAT’s counsel, in an email to the
government, “confirm[ed] JAAAT’s agreement to settle
the Brigade REAs [emphasis added] for $3.l million instead
of the $3.2 million that had been agreed to at the meeting
on August 10, 2017.” Further, JAAAT’s counsel stated
that:
JAAAT understands that USSOCOM has
committed to get the funds to [Respondent] within 15
business days” and “[t]hat then requires [Respondent]
need[s] to accept funds and execute a final
payment/release of claims modification [emphasis added]
for JAAAT to sign. With the signed modification and
release, [Respondent] will send a final payment package to
33
[Respondent’s] Finance Center. The Finance Center asks
for 30 (calendar) days to execute final payments, but they
will expedite final payments to be made as the result of a
settled or adjudicated claim. (Ex. G1 at 0001).
(Gov’t mot. at 6)
Appellant responds stating “Paragraph 9 of the Respondent’s statements is
Denied. Appellant’s counsel was outlining the understood government procedure to
receive government funds.” (App. resp. at 4) Appellant’s response ignores the
primary focus of SUMF 9. JAAAT agreed to the revised settlement amount of $3.1
million (SOF ¶¶ 70, 73). But, even if it did not, the POA was not revocable by
JAAAT once Tetra Tech made its $2.8 million payment to Safeco on JAAAT’s behalf
(SOF ¶¶ 57-58, 62-63). Tetra Tech “act[ed] for and/or on JAAAT’s behalf as true and
lawful agent and attorney for and in JAAAT’s name, place,” and to “finalize[] and/or
otherwise secur[e] payment” for JAAAT’s claims against the government under the
Brigade Project (SOF ¶ 60).
90. SUMF 10: “In reliance on this acceptance, the government obtained funds
and issued a bilateral modification, final pay estimate in the amount of $3,101,218.87,
and a full release of claims and consent of surety for JAAAT to execute and return”
(gov’t mot. at 6;.see SOF ¶¶ 77-79). Appellant responds, “Paragraph 10 of the
Respondent’s statements is Denied. On 28 August 2018, twelve (12) months after a
proposed settlement Modification was to be imminently submitted to JAAAT, USACE
submitted an inadequate Modification [No. 08] . . . with which JAAAT and the Surety
immediately took issue.” Appellant cites to Rule 4, tabs 28 and 32. (App. resp. at 4).
Tab 28 is the email correspondence providing a copy of Modification No. 08 to
JAAAT. Tab 32 is an email exchange where JAAAT ultimately agrees to the $3.1
million settlement amount (SOFs ¶¶ 70-71, 73). JAAAT never describes how
Modification No. 08 is “inadequate” or contrary to the terms of the
JAAAT/Safeco/Tetra Tech Settlement or POA.
91. SUMF 11:
On 30 August 2018, JAAAT stated that in addition to the
$3.1 million agreed upon that JAAAT believed it was also
entitled to $1,091,070.43 of which JAAAT claimed: 1)
$75,973.51 “is the amount deducted in the unilateral
Stormwater modification that was submitted by 2014 by
[Respondent]” and that “[t]he deduction was included in
the settlement agreement amount of $3.2M”; 2) $257,896
“is a JAAAT claim for punch list items that should have
been added to the contract but JAAAT gave it up in the
34
$3.2M settlement and now it has been deducted again in
the modification”; and, 3) $757,200.92 “based on ... the
number of days ... [that] should be deducted for LDs ...
[because] JAAAT gave up the compensable $ for project
day additions in the REA settlement, but it did not agree to
give up the additional project days themselves.” JAAAT
proposed to accept an additional $650,000 in addition to
the $3.1 million agreed upon for a total payment of
$3,750,000 to settle everything related to the SOF Brigade
Bridge contract. (Ex. G-1 at 0006).
(Gov’t mot. at 6; see SOF ¶ 71). Appellant does not contest SUMF 11 (app. resp.
at 4).
92. SUMF 12:
On 31 August 2018, Respondent responded to JAAAT
stating that “[o]n July 17, 2018 [JAAAT’s counsel]
accepted, on behalf of JAAAT, the Government’s final
settlement on the Brigade Headquarters contract in the
amount of $3.1 million.” Respondent rejected the $3.75
million counteroffer and extended Respondent’s $3.l
million offer until 5 PM EDT on Wednesday 5 September
2018.
(Gov’t mot. at 7; see SOF ¶ 72) Appellant contests SUMF 12 and refers to the
position it took in response to SUMF 9: “Appellant’s counsel was outlining the
understood government procedure to receive government funds” (app. resp. at 4).
JAAAT agreed to the revised settlement amount of $3.1 million (SOF ¶¶ 70, 73). But,
even if it did not, the POA was not revocable by JAAAT once Tetra Tech made its
$2.8 million payment to Safeco on JAAAT’s behalf (SOF ¶¶ 57-58, 62-63). Tetra
Tech “act[ed] for and/or on JAAAT’s behalf as true and lawful agent and attorney for
and in JAAAT’s name, place,” and to “finalize[] and/or otherwise secur[e] payment”
for JAAAT’s claims against the government under the Brigade Project (SOF ¶ 60, see
SOF ¶ 73).
93. SUMF 13: “On 31 August 2018, JAAAT confirmed that “[c]ommon to the
positions [of Respondent and JAAAT] is that over $10 million of REAs were settled”
but countered that still open was the “issue of what, if anything, is owed under the
contract” (gov’t mot. at 7); see SOF ¶ 73). Appellant does not contest SUMF 13 (app.
resp. at 4).
35
94. SUMF 14: “Tetra Tech sought an emergency ex parte application that the
District Court enter an Order on the pending Motion to Enforce” (gov’t mot. at 7; see
SOF ¶ 69). Appellant does not contest SUMF 14 (app. resp. at 4).
95. SUMF 15: “On 4 September 2018, the U.S. District Court of the Central
District of California issued an ‘Order Granting Ex Parte Application for Emergency
Relief by Defendant and Counterclaimant Tetra Tech, Inc.,’ and continues to recite the
District Court’s Order (gov’t mot. at 7; see SOF ¶ 74). Appellant contests SUMF 15,
stating:
JAAAT’s position is uncomplicated: a) There is no
“JAAAT’s settlement” to accept. The Order changes
nothing as it merely tracks the language of the POA, which
reflects the exact language quoted above. Therefore, the
Order gives Tetra Tech no more power than it has under
the POA. It merely confirms that power in the form of a
court order.
b) What was not discussed in Wilmington according to the
paper trail both before and after the Wilmington settlement
and therefore not resolved in Wilmington was the unpaid
contract amount due JAAAT in addition to the $3.2 million
to be paid for the REAs/claims JAAAT had filed with
USACE. An unpaid contract amount due is not a claim
until USACE refuses to pay it and JAAAT then files a
claim for it. The use of the term claim in the POA and
elsewhere clearly refers to claims that might have been
made, and/or REAs converted to claims, and not to an
unknown sum yet to be determined that might be due
under the original contract as amended[.]
(App. resp. at 4-5) Support for appellant’s position cannot be found within the
settlement agreement and POA. (SOF ¶¶ 51-52, 54, 59-60, 66)
96. SUMF 16:
On 5 September 2018, Tetra Tech executed contract
modification DQ0108 [Modification No. 08] which
provided equitable adjustment for: 1) “full settlement of
the Storm Water Management Claim, dated 1 October
2014, submitted by the contractor on behalf of it and its
subcontracts”; 2) “full settlement of Modification 04 issued
unilaterally on 17 April 2014”; and 3) “full settlement of
36
Modification 07 issued unilaterally on 12 December
2017”. The contract modification stated that it was
“[e]xecuted by Tetra Tech per authority of Power of
Attorney and per court order confirming the same dated
September 4, 2018.
(Gov’t mot. at 7; see SOF ¶¶ 75, 77) Appellant argues that there was not a settlement
for Tetra Tech to accept. Appellant’s position is not supported by any documentation
or affidavits. Tetra Tech executed Modification No. 08 to finalize the settlement
between JAAAT, the surety and the USACE, in the amount of $3.1 million and
providing for a release of claims in accordance with sections 1.9, 2.1, 2.2 and 2.3 of
the JAAAT/Safeco/Tetra Tech Settlement, and section 1 of the POA (SOF ¶¶ 51-52,
54, 59-60, 66; gov’t mot., ex. G-2; G-3).
97. SUMF 17: “Along with the contract modification DQ0108 [Modification
No. 08], a release of claims was executed by Tetra Tech on 5 September 2018,” which
continues to recite the release of claims in Modification No. 08. The release of claims
noted it was “[e]xecuted by Tetra Tech per authority of Power of Attorney and per
court order confirming the same dated September 4, 2018.” (Gov’t mot. at 8; see SOF
¶ 78)
98. SUMF 18: “On 6 September 2018, Tetra Tech executed a final pay
estimate for [the] Contract . . . which notated that it was signed ‘PER POA & Court
Order’” (gov’t mot. at 8; ex. G-8 at 1).
99. Appellant contests SUMFs 16-18, arguing since there was “no JAAAT
settlement, the POA to secure payment . . . is not applicable,” and that the government
“illegitimately recognized” Tetra Tech to settle the disputes with USACE on JAAAT’s
behalf:
Paragraphs 16, 17, 18 of the Respondent’s
statements are contested. For sixty-nine (69) months, the
Government repeatedly represented that the USACE SOF
Brigade project contract obligations and privity were
legally between JAAAT and USACE. In an effort to close
out the SOF Brigade project without JAAAT’s
concurrence, the government abruptly changed its’ [sic]
position and illegitimately recognized third party (TTI)
involvement in August 2018. As there is no JAAAT
agreed settlement, the POA to secure payment respecting
JAAAT’s settlement is not applicable.
37
(App. resp. at 5) While appellant argues that there was not a settlement for Tetra Tech to
accept, its position is not supported by any documentation or affidavits (SOF ¶¶ 51-52,
54, 59-60, 66; gov’t mot., ex. G-2; G-3).
89. SUMF 19: “In reliance on the Court Order, Tetra Tech’s execution of
required documents, and Safeco’s executed Consent of Surety, Respondent made final
payment of $3.l million to Safeco on JAAAT’s behalf on 7 September 2018” (gov’t
mot. at 8; see SOF ¶ 80). Appellant responds, “The government contravened its’ [sic]
represented legal contractual obligations, misinterpreted and misapplied the California
District Court Order, mismanaged the contract modification documents, and exploited
JAAAT’s contract payments” (app resp. at 5). JAAAT does not elaborate or provide
support for how USACE “misinterpreted and misapplied” the JAAAT/Safeco/Tetra
Tech Settlement, POA, or the U.S. District Court of the Central District of California
issuance of an “Order Granting Ex Parte Application for Emergency Relief” or how
USACE “mismanaged” or “exploited” the contract modification documents and
contract payments.
DECISION
The Parties’ Contentions
The government moves for summary judgment on each of the nine appeals
pending before the Board, asserting the defenses of accord and satisfaction and release
of claims (gov’t mot. at 8-13). Alternatively, the government seeks dismissal of
ASBCA Nos. 61793-6180014 for lack of subject matter jurisdiction (gov’t mot. at 9-
16).
The government argues that in each of the appeals currently before the Board,
that appellant’s agent and attorney-in-fact, Tetra Tech, Inc., executed a bilateral
modification on behalf of appellant for the government’s payment of $3,100,000 to
settle ongoing disputes and to bar all future claims under this contract, following the
U.S. District Court of the Central District of California issuance of an “Order Granting
Ex Parte Application for Emergency Relief by Tetra Tech, as Defendant and
Counterclaimant” (gov’t mot. at 7-8). The government asserts that in reliance on the
District Court’s Order and appellant’s agent and attorney-in-fact, the government
made a final payment of $3.1 million on appellant’s behalf (gov’t mot. at 8, ex. 8-9;
SOF ¶¶ 77, 80). The government argues that the defenses of accord and satisfaction
14 While the government did not challenge the jurisdiction of ASBCA No. 61792, on
April 11, 2019, the Board questioned whether it had jurisdiction. The
discussion is addressed below beginning at Section 1, ASBCA No. 61792
(Stormwater).
38
and “release of claims precludes future claims against the [government]” under this
contract (gov’t mot. at 9).
Appellant argues that “[t]he release signed by [Tetra Tech] was invalid” as the
District Court and the government have misinterpreted the special power of attorney
(POA) “as there was no JAAAT settlement to accept in order to implement the POA”
(app. resp. at 5). JAAAT argues that the California Court Order did nothing other than
recite the exact language of the POA and gives Tetra Tech “no more power than it has
under the POA” (id. at 4) JAAAT continues in its argument by espousing that the
agreement reached by the parties did not cover the unpaid balance on the contract due
to JAAAT, and there was “no mutual agreement between the parties” since the
government and appellant “continued to consider JAAAT’s claims after the legal
actions, [sic] that conduct demonstrates that the government did not consider the
actions to constitute an accord and satisfaction of the claim” (id. at 5).
For ASBCA No. 61793, the government argues that the appeal should be
dismissed for lack of jurisdiction because no written claim was ever submitted to the
contracting officer (gov’t mot. at 14). Appellant disagrees and informs the Board that
this “REA was submitted to USACE on 8 November 2016,” citing one of the 12
documents it submitted along with its complaint 15 (app. resp. at 1).
The government argues further that ASBCA Nos. 61795, 61798, 61799, and
61800 should also be dismissed on jurisdictional grounds because each request
exceeds $100,000 and failed to contain any certification as required by the CDA,
41 U.S.C. § 7103(b)(1). The government argues that the complete absence of a
certification is not a jurisdictional defect that can be corrected consistent with
41 U.S.C § 7103(b)(3). (Gov’t mot. at 13-14) Instead, the facts here require a
dismissal by the Board based upon appellant’s failure to present a certified claim in
accordance with the CDA (id.). Appellant counters that the Board has jurisdiction
over these appeals as the REAs were “submitted per Federal Acquisition Regulations
(FAR) for REA submittals less than $700,000” (app. reply br. at 2).
While ASBCA Nos. 61794, 61796, and 61797, were each under $100,000, and
did not require a certification, the government argues that these appeals should
likewise be dismissed for lack of jurisdiction because JAAAT submitted requests for
equitable adjustment (REA) and never converted those REAs into claims (gov’t mot.
at 15). Appellant argues that the Board has jurisdiction over these appeals as “ASBCA
Nos. 61794, 61796, and 61797 were deemed to have COFDs denied at the settlement
15That document consisted of a letter dated November 8, 2016 indicating the subject
was “Request for Equitable Adjustment: Relocation of Projector Screen, Room 1134”
(compl. at tab 2 at 2028-31).
39
meeting of 10 August 2017” (app. resp. at 6). Appellant provides no further
explanation or support for its argument.
We will first address the question of jurisdiction over each of the appeals
currently pending before the Board, and then proceed to the question of entitlement to
summary judgment. We determine jurisdiction at the time the appellant filed its notice
of appeal. See, e.g., Keene Corp. v. United States, 508 U.S. 200, 207 (1993) (quoting
Mollan v. Torrance, 9 Wheat. 537, 539 (1824)) (“‘the jurisdiction of the Court
depends upon the state of things at the time of the action brought’”).
1. ASBCA No. 61792 (Stormwater)
By Order dated April 11, 2019, the Board questioned whether JAAAT’s
May 20, 2014, and September 30, 2014, documents converted its request for equitable
adjustment into a CDA claim (SOF ¶ 9). We invited the parties to address “(i) whether
the contractor’s request for equitable adjustment in ASBCA No. 61792 was converted
to a proper claim submitted to the contracting officer before the initiation of this
appeal, and (ii) whether the Board has jurisdiction over this appeal.” In response, the
government stated it does not contest the Board’s subject matter jurisdiction in
ASBCA No. 61792, and in support of its position supplemented its Rule 4 file with
new information contained at government Rule 4, tabs 49-76. The government
acknowledges that on July 7, 2015, JAAAT submitted a letter addressing the
Stormwater REA stating, “while JAAAT welcomes any additional discussions to
achieve a mutually agreed resolution to this REA, please accept this correspondence as
JAAAT’s formal request for a Contracting Officer’s final decision.” (Gov’t br. dated
May 21, 2019 at 2) This document was subsequently added to the government’s
Rule 4 file as tab 69. The July 7, 2015 document references an earlier CDA
certification and undeniably states that JAAAT requests a contracting officer’s final
decision (SOF ¶ 11). The parties engaged in numerous exchanges since the
submission of the REA dated May 20, 2014 and the revised REA dated September 30,
2014 (which included a full CDA claim certification) (SOF ¶¶ 10-12, 50, 54, 67, 70-
72).
Certainly, JAAAT’s intention to convert its REA into a claim is further clarified
by its response to the government’s email of August 10, 2017, where the contracting
officer asks “Please respond confirming that you are invoking the certification on the
original REA from September of 2014, turning the REA into a certified claim. . .” (R4,
tab 76 at 10567). JAAAT responded on August 14, 2017, stating, “A[s] requested
JAAAT hereby invokes the claim certification . . .” (SOF 12). These newly added
documents to the government’s Rule 4 file satisfy the Board that it has proper subject
matter jurisdiction over ASBCA No. 61792.
40
2. ASBCA Nos. 61795 (Command Carpet), 61798 (Perimeter
Wall), 61800 (Elevator)
The three appeals here involve the absence of a certification on claims that
exceed $100,000. The government argues that the complete absence of a certification
is a jurisdictional defect that cannot be corrected. (Gov’t mot. at 13-14) JAAAT
argues for each appeal that “The REA was submitted per Federal Acquisition
Regulations (FAR) for REA submittals less than $700,000” (app. resp. at 2). JAAAT
does not provide any citations for this proposition or elaborate on its position.
JAAAT’s argument appears to be that since it submitted a request for equitable
adjustment to the contracting officer and followed the FAR procedures for submitting
a request for equitable adjustment that should suffice. (App. resp. at 2, 6) JAAAT
takes absolutely no position on its failure to certify the claims in accordance with the
CDA, 41 U.S.C. § 7103(b)(1). Nor, does it present evidence that demonstrates any
attempt at certification was made on these submissions in accordance with the CDA,
41 U.S.C. § 7103(b)(1) (SOF ¶¶ 16, 23, 42).
The linchpin of the Board’s jurisdiction over a contractor’s claim is the
contractor’s submission of a proper claim to the contracting officer for a decision.
Air Services, Inc., ASBCA No. 59843, 15-1 BCA ¶ 36,146 at 176,424. A contractor is
required to submit a certification to the contracting officer for any claim exceeding
$100,000. WIT Assocs., Inc., ASBCA No. 61547, 19-1 BCA ¶ 37,226 at 181,210.
Even if we decide that each of the “requests for equitable adjustment” included all the
indicia of a proper claim, a determination we do not make here, JAAAT did not submit
a certification to the contracting officer as part of “request for equitable adjustment”
package (SOF ¶¶ 16, 23, 42). The Board cannot entertain an appeal that exceeds
$100,000 if the claim is not certified. Al Rafideen Co., ASBCA No. 59156, 15-1 BCA
¶ 35,983; Bell Helicopter Textron Inc.& The Boeing Company, ASBCA No. 59561,
15-1 BCA ¶ 36,111.
The amount in dispute for each of the appeals exceeds $100,000 (for ASBCA
No. 61795 the amount in dispute is $201,799; for ASBCA No. 61798 the amount in
dispute is $112,831; and, for ASBCA No. 61800 the amount in dispute is $348,898)
(SOF ¶¶ 16, 23, 42). It is undisputable that while a defective certification may be
remedied, the complete absence of a certification is not considered a defect. Hamza v.
United States, 31 Fed. Cl. 315, 324 (1994); Newport News Shipbuilding & Dry Dock Co. v.
Garrett, 6 F.3d 1547, 1553 (Fed. Cir. 1993). A “claim” exceeding $100,000 not
accompanied by any certification precludes the Board from exercising jurisdiction and
mandates dismissal. URS Federal Services, Inc., ASBCA No. 61443, 19-1 BCA ¶
37,448 at 181,967.
