Hejran Hejrat Co. Ltd v. US Army Corps of Engineers ( 2019 )

United States Court of Appeals
for the Federal Circuit
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HEJRAN HEJRAT CO. LTD,
Appellant
v.
UNITED STATES ARMY CORPS OF ENGINEERS,
Appellee
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2018-2206
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Appeal from the Armed Services Board of Contract Ap-
peals in No. 61234, Administrative Judge Donald Evan
Kinner, Administrative Judge J. Reid Prouty, Administra-
tive Judge Richard Shackleford.
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Decided: July 17, 2019
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JOSEPH ALOYSIUS HENNESSEY, The Law Office of Jo-
seph Hennessey, LLC, Chevy Chase, MD, argued for appel-
lant.
JESSICA R. TOPLIN, Commercial Litigation Branch,
Civil Division, United States Department of Justice, Wash-
ington, DC, argued for appellee. Also represented by
JOSEPH H. HUNT, ROBERT EDWARD KIRSCHMAN, JR.,
PATRICIA M. MCCARTHY.
______________________
2 HEJRAN HEJRAT CO. LTD v. US ARMY CORPS OF ENGINEERS
Before NEWMAN, DYK, and WALLACH, Circuit Judges.
DYK, Circuit Judge.
Hejran Hejrat Co. Ltd. (“HHL”) appeals from a decision
by the Armed Services Board of Contract Appeals (“Board”)
dismissing HHL’s case for lack of jurisdiction. Because we
conclude that there was a request for a final decision by a
contracting officer and a final decision entered by the con-
tracting officer, we reverse and remand for further proceed-
ings.
BACKGROUND
This appeal arises from HHL’s 2011 contract with the
United States Army Corps of Engineers (“USACE”) to pro-
vide transportation services in Afghanistan. After the con-
tract expired, HHL requested additional compensation
from the USACE based on alleged violations of the con-
tract: suspension of work, changes to the contract require-
ments, and termination of the original contract. After
various preliminary submissions, on March 5, 2015, HHL
submitted a document entitled “Request for Equitable Ad-
justment (REA)” with a sworn statement by HHL’s Deputy
Managing Director having “full management [authority]
to . . . close out . . . the contract.” J.A. 70. In that submis-
sion, HHL requested that the submission be “treated as
a[n] REA,” J.A. 74, and requested $4,137,964 in compensa-
tion. The contracting officer denied HHL’s request on
March 26, 2017, in what the contracting officer character-
ized as the “Government’s final determination in this mat-
ter.” J.A. 116. HHL appealed the decision, but the Board
concluded that it did not have jurisdiction because “[a]t no
point, in six years of communication with the [USACE], has
HHL requested a contracting officer’s final decision.”
J.A. 4.
HHL appealed to our court. We have jurisdiction pur-
suant to 28 U.S.C. § 1295(a)(10). We review the Board’s
HEJRAN HEJRAT CO. LTD v. US ARMY CORPS OF ENGINEERS 3
determination of its jurisdiction de novo. Reflectone, Inc. v.
Dalton, 60 F.3d 1572, 1575 (Fed. Cir. 1995) (en banc).
DISCUSSION
In order for the Board to have jurisdiction, there must
be a final decision by a contracting officer on a claim. Par-
sons Glob. Servs. v. McHugh, 677 F.3d 1166, 1170 (Fed. Cir.
2012) (citing 41 U.S.C. § 7103). The issue on appeal is
whether HHL requested a contracting officer’s final deci-
sion on a claim, such that the officer’s denial constituted a
final decision that supported the Board’s jurisdiction.
The statute provides that “[e]ach claim by a contractor
against the Federal Government relating to a contract
shall be submitted to the contracting officer for a decision.”
41 U.S.C. § 7103(a)(1). Thus, in order to constitute a claim
a contractor must request a final decision by a contracting
officer. M. Maropakis Carpentry, Inc. v. United States, 609
F.3d 1323, 1327 (Fed. Cir. 2010) (citing James M. Ellet
Const. Co., v. United States, 93 F.3d 1537, 1543 (Fed. Cir.
1996)) (“The CDA . . . requires that a claim indicate to the
contracting officer that the contractor is requesting a final
decision.”).