JAAAT’s failure to provide a certification as required by the CDA, 41 U.S.C.
§ 7103(b)(1), necessitates that we grant the government’s motion to dismiss for lack of
41
jurisdiction for ASBCA Nos. 61795, 61798, and 61800. Having reached a decision
based upon certification, there is no need to conduct an examination into appellant’s
other arguments related to ASBCA Nos. 61795, 61798, and 61800 16.
3. ASBCA No. 61799 (Punch List)
The government would also have us resolve this appeal by a similar analysis to
ASBCA Nos. 61795, 61798, and 61800, arguing that the Board lacks jurisdiction of
ASBCA No. 61799 because it involves an appeal in excess of $100,000 which was not
certified as required by the CDA. Unfortunately, this appeal presents more difficult
questions that must be resolved in order to determine whether this appeal is properly
before the Board for consideration. In the government’s motion, it argues that
ASBCA No. 61799 should be dismissed for lack of jurisdiction because the request
exceeded $100,000 and was not certified and that “the complete absence of a
certification is not a jurisdictional defect that can be corrected and therefore dictates
dismissal” (gov’t mot. at 13-14) (citing Al Rafideen Company, 15-1 BCA ¶ 35,983
at 175,808). JAAAT provides the same argument here as it advanced for ASBCA
Nos. 61795, 61798, and 61800, that the REA was “submitted per the FAR for REAs
less than $700,000” and certification was not required (app. resp. at 2).
After receiving the government’s motion to dismiss for lack of subject matter
jurisdiction and motion for summary judgment for ASBCA No. 61799, and having
reviewed the parties respective briefs, a further review of the record identified an issue
not raised or briefed by either party: the possibility that the government’s unilateral
Modification No. 07 which reduced the contract amount by $257,896 for unfinished
and incomplete punch list items is a government claim against JAAAT (SOF ¶¶ 30-
31). A determination whether Modification No. 07 is a government claim may
influence whether the Board has subject matter jurisdiction over ASBCA No. 61799.
The Board ordered the parties to brief this issue (SOF ¶ 38) and we examine their
responses here (SOF ¶¶ 39-41).
a. JAAAT’s response to the Board’s June 10, 2020 Order
JAAAT’s position is that Modification No. 07 is a government claim which
reduced the contract price by $257,896. JAAAT provides no other argument other
than reciting the Disputes clause, FAR 52.233-1(c), “a . . . written assertion by one of
the contracting parties seeking, as a matter of right, the . . . adjustment . . . of contract
terms” (app. br. dtd. June 30, 2020 at 1). Yet, whether Modification No. 07 is a
contracting officer’s final decision, JAAAT is equivocal, stating, “[t]he facts of this
case may support either ‘yes’ or ‘no’” (id.) JAAAT argues that Modification No. 07
16 In order for the Board to possess jurisdiction JAAAT must meet all the certification
requirements of a claim as required by CDA, 41 U.S.C. § 7103(b)(1).
42
is not a valid final decision and, thus, the 90 day appeal time limitation of CDA does
not apply. JAAAT states:
Modification No. 07, however, did not comply with
the protocols of FAR 33.211(a). It does not appear to
adequately describe the claim or dispute, state the factual
areas of agreement and disagreement, state the contracting
officer’s decision with supporting rationale, or disclose
that it is a final decision with the required advice of rights.
Failure to comply with this requirement renders the
decision invalid, and the limitations period of 41 U.S.C.
§ 7104(a) would not apply.
(Id. at 2)
Addressing the question whether Modification No. 07 is a final decision by the
contracting officer, JAAAT provides five distinct arguments, some of which are
irreconcilable of each other (app. br. dtd. June 30, 2020 at 2-3).
In JAAAT’s first argument, it appears to be concerned that if Modification
No. 07 is deemed a final decision, then the Board will find it did not timely appeal to
the Board within 90 days. It argues that Modification No. 07 is not a final decision
and was not “satisfied or settled by mutual assent,” citing FAR 33.211(a) and 41
U.S.C. § 7103 (App. br. dtd. June 30, 2020 at 2). JAAAT cites to Uniglobe Gen.
Trading & Contracting Co., W.L.L. v. United States, 115 Fed. Cl. 494 (2014) and
concludes that “[f]ailure to comply with this requirement renders the decision invalid,
and the limitations period of 41 U.S.C. § 7104(a) would not apply.” (App. br. dtd.
June 30, 2020 at 2)
In JAAAT’s second argument, it backtracks and argues Modification No. 07 is
“legally effective” and it is appropriate to determine when the government declined to
pay JAAAT the balance due on the contract as a result of the modification. Thus,
JAAAT argues the government’s refusal to pay is the act which constitutes the final
decision, which it timely appealed from and relies upon Placeway Constr. Corp. v.
United States, 920 F.2d 903, 906 (Fed. Cir. 1990), in which the Court concluded that
the contract officer had “effectively made a final decision on the government claim . . .
when he declined to pay Placeway the balance due on the contract.” (App. br. dtd.
June 30, 2020 at 2-3)
Third, JAAAT argues that it submitted claims on December 13, 2016, or
March 24, 2017, and the contracting officer’s failure to issue a valid final decision is a
deemed denial. Thus, JAAAT argues that its appeal is timely as a deemed denial and
43
is not subject to the 90-day appeal deadline of 41 U.S.C. 7104(a) 17 (app. br. dtd.
June 30, 2020 at 3).
For its last two arguments, JAAAT argues that it was prejudiced by the lack of
appeal rights or the misstatement of appeal rights (app. br. dtd. June 30, 2020 at 4-5).
In support of its position, a Declaration by Mr. Rickey Barnhill is provided stating that
the documents submitted to the contracting officer for the punch list dispute were not
submitted as a claim. Rather, it was customary practice for JAAAT to resolve disputes
with the contracting officer through the REA process, which for the punch list dispute
(ASBCA No. 61799) proceeded as an REA until at least August 2018:
I do not recall ever seeing a unilateral modification by the
government containing the language indicating that it was
a final decision imposing appeal deadlines. I and the
company had prior experience with disputes concerning
unilateral modifications by the government being
successfully resolved through the REA process, and I and
JAAAT expected that this would be the manner we would
have to proceed in this case. Additionally, we did not file
this as a claim. I and JAAAT previously had regularly
been encouraged by government project representatives to
pursue REAs as a means of resolving disputes, though our
REAs were often converted to claims as part of the
process. I and JAAAT understood the statement in the
email of December 15, 2016, about “processes outlined in
your contract and the FAR” to mean the option of pursuing
an REA, and did not understand it to indicate that an
appeal within 90 days was necessary. From JAAAT’s
perspective, the letter of June 6, 2017 was part of the
ongoing REA process, and not a conclusion of the REA
process, because it did not contain the typical language
indicating that it was the contracting officer’s final
decision as to the REA. From JAAAT’s perspective,
negotiations in the REA process on this matter continued
until August or September 2018.
17 We do not find this argument persuasive that JAAAT appealed from a deemed
denial for the contracting officer’s failure to issue a final decision to its claim
documents dated December 13, 2016, or March 24, 2017. In its brief, JAAAT
provided a Declaration by Mr. Rickey Barnhill, discussed below, that these
documents were not submitted as claims, rather as requests for equitable
adjustment per the company’s practice to resolve these types of disputes
through the REA process.
44
(App. br. dtd. June 30 2020, ex. A, Declaration of Rickey Barnhill at 1-2) (emphasis
added)
JAAAT argues that lack of appeal rights in Modification No. 07 prejudiced it
and that it was not aware that Modification No. 07 could act as a final decision (app.
br. dtd. June 30, 2020 at 5-6). In response to question 4, whether the contracting
officer’s June 6, 2017 letter vacated Modification No. 07, JAAAT argues that the
government’s June 6 letter does not support that Modification No. 07 was being
reconsidered or vacated:
No. . . . This June 6, 2017 letter asserted that the REA was
“without merit.” This did not suggest, let alone support a
conclusion, that Modification No. 07 was being
reconsidered or vacated, as required under the Sach
Sinha 18 precedent.
(App. br. dtd. June 30, 2020 at 6)
JAAAT characterizes its appeal as timely and argues, through reference to the
government’s Statement of Undisputed Material Facts (SUMF) and without
elaborating, that the government’s June 6, 2017 letter was a response to JAAAT’s
REA and would have no effect on the analysis, but if the Board deems it “to have
vacated the finality of Modification 07,” then the events of June 25 and September 7,
2018 would constitute a final decision, thus making its appeal timely 19 (app. br. dtd.
June 30, 2020 at 7). JAAAT refers to SUMF 8-19 without elaborating how “the
events of June 25 and September 7, 2018, as described in the Respondent’s Statement
of Undisputed Material Facts ¶¶ 8-19, would constitute an ‘effectively . . . final
decision’” (app. br. dtd. June 30, 2020 at 6-7 (quoting Placeway; 920 F.2d at 906;
18 Appellant does not provide a citation of “Sach Sinha,” but we presume it is referring
to Sach Sinha and Associates, Inc., ASBCA No. 46916, 95-1 BCA ¶ 27,499
at 137,042, where this Board has repeatedly found the test for vitiation of
finality “is whether the contractor presented evidence showing it reasonably or
objectively could have concluded the CO’s decision was being reconsidered.”
19 As a result of JAAAT’s failure to elaborate on its argument, and the complete
absence of anything that resembles support, we can only guess at the argument
that it makes here. For purposes of this decision, we will not speculate. See
McDonnell Douglas Helicopter Sys., ASBCA No. 50341, 99-2 BCA ¶ 30,546;
G & C Enterprises, Inc., ASBCA No. 53067, 05-2 BCA ¶ 33,033.
45
see SOF ¶¶ 88-100). SUMFs 8-19 (SOF ¶¶ 88-100) largely deal with the events
surrounding the JAAAT/Safeco/Tetra Tech Settlement, Modification No. 08, and the
government’s payment of $3,100,000 to Safeco on JAAAT’s behalf. Interestingly,
JAAAT’s response brief to the government’s motion disputes SUMF 9-10, 12, 15-19
(SOF ¶¶ 89-90, 92, 95-100), while its brief dated June 30, 2020 (SOF ¶ 39) filed by its
new representation of counsel, appears to accept SUMF 8-19. (App. br. dtd. June 30,
2020 at 6-7; SOF ¶¶ 88-100).
b. Government’s response to the Board’s June 10, 2020 Order
The government’s arguments can be summarized as: 1) Modification No. 07 is
not a government claim but instead an administrative action under FAR 52.243-4; 2)
and, JAAAT never filed a claim and a claim certification to the contracting officer for
the dispute surrounding the punch list items (SOF ¶¶ 36-37; $257,896 – $21,609.32 =
$236,286.68). JAAAT sought “an equitable adjustment in the amount of $236,286.68”
and states that the “total project construction credit [should be] $21,609.32,” not
$257,896 as determined in Modification 7 (SOF ¶ 36).
The government portrays Modification No. 07 as a contract administration
action in the form of a reduction in contract price pursuant to the Changes clause
(FAR 52.243-4), and, thus is not a government claim:
[T]his case does not involve excess procurement costs or a
demand for payment of an overpayment as in Highland A1
Hujaz Co., Ltd.[, ASBCA Nos. 59746, 59818, 15-1 BCA ¶
36,041.] Instead, this case involves a contract
administration action in the form of a reduction in the
contract price and is not seeking any payment from the
contractor.
Unilateral Modification No. 07 was issued by the
Contracting Officer pursuant to the Changes Clause (FAR
52.243-4) (See Block 13D of the SF 30 - R4, tab 14a at
2707). The Changes Clause gives the government the
unilateral right to order changes in work within the scope
of the contract. The clause also provides for an equitable
adjustment if the change increases or decreases the cost or
time of performance. See ThermoCor, Inc. v. United
States, 35 Fed. Cl. 480, 492 (1996).
(Gov’t br. dtd. June 30, 2020 at 4-5)
46
The government argues that it needed to find a replacement contractor to finish
work JAAAT failed to do pursuant to the contract and the government requested
JAAAT to submit a proposal for the value to be deducted from the contract:
In a correspondence dated November 30, 2016, the
Government had requested that JAAAT submit a proposal
to address remaining work (R4, tab 14a at 2694).
Modification No. 07 was executed by the government on
December 12, 2016 after a bilateral agreement was unable
to be reached concerning credit to complete the remainder
of the punch list for building X-4647. The value deducted
under the unilateral modification was to be utilized to pay
a replacement contractor to finish that work, pursuant to
FAR 52.246-12(g)(1).
(Gov’t br. dtd. June 30, 2020 at 5)
The government argues that the contracting officer issued Modification No. 07
through the Changes clause (FAR 52.243(a)(2) which was “work within the general
scope of the contract, including changes in the method or manner or performance of
the work” as JAAAT failed to complete work that was required in the contract:
According to the Changes Clause, the Contracting
Officer may, at any time, make changes in the work within
the general scope of the contract, including changes in the
method or manner of performance of the work. FAR
52.243-4(a)(2). In this case, the contract was unilaterally
modified to reduce the contract value to account for punch
list items that were not completed by JAAAT.
(Gov’t br. dtd. June 30, 2020 at 5)
In addition, the government contends the reduction in contract price as set forth
in Modification No. 07 was consistent with the Changes clause for work not performed
by JAAAT. Pursuant to Section (e) of the Changes clause, JAAAT had 30 days to
assert its right to an adjustment in contract price, a timeline which JAAAT did not
achieve:
FAR 52.243-4(e) further requires the contractor to assert
its right to an adjustment in contract price within 30 days
of receipt of a written change order.
(Gov’t br. dtd. June 30, 2020 at 5)
47
JAAAT eventually filed an REA on March 24, 2017, seeking a payment in
excess of $100,000, which was approximately 102 days after receiving notice of the
contract reduction through Modification No. 07. The government found the REA to
be without merit on June 6, 2017. (Gov’t br. dtd. June 30, 2020 at 6) The government
cites to Info. Sys. & Networks Corp., ASBCA No. 46119, 02-2 BCA ¶ 31,952 for the
proposition that “[a] failure to agree to an adjustment shall be a dispute under the
Disputes Clause” and “[t]he Disputes Clause in the contract . . . provides all disputes
arising under or relating to the contract shall be resolved under that clause,” yet
JAAAT failed to file a claim or a claim certification (gov’t br. dtd. June 30, 2020 at 6).
The government reiterates its argument from prior briefing that the Board lacks
jurisdiction as JAAAT never provided a claim, never requested a final decision, and
never provided a claim certification for the $236,286 which it now seeks. The
complete absence of a certification under 41 U.S.C. § 7103(b)(3) is a defect which
cannot be corrected. (Gov’t br. dtd. June 30, 2020 at 6-7)
The government states further that “USACE did not consider the unilateral
modification to be a government claim, so the absence of the notice of appeal rights
was not an accidental oversight. Thus, Modification No. 07 was not intended by the
government to be a final Contracting Officer’s decision.” (Gov’t resp. br. dtd. July 10,
2020 at 2) “To the extent the Board finds Modification No. 07 to be a claim, the fact
that the Contract Modification may have failed to satisfy certain requirements for final
decisions does not necessarily deprive that document of legal effect as a final
decision” ” (gov’t br. dtd. June 30, 2020 at 8 (citing Uniglobe Gen. Trading & Contr.
Co., W.L.L. v. United States, 115 Fed. Cl. 494 (2014)). It is JAAAT’s burden to
demonstrate that the defective notice “‘prejudiced its ability to prosecute its timely
appeal before the limitation period will be held not to have begun’” (quoting Decker &
Co. v. West, 76 F.3d 1573, 1579-80 (Fed. Cir. 1996)):
When the government fails to adequately provide the
appeal notice, the Decker test is one of detrimental
reliance, i.e., whether the CO’s decision, by words of
commission or omission, actually misled the contractor to
its prejudice regarding its appellate rights.
The record here does not reveal any word or deed of the
government that would lead a reasonable contractor to
believe that the decision to reduce the contract amount for
unfinished work was not a final decision that needed to be
appealed. JAAAT should have known that the Contracting
Officer’s decision needed to be appealed when the
government ceased negotiations and executed Modification
No. 07 in order to reduce the contract price. The finality of
the decision should also have been reaffirmed when their
48
untimely and uncertified REA was denied for consistent
reasons on June 6, 2017. However, JAAAT did not file a
notice of appeal until September 10, 2018 – almost 20
months after the execution of Modification No. 07, and
approximately 14 months after the decision on their REA.
The appeal was subsequently filed on November 8, 2018.20
Therefore, this appeal was not timely from either event.
(Gov’t br. dtd. June 30, 2020 at 8-9) (footnote and internal citations omitted)
The government agrees with JAAAT that it refused to reopen negotiations on
the reduction of contract price and it has no record of any conversations after issuance
of Modification No 07 (gov’t br. dtd. June 30, 2020 at 9-10). The government argues
that even if the Board finds Modification No. 07 to be a government claim, JAAAT
has failed to carry its burden of proving that it was prejudiced by the lack of appeal
rights:
[T]he record is devoid of facts to satisfy JAAAT’s burden
of proving that they were prejudiced by the lack of appeal
rights. JAAAT acknowledges that they were “informed
that no negotiation would be allowed, and if JAAAT did
not concur, a unilateral contract modification would be
immediately issued.” (R4, tab 14a at 2691). The fact that
JAAAT chose to delay the filing of this appeal so as to
lump it in with 8 other appeals does not provide
justification to ignore the statutory deadline for this
particular appeal.
(Gov’t br. dtd. June 30, 2020 at 10)
Whether the contracting officer’s June 6, 2017 letter in response to appellant’s
March 24, 2017 “Credit for remaining work request for equitable adjustment” vacated
Modification No. 07, the government argues that JAAAT has failed to come forward
with evidence showing it reasonably could have concluded the contracting officer’s
decision was being reconsidered (gov’t br. dtd. June 30, 2020 at 11). The government
points out that JAAAT admits in its REA submitted March 24, 2017, that “USACE did
not entertain any negotiation. . .” following instead with what JAAAT labeled as an
“unreasonable” Modification No. 07 (gov’t br. dtd. June 30, 2020 at 11 (quoting
JAAAT’s March 24, 2017 submission)), and that “[no] government action could have
reasonably led [it] to believe that the subject matter was not yet final, thereby making
an appeal to the board unnecessary” (gov’t br. dtd. June 30, 2020 at 12). The
20 We note that JAAAT appealed to the Board on September 10, 2018. See (SOF ¶ 6).
49
government argues that the Board lacks subject matter jurisdiction over ASBCA No.
61799 as JAAAT failed to provide a claim and claim certification to the contracting
officer, Modification No. 07 was not a government claim from which it could directly
appeal from, and JAAAT failed to carry its burden that the lack of appeal rights in
Modification No. 07 prejudiced it (gov’t br. dtd. June 30, 2020 at 5-13).
c. Is Unilateral Modification No. 07 a Government Claim?
The CDA imposes specific prerequisites for the Board to exercise jurisdiction
over an appeal, whether it is a government claim against a contractor, or a contractor
claim against the government. See 41 U.S.C. §§ 7103-7104. Our examination of
jurisdiction here must determine whether USACE’s Unilateral Modification No. 07 is
a government claim. The government argues that Unilateral Modification No. 07 was
not a government claim but merely an administrative action under the Changes Clause,
to reduce the contract price by $257,896 (gov’t br. dtd. June 30, 2020 at 5-6).
Our review of this action reflects the manifest understanding that a contractor
must complete a project as required by the contract, to include all “punch list” items.