“[W]e evaluate whether a particular request for pay-
ment amounts to a claim based on the [Federal Acquisition
Regulations (FARs),] . . . the language of the contract in
dispute, and the facts of each case.” Parsons, 677 F.3d at
1170. Under the relevant FAR, a claim is defined as “a writ-
ten demand or written assertion by one of the contracting
parties seeking, as a matter of right, the payment of money
in sum certain.” FAR 52.233-1(c) (2002).
HHL contends that its March 5, 2015, submission con-
stituted a claim within the meaning of the CDA. There is
no dispute that HHL’s March 5 submission was under the
FAR a “written demand . . . seeking, as a matter of right,
the payment of money in sum certain.” Id. Indeed, the
Board found that in its submissions “HHL adequately
4 HEJRAN HEJRAT CO. LTD v. US ARMY CORPS OF ENGINEERS
described five grounds why it is owed more money, and the
sum certain being requested for each.” J.A. 4.
On appeal the government makes three arguments as
to why HHL’s submission did not constitute a request for a
final decision. First, the government’s “[f]oremost” argu-
ment is that “HHL’s March 5, 2015, submission is styled as
a[n] REA, not as a claim. HHL also expressly requested
that the document be ‘treated as an REA.’” Gov’t Br. at 12
(internal citations omitted) (emphasis added). The govern-
ment’s argument that an REA cannot constitute a claim is
directly contrary to this court’s en banc decision in Reflec-
tone, Inc. v. Dalton, 60 F.3d 1572 (Fed. Cir. 1995) (en banc),
and subsequent cases. Just as in the current appeal, in Re-
flectone “[the contractor’s] REA satisfie[d] all the require-
ments listed for a [Contract Disputes Act (CDA)] ‘claim’
according to the first sentence of FAR [52.233-1(c)],” and
thus we “conclude[d] that the Board ha[d] jurisdiction to
review the [contracting officer]’s denial of [the contractor’s]
REA.” Id. at 1578. 1
Second, the government argues that “the [March 5]
document fails to include any language requesting a final
decision.” Gov’t Br. at 12. Although the government agrees
that magic words are not required under our cases, the gov-
ernment’s position appears to be that a contractor must
1 See also, e.g., Tip Top Constr., Inc. v. Donahoe, 695
F.3d 1276, 1279 (Fed. Cir. 2012) (treating the contractor’s
REA as a claim); Daewoo Eng’g & Constr. Co. v. United
States, 557 F.3d 1332, 1334 (Fed. Cir. 2009) (treating the
contractor’s REA as a claim); Propellex Corp. v. Brownlee,
342 F.3d 1335, 1337–38 (Fed. Cir. 2003) (noting the con-
tracting officer’s denial of an REA was the relevant final
decision that was appealed to the Board); Oman-Fischbach
Int’l (JV) v. Pirie, 276 F.3d 1380, 1383 (Fed. Cir. 2002) (not-
ing that the contracting officer denied the contractor’s
REA, which was treated as a denied claim).
HEJRAN HEJRAT CO. LTD v. US ARMY CORPS OF ENGINEERS 5
include particular words in its submission in order to con-
stitute a request for a contracting officer’s final decision.
This argument is also squarely inconsistent with our
caselaw, which recognizes that “a CDA claim need not be
submitted in any particular form or use any particular
wording,” Maropakis, 609 F.3d at 1327, so long as it has “a
clear and unequivocal statement that gives the contracting
officer adequate notice of the basis and amount of the
claim,” id. (quoting Contract Cleaning Maint., Inc. v.
United States, 811 F.2d 586, 592 (Fed. Cir. 1987)); see, e.g.,
K-Con Bldg. Sys., Inc. v. United States, 778 F.3d 1000, 1005
(Fed. Cir. 2015); Parsons, 677 F.3d at 1170; Ellett, 93 F.3d
at 1542.