See Toombs & Co., ASBCA No. 34590, et al. 91-1 BCA ¶ 23,403. We agree that the
Changes Clause authorizes the contracting officer to unilaterally direct the contractor,
by written order, to make a change within the general scope of the contract, including
increasing or decreasing the contract price. This right is solely within the
government’s discretion, not the contractor. FAR 43.201; FAR 2.101 (definition of
“change order”). Here, however, the parties went through months of discussions over
the punch list work only to find that once the contracting officer requested a proposal
pursuant to FAR 52.243-4, Changes Clause; and DFARS 252.236-7000,
MODIFICATIONS PROPOSALS-PRICE BREAKDOWN, they were unable to agree
on the cost to complete work required by the contract that was performed improperly
by JAAAT, or not performed at all. (SOF ¶¶ 25-30) On November 30, 2016, the
government informed JAAAT that it was reducing the contract price under the
Changes Clause for unfinished work, punch list items, and sought an itemized proposal
for all material, labor, equipment, subcontract, overhead costs, and profit due
(SOF ¶ 25). On December 12, 2016, the contracting officer issued Unilateral
Modification No. 07 decreasing the contract amount by $257,896.00, cited the
Changes Clause and identified it as a “Credit to complete remainder of punch list for
building X-4647” (SOF ¶ 31).
We questioned whether this action was a government claim. The CDA
envisions both contractor claims against the government and government claims
against contractors. 41 U.S.C. § 7103(a). Further guidance is provided by
FAR 52.233-1, DISPUTES, which provides the following definition of a claim:
50
“Claim,” as used in this clause, means a written demand or
written assertion by one of the contracting parties seeking,
as a matter of right, the payment of money in a sum
certain, the adjustment or interpretation of contract terms,
or other relief arising under or relating to this contract.
FAR 52.233-1(c).
Although the CDA does not define a claim, the Federal Circuit has found that the FAR
definition “governs.” See Todd Const., L.P. v. United States, 656 F.3d 1306, 1311
(Fed. Cir. 2011) citing to H.L. Smith, Inc. v. Dalton, 49 F.3d 1563, 1564–65
(Fed.Cir.1995). The government may advance a claim against the contractor under
several theories including liquidated damages, breach of warranty, defective pricing,
excess financing payments, overpayments, defective goods/services, and more. See
FAR 52.233-1(c)- (d) (recognizing government’s right to seek redress through claims
process). Here, we think that the USACE may have advanced a claim by the issuance
of Unilateral Modification No 07. The first category of a claim, which requires a
written demand, was met when the contracting officer issued the modification.
Likewise, a reduction of the contract price, the amount of $257,896, indisputably
represents the seeking of “the payment of money in a sum certain” over the disputed
items of work (SOF ¶ 31).
The Board has recognized that the same operative facts can give rise to claims
by either party. See General Elec. Co., ASBCA Nos. 36005 et al., 91-2 BCA ¶ 23,958
(citing Teton Constr. Co., ASBCA Nos. 27700, 28968, 86-2 BCA ¶ 18,971
(Government claim reducing contract price and contractor claim for withheld funds);
Garrett v. Gen. Elec. Co., 987 F.2d 747, 749-51 (Fed. Cir. 1993) (affirming the
Board’s decision that it had jurisdiction over Navy’s directive to contractor to correct
or replace defective engines, constituted “other relief” within the FAR’s third category
of “claims,” and, thus, was within CDA concept of “claim,” and on contractor’s appeal
of decision by Department of Navy on contract was “final,” for purpose of conferring
jurisdiction to the Board); Perkins & Will, ASBCA No. 28335, 84-1 BCA ¶ 16,953
(Government damages claim resulted in withholding of funds sought by contractor);
cf. Martin Marietta Corp., ASBCA No. 25828, 84-1 BCA ¶ 17,119 (cost
disallowance); Fruit Growers Express Co., ASBCA No. 28951, 84-1 BCA ¶ 17,158
(price reduction under Economic Price Adjustment clause). In such cases, the
contractor’s failure to submit a monetary claim, certified if for more than $100,000,
affects only the running of interest on any amounts ultimately found due the contractor
and not the justiciability of the appeal of the Government’s claim. See Martin
Marietta Corp., 84–1 BCA at 85,257-58 (CDA certification amount was $50,000
during this time period). Here, JAAAT used the same facts to support the REA it filed
on March 24, 2017, which if found to be properly appealed would only affect its
51
interest calculation. 21
In advocating for a finding that Unilateral Modification No. 07 is not a
government claim, the government argues that when JAAAT failed to perform work
required under the contract, it issued a unilateral modification consistent with FAR
52.243-4, and deducted $257,000 from the contract price. The government asserts that
Unilateral Modification No. 07 was nothing more than a contract administration action
to delete work that JAAAT did not perform. What the government has chosen to
ignore in this discussion is that the action was a result of a dispute between the parties
after deficiencies were found in JAAAT’s work pursuant to FAR 52.246-12
(INSPECTION OF CONSTRUCTION) (SOF ¶¶ 25-27, 31, 37). Months of
negotiations ensued with the final exchange revealing that the parties differed
considerably over the value of the punch list work. Just before the issuance of the
unilateral modification, JAAAT proposed a final number of $9,880 as the value of the
punch list work. The contracting officer’s estimated value was $257,896. Unable to
reach a resolution, the contracting officer brought an end to this unproductive
discussion by issuing a unilateral modification reducing the contract price by an
amount the government determined to be fair and reasonable for the outstanding punch
list items. That unilateral modification was issued on December 12, 2016. The
contracting officer brought finality through that action.
The government would have us find that the action of reducing the contract
price through the Changes clause is an administrative action, and, thus, not a
government claim and not an immediately appealable event because the government is
not seeking payment from the contractor (gov’t br. dtd. June 30, 2020 at 5-6).
Certainly, the decision to issue Unilateral Modification No. 07 was the direct result of
the issues over JAAAT’s performance where, through the Inspection of Construction
clause, the government identified several construction issues and unfinished work
(SOF ¶¶ 25, 27, 30-31). The government was not satisfied with incomplete and
inadequate work, and in some instances the failure to perform work at all. Ultimately,
the contracting officer decided to proceed by having a different contractor replace, fix,
or perform the items identified on the punch list. The differences between the parties
did not end there, and the value to be assessed to the punch list items remained a major
hurdle. (SOF ¶¶ 34-37) This scenario is not the simple contract administration action
as the government suggests. The contracting officer would have us equate the
issuance of Modification No. 07 to something analogous to the contracting officer
21 See 41 U.S.C. § 7109(a). JAAAT’s punch list REA was in excess of $100,000 and
was not certified. If we had to consider that issue, JAAAT’s March 24, 2016
REA and assigned ASBCA No. 61799 would likewise suffer the same fate as
the Appeal Nos. 61795 (Command Carpet), 61798 (Perimeter Wall), and 61800
(Elevator).
52
deleting a CLIN as merely deleting contract work the contractor had not yet
performed. The latter is more akin to a simple contract administration action – one
where a contracting officer would not expect a challenge. In this hypothetical
example, the reduction in the contract price for the deletion of the work would not be a
government claim, and the contractor would have to file a claim with the contracting
officer to express its grievance. What we have before us is something distinctly
different, a disagreement over the value of the unfinished or poorly performed work
required by the contract. Modification No. 07 reducing the contract price for
unfinished and poorly performed work, valued at an amount considerably larger than
the contractor’s estimated value, is a government claim for which the contracting
officer effectively issued a final decision.
This Board has dealt with numerous situations analogous to the one here and
found the government’s correspondence/modification/action was a government claim.
See Greenland Contractors I/S, ASBCA Nos. 61113, 61248, 19-1 BCA ¶ 37,259 (the
government’s issuance of a unilateral contract modification to reduce the contract
amount found to be a government claim (citing DynPort Vaccine Co. LLC, ASBCA
No. 59298, 15-1 BCA ¶ 35,860 and LTV Aerospace & Defense Co., Vought Missiles &
Advanced Programs Div., ASBCA No. 35674, 89-2 BCA ¶ 21,858 at 109,950-51);
The Boeing Company, ASBCA No. 37579, 89-3 BCA ¶ 21,992, (finding the
government’s actions in issuing a unilateral modification to exercise an option subject
to applicable contract definitization provisions, to be a government claim); PX Eng’g,
ASBCA No. 38215, 89-2 BCA ¶ 21,859 (the issuance of a unilateral modification
reducing the contract price, while not characterized as a decision, constituted a formal
and final action from which the contractor could appeal (citing Systron Donner,
Inertial Div., ASBCA No. 31148, 87-3 BCA ¶ 20,066); Solflores Constr., ASBCA
No. 31557, 86–1 BCA ¶ 18,617 (a unilateral contract modification establishing the
amount of an equitable adjustment and making other unilateral determinations
considered an appealable final decision). Having all the indicia of a claim, the
unilateral modification reducing the contract price by $257,896, was unquestionably a
government claim upon which an appeal can be taken. See The Boeing Company,
89- 3 BCA ¶ 21,992; Building Servs. Unlimited, Inc., ASBCA No. 33283, 87-3 BCA ¶
20,135.
The fact that the unilateral modification did not identify itself as a final
decision, or did not contain the appeal rights that are required, is of no consequence.
The government argues that the lack of appeal rights contained in Unilateral
Modification No. 07 was not an oversight as they did not view this action to reduce the
contract price, under the Changes clause, as a government claim against JAAAT (gov’t
br. dtd. June 30, 2020 at 5-6). The requirements set forth in the CDA and
corresponding regulations to advise contractors of their appeal rights are for the
“contractors’ protection and benefit and the failure to comply with those requirements
can prevent the appeal period from running.” Decker & Co. v. West, 76 F.3d 1573,
53
1579-80 (Fed. Cir. 1996). See also North Am. Corp., ASBCA No. 28140, 83-2 BCA ¶
16,801; W.H. Moseley Co., ASBCA No. 27370, 83-1 BCA ¶ 16,272; Vepco, Inc.,
ASBCA No. 26993, 82-2 BCA ¶ 15,824; Habitech, Inc., ASBCA No. 26388 et al.,
82- 1 BCA ¶ 15,794; R.G. Robbins Co., Inc., ASBCA No. 26521, 82-1 BCA ¶ 15,643.
In Placeway Constr. Corp., 920 F.2d at 906-07, the court reversed the lower court’s
dismissal for lack of jurisdiction where the contractor had appealed from the
government’s assertion of a right of set off. Though there was no “final decision”
labeled as such and no notice of appeal rights, the court held that the contracting
officer had effectively issued a final decision and granted a government claim in the
amount of the set off. See also KAL M.E.I. Mfg. & Trade, Ltd., ASBCA No. 44367 et
al., 94-1 BCA ¶ 26,582 at 132,257 (citing Placeway, 920 F.2d at 902 for the
proposition that the government’s withholding constituted “a final decision on a
government claim”). More importantly, the failure to include appeal rights, will not
render the otherwise valid final decision into an invalid decision. Alenia N. Am., Inc.,
ASBCA No. 57935, 13 BCA ¶ 35,296. When this occurs, a contractor must
demonstrate that it was actually prejudiced by the lack of notice in order to prevent the
start of the appeal period. Decker & Co. 76 F.3d at 1580 (“A contractor in Decker’s
position must demonstrate that [incorrect appeal advice] actually prejudiced its ability
to prosecute its timely appeal before the limitation period will be held not to have
begun.”); Mansoor Int’l Dev. Servs., ASBCA No. 59466 et al., 16-1 BCA ¶ 36,376
at 177,337.
The CDA provides that a contractor must take an appeal to this Board within 90
days of receipt of a final decision or within one year of receipt to the Court of Federal
Claims. 41 U.S.C. § 7104.22 These statutory appeal periods may not be waived.
Cosmic Constr. Co. v. United States, 697 F.2d 1389, 1390 (Fed. Cir. 1982); Structural
Finishing, Inc. v. United States, 14 Cl. Ct. 447, 450 (1988). Thus, the government
argues that JAAAT must have filed its appeal of the government claims with the Board
on or before March 13, 2017, or with the Court of Federal Claims on December 12,
2017 for its appeal to be timely. Instead, JAAAT made no attempt to appeal the
contracting officer’s Unilateral Modification No. 07 for the reduction in contract price.
Instead, on March 24, 2017, eleven days after the presumptive deadline to the Board,
JAAAT submitted an REA disputing the amount of the contract reduction. The
contracting officer responded on June 6, 2017, finding the REA to have no merit
(SOF ¶ 37). It was not until approximately fifteen months later that JAAAT filed its
notice of appeal to the Board based upon what it classified as a deemed denial to its
“Punch List REA” submitted March 24, 2017.
We know that once the contracting officer’s decision becomes final (i.e., once
22 JAAAT could have appealed to the United States Court of Federal Claims within
one year of the final decision. 41 U.S.C. § 7104(b)(3). However, that deadline
had also passed on December 12, 2017.
54
the appeal period has passed), the contractor cannot challenge the merits of that
decision judicially. 41 U.S.C. § 7103(g); see Seaboard Lumber Co. v. United States,
903 F.2d 1560, 1562 (Fed. Cir. 1990); L.A. Constr., Inc., ASBCA Nos. 3338, 3372,
95- 1 BCA ¶ 27,291 (holding that the contractor’s failure to appeal the final decision in
a timely manner deprived the Board of jurisdiction, even though both parties testified
on the merits during the hearing). Similarly, the submission of a claim after the final
decision will not circumvent the statutory appeal timing requirements. See Military
Aircraft Parts, ASBCA No. 60139, 17-1 BCA ¶ 36,667 (contractor’s claim relating to
the contract was in reality a challenge to the earlier propriety of the default termination
and the contractor did not timely appeal the default within the CDA’s 90-day appeal
period); Midland Maint., Inc., ASBCA No. 44563, 93-2 BCA ¶ 25,618 at 127,520 (“A
request for the contracting officer to reconsider a decision does not extend the 90-day
period in which to appeal to a board of contract appeals. It is the contracting officer’s
agreement to reconsider the merits of a previously issued decision that serves to extend
the 90-day period for an appellant to appeal.”) (citing Cosmopolitan Mfg. Co. v.
United States, 156 Ct. Cl. 142 (1962)). Cf. Royal Int’l Builders Co.., ASBCA
No. 42637, 92-1 BCA ¶ 24,684 (agreement by contracting officer to meet with
contractor in response to request for reconsideration of decision signaled a willingness
to reconsider))
To the contrary, where there is a failure to properly advise the contractor of its
appeal rights that failing may prevent the “appeal clock” from running. See Alenia N.
Am., Inc., 13 BCA ¶ 35,296 at 173,271 (citing Placeway Constr. Corp., 920 F.2d
at 907). Where a contracting officer’s notice of appeal rights is deficient, the
contractor must demonstrate that, but for its detrimental reliance upon the faulty
advice, its appeal would have been timely. Decker & Co., 76 F.3d at 1580. It is the
contractor’s burden to demonstrate that the defective notice “prejudiced its ability to
prosecute its timely appeal before the limitation period will be held not to have
begun.” Id.; see Mansoor Int’l Dev. Servs., ASBCA No. 58423, 14-1 BCA ¶ 35,742.
JAAAT states that from the time it received the email from the contracting
officer forwarding Modification No. 07, it was understood to mean that JAAAT had
the option of resolving its dispute over the value of the punch list items by submitting
an REA to the contracting officer. JAAAT supports its position by way of affidavit
and explains that it never understood Modification No. 07 to be a final decision that
required an appeal to the Board within 90 days. Instead, JAAAT considered the
contracting officer’s June 6, 2017 communication to be “part of the ongoing REA
process,” not a conclusion of the REA process. The fact is that there was no indication
by the contracting officer that any of the communication related to the punch list items
represented a final decision. Instead, JAAAT viewed the negotiations as continuing
through August or September 2018. (App. br. dtd. June 30, 2020, ex. A, Declaration
of Rickey Barnhill at 1-2) It is apparent from JAAAT’s actions, as we draw from its
affidavit, that the absence of appeal rights on this government claim was detrimental to
55
its understanding of the process that needed to be followed if it wanted to challenge
the contracting officer’s actions under the unilateral modification. We look also to the
exchanges that occurred between the parties from the date that the unilateral
modification was provided, including the exchanges that occurred on December 13,
2016 where a request was made for the list of final items deducted by the modification,
the contracting officer providing that list, to further challenges to the amount, and then
the contracting officer advising that if JAAAT had further “disagreements with the
unilateral and the negotiations attempted on 12/8/16, there are processes outlined in
your contract and the FAR for you to follow.” We find that they all support JAAAT’s
understanding that it was taking the appropriate path. (SOF ¶¶ 30-36) Our review of
these same facts leads us to the conclusion that the government was also confused
about that effect of the action taken. The government reminds us that the failure to
include appeals rights in a unilateral modification deducting $257,896 after invoking
the inspection clause, was not an oversight, it was intentional (gov’t br. dtd. June 30,
2020 at 5-6). The fact that the government did not understand its action to be a
government claim only adds to the confusion and ultimate prejudice to JAAAT. While
we recognize that it was not the government’s intention, the failure to advise JAAAT
of its appeal rights, along with the exchanges between the parties, may have
reasonably led JAAAT to believe that the process they were following was compliant.
In its affidavit, JAAAT states they pursued the dispute as if this was an REA and did
not know that the appeal time clock was ticking. Had they been advised properly
“JAAAT would have been able to file an appeal to ABSCA within 90 days. We were
unaware of any deadline under the circumstances.” (App. br. dtd. June 30, 2020,
ex. A, Declaration of Rickey Barnhill at 3)
The government’s failure to clearly identify the modification as a final decision,
the absence of appeal rights, and the government’s responses immediately after the
issuance of the modification, fueled JAAAT’s misunderstanding and prejudiced its
ability to prosecute its timely appeal of this government claim. CB of Bozeman, Inc.,
DBA Maintenance Patrol, ASBCA No. 58533, 13 BCA ¶ 35,452. The Board has “the
authority to rule on the validity of a contracting officer’s decision as part of the
jurisdictional inquiry under [41 U.S.C.] § 7104(b)(3)”. Uniglobe Gen. Trading, 115
Fed. Cl. at 513 (quoting Renda Marine Inc. vs United States, 509 F.3d 1372, 1380
(Fed. Cir. 2007) (a court “may declare a contracting officer’s final decision invalid –
for whatever reason”)). As part of that jurisdictional inquiry we find that the defects
contained in Unilateral Modification No. 07 having caused prejudice to JAAAT,
prevented the appeals clock from running and the limitation period of 41 U.S.C. ¶
7104 does not apply. Decker & Co., 76 F.3d at 1580.
We replicate here what this Board held in The Boeing Company, 89-3 BCA
¶ 21,992, finding that Boeing could have appealed directly from the “unilateral option
exercise” modification, so they “disregard the necessary exchange of paper
engendered by Boeing that requested a contracting officer’s final decision, and held
56
that “Boeing’s . . . notice of appeal was properly taken from the contracting officer’s
decision reflected in unilateral modification P00154.” Id. at 110,597. As with our
decision in Boeing, JAAAT’s filing of the REA, and the contracting officer’s decision
on that REA are disregarded as unnecessary to establish that its September 2018
Notice of Appeal of the government claim was properly taken from the contracting
officer’s decision reflected in Unilateral Modification No. 07. 23
Our determination that JAAAT properly appealed the government claim by the
contracting officer, eliminates the need to determine whether JAAAT’s subsequent
“request for equitable adjustment” to the contracting officer is a proper claim under the
CDA. Since there is no requirement for a certification of a government claim, this
eliminates the need to address the government’s argument that we lack jurisdiction
based upon its failure to submit a certified claim to a contracting officer prior to filing
its notice of appeal. (Gov’t br. dtd. June 30, 2020 at 4-7) Neither party is required to
certify a government claim. 41 U.S.C. § 7103(b). See Placeway Constr. Corp., 920 F.2d
at 906. A contractor, however, must certify its request for interest on monies deducted or
withheld by the government. General Motors Corp., ASBCA No. 35634, 92-3 BCA
¶ 25,149.