Under our caselaw, HHL’s March 5 submission consti-
tutes a request for a final decision on a claim. In the
March 5 submission, HHL requested that the contracting
officer provide specific amounts of compensation for each of
the alleged grounds. HHL submitted a sworn statement at-
testing to the truth of the submission, included detailed
factual bases for its alleged losses, and claimed a sum cer-
tain based on the losses. This submission bears all of the
hallmarks of a request for a final decision on a claim, and
“[t]his court is loathe to believe that in this case a reasona-
ble contractor would submit to the contracting officer a let-
ter containing a payment request after a dispute had
arisen solely for the contracting officer’s information and
without at the very least an implied request that the con-
tracting officer make a decision as to entitlement. Any
other finding offends logic.” Transamerica Ins. Corp. v.
United States, 973 F.2d 1572, 1578 (Fed. Cir. 1992), over-
ruled in part by Reflectone, 60 F.3d at 1579 & n.10.
Third, the government argues that the March 5 sub-
mission is not a request for a final decision because HHL
expressly stated that its submissions did not constitute a
request for a final decision by the contracting officer on a
claim. The government is correct that before the March 5
submission, the contractor submitted a document similar
6 HEJRAN HEJRAT CO. LTD v. US ARMY CORPS OF ENGINEERS
to the March 5 submission (though unsworn) and indicated
an intent to later file a certified formal claim. See, e.g.,
J.A. 290 (“In the event that you decide to treat this [Janu-
ary 31, 2014 submission] as [an] REA and still reject our
request for the adjustment of payments, we would then
proceed with issuing a certified claim.”); id. (“[W]e are
hopeful that you treat this [January 31 submission] as [an]
REA and conclude in our favor, which will in turn eliminate
the possibility of proceeding with a certified claim.”). But
most of those communications occurred more than a year
before HHL’s March 5, 2015, submission and no similar
communications followed the March 5 submission. 2
The March 5 submission purportedly provided the cer-
tification that HHL had earlier recognized would be neces-
sary to proceed with a claim. 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 unwar-
ranted contractor claims and to encourage settlement.”
Skelly & Loy v. United States, 685 F.2d 414, 418 n.11 (Ct.
2 During a nearly year-long communication hiatus
by the USACE, HHL did inquire as to the status of its sub-
mission and whether it should “submit our claim.” J.A. 86.
But, as is clear from the other communications sent during
that time, HHL was seeking a final decision on its submis-
sion (whether it called it a claim, an REA, or something
else). See, e.g., J.A. 109 (asking that the contracting officer
“[p]lease let [HHL] know if the review of the case/infor-
mation is going to be completed soon and when to expect
the final result” (emphasis added)). To whatever extent
there was uncertainty based on those communications, the
contracting officer could have asked for clarification rather
than issuing a “final determination” in the matter.
HEJRAN HEJRAT CO. LTD v. US ARMY CORPS OF ENGINEERS 7
Cl. 1982) (citation omitted). It is also important that the
contracting officer treated the denial of HHL’s REA as a
“final determination” in the matter. See Transamerica, 973
F.2d at 1578 n.2 (“The fact that the Government referred
to the operative submission(s) as ‘claims’ was found per-
suasive . . . .” (citing Contract Cleaning, 811 F.2d at 592)).
The contracting officer suggested in an email the need to
file a formal claim, but this occurred after the contractor’s
submission was complete and the contracting officer had
issued a “final determination” in the matter. The contract-
ing officer could not retroactively turn a qualifying claim
document into something else.
HHL’s March 5 submission constituted a request for a
final decision by the contracting officer, and the contracting
officer’s denial of that submission was a final decision on a
claim. The Board erred when it concluded that it did not
have jurisdiction over HHL’s appeal.
We note that the Board found that HHL’s March 5 sub-
mission did not contain a proper certification as required
for a claim of more than $100,000. FAR 52.233-1(c); 41
U.S.C. § 7103(b)(1). “A contracting officer is not obligated
to render a final decision on a claim of more than $100,000
that is not certified . . . .” 41 U.S.C. § 7103(b)(3). It is un-
clear how the certification was inadequate, but, as the
Board and the government recognize, “[a] defect in the cer-
tification of a claim does not deprive a court or an agency
board of jurisdiction over the claim.” Id. “Prior to the entry
of a final judgment by a court or a decision by an agency
board, the court or agency board shall require a defective
certification to be corrected.” Id. Here, the government con-
cedes that HHL could cure any issues with its certification
on remand. Therefore, on remand the Board may require
HHL to correct any defects in the certification for the
March 5 submission.
REVERSED AND REMANDED