We find that Modification No. 07 is a government claim and that JAAAT
carried its burden to show that the lack of appeal rights in Modification No. 07, and the
circumstances surrounding the punch list items prejudiced its ability to prosecute a
timely appeal to the Board. We find we have jurisdiction over ASBCA No. 61799.
4. ASBCA NOS. 61793 (Relocate Projector Screen), 61794 (Weather Delays),
61796 (Communication Grounding), 61797 (Nec Switch Delay)
We address the jurisdictional arguments raised by the government in ASBCA
Nos. 61794, 61796, and 61797 and presumably what would be the same argument for
61793.24 Each of the requests for equitable adjustment are under $100,000 (SOF
23 The Board declines to adopt the government’s argument that JAAAT had 30 days to
assert an adjustment under FAR 52.243-4(e) following receipt of a written
change order (Modification No. 07) (SOF ¶ 40). The standard Changes clauses
each state that “the Contractor must assert its right to an adjustment . . . within
30 days after receipt of a written [change] order.” The Board does not strictly
construe this requirement unless the untimely notice is prejudicial to the
government. E.W. Jerdon, Inc., ASBCA Nos. 32957, 34723, 88-2 BCA ¶
20,729; see also Watson, Rice & Co., HUD BCA No. 89-4468-C6, 90-1 BCA ¶
22,499; Sosa y Barbera Constrs., S.A., ENG BCA No. PCC-57, 89-2 BCA ¶
21,754. We find no prejudice here.
24 The government argued that JAAAT failed to provide any document in the form of a
request for equitable adjustment or claim to the contracting officer for the
57
¶¶ 13-14, 19, 21). The government argues that JAAAT failed to convert each of the
requests for equitable adjustment into a claim before appealing to the Board, and, thus,
we lack jurisdiction to entertain these appeals (gov’t mot. at 9, 14-16). The Board
must determine, from limited documentation in each appeal, whether each “Request
for Equitable Adjustment” was converted to a claim. If not, the impact to JAAAT is
considerable.
The linchpin of the Board’s jurisdiction over a contractor claim is the
contractor’s submission of a proper claim to the contracting officer for a decision.
Puget Sound Envtl. Corp., ASBCA Nos. 58827, 58828, 14-1 BCA ¶ 35,585
at 174,371; MACH II, ASBCA No. 56630, 10-1 BCA ¶ 34,357 at 169,673. If a claim
exceeds $100,000 it must be certified in accordance with 41 U.S.C. § 7103(b). We
determine whether a contractor’s submission is a CDA claim on a case-by-case basis,
applying a common sense analysis. CCIE & Co., ASBCA Nos. 58355, 59008, 14-1
BCA ¶ 35,700 at 174,816; Precision Standard, Inc., ASBCA No. 55865, 11-1 BCA
¶ 34,669 at 170,787. We will examine the totality of the correspondence between the
parties in determining the sufficiency of a claim. Lael Al Sahab & Co., ASBCA
Nos. 58344, 59009, 15-1 BCA ¶ 35,809 at 175,129; Vibration & Sound Solutions Ltd.,
ASBCA No. 56240, 09-2 BCA ¶ 34,257 at 169,270.
It has been said that “there is no bright-line distinction between an REA and a
CDA claim.” Air Servs., Inc., 15-1 BCA ¶ 36,146. As the line between an REA and a
CDA claim has been elucidated over the years, it understandably becomes more
challenging to distinguish between the two. A claim need not be submitted in any
particular format or use any particular wording; the contractor need only submit “a
clear and unequivocal statement that gives the contracting officer adequate notice of
the basis and amount of the claim.” Hejran Hejrat Co. Ltd. v. United States Army
Corps of Engineers, 930 F.3d 1354 (Fed. Cir. 2019) citing Contract Cleaning Maint.,
Inc. v. United States, 811 F.2d 586, 592 (Fed. Cir. 1987); Air Servs., Inc., 15-1 BCA
¶ 36,146. Notably, a request for a contracting officer’s decision “can be implied from
the context of the submission.” Heyl & Patterson, Inc. v. O’Keefe, 986 F.2d 480, 483
(Fed. Cir. 1993). In Transamerica Ins. Corp. v. United States, 973 F.2d 1572, 1576,
1579 (Fed. Cir. 1992), overruled on other grounds by Reflectone, Inc. v. Dalton,
60 F.3d 1572 (Fed. Cir. 1995), the court held that a claim need not expressly request a
contracting officer’s decision, “as long as what the contractor desires by its
appeal of ASBCA 61793. However, in its reply JAAAT provided a copy of a
document dated November 8, 2016, a “request for equitable adjustment,”
substantiating its submission to the CO (SOF ¶ 13). As this document is similar
to the “request for equitable adjustment” documents in form and function in
ASBCA Nos. 61794, 61796, and 61797, the Board presumes that the
government would also assert that this document is not a claim and that the
Board lacks jurisdiction over ASBCA No. 61793.
58
submissions is a final decision” and a “common sense” approach should be taken in
analyzing a document to determine if it is a claim. An REA can be converted into a
claim by the addition of a CDA certification, requesting a contracting officer’s final
decision, or stating they seek rights under the CDA or Disputes Clause, or “disputing”
an ongoing issue that has already gone through the REA process. See Andrews
Contracting Servs., LLC, ASBCA No. 60808, 17-1 BCA ¶ 36,766; Air Servs., Inc.,
15- 1 BCA ¶ 36,146; Creative Times Dayschool, Inc., ASBCA Nos. 59507, 59779,
16- 1 BCA ¶ 36,535; ECC Centcom Constructors, LLC, ASBCA No. 60647,
18- 1 BCA ¶ 37,133; Duncan Aviation, Inc., ASBCA No. 58733, 14-1 BCA ¶ 35,471;
Engineered Demolition, Inc., ASBCA No. 54924, 06-1 BCA ¶ 33,125; Madison
Lawrence, Inc., ASBCA No. 56551, 09-2 BCA ¶ 34,235. The Court of Claims discussed
the importance and purpose of the certification requirement in Paul E. Lehman, Inc. v. United
States, 230 Ct.Cl. 11, 673 F.2d 352, 354 (1982):
An important objective of Congress was to “discourag[e] the
submission of unwarranted contractor claims.” S.Rep. No.
1118, 95th Cong., 2d Sess. 5, reprinted in [1978] U.S.C.C.A.N.
5235, 5239. One method of accomplishing this purpose was
provided in section 5 of the Act, 41 U.S.C. § 604, which makes
a contractor liable for the amount of any portion of its claim that
it is unable to support because of misrepresentation or fraud.
Another was the certification requirement.
This court in Fidelity Construction Co. v. United States,
700 F.2d 1379, 1384 (Fed.Cir.), cert. denied, 464 U.S. 826,
104 S.Ct. 97, 78 L.Ed.2d 103 (1983), stated that the certification
requirement was one of the “most significant provisions of the
CDA” and that Congress viewed the certification requirement
“as a mechanism to discourage the submission of unwarranted
claims and encourage prompt settlements.”
Transamerica Ins. Corp., 973 F.2d at 1579, overruled on other grounds by Reflectone,
Inc. v. Dalton, 60 F.3d 1572 (Fed. Cir. 1995). The certification of an REA under FAR
33.207 is evidence that an REA is intended as a claim. See Southern Automotive
Wholesalers, ASBCA No. 53671, 03-1 BCA ¶ 32,158 at 158,998. On the other hand,
the certification of an REA under DFARS 252.243-7002 is evidence that an REA is
not intended as a claim. See Certified Constr. Co. of Kentucky, LLC, ASBCA No.
58782, 14-1 BCA ¶ 35,662 at 174,572.
We are faced with making a determination whether the REAs submitted by
JAAAT seeking costs associated with the relocation of the project screen, or weather
delays, or delays associated with the NEC switch, and the problems with the
communication system were actually CDA claims. While we acknowledge that the
distinctions between an REA submitted under DFARS 252.243-7002, and a claim
submission under the CDA have at times been muddied, we believe a discussion of the
59
historic differences between an REA and a CDA claim are helpful here. The U.S.
government is the largest customer in the world. It buys many types of products and
services — in both large and small quantities, including janitorial services to complex
space vehicles. In short, the government buys just about every category of commodity
and service available. At the center of this are the contractors who support the U.S.
government’s purchasing requirements. The parties recognize that issues may arise
during performance requiring adjustments to the contract or the delivery schedule.
Those adjustments are typically made through a Request for Equitable Adjustment
(REA) as set forth in the FAR and DFARS. DFARS 252.243-7002 (requests for
equitable adjustment); FAR 52.243-4(d)-(e); FAR Subpart 43.2 –Change Orders;
DFARS 252.243-7002. Although the FAR and DFARS do not define a request for
equitable adjustment, the term is used throughout the regulation, and the courts have
long recognized the importance of an equitable adjustment. Generally, an equitable
adjustment seeks to adjust the contract price or the delivery schedule based upon a
change to the contract. The requests may occur when there are increased direct costs
of added work, work is deleted, or not performed, and there are government-caused
delays or other changes to the contract. “Generally, an equitable adjustment is
justified by a change contrary to, or materially different from, the nature of the work
contemplated by the parties to the contract.” Ralph L. Jones Co. v. United States,
33 Fed. Cl. 327, 334 (1995) (citing Miller Elevator Co. v. United States, 30 Fed. Cl.
662, 677 (Fed. Cir. 1994)). The purpose of an equitable adjustment is to keep a
contractor whole through reimbursement of increased costs and payment of a fair
profit. See United States v. Callahan Walker Const. Co., 317 U.S. 56, 61 (1942);
Bruce Constr. Corp. v. United States, 163 Ct. Cl. 97, 98 (1963).
An REA allows contractors to submit to the contracting officer a request for
compensation that goes beyond the contract documents. REAs are commonly
employed in all types of government contracts as part of the administration of the
contract. For example, in construction contracts, unexpected site conditions, adverse
weather delays, and changes in scope may arise during the course of the contract.
These additional tasks completed by the contractor may result in expenses incurred
that were not contemplated. Understandably, the contractor wants to be compensated
for these additional expenses. The request for equitable adjustment allows just that.
At the lowest level, the contracting officer can review the request, make a
determination of entitlement and, if appropriate, compensate the contractor. It was the
intention of Congress to have disputes resolved at the lowest possible level. See
Minesen Co. v. McHugh, 671 F.3d 1332, 1338 (Fed. Cir. 2012) (citing 124 Cong. Rec.
31,645 (1978)); Pathman Constr. Co. v. United States, 817 F.2d 1573, 1578
(Fed.Cir.1987) (“A major purpose of the [Contract] Disputes Act was to induce
resolution of contract disputes with the government by negotiation rather than
litigation.” (internal quotation marks omitted)).
60
Submitting an REA is a routine part of government contracts. This
administrative process is contemplated by the contract though the “Changes” clause
(FAR 52.243-4), the “Changes and Changed Conditions” clause (FAR 52.243-5), and
the “Differing Site Conditions” clause (FAR 52.236-2). The determination of an
equitable adjustment under these clauses is governed by DFARS 252.243-7002
(requests for equitable adjustment). If a contractor cannot successfully make itself
“whole” through an REA and is dissatisfied with the REA negotiation and lack of
resolution, the contractor may then convert its REA to a CDA claim for a formal
decision by the contracting officer and possible litigation. What remains clear
throughout is that it is a contractor’s choice whether to submit its demand(s) as an
REA or a CDA claim. See 41 U.S.C. § 7103(a)(“[e]ach claim by a contractor against
the Federal Government relating to a contract shall be submitted to the contracting
officer for a decision”) (emphasis added)); Creative Times Dayschool, Inc., ASBCA
No. 59507, 16-1 BCA ¶ 36,535 (the Board lacked jurisdiction after the contractor
withdrew the FAR 33.207 certification of its previously submitted claim, and replaced
it with the DFARS 252.243-7002 certification, indicating an intent to no longer treat
its submission as a claim.); Zafer Taahhut Insaat ve Ticaret, A.S. v. United States,
129 Fed. Cl. 454, 456–57 (2016) (an REA that merely asked to review and evaluate
the matter at earliest convenience, was not enough to put the contracting officer on
notice that contractor was requesting a final decision on its claim. While a claim need
not take any particular form, the REA did not request a final decision, and thus the
court did not have subject matter jurisdiction); Agility Def. & Gov't Servs., Inc. v.
United States, 103 Fed. Cl. 366, 368-69 (2012) (the contractor’s submission was not
viewed as a defective CDA claim, but as a properly-certified REA. The contractor even
states in its submission that it is certifying its REA “[p]ursuant to DFAR 252.243–7002”).
Equitable adjustments were never designed to be adversarial proceedings. The
intricacies of the equitable adjustment process as set forth in the DFARS spells out
when and how the proposal should be submitted, the types of costs and breakdown of
direct costs, markups and time, and how presented. DFARS 252.243-7002 (requests
for equitable adjustment). Unlike a CDA claim, it also provides for the recovery of
proposal preparation costs. Bill Strong Enterprises, Inc. v. Shannon, 49 F.3d 1541(Fed. Cir. 1995), overruled in part on other grounds, Reflectone, Inc. v. Dalton,
60 F. 3d 1572 (Fed. Cir. 1995). All these factors lead to the realization that the
equitable adjustment process is part of the administration of contracts.
REAs can be resolved at the lowest levels which allows prompt and amicable
resolution of contractor issues that does not involve the Board or the courts. REAs can
be resolved by negotiation and then formalized in a bilateral modification without ever
reaching the claims stage. The request for equitable adjustment allows the parties to
quickly address and move past any issues which may arise during contract
performance and to help maintain a healthy working relationship. If, however, the
contracting officer and the contractor are unable to reach agreement, the contracting
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officer may then decide the equitable adjustment unilaterally. DFARS 252.243-7002
(Requests for equitable adjustment).
Unfortunately, there are also situations where even with the best efforts of the
parties the differences between the contractor and the government are unresolved, and
the dispute cannot be settled at the lowest level. Enter the “claim.” Contract Dispute
Act (CDA) claims, on the other hand, often turn into contentious, expensive, and time-
consuming legal battles. The formality and adversarial nature of the claim are noted in
the FAR defining a claim as a “written demand or written assertion by one of the
contracting parties seeking, as a matter of right, the payment of money in a sum
certain, the adjustment or interpretation of contract terms, or other relief arising under
or relating to the contract.” See FAR 2.101. The CDA was enacted by Congress to
implement a comprehensive statutory scheme for the resolution of government
contract claims. The CDA provides the framework for asserting and handling claims
by either the government or a contractor. Once a contractor submits a claim to a
contracting officer meeting all of the criteria as set forth in a CDA claim, the
contracting officer must issue a final decision on that claim, typically within 60 days.
Once a COFD is issued, the contractor may then appeal within 90 days to the Armed
Services Board of Contract Appeals (ASBCA) or within one year to the U.S. Court of
Federal Claims (COFC). 41 U.S.C. § 7104. If a final decision is not issued, the
contractor may appeal based upon a deemed denial. 41 U.S.C. § 7103(f)(5); Vox
Optima, LLC, ASBCA No. 62313, 20-1 BCA ¶ 37,625; Suh’dutsing Techs., LLC,
ASBCA No. 58760, 14-1 BCA ¶ 35,596.
While we recognize that REAs and claims often ask for the same thing – money
and time, they are distinctly different with each having its unique qualities and
consequences including purpose, timing, certification, allowable administrative costs,
collection of interest, recovery of attorneys’ fees, and avenues of appeal. See, e.g.,
CDA, 41 U.S.C. §§ 7101-7109; FAR 52.243-1 - 52.243-3; FAR 43.103; FAR 43.204;
FAR 31.205-47(f)(1); CERTIFICATION: 41 U.S.C. § 7103(b); Tecom, Inc. v. United
States, 732 F.2d 935, 937 (Fed. Cir. 1984); DFARS 243.204-71(c); DFARS 252.243-
7002, 7002(b); 41 U.S.C. § 134; TIMING: CDA, 41 U.S.C. §§ 7101-7109; FINAL
DECISION: 41 U.S.C. § 7103(f); REA PREPARATION ADMINISTRATIVE
COSTS ARE ALLOWABLE: FAR 31.205-33; Bill Strong Enterprises, Inc. v.
Shannon, 49 F.3d 1541 (Fed. Cir. 1995), overruled on other grounds by Reflectone,
Inc. v. Dalton, 60 F.3d 1572 (Fed. Cir. 1995).
a. How a REA is properly converted to a claim?
In reaching our determination in ASBCA Nos. 61793, 61794, 61796, and
61797, whether JAAAT properly converted its REAs into claims, the Federal Circuit
has provided much guidance. In Reflectone, Inc. v. Dalton, 60 F.3d 1572 (Fed. Cir.
1995), an REA was submitted to the contracting officer demanding $266,840 for costs
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related to government-caused delays. Reflectone’s President and CEO certified the
REA and requested a decision from the contracting officer. On March 19, 1991, the
contracting officer rendered a final decision and advised Reflectone of its right to
appeal. Reflectone appealed the contracting officer’s final decision to the Board,
which held that the REA was not a “claim” within the meaning of the CDA and,
therefore, it did not have jurisdiction over the appeal. The Board relied on language
from Dawco Constr., Inc. v. United States, 930 F.2d 872, 878 (Fed.Cir.1991), stating
“‘[a] contractor and the government contracting agency must already be in dispute
over the amount requested.’” Reflectone, 60 F.3d at 1574 (quoting Dawco). The
Court of Appeals reversed the Board’s holding stating that Reflectone’s REA “clearly”
satisfies all of the elements of a claim: “Reflectone, a contracting party, submitted a
written document to the [contracting officer] demanding the payment of $266,840
which it asserted the government owed for delaying performance of the contract by
furnishing defective goods. The submission was certified and requested a CO
decision.” Id. at 1578. So, while an ideal example of a REA being converted to a
claim is set forth in ASBCA No. 61792, we are reminded that Reflectone clearly
provides that the language of a “request for equitable adjustment” is not determinative
and we must weigh the entirety of the document or documents.
A year later the Federal Circuit decided James M. Ellett Const. Co., 93 F.3d
1537. The Forest Service terminated Ellett’s contract for convenience. By letter dated
November 17, 1988, Ellett submitted a letter to the contracting officer for the stated
purpose “to file [a] formal notice of claim pursuant to the Contract Disputes Act of
1978 (CDA),” to recover $545,157.19. See Ellett, 93 F.3d at 1540. The contracting
officer responded that Ellett needed to submit a settlement proposal on Standard Form
1436, which Ellett submitted on March 3, 1989. The parties entered into settlement
negotiations which continued into January 1990. Finally, in a January 12, 1990, letter
to the contracting officer, Ellett observed that it had been “nearly 14 months” since the
November 17, 1988, CDA “claim” and one year since the settlement proposal. Ellett
stated “that unless the ‘outstanding claim’ was resolved satisfactorily within thirty
days, it would file suit in the United States Court of Federal Claims.” The agency
responded with a settlement offer that was rejected on March 31, 1990. The agency
was told that a suit would be filed unless a settlement of $250,000 was reached within
two weeks. Id. at 1540–41. On July 13, 1990, Ellett filed a complaint in the Court of
Federal Claims, and the government moved to dismiss for lack of subject matter
jurisdiction arguing that the November 17, 1988, letter did not qualify as a valid claim
under the CDA. The COFC dismissed stating “that the November 17, 1988, letter did
not request a final determination by the contracting officer, but was only an invitation
to enter negotiations. Id. at 1541. The Federal Circuit disagreed and reversed the
COFC decision finding that the parties agreed that they would try to reach a mutually
agreeable settlement. However, if they were unable to do so, the contracting officer
would issue a final decision consistent with the FAR’s requirements. The Federal
Circuit found that “After ten months of fruitless negotiations, Ellett explicitly
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requested that the contracting officer settle its claim. This demand is tantamount to an
express request for a contracting officer’s decision.” Id. at 1544. Finding that Ellett’s
claim “read as a whole, was submitted for the purposes of obtaining a final decision,”
id., the Federal Circuit reminds us that the “law does not require an explicit demand or
request for a contracting officer’s decision, ‘as long as what the contractor desires by
the submissions is a final decision, that prong of the CDA claim test is met.’” Id.(quoting Transamerica, 973 F.2d at 1576).
Nevertheless, the facts and guidance provided in Ellett are distinctly different
from the facts in these appeals. In each instance, JAAAT treated its submissions as an
REA; never implicitly or explicitly seeking to convert those submissions into claims
by asking for a final decision. JAAATs actions under the “stormwater” REA reveal its
clear understanding of how to convert its REAs into proper claims. So, while an ideal
example of a REA being converted to a claim is set forth in ASBCA No. 61792, the
correspondence in ASBCA Nos. 61793, 61794, 61796, 61797, being read as broadly
as practicable do not demonstrate that JAAAT wanted a contracting officer’s decision.
Further guidance can be found in M. Maropakis Carpentry, Inc. v. United
States, 609 F.3d 1393 (Fed. Cir. 2010). On August 20, 2001, Maropakis sent a letter
requesting a contract extension of 447 days. On August 28, 2001, the contracting
officer responded that Maropakis did not submit sufficient justification to warrant the
time extension, rejected the request, invited Maropakis to submit additional
information in support of its request, and stated that “this letter is not a Final Decision
of the Contracting Officer.” Maropakis, 609 F.3d at 1325-26. On June 28, 2002, the
contracting officer sent another letter to Maropakis stating it has not received a
response to the Navy’s August 28, 2001 letter and stated that Maropakis would owe
liquidated damages for the 467 days of delay. Maropakis responded in a letter on July
22, 2002 reiterating its earlier request for an extension but mentioning specifically
only the 107–day extension for the removal of lead contaminated windows. This letter
referred to multiple delays but did not specify a total number of days of extension
requested. The letter then stated, “we will dispute ... the liquidated damages amount of
$303,550.00 and will indicate that M. Maropakis was not responsible for the delays.”
Maropakis, 609 F.3d at 1326. On December 20, 2002 the Navy issued a final decision
which reiterated the government's demand for liquidated damages (id.).
Maropakis filed a complaint in the COFC “alleging (1) breach of contract due
to government delay and seeking resulting time extensions, and (2) breach of contract
due to the government’s assessment of liquidated damages and seeking remission” of
the full amount of liquidated damages withheld. Id. The COFC granted the
government’s motion to dismiss finding that Maropakis had not submitted a “claim” as
required under the CDA. Id. Maropakis appealed, arguing that its July 22, 2002, letter
was sufficient to constitute a claim under the CDA. Id. at 1327. The Federal Circuit
found the July 22nd letter was not a CDA claim, stating:
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The letter did not state the total number of days requested
in extension and did not request a final decision. In fact,
the letter appears to promise a forthcoming written claim,
which never materialized. A claim cannot be based merely
on intent to assert a claim without any communication by
the contractor of a desire for a contracting officer decision.
Id. at 1328 (Emphasis added).
An explicit request for a final decision is not required, “‘as long as what the
contractor desires by its submissions is a final decision. . . .’” Id. at 1327-28 (quoting
Ellett, 93 F.3d at 1543). However, the failure to request a final decision remains a
jurisdictional impairment for a claim under the CDA (Maropakis, 609 F.3d at 1329).
Most recently, the Federal Circuit issued its decision in Hejran Hejrat Co. Ltd,
930 F.3d at 1354. The underlying facts reveal that after the USACE’s July 2012
decision not to exercise an option, Hejran informed the government that it was due
additional payments. Hejran Hejrat Co. LTD, ASBCA No. 61234, 18-1 BCA
¶ 37,039. Hejran submitted invoices for the additional compensation to which the
contracting officer responded, “This letter is in response to your three (3) invoices . . . .
Although you used the word ‘claim’ and ‘compensation’ in your email and invoices, I
have treated this as a request for equitable adjustment (REA) because it is not clear
that you were seeking a contracting officer’s final decision.” Hejran Hejrat, 18-1
BCA ¶ 37,039 at 180,321. The contracting officer asked Hejran whether it intended to
submit a claim or seek a contracting officer’s final decision. Hejran responded in a
January 31, 2014, email that:
We therefore ask you to treat this email together with the
supporting documents as a[n] REA. In the event that you
decide to treat this email as [an] REA and still reject our
request for the adjustment of payments, we would then
proceed with issuing a certified claim. . . . We reiterate that
this email together with the supporting documents be
treated as a[n] REA.
Id. at 180,321-22. The correspondence continued including the submission by Hejran
of revised invoices. None of the communication requested a contracting officer’s final
decision or provided a certification. Id. at 180,322. However, on March 5, 2015,
Hejran submitted to the contracting officer another request for additional payment,
providing similar statements of fact for each, and provided a “Sworn Statement in
reference to (REA).” Id. The sworn statement included a signed affidavit that the
following statement is true: “The clauses and points reflected in REA (Request for
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Equitable Adjustment) in reference to contract . . . to the best of my knowledge are
true.” Id..
In May 2015, not having received a response, Hejran again contacted the
contracting officer. The contracting officer “responded by email telling [Hejran] ‘We
should be providing you the Contracting Officer’s final decision by the end of this
week.’” Id. Immediately following that message, the contracting officer sent an email
that contained a PDF document titled “Response to REA” to Hejran. Id. Hejran
appealed. The Board held it did not have subject matter jurisdiction as a valid claim
under the CDA was not submitted to the contracting officer. Id. at 180,323.
The Federal Circuit reversed the Board and found that Hejran did request a final
decision. The Federal Circuit determined that the March 5 submission provided
specific amounts of compensation for each of the alleged grounds, included detailed
factual bases for its alleged losses, and claimed a sum certain based on the losses.
More importantly, the Federal Circuit determined that last submission contained an
attempted certification. Hejran Hejrat, 930 F.3d at 1357-58. The court relied on two
facts pointing to a valid claim under the CDA: (i) “The March 5 submission was
sworn unlike earlier submissions, and thus had a formality lacking in the earlier
submissions. ‘[C]ertification plays a serious role in the statutory scheme because it
triggers a contractor’s potential liability for a fraudulent claim [and is] designed to
discourage the submission of unwarranted contractor claims and to encourage
settlement.’” Id. at 1358 (quoting Skelly & Loy v. United States, 685 F.2d 414, 418
n.11 (Ct. Cl. 1982)). (ii) “It is also important that the contracting officer treated the
denial of [Hejran’s] REA as a ‘final determination’ in the matter.” Hejran, 930 F.3d
at 1358. The totality of these facts demonstrated to the Federal Circuit that while the
submission may have started as an REA, it was converted to a claim when Hejran
attempted certification through a sworn affidavit. Equally important is the fact that
this action was interpreted by the contracting officer as a request for a final decision on
its claim and he responded by stating that a final decision was forthcoming. The court
concluded that “[t]his [March 5] submission bears all of the hallmarks of a request for
a final decision on a claim . . . .” and that “[t]he contracting officer could not
retroactively turn a qualifying claim document into something else.” Id.
The Federal Circuit in Hejran did not diminish the significance of the REA, but
instead recognized its import to the entire regulatory and statutory scheme and the
necessity that they work in concert. Hejran may have lowered the threshold necessary
to convert an REA to a CDA claim, but a request for a final decision remains a
jurisdictional prerequisite to any subsequent action before the Board or the COFC.
The purpose of this requirement is “‘to create opportunities for informal dispute
resolution at the contracting officer level and to provide contractors with clear notice
as to the government’s position regarding contract claims.’” Raytheon Co. v. United
States, 747 F.3d 1341, 1354 (Fed. Cir. 2014) (quoting Applied Cos. v. United States,
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144 F.3d 1470, 1478 (Fed. Cir. 1998)). The issuance of the final decision is controlled
by the contractor’s claim. While a claim need not be submitted in any particular
format or use any particular wording; the contractor need only submit “a clear and
unequivocal statement that gives the contracting officer adequate notice of the basis
and amount of the claim.” Contract Cleaning Maintenance, Inc. v. United States,
811 F.2d 586, 592 (Fed. Cir. 1987). The Federal Circuit recognizing that a request for
a final decision may be implied from the context of the submission. See Maropakis,
609 F.3d at 1327-28; Ellett, 93 F.3d at 1543; Hejran Hejrat, 930 F.3d at 1357-58; Rex
Systems, Inc. v. Cohen, 224 F.3d 1367, 1372 (Fed. Cir. 2000); Transamerica Insurance
Corp., 973 F.2d at 1578-79.
In reaching a decision on whether JAAAT requested a final decision, directly or
indirectly, we examine the course of negotiations between the parties, examining the
totality of the correspondence in determining the sufficiency of a claim. See generally,
Ellett, 93 F.3d 1537; Hejran Hejrat, 930 F.3d 1354; D.L. Braughler Co. v. West,
127 F.3d 1476 (Fed. Cir. 1997). See SAB Const., Inc. v. United States, 66 Fed. Cl. 77,
91 (2005), aff’d, 206 F. App’x 992 (Fed. Cir. 2006); Johnson v. Advanced Eng’g &
Planning Corp., 292 F. Supp. 2d 846 (E.D. Va. 2003); Lael Al Sahab & Co.,
15- 1 BCA ¶ 35,809 at 175,129; Vibration & Sound Solutions Ltd., 09-2 BCA ¶ 34,257
at 169,270. As we examine the facts in Appeal Nos. 61793, 61794, 61796, and 61797,
we simply cannot find, based upon the totality of the correspondence that JAAAT
either directly or by implication, requested a final decision. The details of each REA
and our decision are addressed below.
b. ASBCA NOS. 61794 (WEATHER DELAYS), 61796
(COMMUNICATION GROUNDING), 61797 (NEC SWITCH DELAY)
The government argues that these three appeals “should be dismissed because
JAAAT failed to request a final decision by the contracting officer” (gov’t mot. at 15).
The government asserts that JAAAT’s request for ASBCA No. 61794 asks about
“settlement for adverse weather delays,” which “appears to be in the nature of
settlement discussions as opposed to a claim” (gov’t mot. at 15). Similarly, for
ASBCA Nos. 61796 and 61797, the government states that the submissions were
“styled as Requests for Equitable Adjustment and appeared to be for the purpose of
settlement discussions” (id. at 16). The government argues that the parties never
treated the “Request for Equitable Adjustment” in ASBCA Nos. 61794, 61796, and
61797 as claims (id.). JAAAT argues that “[e]ach of the corresponding REAs were
less than $100,000 and again were verbally summarily rejected by the CO at the 10
August 2017 settlement meeting. . .” and JAAAT appealed to the Board after the
contracting officer failed to issue a formal decision within a reasonable time (app reply
at 7). JAAAT does not elaborate on the “August 2017 settlement meeting,” other than
acknowledging a settlement meeting occurred (app. resp. at 6-7).
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Our discussion of this argument is generous as it consists of a single conclusory
sentence that contains no citation to the record or case law for its proposition. JAAAT
does not describe why this August 10, 2017, meeting converted each of its REAs to
claims. The Board rejects the notion that the contracting officer entertaining and/or
discussing the contractor’s request for equitable adjustment automatically converts its
REA to a claim. Where possible, a contracting officer should attempt to resolve
disputes by mutual agreement. See FAR 33.204 (“The Government’s policy is to try
to resolve all contractual issues in controversy by mutual agreement at the contracting
officer’s level. Reasonable efforts should be made to resolve controversies prior to the
submission of a claim.”); FAR 33.210 (“[C]ontracting officers are authorized, within
any specific limitations of their warrants, to decide or resolve all claims arising under
or relating to a contract subject to the Disputes statute.”); Pathman Constr. Co.,
817 F.2d at 1578 (stating that a “major purpose” of the CDA is to “induce resolution
of contract disputes with the government by negotiation rather than litigation” (citation
omitted)).
Not only would JAAAT’s position circumvent the procedures outlined in both
the Disputes clause, 52.233-1 and the certification requirements of 41 U.S.C.
§ 7103(b), but it would thwart rather than aid the policy of negotiation. A theme
coursing through each of the contracting officer’s letters in response to JAAAT’s
REAs (SOFs ¶¶ 15, 20, 22, 24, 43) is that additional information is required to
evaluate the equitable adjustment (ASBCA No. 61794: documents provided “do[] not
indicate the critical path activity that was delayed more than 50 percent during your
scheduled workday nor does it indicate which workdays you were delayed. . . no
activity numbers were provided to verify your schedule. . . . If you have any additional
documentation on the topics above, please submit to this office. . . .” (SOF ¶ 15; R4,
tab 9b at 2587-88); 61796: “No backup information was provided to explain how the
original design meets code” (SOF ¶ 20; R4, tab 11c at 2648); 61797: “Government
review is not possible due to lack of critical information . . . . The REA provides no
supporting information to demonstrate a schedule impact. Provide a time impact
justification as required by specification section. . . .” (SOF ¶ 22; R4, tab 12b at 2667);
61798: “Provide the requested supporting documentation as soon as possible . . .”
(SOF ¶ 24; R4, tab 13b at 2688); 61800: “The Government is unable to review due to
a lack of critical information. . . . The REA provides no supporting information to
demonstrate a schedule impact. . . . Please provide this missing documentation as soon
as possible” (SOF ¶ 43; R4, tab 15b at 2779)).
We are guided by the Federal Circuit in determining whether these REAs were
properly converted to a CDA claim prior to appealing to the ASBCA. Here, the record
is devoid of any reference to a request for final decision from JAAAT. Instead, the
documentation for each of these appeals leads to only one conclusion which is
JAAAT’s desire was to negotiate with the contracting officer as reflected in the REA
process set forth in the DFARS 252.243-7002. Discussions were held between the
68
parties as envisioned by that process. It was incumbent upon JAAAT, as they did in
ASBCA No. 61792, to convert the REA to a claim and request a final decision before
filing its Notice of Appeal to the Board. While we do not dictate the content or
eloquence of the appellant’s request for a final decision it must still be made, whether
provided directly or by implication. The fact that JAAAT labeled each submission as
an equitable adjustment, and made no attempt to request a final decision by direct or
circuitous routes, leads to a conclusion that it did not intend to convert the REA into a
claim. Even after the contracting officer denied the REAs based upon the submissions
presented, and requested additional information, JAAAT languished in converting its
REAs into claims. (SOF ¶¶ 15, 20, 22) Unlike JAAAT’s actions in ASBCA
No. 61792, where the REA was denied by the contracting officer but later converted to
a claim pursuant to CDA, 41 U.S.C. §7103(b)(1)(SOF ¶¶ 11-12), there was no such
attempt here, direct or otherwise (SOF ¶¶ 14, 18-19, 21).
“The fact that appellant is a pro se. . . contractor, whose personnel are likely to
be unfamiliar with government contract law . . . does not excuse the failure to comply
with jurisdictional prerequisites. We have routinely required similarly situated
appellants to comply with our jurisdictional prerequisites.” Elham Ahmadi Constr.
Co., ASBCA No. 61031, 17-1 BCA ¶ 36,861; see also Pamir Zameen Constr. and
Logistic Co., ASBCA No. 60597, 17-1 BCA ¶ 36,683; Golden Build Constr. Co.,
ASBCA No. 60652, 17-1 BCA ¶ 36,654; Washington Star Constr. Co., ASBCA
No. 60644, 16-1 BCA ¶ 36,556; Genuine Constr. Co., ASBCA No. 60626, 16-1 BCA
¶ 36,553; Lael Al Sahab & Co., ASBCA No. 58346, 13 BCA ¶ 35,394 at 173,663. But
here, it is obvious that JAAAT is familiar with the distinctions between the request for
equitable adjustment process and CDA claim process. Mr. Barnhill’s declaration
states that JAAAT had previous experience converting REAs to claims. Its actions in
ASBCA No. 61792 demonstrate JAAAT’s familiarity with the nuances associated
with converting an REA to a CDA claim (SOF ¶¶ 8, 10-12). That knowledge is
reflected in its July 7, 2015, correspondence where JAAAT makes a formal request for
a COFD, and states that while amenable to further discussion and potential resolution
“please accept this correspondence as JAAAT’s formal request for a Contracting
Officer’s final decision” (SOF ¶ 11). Likewise, JAAAT understands that continuing
discussions with the contracting officer can ultimately lead to the resolution of its
REA:
I and the company had prior experience with disputes
concerning unilateral modifications by the government
being successfully resolved through the REA process, and
I and JAAAT expected that this would be the manner we
would have to proceed in this case. . . .[W]e did not file
this as a claim.
....
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We had the expectation that an REA would resolve the
financial matters fairly once the practical issues were
resolved.
(App. br. dtd. June 30, 2020, ex. A, Declaration of Rickey Barnhill at 1-2)
The choice to continue with those discussions or convert the REA to a claim by
requesting a final decision is a choice that is in the hands of the contractor.
Nonetheless, we cannot allow a contractor after the fact to attempt to change the basic
nature of those facts, as JAAAT attempts to do here. The court may consider
affidavits and other materials beyond the pleadings but cannot rely on conclusory or
hearsay statements contained in the affidavits. See FED. R. CIV. P. 56(c)(4), “An
affidavit or declaration used to support or oppose a motion must be made on personal
knowledge, set out facts that would be admissible in evidence, and show that the
affiant or declarant is competent to testify on the matters stated.” See also Lujan v.
Nat’l Wildlife Fed’n, 497 U.S. 871, 888–89, 110 (1990) (“The object of this provision
[Rule 56(c)(4)] is not to replace conclusory allegations of the complaint or answer
with conclusory allegations of an affidavit.”); Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 249 (1986) (quoting First National Bank of Ariz. v. Cities Service Co.,
391 U.S. 253, 290 (1968) for the proposition that “the plaintiff could not rest on his
allegations of a conspiracy to get to a jury without ‘any significant probative evidence
tending to support the complaint’”).
A contractor’s words and actions cannot proceed down the REA path to only
later say that those same words and actions meant something else entirely. JAAAT
has failed to demonstrate through its documentation that it even implied that they
wanted a final decision. See, e.g., Andrews Contracting Services, LLC, 17-1 BCA
¶ 36,766 (REA submittal was not a claim when it did not implicitly or explicitly
request a contracting officer's final decision); Creative Times Dayschool, Inc.,
16- 1 BCA ¶ 36,535 (Contractor withdrew the REA’s FAR 33.207 certification, and
certified the REA under DFARS 252.243-7002, indicating its intent that the REA no
longer be treated as a claim, thereby converting it to a non-claim REA); Air Servs.,
Inc., ASBCA No. 59843, 15-1 BCA ¶ 36,146 at 176,426-27 (The Board reviewing the
totality of the parties’ correspondence and finding that the contractor’s submission was
indeed a CDA claim as the contractor sent a letter revising an earlier REA and
indicated that it was seeking a final decision, and an expected timeline for which the
contracting officer would issue the final decision. The contractor’s submission of a
DFARS certification was in response to the contracting officer’s erroneous instruction.
“[DFARS] certification provided by the contractor was one piece of evidence in
determining whether a proper CDA claim had been submitted”); Certified Constr. Co.
of Kentucky, LLC, ASBCA No. 58782, 14-1 BCA ¶ 35,662 (letter was not a claim but
was in fact an REA when letter failed to implicitly request a contracting officer’s
70
decision, a foundational requirement for any contractor claim); Madison Lawrence,
Inc., 09-2 BCA ¶ 34,235 (contractor explicitly stated that it was converting its REA
into a claim and it submitted a proper CDA claim certification); DTS Aviation
Services, Inc., ASBCA No. 56352, 09-2 BCA ¶ 34,288 (contractor submitted a letter
converting REA to a CDA claim); Engineered Demolition, Inc., ASBCA No. 54924,
06-1 BCA ¶ 33,125 (Board was unable to conclude there was a proper claim before the
contracting officer; as contractor indicated, its REA was not a CDA claim).
There is no indication in the record that the contracting officer treated JAAAT’s
submission as anything other than a request for equitable adjustment. 25 As
demonstrated in many of the contracting officer’s responses to the REAs, the
contracting officer appeared to be operating under the guise of DFARS 252.243-7002
and cited JAAAT to missing support for its REA, and asking to “provide additional
documentation on the topics” (SOF ¶ 15); no backup information was provided to
explain how the original design meets code (SOF ¶ 20); “[p]rovide a time impact
justification as required by specification section 01 32 01. 00 10 paragraph 3.7”
(SOF ¶ 22). While not determinative, the contracting officer did not treat the request
for equitable adjustments dated February 24, 2017 (ASBCA No. 61794, SOF ¶¶ 14-
15) and February 28, 2017 (ASBCA Nos. 61796 and 61797, SOF ¶¶ 19, 21) as a claim
and issue final decisions on the requests (SOF ¶¶ 15, 20, 22). The contracting officer’s
response to each of JAAAT’s REA refers to the requests in the same language
employed by JAAAT, “request for equitable adjustment” or “adverse weather delays”
(SOF ¶¶ 15, 20, 22). In denying each of JAAAT’s requests, the contracting officer
uses language encouraging appellant to provide supplemental material. (Id.; FAR
33.211(contracting officer’s decision)). While the Federal Circuit concluded in Hejran
that the contracting officer created the impression that he understood that the later
submitted request and attached affidavit to be a claim through issuing “a final
25 “If a contractor fails to submit a proper CDA claim to the [contracting officer], any
purported [contracting officer’s] decision on the matter is a nullity.” Suodor Al-
Khair Co - Sakco for Gen. Trading, ASBCA Nos. 59036, 59037, 15-1 BCA ¶
35,964 at 175,726 (citing W.M. Schlosser Co. v. United States, 705 F.2d 1336,
1338 (Fed. Cir. 1983)). The parties cannot confer jurisdiction to the Board; yet,
the contracting officer’s behavior and treatment of the contractor’s
correspondence can be instructive whether the contractor intended to submit a
claim and whether the contracting officer’s actions are consistent that a claim
has been submitted. See, e.g., Transamerica Ins. Corp., 973 F.2d at 1579 n.2(“The fact that the Government referred to the operative submission(s) as
‘claims’ was found persuasive by this court in its Contract Cleaning analysis”
[811 F.2d at 592]); James M. Ellett Const. Co., 93 F.3d at 1542, 44-46; Hejran
Hejrat, 930 F.3d at 1358 (“It is also important that the contracting officer
treated the denial of HHL’s REA as a ‘final determination’ in the matter.”)
71
decision,” the contracting officer in these appeals treated JAAAT’s “requests for
equitable adjustment” as REAs throughout. See Hejran Hejrat, 930 F.3d at 1358;
There is nothing in the contracting officer’s correspondence that can be used to help
support a finding that appellant sought a final decision.
Again, while the request for a final decision need not be explicit, and may be
implied from the context of the submission, there needs to be something more than an
after-the-fact assertion that the contractor meant it to be a claim. Rex Systems,
224 F.3d at 1372; Ellett, 93 F.3d at 1543; Transamerica, 973 F.2d at 1576-77.
Air Services, 15-1 BCA ¶ 36,146 at 176,425-26. JAAAT’s REAs did not indicate,
either expressly or implicitly, that it was seeking a final decision (SOF ¶¶ 14, 19, 21).
The document dated February 24, 2017, for ASBCA No. 61794 is stylized as an REA,
and a reading of the one paragraph document in its entirety would not lead a
contracting officer to believe that JAAAT was seeking to file a claim and desire a final
decision on that claim: “[JAAAT] became aware that there was never a settlement for
adverse weather delays. . . . [W]e therefore ask that 50 days be added to our contract.”
(SOF ¶ 14). Similarly, the court in Maropakis rejected a similar request as insufficient
to be a CDA claim. Maropakis, 609 F.3d at 1328.
Similarly, the documents dated February 28, 2017 (SOF ¶ 19, ASBCA
No. 61796; SOF ¶ 21, ASBCA No. 61797), do not expressly or implicitly seek a final
decision. Each document provides a description stating that the submission is a
“Request for Equitable Adjustment,” it identifies the amount sought, and provides
supporting details for the request (id.). The documents repeatedly state the
submissions are “Request for Equitable Adjustment” with bold typeface for emphasis
(id.). Consistent with DFARS 252.243-7002, each submission is accompanied by a
“Change Order and REA Cost Sheet” that is an “ESTIMATE FOR CONTRACT
MODIFICATION” (id.). In addition, JAAAT has not argued nor provided any
evidence that the parties treated the documents as claims for each of ASBCA
Nos. 61794, 61796, and 61797 (app. reply at 7-8).
In contrast to ASBCA Nos. 61794, 61796, and 61797, JAAAT’s representative,
Mr. Eddie Cummings, who signed all of the request documents and engaged the
contracting officer throughout, chose to only convert ASBCA No. 61792 into a claim
after failed negotiations (SOF ¶¶ 10-12). The formality observed by JAAAT for
ASBCA No. 61792 in converting the other REA into a claim suggests that JAAAT
understood the differences and nuances between REAs and claims. See Reflectone,
60 F.3d 1572; Ellett, 93 F.3d 1537; Maropakis, 609 F.3d 1323. The facts clearly
demonstrate that JAAAT made a decision in ASBCA Nos. 61794, 61796, and 61797
to pursue the REA process as set forth in DFARS 552.243-71, “Equitable
Adjustments.”
72
JAAAT bears the burden of proving the Board’s subject matter jurisdiction by a
preponderance of the evidence. Reynolds v. Army & Air Force Exchange Serv.,
846 F.2d 746, 748 (Fed. Cir. 1988); Suodor al-Khair Co - Sakco for Gen. Trading,
15- 1 BCA ¶ 35,964 at 175,725 (citing Baghdadi Swords Co., ASBCA No. 58539,
13 BCA ¶ 35,395 at 173,664); United Healthcare Partners, Inc., ASBCA No. 58123,
13 BCA ¶ 35,277 at 173,156. 26 JAAAT has failed to advance facts that support that
the REAs set forth in ASBCA Nos. 61794, 61796, and 61797 were properly converted
into claims. JAAAT has failed to meet its burden. For these reasons, the Board
concludes that it lacks the jurisdiction over ASBCA Nos. 61794, 61796, and 61797.
c. ASBCA NO. 61793 (RELOCATE PROJECTOR SCREEN)
While the same jurisdictional issues raised in ASBCA Nos. 61794, 61796, and
61797 are present here, we separate out this appeal because of the nature in which it
found its way to the Board 27. The government asserts that the Board does not have
jurisdiction over this appeal because “no records can be found . . . that this REA was
ever filed” (gov’t mot. at 1) and no written claim was submitted to the contracting
officer (id. at 14). JAAAT counters that the REA was submitted to USACE on
November 8, 2016, provided a copy of the document and cites to JAAAT’s
Supplemental Rule 4, tab 2 (app. reply at 1). The Board accepts that JAAAT
submitted the November 8, 2016 document to the contracting officer, but finds that for
similar reasons as identified in ASBCA Nos. 61794, 61796, and 61797, the document
is not a claim. First, the November 8, 2016 document states it is a request for an
“equitable adjustment” of $1,753 and requests “that a contract modification [should]
be created to cover this amount.” The document does not indicate that JAAAT views
the submission as a claim nor does JAAAT request a final decision. (SOF ¶ 13) There
is no indication from JAAAT in the November 8, 2016 document or any other
document concerning this request that they will exercise its appeal rights if the
USACE does not approve their request. JAAAT relies on no other document,
communication between the parties, or argument to support its position that the
November 8, 2016 document is a claim under the CDA (app. reply at 6, 7). Like the
26 “Jurisdiction is an absolute concept, it either exists or it doesn’t. The Board has no
discretion with respect to jurisdiction.” “It is well established that without a
formal claim and final decision by the contracting officer [or a deemed denial]
there can be no appeal under the Contract Disputes Act (CDA), 41 U.S.C. §§
7101-7109.” Elham Ahmadi Constr. Co., 17-1 BCA ¶ 36,861 (citing Milmark
Services, Inc. v. United States, 231 Ct. Cl. 954, 956 (1982)); Envtl. Safety
Consultants, Inc., ASBCA No. 54615, 07-1 BCA ¶ 33,483 at 165,980; CCIE &
Co., ASBCA Nos. 58355, 59008, 14-1 BCA ¶ 35,700 at 174,816.
27 See n.7.
73
facts in ASBCA Nos. 61794, 61796, and 61797, there is no suggestion here that
JAAAT intended this document to be anything other than an REA at the time of
submitting it to the contracting officer or thereafter. See Maropakis, 609 F.3d at 1328;
Andrews Contracting Services, LLC, 17-1 BCA ¶ 36,766; cf. Reflectone, 60 F.3d
at 1578. For these reasons, the Board concludes that it lacks jurisdiction over ASBCA
No. 61793.
5. GOVERNMENT’S MOTION FOR SUMMARY JUDGMENT
Having found jurisdiction over ASBCA Nos. 61792 and 61799, we now
proceed to the government’s motion for summary judgment. Having dismissed
ASBCA Nos. 61793-61798, and 61800 for lack of jurisdiction, consideration of the
government’s entitlement to summary judgment on these appeals is moot.
a. Standard of Review for Motion for Summary Judgment
The applicable provisions are well settled. Summary judgment is appropriate
only if there is no genuine issue as to any material fact, and the moving party is
entitled to judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 322
(1986); Mingus Constructors, Inc. v. United States, 812 F.2d 1387, 1390 (Fed. Cir.
1987); Colonna’s Shipyard, Inc., ASBCA No. 59987 et al., 16-1 BCA ¶ 36,518
at 177,901. In the course of the Board’s evaluation of a motion for summary
judgment, our role is not “‘to weigh the evidence and determine the truth of the
matter,’ but rather to ascertain whether material facts are disputed and whether there
exists any genuine issue for trial.” Holmes & Narver Constructors, Inc., ASBCA
Nos. 52429, 52551, 02-1 BCA ¶ 31,849 at 157,393 (quoting Liberty Lobby, Inc.,
477 U.S. at 249). A material fact is one that may affect the outcome of the decision.
Liberty Lobby, 477 U.S. at 248-49; Colonna’s Shipyard, 16-1 BCA ¶ 36,518
at 177,901. Finally, in deciding a motion for summary judgment, our task is not to
resolve factual disputes, but to ascertain whether material disputes of fact are present.
General Dynamics Corp., ASBCA Nos. 32660, 32661, 89-2 BCA ¶ 21,851.
It is the moving party’s burden to establish the absence of any genuine issue of
material fact, and all significant doubt over factual issues must be resolved in favor of
the party opposing summary judgment. Mingus Constructors, 812 F.2d at 1390-91;
Colonna’s Shipyard, 16-1 BCA ¶ 36,518 at 177,901. Once the moving party has met
its burden of establishing the absence of disputed material facts, then the non-moving
party must set forth specific facts, not conclusory statements or bare assertions, to
defeat the motion. Mingus Constructors, 812 F.2d at 1390-91; Pure Gold, Inc. v.
Syntex (U.S.A.), Inc., 739 F.2d 624, 626-27 (Fed. Cir. 1984); Colonna’s Shipyard, 16-1
BCA ¶ 36,518 at 177,901. Where a party opposes summary judgment they must
provide a clear challenge with support to demonstrate material facts in dispute.
74
b. Are there any genuine issue(s) of material fact(s)?
Throughout its motion the government maintains that there are no material facts
in dispute with respect to each of JAAAT’s requests for equitable adjustment. 28 To
support the government’s position, it has put forth 19 “Statement of Undisputed
Material Facts” (SUMF) that outline and recite the clauses within the
JAAAT/Safeco/Tetra Tech Settlement and the POA (gov’t mot. at 3-8). JAAAT
initially contested some of the SUMFs in its response brief to the government’s motion
(app. resp. at 1-5); but, later in its brief dated June 30, 2020, addressing whether its
appeal for ASBCA No 61799 was timely, JAAAT reverses and utilizes many of the
government’s SUMFs in support of its arguments. (See App. br. dtd. June 30, 2020
at 2-3, 6-7) In making a determination whether any genuine issue of material fact
exists that would preclude us from summary judgment, we have considered each of the
government’s SUMFs 1-19, and appellant’s corresponding responses (SOF ¶¶ 81-100).
See Mingus Constructors, 812 F.2d at 1390-91; Barefoot Architect, Inc. v. Bunge,
632 F.3d 822, 826 (3d Cir. 2011) (The Court summarizing the undisputed facts,
drawing all inferences in favor of the non-moving party).
The government relies on (i) representations by JAAAT’s agent and attorney-
in-fact, Tetra Tech (SOF ¶¶ 50, 54, 60, 75), (ii) the signed settlement agreement (in
principle) (SOF ¶¶ 50-63, 65-66), (iii) JAAAT’s August 31, 2018, acceptance of the
government’s adjustment to the settlement amount (SOF ¶ 73), (iv) the $2,800,000
payment by Tetra Tech to the surety pursuant to the terms of the POA (SOF ¶ 63), (v)
the Central District of California Court’s Order granting the Ex parte Application for
emergency relief (SOF ¶¶ 74-75), and (vi) the government’s payment of $3,100,000
pursuant to Modification No. 08 (SOF ¶¶ 77-80) to advance its’ position.
The government argues that JAAAT is barred from relief under the affirmative
defenses of either accord and satisfaction or release:
Operative for all appeals are the defenses of accord and
satisfaction and release. Either theory serves as a basis for
summary judgment in favor of the [government].
....
Modification DQ0108 [Modification No. 08] with release
of claims is all-encompassing and clearly covers the
subject matter of these appeals as well as any other future
28 We previously concluded that the Board does not have jurisdiction to entertain
appeal Nos. 61793-61798, and 61800, leaving only Appeal Nos. 61792 and
61799.
75
claims and shows a meeting of the minds of the parties.
Further, consideration was provided as the Government
received the release of claims and settlement and the
government issued a payment in the amount of $3.1
million.
(Gov’t mot. at 8-12)
JAAAT, with the surety’s concurrence, executed a POA which provided Tetra
Tech the right to “to act for and/or on JAAAT’s behalf as true and lawful agent and
attorney. . . as needed to make, endorse, sign, and deliver any and all documents or
things necessary for finalizing and/or otherwise securing payment” and settle on
JAAAT’s behalf “contract adjustments and/or claims” against the Army under the task
order for “the project commonly referred to as the ‘SOF Brigade Headquarters
Facility’” (SOF ¶ 60; gov’t mot. at 4-5; see ex. G-3 at 1-2). Attached to its motion is a
copy of the notarized POA signed by JAAAT’s Director and Safeco, as surety for the
payment and performance bonds posted under the Brigade contract (SOF ¶¶ 54, 56;
gov’t mot., ex. G-3). The POA states that JAAAT and the surety, Safeco, have agreed,
in principle, to settle with the government JAAAT’s claims against the government for
$3,200,000:
R1. JAAAT and the Brigade Project’s surety, Safeco. . .
have agreed, in principal [sic], to settlement with the
Government the Brigade Project adjustment claims
submitted previously by JAAAT to the Government for the
total amount of $3,200,000 . . . .
R2. The Brigade Project Settlement will be divided
between Safeco and JAAAT by agreement between them,
with Safeco receiving $2,800,000 and with JAAAT
receiving the remainder.
(Gov’t mot., ex. G-3 at 1, ¶¶ R1, R2; SOF ¶¶ 58-59)
The POA states further:
Tetra Tech is entitled, but not required, to act for and/or on
JAAAT’s behalf as true and lawful agent and attorney for
and in JAAAT’s name . . . as needed to make, endorse,
sign, and deliver any and all documents or things necessary
for finalizing and/or otherwise securing payment
respecting JAAAT’s settlement of contract adjustments
76
and/or claims . . . [against] the Government [under] “SOF
Brigade Headquarters Facility . . . ”
(SOF ¶ 60)
The government has produced information that appears to establish that no
factual dispute exists. Now, JAAAT, the responding party, must come forward to
show that there indeed is a genuine issue of material facts. San Antonio Mgmt. Corp.,
ASBCA No. 40415, 95-2 BCA ¶ 27,785. If JAAAT fails to meet this burden,
summary judgment may be granted.29 Alutiiq Commercial Enterprises, LLC, ASBCA
No. 61503, 20-1 BCA ¶ 37,506.
JAAAT responds that the Central District of California Order granting the Ex
parte Application for emergency relief “changes nothing as it merely tracks the
language of the POA . . . . [T]he Order gives Tetra Tech no more power than it has
under the POA. It merely confirms the power in the form of a court order” (app. resp.
at 4). JAAAT maintains that there is a genuine issue of material fact in dispute with
respect to at least the interpretation of the POA document and whether Tetra Tech may
act as JAAAT’s agent to negotiate and settle its claims against the government (app.
resp. at 6-7).
JAAAT does not contest SUMF 1, 8, 11, 13, and 14 (app. resp. at 3-4; SOFs
¶¶ 81, 88, 91, 93, 94), while providing only general denials for the remaining SUMFs
(SOFs ¶¶ 82-87, 89-90, 92, 95-100). JAAAT’s responses to each of the government’s
SUMFs are woefully inadequate, largely do not address the government’s SUMFs, and
more importantly, do not show that any material facts are in dispute. (SOFs ¶¶ 81, 85-
90, 92, 95, 99-100) See GSC Constr., Inc., ASBCA No. 61380, 20-1 BCA ¶ 37,626
29 Conclusory statements or completely insupportable, specious, or conflicting
explanations or excuses will not suffice to raise a genuine issue of fact.
Paragon Podiatry Laboratory, Inc., v. KLM Laboratories, Inc., 984 F.2d 1182,
1190 (Fed. Cir. 1993). The evidence must be credible. Matsushita Elec. Indus.
Co. v. Zenith Radio Corp., 475 U.S. 574, 586, (1986). If there is a failure to
contradict the evidence, the Board may accept the government’s undisputed
version of the facts. See Sinil Co., Ltd., ASBCA No. 55819, 09-2 BCA ¶
34,213 at 169,131 (“[T]he party opposing summary judgment must show an
evidentiary conflict on the record; mere denials or conclusory statements are
not sufficient . . . A non-movant runs the risk of a grant of summary judgment
by failing to disclose the evidentiary basis for its claim.”) (internal citations
omitted; citing to Barmag Barmer Maschinenfabrik AG v. Murata Machinery,
Ltd., 731 F.2d 831, 836 (Fed. Cir. 1984) and Pure Gold, Inc., 739 F.2d at 627).
77
at 182,666 (non-moving party denying 62 SUMFs, “but generally in ways insufficient
to establish that a dispute actually exists.”). Indeed, JAAAT fails to raise any material
facts that may make a difference in the outcome of the case. (SOFs ¶¶ 81-100) See
Liberty Lobby, 477 U.S. at 248; see also Kelly v. United States, 924 F.2d 355, 357–58
(1st Cir. 1991) (“Proof based on arrant speculation, optimistic surmise or farfetched
inference will not suffice. . . . By the same token, ‘evidence [that] is merely colorable,
or [ ] not significantly probative’ cannot impede an otherwise deserved summary
disposition.”). Later, in response to the Board’s Order requesting the parties to brief
questions surrounding the events of Modification No. 07 (SOF ¶ 38), JAAAT entered
a notice of appearance for counsel and filed its brief (SOF ¶ 39) which was signed by
the same counsel. JAAAT’s brief alters its course and adopts SUMFs 8-19 to
demonstrate that its appeal for ASBCA No. 61799 was timely:
But if Placeway is used, it would be more appropriate to
look to when the government “declined to pay [Appellant]
the balance due on the contract” as a result of the
modification. In fact, the events that occurred between
June 25 and September 7, 2018, as described in the
Statement of Undisputed Material Facts ¶¶ 8-19 in the
Respondent’s Motion for Summary Judgment would be
when the government “effectively made a final decision on
the government claim . . . when he declined to pay
[Appellant] the balance due on the contract.”
...
[T]he events of June 25 and September 7, 2018, as
described in the Respondent’s Statement of Undisputed
Material Facts ¶¶ 8-19 serves as an effective final
decision on the matter, making the appeal timely.
...
[T]he events of June 25 and September 7, 2018, as
described in the Respondent’s Statement of Undisputed
Material Facts ¶¶ 8-19, would constitute an “effectively .
. . final decision” under Placeway Constr. Corp. v. United
States, 920 F.2d 903, 906 (Fed. Cir. 1990), making this
appeal timely.
(App. br. dtd. June 30, 2020 at 2, 6-7) (emphasis added)
78
JAAAT’s utilization of the government’s SUMFs 8-19 in its favor, support the
Board’s use of the same SUMFs for purposes of the summary judgment. “If a party
fails to . . . properly address another party’s assertion of fact . . . the court may . . . (2)
consider the fact undisputed for purposes of the motion . . . .” FED. R. CIV. P. 56(e)(2).
Irrespective of JAAAT’s change of position with SUMFs 8-19 in its June 30, 2020
brief, and its challenges, JAAAT has not sufficiently raised any material facts with the
JAAAT/Safeco/Tetra Tech Settlement (SOF ¶ 50), the POA (SOF ¶¶ 54, 55), the
triggering events for Tetra Tech to act as JAAAT’s agent and to finalize settlement
(SOF ¶¶ 52, 58, 60, 62, 63, 75), the interpretation of the settlement terms (SOF ¶¶ 51,
52), interpretation of the release of claims clauses (SOF ¶ 66), interpretation of the
waiver clauses (SOF ¶ 66), and JAAAT’s subsequent acceptance of the $3.1 million
settlement amount (SOF ¶¶ 68, 70, 73). Conclusory allegations and attorney
arguments are insufficient to overcome a motion for summary judgment. Ferring B.V.
v. Barr Labs., Inc., 437 F.3d 1181, 1193 (Fed. Cir. 2006).
The JAAAT and USACE Settlement
We begin this discussion with an examination of what lead to Tetra Tech’s
execution of Modification No. 08. Critical to this analysis is a determination of
whether Tetra Tech had the power to sign Modification No. 08 in the first place, and
the extent of that power. For that we turn to the agreements between JAAAT, its
surety Safeco, and Tetra Tech. We recognize that the settlement between JAAAT and
the USACE was part of a larger omnibus agreement entered into by several
participants (SOF ¶¶ 48, 50-53). Settlement agreement disputes are governed by
contract principles. See Williams v. United States, 144 Fed. Cl. 218, 230 (2019);
Cunningham v. United States, 748 F.3d 1172, 1176 (Fed. Cir. 2014); Slattery v. Dep’t
of Justice, 590 F.3d 1345, 1349 (Fed. Cir. 2010); Lutz v. United States Postal Serv.,
485 F.3d 1377, 1381 (Fed. Cir. 2007); Musick v. Dep’t of Energy, 339 F.3d 1365, 1369
(Fed. Cir. 2003) (“A settlement agreement is a contract, the interpretation of which is a
question of law.”); Kasarsky v. Merit Sys. Prot. Bd., 296 F.3d 1331, 1336 (Fed. Cir.
2002) (“Disputes involving Settlement Agreements are governed by contract
principles.”); Conant v. Office of Personnel Mgmt., 255 F.3d 1371, 1376 (Fed. Cir.
2001) (“A settlement agreement is a contract . . . .”); Greco v. Dep’t of the Army, 852
F.2d 558, 560 (Fed. Cir. 1988) (“It is axiomatic that a settlement agreement is a
contract.”); Rebish v. United States, 134 Fed. Cl. 308, 315 (2017); Eby v. United
States, 133 Fed. Cl. 706, 709 (2017).
The rules of contract interpretation are well known. When interpreting a
contract, “‘the language of [the] contract must be given that meaning that would be
derived from the contract by a reasonably intelligent person acquainted with the
contemporaneous circumstances.’” TEG-Paradigm Envtl., Inc. v. United States,
465 F.3d 1329, 1338 (Fed. Cir. 2006) (quoting Metric Constructors, Inc. v. Nat’l
Aeronautics & Space Admin., 169 F.3d 747, 752 (Fed. Cir. 1999)). The interpretation
79
of a contract requires that the document be considered as a whole and interpreted so as
to harmonize and give reasonable meaning to all of its parts. NVT Tech. v. United
States, 370 F.3d 1153, 1159 (Fed. Cir. 2004) (citing McAbee Constr., Inc. v. United
States, 97 F.3d 1431, 1434-35 (Fed. Cir. 1996)). In determining reasonableness it is
only necessary that the interpretation be in the “zone of reasonableness.” States
Roofing Corp. v. Winter, 587 F.3d 1364, 1369 (Fed. Cir. 2009).
It is readily apparent from a reading of the JAAAT/Safeco/Tetra Tech
Settlement agreement that the Brigade Project Settlement was instrumental to the
parties reaching an agreement at all. (SOF ¶¶ 50-53, 59, 61-63) Safeco issued
performance and payment bonds on five federal government construction projects
awarded to JAAAT, including the SOF Brigade Headquarters contract. (SOF ¶¶ 3, 44,
56) During the performance of those contracts, Safeco received numerous claims
under its payment bond from unpaid subcontractors and suppliers of JAAAT (SOF ¶¶
44, 45). Safeco paid out a total of $7,459,124.41 in claims and related expenses as a
direct result of JAAAT’s actions or inactions during performance of the government
contracts (SOF ¶ 45). Several other disputes and/or litigation arose relating to the
Bonded Projects; 17 of those cases are listed in Section 1.7 of the
JAAAT/Safeco/Tetra Tech Settlement agreement (SOF ¶ 49).
As a result of the $7,459,124.41 in payments, Safeco filed suit against JAAAT
and Tetra Tech for satisfaction of the surety bonds (SOF ¶¶ 46, 47).30 As reflected in
the JAAAT/Safeco/Tetra Tech agreement at paragraph 1.10, a meeting was held on
August 30, 2017 to mediate the disputes. With the assistance of a mediator, the parties
entered into a memorandum of settlement on August 30, 2017, “in which they agreed
to execute a formal agreement of settlement and release containing the material terms
of the Memorandum of Settlement . . .” The JAAAT/Safeco/Tetra Tech Settlement
was executed on or about October 30, 2017 and formalized that memorandum of
settlement. (SOF ¶ 50) Safeco agreed to settle its claims with JAAAT and Tetra Tech
for a total payment of $6,650,000. The $6,650,000 settlement amount was to be
funded from a payment by Tetra Tech in the amount of $3,850,000, with the remaining
balance of $2,800,000 to be paid from proceeds of the settlement between JAAAT and
the USACE under the task order. (SOF ¶¶ 52, 63; Gov’t mot., ex. G-2 at 5, ¶¶ 2.2-2.5)
Any excess proceeds over and above the $2,800,000 were to be paid to JAAAT in
accordance with the settlement agreement (SOF ¶¶ 51, 58, 61). In exchange, and upon
full payment, Safeco agreed to dismiss the litigation against JAAAT and Tetra Tech
that was pending in the District Courts of California and Virginia (SOF ¶¶ 47, 52, 66).
30 Suit was filed by Safeco against JAAAT in the United States District Court for the
Eastern District of Virginia (Case No. 3:15-cv-00019-JAG) and against Tetra
Tech in United States District Court for the Central District of California (Case
No. 2:15-cv-03386-SJO-JEMx).
80
The path to the execution of Modification No. 08 began with a meeting held in
August 2017, between Safeco, JAAAT and the government along with respective
counsel. Whether that meeting was the same August 30, 2017 meeting identified in
the JAAAT/Safeco/Tetra Tech agreement at paragraph 1.10, we are unsure. The
JAAAT/USACE agreement in principle, appears to be the direct result of that meeting.
As we look to the JAAAT/Safeco/Tetra Tech agreement that was the result of the
mediation referenced therein, it is undeniable that JAAAT and USACE agreed to a
settlement in principle, the details of which can be found in the agreement itself
(SOF ¶¶ 51-63, 65-66). Our examination of the JAAAT/Safeco/Tetra Tech Settlement
leads to the conclusion that JAAAT and USACE reached an agreement in principle on
or before August 30, 2017, that was documented in the October 30, 2017
JAAAT/Safeco/Tetra Tech Settlement agreement. The settlement included the
payment of $3.2 million (later amended to $3.1) by the government from which Safeco
was to receive $2.8 million, with the balance to be paid to JAAAT. In exchange for
the government payment, JAAAT released “all contract claims, confirms project
completion and voids the Bond for the specific contract . . . ” (SOF ¶ 51). JAAAT
admits that “the term claim in the POA and elsewhere clearly refers to claims that
might have been made, and/or REAs converted to claims . . ..” (SOF ¶ 64) The only
two things that remained as of October 30, 2017 was the completion of the Brigade
Project Settlement documentation consistent with the terms set forth in the
JAAAT/Safeco/Tetra Tech Settlement, and the government’s payment to Safeco on
JAAAT’s behalf. Still, JAAAT contends that there was no JAAAT settlement for
Tetra Tech to accept (app. resp. at 4, 6-7). Although, as a rule, statements made by the
party opposing a motion for summary judgment must be accepted as true for the
purpose of ruling on that motion, some statements are so conclusory as to come within
an exception to that rule. See, e.g. Liberty Lobby, 477 U.S. at 256–57; Scott v. Harris,
550 U.S. 372, 380 (2007). “[W]e draw all justifiable inferences in favor of the
nonmoving party,” but JAAAT has not provided any reasonable, alternative
interpretation of the JAAAT/Safeco/Tetra Tech Settlement, the POA, or the triggering
events for Tetra Tech to act as JAAAT’s agent to finalize settlement to raise even a
scintilla that a material fact could be in dispute. See Conquistador Dorado Joint
Venture, ASBCA No. 60042 et al., 20-1 BCA ¶ 37,628 at 182,677 (citing CI 2, Inc.,
ASBCA Nos. 56257, 56337, 11-2 BCA ¶ 34,823 at 171,353.)).
We hold that there existed an omnibus settlement inclusive of an agreement to
resolve the Brigade Project. The terms and conditions of the Brigade Project
Settlement were clearly set forth in the JAAAT/Safeco/Tetra Tech Settlement. We
now move on to our examination of the powers enumerated in the POA.
ii. Power of Attorney (POA)
JAAAT contends that the California Court Order gives Tetra Tech no more
power than it has under the POA (app. resp. at 4). We agree with JAAAT that Tetra
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Tech’s powers are limited to what was set forth in the POA, and no more (SOF ¶ 74).
Yet, we conclude that the action taken by Tetra Tech to complete the Brigade Project
Settlement was within the confines of the POA. Our interpretation of the
JAAAT/Safeco/Tetra Tech Settlement and POA is a question of law. Where a contract
can be construed within its four corners, interpretation of the contract presents a
question of law that can be decided on summary judgment. LAI Servs., Inc. v. Gates,
573 F.3d 1306, 1310, 1314 (Fed. Cir. 2009); Varilease Technology Group, Inc. v.
United States, 289 F.3d 795 (Fed. Cir. 2002); Cmty. Heating & Plumbing Co. v. Kelso,
987 F.2d 1575, 1578–79 (Fed. Cir. 1993); Fry Commc’ns, Inc. v. United States, 22 Cl.
Ct. 497, 503 (1991)(“[C]ontract interpretation is clearly a question of law and, as here,
may be appropriately resolved by a decision on summary judgment” (citing P.J. Maffei
Building Wrecking Corp. v. United States, 732 F.2d 913, 916 (Fed.Cir.1984)). Our
interpretations of the JAAAT/Safeco/Tetra Tech Settlement and POA documents are
considered as a whole and interpreted to give reasonable meaning to all of their parts.
See Teg-Paradigm Envtl., Inc., 465 F.3d at 1338; Metric Constructors, Inc., 169 F.3d
at 752; NVT Technologies, 370 F.3d at 1159; McAbee Constr., Inc., 97 F.3d at 1434-
35; States Roofing Corp., 587 F.3d at 1369.
The language of the POA is undeniably clear in its granting of powers to Tetra
Tech and leaves little, if any room for interpretation. The POA accepts that both
JAAAT and Safeco (Brigade Project’s surety) agreed in principle to a settlement with
USACE and that Tetra Tech would be granted the power to execute “any and all
documents or things necessary for finalizing and/or otherwise securing payment
respecting JAAAT’s settlement of contract adjustments and/or claims. . . .” upon the
trigger of certain events. (SOF ¶ 60) The Board has long recognized the legitimacy of
powers of attorney. Bell Helicopter Textron Inc.& The Boeing Company, 15-1 BCA
¶ 36,111; TPS, Inc. ASBCA No. 52421, 01-1 BCA ¶ 31,375; Rudolf Bieraeugel, Stahl-
und Metallbau Gesellschaft mit beschranenkter Haftung, ASBCA No. 47145, 95-1
BCA ¶ 27,536.
The JAAAT/Safeco/Tetra Tech Settlement delineated the arrangement for
payment of JAAAT’s share and provided Tetra Tech to step-in should the government
not make payment of the $3,200,000 by December 31, 2017 (SOF ¶ 52). In the event
the USACE did not make payment by the date established in the agreement, Tetra
Tech provided a guarantee of the $2,800,000 payment to Safeco, with reimbursement
once the Brigade Project Settlement was consummated and payment made by the
government (SOF ¶ 52). The POA was not revocable by JAAAT, and would only
become null and void if the government made timely payment to Safeco such that
Tetra Tech’s guaranty obligation became pointless (SOF ¶¶ 57, 62).
As contemplated by the agreement, the Brigade Project Settlement was not
consummated in time for the government to make the payment by December 31, 2017
(SOF ¶ 63). Subsequently, Tetra Tech paid to Safeco its payment of $3,850,000, along
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with the $2,800,000 under its guarantee obligation (SOF ¶ 52, SOF ¶ 63). It is this
event that triggered the ability of Tetra Tech to exercise the powers under the POA
(SOF ¶¶ 54, 62, 63). While we acknowledge that JAAAT was free to execute the
documentation to finalize the settlement with the government, in the event JAAAT did
not, the POA provided a mechanism for the settlement with the government to be
finalized, and Tetra Tech to be reimbursed for the $2.8 million paid on JAAAT’s
behalf from the proceeds of the government payment. The events that have brought
the parties to this litigation before the Board are exactly the reason that an irrevocable
POA was necessary. It is obvious that as part of the agreement, Tetra Tech wanted to
ensure the reimbursement of the $2.8 million it paid to Safeco; and did not want to rely
upon JAAAT after the fact for the repayment of monies it paid out on JAAAT’s
behalf.
The government argues that “[t]he clear language of the POA allowed Tetra
Tech to take the very actions it took on behalf of JAAAT when settling the claims”
(gov’t mot. at 10). JAAAT responds with the position that Tetra Tech did not have the
right to execute Modification No. 08, as it did (app. resp. at 4-6). JAAAT’s argument
is premised on a position that cannot be found in or interpreted from the
JAAAT/Safeco/Tetra Tech Settlement or the POA. When opposing parties tell two
different stories, one of which is contradicted by the record, so that no reasonable fact
finder could believe it, the Board should not adopt that version of the facts for
purposes of ruling on a motion for summary judgment. See Scott, 550 U.S. at 380-81(noting that one party’s version of the events was captured in a videotape); see also
Liberty Lobby, 477 U.S. at 247-248; McManemy v. Tierney, 970 F.3d 1034, 1038 (8th
Cir. 2020). We find that the government’s position is more consistent with the facts.
To create an ambiguity, and ultimately a material fact in dispute, JAAAT would need
to provide us with an interpretation that is also reasonable. Teg-Pardigm Envtl., 465 F.
3d 1329 at 1338 (quoting Metric Constructors, Inc., 169 F.3d at 752). If it did, we
could reach a finding that there was an ambiguity in the language. JAAAT simply
fails to support its position with any language that could provide a reasonable
interpretation that conflicts with the government’s interpretation that under the terms
of the POA, Tetra Tech had the right to execute whatever documents it needed to in
order to finalize the settlement. Tetra Tech’s exercise of its powers under the POA
appropriately included the signing of Modification No. 08. See TPS, Inc., 01-1 BCA ¶
31,375. Modification No. 08 allowed for the payment of the settlement funds by the
government to Safeco, thus providing for the ultimate reimbursement of the $2.8
million that Tetra Tech paid to Safeco on JAAAT’s behalf. Tetra Tech’s exercise of
its powers was within the broad powers granted by the POA. JAAAT’s challenge to
the powers given to Tetra Tech by its own hand, without a challenge to the validity of
the POA, is unconvincing. A similar situation was addressed in Seaboard Air Line
Railway v. United States, 53 Ct. Cl 107 (Ct. Cl. 1918), where the plaintiff, having
properly granted a power of attorney, and after payment to the person holding the
power of attorney, then sued the United States asserting that the payment was
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improper because the POA was void under federal law. The Claims Court found that
any attempt by plaintiff as the person having given the power of attorney, where it is
unrevoked and payment made by the government, the plaintiff would not be allowed to
question the propriety of the payment. Id. at 113. Having failed to provide an
interpretation that can be read harmoniously with the agreement, we find the
government’s interpretation to be the only reasonable interpretation. Manhattan Hunt
A Joint Venture, ASBCA No. 61477, 19-1 BCA ¶ 37,386 at 181,756-57. The
language of the JAAAT/Safeco/Tetra Tech agreement and the POA provides a clear
path toward the only conclusion that provides meaning to the whole of the documents;
a settlement was reach in principle between JAAAT and USACE, and that Tetra Tech
could act to finalize that agreement once certain conditions were met.
The POA affords Tetra Tech the absolute authority to take whatever steps are
necessary to “finalize and/or otherwise secure payment” respecting the Brigade Project
Settlement. Acting on that authority, Tetra Tech could act in “JAAAT’s name, place,
and stead . . . to make, endorse, sign, and deliver any and all documents or things
necessary for finalizing and/or otherwise securing payment respecting JAAAT’s
settlement of contract adjustments and/or claims” under “Contract No. W912HN-10-
D-0063 DQ01, and relating to the project . . . .” (SOF ¶ 60) If finalizing the
settlement and/or securing the payment requires Tetra Tech to execute a contract
modification, as it did here, then that is one of the enumerated powers inherent in the
language of the POA.
iii. Settlement Amount
Having found that JAAAT and USACE reached a settlement in principle and
the POA authorized Tetra Tech to execute documents to finalize that settlement, we
acknowledge that Modification No. 08 was not executed in the amount of $3.2 million
as set forth in the JAAAT/Safeco/Tetra Tech Settlement agreement. Instead, the
settlement amount in Modification No. 08 was $3.1 million. (SOF ¶¶ 68, 77, 80) We
must examine the JAAAT/Safeco/Tetra Tech Settlement agreement to determine
whether Tetra Tech had the power under the POA to modify the settlement amount.
Significant to our inquiry is the language in both the JAAAT/Safeco/Tetra Tech
Settlement and the POA that contemplates an adjustment to the Brigade Project
Settlement amount once the government’s audit was complete (SOF ¶ 59). The parties
specifically note that the “finalization of the agreement and payment of the monies by
the Government for the SOF Brigade Headquarters Contract has been delayed pending
resolution of a recent Government audit” (id.; gov’t mot., ex. G-2 at 4, ¶ 1.9). Further
acknowledgement of a potential adjustment to the settlement amount is found in
Section 2.2 of the agreement. The parties planned for several contingencies, all of
which when taken together support the understanding that the settlement amount of
$3.2 million could be adjusted. (SOF ¶¶ 52, 59) The parties contemplated that Safeco
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could receive more or less 31 than the $2.8 million from the government. There was
also a contingency for Safeco receiving two payments, one from Tetra Tech and one
from the government. (SOF ¶ 52) The agreement provides for Tetra Tech to receive a
“return of any payment advance it has made on the guarantee.” (SOF ¶ 52) As well as
providing for any remaining settlement proceeds after payment of the $2.8 million to
Safeco, those funds in whatever amount would go to JAAAT in accordance with
Section 2.1 and 2.2 of the JAAAT/Safeco/Tetra Tech Settlement (SOF ¶ 52).
Under the JAAAT/Safeco/Tetra Tech Settlement agreement, JAAAT was
obligated to continue working with the government to “facilitate, and to cooperate and
not interfere or prevent the consummation of, the SOF Brigade settlement and the
payments as contemplated” (SOF ¶ 52). In May 2018, after irregularities in payment
estimates were identified, the government advised JAAAT that it would adjust the
settlement amount from $3.2 million to $3.0 million and later adjusted it upwards to
$3.1 million (SOF ¶¶ 59, 68; gov’t mot. at 5; app. resp. at 3-4). Tetra Tech was ready
to execute the documents to finalize the Brigade Project Settlement pursuant to the
POA, but in contravention of the provision to “cooperate and not interfere or prevent
the consummation of, the SOF Brigade Settlement and the payments as contemplated
by this Agreement,” JAAAT objected (SOF ¶¶ 52, 69). Tetra Tech filed an Ex Parte
Application for Emergency Relief in the United States District Court, Central District
of California, on June 25, 2018, asking for the court to review the POA and
confirm/deny Tetra Tech’s rights to accept the government’s settlement offer
(SOF ¶ 69). Yet, prior to the issuance of the Court’s Order, JAAAT accepted the
adjustment of the settlement amount to $3.1 million following the completion of the
government’s audit, and confirming that acceptance in an email dated July 17, 2018
(SOF ¶¶ 68, 70).
Despite the acceptance, on August 30, 2018, JAAAT then raised a question
about what was resolved during the negotiations that lead to the signing of the
October 31, 2017 JAAAT/Safeco/Tetra Tech Settlement, the POA, and ultimately the
payment by Tetra Tech of the $2.8 million to Safeco on behalf of JAAAT (SOF ¶ 71).
While there was much discussion back and forth, JAAAT again confirmed its
acceptance of the $3.1 million on August 31, 2018 (SOF ¶¶ 72-73). As a result, even
if Tetra Tech did not have the power to accept an amount other than $3,200,000 under
the POA, which we think it did, that issue is moot since JAAAT itself accepted the
adjusted amount of $3.1 million (SOF ¶ 73).
31 In the event Safeco received less than $2.8 million from the government from the
Brigade Project Settlement, Tetra Tech was to make up the difference so that
Safeco received $2.8 million pursuant to the guarantee set forth in Section 2.2
of the JAAAT/Safeco/Tetra Tech settlement.
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iv. Release
Pursuant to paragraph 1 of the POA, Tetra Tech had the ability to execute
whatever documents where necessary to consummate the settlement reached in
principle during the negotiations that lead to the JAAAT/Safeco/Tetra Tech Settlement
(SOF ¶¶ 54, 60). The government argues in reliance on the POA, the settlement
agreement, and the Central District of California Court’s granting of the Ex parte
application, that it issued Modification No. 08 in the amount of $3,100,000, and it was
signed by Tetra Tech’s CEO on September 5, 2018 (SOF ¶¶ 51, 52, 54-55, 74-75, 77,
80; gov’t mot. at 6-8). The government further argues that “[i]n signing a final
bilateral modification to the subject contract, and executing a full release of claims on
behalf of JAAAT, Tetra Tech was acting as an agent and attorney-in-fact for JAAAT
and its actions are binding on JAAAT” (gov’t mot. at 10). As we found above, Tetra
Tech was acting as JAAAT’s agent and attorney-in-fact in signing the final bilateral
modification. Our final inquiry relates to the release language set forth in
Modification No. 08, which provides, in part:
Provide for the full settlement of the Storm Water
Management Claim, dated 1 October 2014, submitted by
the contractor on behalf of it and its subcontractors. This
modification adds an additional 255 Calendar Days to the
contract with a revised completion date of 23 June 2015.
Provides for the full settlement of Modification 04 issued
unilaterally on 17 April 2014.
Provides for the full settlement of Modification 07 issued
on 12 December 2017.
....
The total cost of this contract was increased by
$3,100,000.000 . . . ..
(SOF ¶ 77) The government argues further that the release language contained in bi-
lateral Modification No. 08 releases the government from all liability and equitable
adjustments under this contract (gov’t mot. at 17-18) and provides:
RELEASE: In consideration of the modification agreed to
herein as complete, equitable adjustments for all existing
or potential claims or appeals of the contractor and its
subcontractors and suppliers arising under this contract, the
Contractor hereby releases the Government from any and
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all liability under this contract for further equitable
adjustments attributable to such facts or circumstances
which gave rise to the times outlined above.
The Contractor hereby agrees to release, waive and forever
abandon all claims arising under the Equal Access to
Justice Act to attorney fees and other expenses arising
from the above stated contract claims under the contract.
(SOF ¶ 78)
JAAAT does not identify any ambiguity in the terms or provisions of the release;
rather, it responds with challenges to the efficacy of its execution by its agent. JAAAT
responds to the government’s argument by stating:
[it] rejected the final Modification P00008 and has not
released its’ [sic] claims on the project contract; and has
notified the government that it retains its’ rights to full
payment under the contract and the nine (9) submitted
REAs. The government has unlawfully signed project
releases and made project payments to unauthorized
representatives claiming to represent JAAAT.
(App. resp. at 7)
As we set forth above, Tetra Tech had the power to execute Modification
No. 08 in accordance with the terms and conditions set forth in the
JAAAT/Safeco/Tetra Tech Settlement and the POA. JAAAT challenges bring into
question whether Tetra Tech had the ability to execute the modification with release
language that resolves all claims as the government contends. The government
maintains that the release set forth in Modification No. 08 resolved all claims relating
to the contract and prevents JAAAT from pursuing any further entitlement under the
contract. “A release is a contract whereby a party abandons a claim or relinquishes a
right that could be asserted against another.” Colorado River Materials, Inc. d/b/a
NAC Constr., ASBCA No. 57751, 13 BCA ¶ 35,233 at 172,991. Consequently, the
scope of a release is a question of contract interpretation. Id. Because a release is
contractual in nature, it is interpreted in the same manner as any other contract term or
provision. See Metric Constructors, Inc. v. United States, 314 F.3d 578, 579 (Fed. Cir.
2002) (“This case, like many contract disputes, turns on the interpretation of [the
release]”); RESTATEMENT (SECOND) OF CONTRACTS § 284 cmt. c (1981) (“The rules
of interpretation that apply to contracts generally apply also to writings that purport to
be releases.”). Our first step in interpreting any provision is to examine the language
used by the parties. Bell BCI Co. v. United States, 570 F.3d 1337, 1341 (Fed. Cir.
87
2009); Dureiko v. United States, 209 F.3d 1345, 1356 (Fed. Cir. 2000); Tri-O, Inc. v.
United States, 28 Fed. Cl. 463,470-71 (1993). We look to the plain language of the
release, as “if the ‘provisions are clear and unambiguous, they must be given their
plain and ordinary meaning’” Bell BCI Co., 570 F.3d at 1435 (quoting Alaska Lumber
& Pulp Co. v. Madigan, 2 F.3d 389, 392 (Fed.Cir.1993)); see Barron Bancshares, Inc.
v. United States, 366 F.3d 1360, 1375-76 (Fed. Cir. 2004). The release language set
forth in Modification No. 08 demonstrates the parties’ intention to bring finality to this
contract and resolve all matters arising under or by virtue of the contract. E.g.,
Augustine Med. Inc. v. Progressive Dynamics, Inc., 194 F.3d 1367, 1371-72 (Fed. Cir.
1999). “[A] general release precludes a party to the contractual armistice from
renewing or initiating further combat . . . .” H.L.C. & Assocs. Constr. Co. v. United
States, 367 F.2d 586, 590 (Ct. Cl. 1966) (citing United States v. William Cramp &
Sons Ship & Engine Bldg. Co., 206 U.S. 118 (1907)). Generally, a release which is
complete on its face and reflects the contractor’s unqualified acceptance and
agreement with its terms is binding on both parties. Inland Empire Builders, Inc. v.
United States, 424 F.2d 1370, 1376 (1970); J.G. Watts Constr. Co. v. United States,
161 Ct. Cl. 801, 805 (1963); INCA Contracting Co.., ASBCA No. 52697, 01-1 BCA
¶ 31,255.
JAAAT argues that the release signed by Tetra Tech was invalid (app. resp.
at 5, 7). We disagree. The release set forth in Modification No. 08 is consistent with
the agreement as prescribed in the JAAAT/Safeco/Tetra Tech Agreement. We reach
that conclusion from our review of Sections 1.9, 2.1, 2.2 and 2.3 (SOF ¶¶ 51, 52, 54,
59), which provides for the finalization of all aspects of the settlement agreement,
inclusive of the settlement reached between JAAAT and USACE of the “Requests for
Equitable Adjustment submitted to the Government respecting the SOF Brigade
Headquarters Contract which resolves all contract claims, confirms project completion
and voids the Bond for the specific contract, and which includes the Government’s
agreement to pay $3.2 million. . . .” This language unambiguously reaches beyond the
REAs submitted by JAAAT and also provides for the closeout of the contract and a
release of the Bond under the contract. The language clearly articulates that the
Brigade Project Settlement resolves all disputes under the contract. By confirming
contract completion, the government was accepting all work under the contract and
likewise releasing liquidated damages to allow for completion that occurred over 1000
days beyond the original completion date.
Further support of JAAAT’s release of all claims by Tetra Tech’s hands can be
found in section 2.6 of the JAAAT/Safeco/Tetra Tech Agreement. It provides that
JAAAT could pursue other claims but specifically excluded claims related to the
Brigade Project by providing that JAAAT “shall be responsible and assumes all further
risks and costs for close out of the Bonded Projects and to the extent JAAAT opts to
prosecute at its own cost and expense any non-Brigade or other requests for equitable
adjustments . . . JAAAT may do so at its own risk and cost . . . .” (SOF ¶ 65)
88
(emphasis added)). If there were potential claims remaining under the Brigade project
this provision supports a finding that JAAAT would need to reserve those claims.
Whiting-Turner Contracting Co., ASBCA No. 56319, 10-1 BCA ¶ 34,436; See
William Cramp & Sons Ship & Engine Bldg. Co., 206 U.S. at 128 (noting that “[i]f
parties intend to leave some things open and unsettled, their intent so to do should be
made manifest.”). There is no such reservation here. Without a reservation of claims
JAAAT waives any rights to pursue additional claims associated with the Brigade
Project. To hold otherwise would require that we ignore the settlement language to
provide for the resolution of “all contract claims, confirms project completion and
voids the Bond for the specific contract. . .”
Lastly, we look to Section 3 of the JAAAT/Safeco/Tetra Tech Settlement, for
further amplification of the intention between JAAAT and USACE to release all
claims. Section 3 JAAAT/Safeco/Tetra Tech Settlement provides for all the parties to
release “any and all present and future claims, demands, causes of action, rights . . .
arising out of or relating in any way to the Bonds, the Bonded Projects, the Teaming
Agreements, the Subcontracts, and the Settled Litigation.” (SOF ¶ 66) The parties
identified the “Settled Litigation” to include “any other payment bond or Project
Contracts litigation previously or currently filed” (SOF ¶ 53). We know that each of
the REAs (ASBCA Nos. 61793, 61794, 61795, 61796, 61797, 61798, 61800),
JAAAT’s claim (ASBCA No. 61792), and the government’s claim (ASBCA
No. 61799) that are currently before this Board were submitted to the contracting
officer or to JAAAT prior to the execution of the October 30, 2017 settlement, making
them all subject to the release (SOF ¶¶ 6, 12-13, 31). In addition, as late as
October 30, 2017, the parties represented that “they are not aware of any other
claims.” (SOF ¶53) We conclude that the release contained in Modification No. 08
was in every respect consistent with the release terms agreed to by JAAAT in the
JAAAT/Safeco/Tetra Tech Settlement. While JAAAT would have us disregard the
legitimacy of the POA, we will not do so. Bell Helicopter Textron Inc.& The Boeing
Company, 15-1 BCA ¶ 36,111; TPS, Inc. 01-1 BCA ¶ 31,375; Rudolf Bieraeugel,
Stahl-und Metallbau Gesellschaft mit beschranenkter Haftung, 95- 1 BCA ¶ 27,536.
The government had every right to include a full release in Modification No. 08 in
exchange for the $3.1 million to Safeco. Likewise, Tetra Tech had every right under
the POA to sign Modification No. 08 containing a release of all claims.
We do not have a situation here where JAAAT seeks the recovery of a claim
excepted from the release. If a party who executes a general release has knowledge of
facts sufficient to constitute a claim at the time of executing the general release and
wishes to make an exception for such a claim, that party bears the burden of
manifesting his intent to do so with an explicit reservation. See Baha v. United States,
144 Fed. Cl. 500, 505 (2019); see also Augustine Med., Inc 194 F.3d at 1373; Mingus,
812 F.2d at 1393-94. As we look back at the term “Settled Litigation” of which the
contract is a part, both the omnibus settlement and the Brigade Project Settlement in
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principle included a release of Safeco’s performance and payment bonds. The release
of the surety bond and the government’s acceptance of project completion, release of
the surety bond, and close out included a full relinquishment of any and all assertions
of additional compensation and a full release given by JAAAT. If JAAAT was aware
of claims related to the Brigade Project that it wished to preserve, and did not reserve
those claims for all to consider, the omnibus negotiation might have produced different
results. Instead, other than the reservations set forth in paragraph 2.6, there were no
reservations by JAAAT of claims related to the Brigade Project. In fact, every
reference leads to an opposite conclusion.
While JAAAT argues that there are genuine issues of material facts in dispute
that preclude summary judgment (app. resp. at 6), it fails to provide any support for its
position. Merely suggesting conflicting facts without more will not defeat summary
judgment. JAAAT must set forth specific facts showing that there is a genuine issue
for trial. Liberty Lobby, 477 U.S. at 248 (quoting First National Bank of Ariz. v. Cities
Service Co., 391 U.S. 253, 288 (1968)). The opposing party must assert facts
sufficient to show a dispute as to a material fact of an element of the argument.
New Iraq Ahd Co., ASBCA No. 59304, 15-1 BCA ¶ 35,849 at 175,291-92 (citing
Mingus, 812 F.2d at 1390-91) (“To ward off summary judgment, the non-moving
party must do more than make mere allegations; it must assert facts sufficient to show
a dispute of material fact.”); see Lee’s Ford Dock. Inc., ASBCA No. 59041, 16-1 BCA
¶ 36,298 at 177,010. Appellant fails to proffer any facts that demonstrate a material
issue for trial. (SOF ¶¶ 81, 85-90, 92, 95, 99-100) JAAAT’s interpretation of the
JAAAT/Safeco/Tetra Tech Settlement agreement cannot be read harmoniously with
other provisions in the agreement and is unsupported by any language or other facts in
the record.
As we compare Modification No. 08 with the Brigade Project Settlement
expressed in the JAAAT/Safeco/Tetra Tech agreement, we find the terms as agreed to
by JAAAT to be identical in form and function with the terms of the Brigade Project
Settlement outlined in the JAAAT/Safeco/Tetra Tech agreement executed on or about
October 30, 2017. To argue now, as appellant does, that there was no “JAAAT
settlement to accept” is unpersuasive. We hold that there was a settlement for Tetra
Tech to accept that provided for a full release of all claims, existing or potential,
including government claims, and that Tetra Tech had the authority pursuant to the
POA to execute Modification No. 08, as written, to finalize the settlement as JAAAT’s
agent. 32 We conclude that the language in Modification No. 08 is unambiguous, and
plainly states that JAAAT released the government from adjustments for all existing or
potential claims or appeals attributable to the contract (SOF ¶ 78). When a release is
32 Safeco, as surety, provided its consent to both the execution of the POA and the
execution of Modification No. 08. (SOFs ¶¶ 56, 79).
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clear, unequivocal, and unconditional, the release “must be given its plain meaning
and effect.” New Iraq AHD Co., 15-1 BCA ¶ 35,849 at 175,292 (citing Bell BCI Co.,
570 F.3d 1337). When such a release exists, it “bars any and all claims for additional
compensation based upon events occurring prior to the execution of the release.”
New Iraq AHD, 15-1 BCA ¶ 35,849 at 175,292 (citing Todd Pacific Shipyards Corp.,
ASBCA No. 55126, 08-2 BCA ¶ 33,891 at 167,759). Further, the government’s
payment of $3,100,000 in Modification No. 08 constitutes adequate consideration for
JAAAT’s release. See RESTATEMENT (SECOND) OF CONTRACTS § 79 cmt. c (1981);
see also Aviation Contractor Ems., Inc. v. United States, 945 F.2d 1568, 1573-74 (Fed.
Cir. 1991). Tetra Tech’s signing a final release disposes of these appeals (SOFs ¶¶ 77-
78).
For the reasons stated above, we grant the government’s motion for summary
judgment of ASBCA No. 61792 upon finding that JAAAT released all claims
pursuant to Modification No. 08. Similarly, the issues surrounding the punch list
dispute addressed in JAAAT’s REA under ASBCA No. 61799 and the corresponding
government claim related to Modification No. 07 are also covered by the release
language. 33 Having found in the government’s favor on summary judgment on the
issue of release in ASBCA No. 61792, there is no need to address the defense of
accord and satisfaction. Consideration of the defense of accord and satisfaction as it
relates to ASBCA Nos. 61793-61798, 61800 is likewise outside our jurisdiction.
33 We determined above that the Board does not have subject matter jurisdiction over
ASBCA Nos. 61793-61798, 61800, and while we cannot rule on those appeals
now, the findings in ASBCA No. 61792 and 61799 relating to the release
language in the agreements will apply to any future attempt at refiling of those
claims. A “final release followed by final payment to a contractor generally
bars recovery of the contractor's claims under the contract except for those
excepted on the release.” Tri- County Contractors, Inc., ASBCA No. 58167,
13 BCA ¶ 35,310 at 173,346 (citing Mingus Constructors, 812 F.2d at 1394).
“[I]t is a fundamental rule that a contractor who executes a general release is
thereafter barred from claiming additional compensation under the contract on
the basis of events that occurred prior to the execution of the release unless
there are special circumstances present which vitiate the release.” Shams
Walizada Constr. Co., ASBCA No. 61411, 18-1 BCA ¶ 37,008 at 180,241
(citing Mary Lou Fashions, Inc., ASBCA No. 29318, 86-3 BCA ¶ 19,161
at 96,845).
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CONCLUSION
Accordingly, we grant the government’s motion to dismiss for lack of
jurisdiction for ASBCA Nos. 61793, 61794, 61795, 61796, 61797, 61798, and 61800.
We grant the government’s motion for summary judgment in ASBCA Nos. 61792 and
61799 on the defense of release, and deny all else. ASBCA Nos. 61792 and 61799 are
denied.
Dated: June 7, 2021
STEPHANIE CATES-HARMAN
Administrative Judge
Armed Services Board
of Contract Appeals
I concur I concur
RICHARD SHACKLEFORD OWEN C. WILSON
Administrative Judge Administrative Judge
Acting Chairman Vice Chairman
Armed Services Board Armed Services Board
of Contract Appeals of Contract Appeals
I certify that the foregoing is a true copy of the Opinion and Decision of the
Armed Services Board of Contract Appeals in ASBCA Nos. 61792, 61793, 61794,
61795, 61796, 61797, 61798, 61799, 61800, Appeals of JAAAT Technical Services,
LLC, rendered in conformance with the Board’s Charter.
Dated: June 17, 2021
PAULLA K. GATES-LEWIS
Recorder, Armed Services
Board of Contract Appeals
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